00:29:25 · Henrique Dubugras, Jack Zhang
[00:29:25] S0: Got it. [00:29:26] S1: And I built, like, a software called Currency Overlay in my job that we made a bunch of money for the bank. And I basically thought I will be able to lead that business because I created a product with another guys on trading desk. But they then later on, like, moved someone from, like, New York to lead that business, and I was pretty pissed. So I was like, okay, I'm going to resign and start a company doing that. And I think I didn't know why people were buying the product, I think mostly because the brand of the bank instead of the product itself. And when I build the product, I try to sell product myself to those mutual funds and hedge funds, and I just couldn't sell the product. And I realized people are buying the product not because of the product itself, it's because it's Morgan Stanley. And then I thought maybe entrepreneur is not my thing. I went back to Australia and then just like found a job in one of the big four banks in Australia and become, like, this front office algorithmic trader and engineers. [00:30:32] S0: And were you making good money at this point? [00:30:35] S1: Not a lot. I was making, like, 250 sort of thousand dollars. It's, you know, it's not a lot. But then How old are you? I was 25. [00:30:44] S0: I mean, 250 k. In Australia, at 25, like, that was... Seemed like a lot, I imagine, right, when you're going through it compared to, like, what you had before. [00:30:52] S1: Yeah. I guess it's not bad. [00:30:56] S0: How many other kids your age you knew that were making?
00:30:56 · Henrique Dubugras, Jack Zhang
[00:30:56] S0: How many other kids your age you knew that were making? [00:30:58] S1: I mean, I would definitely consider like, you know, doing a decent job. But I started multiple businesses on the side when I went back to Australia. I started a real estate development business. I started like [00:31:12] S0: How did that work? [00:31:14] S1: I mean, it's just really buying land and building properties. [00:31:16] S0: How did you learn how to do [00:31:18] S1: I don't think it's that hard. I mean, you're just buying land and and then I [00:31:21] S0: don't know. I think it's really like, which land do you buy? Like, are you overpaying? Are you underpaying? You know? Like, what do you build? Like [00:31:28] S1: Yeah. I I guess you're just developing. You just go check out houses every weekend and see the auction price and try to understand the price in that suburb and and try to figure out the the council rules of, you know, what the lander can do. Like, can you subdivide to... Can you combine the land and to build multiple properties, build apartments and stuff? [00:31:48] S0: So no one was teaching you this? You're kind of learning by yourself? [00:31:50] S1: Yeah. And I I I partnered with, you know, a friend, Max, who is architect. So he knows a little bit about design, but he doesn't know the developer part, and we're sort of just learning together. [00:32:02] S0: How And did you have the money to buy the first land? [00:32:05] S1: Yeah. So I think in '20... You know, when I... Working my first insurance job in 2008, I made $30,000 and... [00:32:16] S0: Like a bonus?
00:32:16 · Henrique Dubugras, Jack Zhang
[00:32:16] S0: Like a bonus? [00:32:17] S1: Not just savings from my salary. And then the GFC happened, so global financial crisis, and the house price went down massively. You know, I leveraged 90% to borrow a loan, and I used that money to purchase the first property. In Australia. That property appreciated 30% within twelve months Wow. In 2009. And so that kind of made, you know, dollars 150 ish thousand. Then I refinanced the property, so I got more than $150,000 out. Then I just keep doing the same thing again and again. I'm just buying a bunch of properties, and the price has gone up again. I leveraged ridiculously. Wow. Anything side of your job. Yeah. If there's anything happen, I will basically bankrupt because I was leveraging so much. [00:33:05] S0: Wow. [00:33:06] S1: At the peak, you know, I was making 200 something dollars... 200 something thousand dollars, I was levered... I borrowed more than 10,000,000 from the [00:33:12] S0: bank. Really? Yeah. And the banks are totally fine doing it? [00:33:16] S1: Yeah. Because it's a it's a property backed finance. [00:33:18] S0: Yeah. Oh, but, like, in The US, it's hard to get Yeah. [00:33:21] S1: Don't think I don't think you can do that in The US, and I can get 95% leveraged finance when I was, as an employee of the bank. [00:33:29] S0: Wow. Oh, so that's, a reason why you also kept the job because [00:33:31] S1: you can [00:33:32] S0: get better leverage. [00:33:32] S1: Yes. [00:33:33] S0: Ah, so interesting.
00:33:33 · Henrique Dubugras, Jack Zhang
[00:33:33] S0: Ah, so interesting. [00:33:35] S1: Yeah. And I I... At one point, I was making a couple million dollar on the side from my real estate business, from my... You know, I started a burger chain. I started a coffee chain. [00:33:45] S0: Chain? Tell me more about that. [00:33:46] S1: Like, what's [00:33:46] S0: the burger chain story? [00:33:48] S1: That is called tuck and close. So it's kind of together with my coffee business and Coffee. [00:33:53] S0: We don't talk about that. Let's talk about the coffee business too. [00:33:56] S1: Yeah. So we, you know, we started sort of residential development. We were like, oh, how do we get into commercial real estate? You know, that's an area that we never really touched. And at the same time, I was also reading the, what they call like Telstra, which is a large telecom in Australia. This is like Telstra Fast 50 Companies. It's like the fast growing 50 companies in Australia. And I look at the 50 list, about a third of them is in retail. It's like in food, F and B, you know, retail businesses. I'm like, okay, it seems like that's a very good business to be making money, and let's just get into that. And then maybe we can look at how to do commercial real estate at the same time. Yeah, we started, like, build the first shop and we built the coffee business. And that's kind of how we started Airwallex effectively. And it's because we were importing beans from Brazil, from Indonesia. [00:34:46] S0: Like, how do you even, like, know who to import beans from? You know? Like, how do you find suppliers at that time and, like
00:34:46 · Henrique Dubugras, Jack Zhang
[00:34:46] S0: Like, how do you even, like, know who to import beans from? You know? Like, how do you find suppliers at that time and, like [00:34:53] S1: We just go to different coffee shop to ask, just make friends. [00:34:57] S0: Oh, really? So you just went to, like, different coffee shops and were like, yeah. Where do you get your beans? I wanna start a competitor? [00:35:03] S1: I mean, the the the barista working in a coffee shop is not the owner. Right? You just just be fans with the the barista, then you go to these competitions. You just make friends with the the most famous barista. So when we opened a coffee shop, our barista is actually a world champion. [00:35:19] S0: World champion? [00:35:20] S1: Of of of making coffee. Really? Yes. It's a competition. There's a whole kind of very big industry there. And I become friends with the most famous baristas in Melbourne, which is considered probably the best coffee in the world. Then, you know, we were importing bins and stuff and packages from China, we were making payments using Western Union and then banks that were charging us 4.5%, you know, a couple 100, like more than $500 for a $15,000 transaction. We're like, this is a rip off. And my co founder's name is Max Li, and then his name is on the OFAC blacklist, the same name. But because how the Swift works is it doesn't reduce the false positive because the middle bank doesn't have the name address and the date of birth and all that, so they can't [00:36:07] S0: really reduce false he's like a terrorist called Max Slayer
00:36:07 · Henrique Dubugras, Jack Zhang
[00:36:07] S0: really reduce false he's like a terrorist called Max Slayer [00:36:10] S1: Yes. Or something like And every time he's sending money to Brazil, it goes through multiple correspondent banks. His money just gone missing for a month and bounced back. And he kinda keep complaining to me. He's like, hey. You know, this is terrible. You know, you you work in a bank. Can you do something about it? [00:36:25] S0: That's And the whole time, you're still working at the bank? Yeah. But, like, it just didn't take a lot of time from you? You can do all these things. [00:36:31] S1: I didn't work very hard. [00:36:32] S0: Yeah. And you're making like... So okay. So you had a real estate development business, a coffee shop business, and then a burger business. [00:36:41] S1: I also have a trading business, trading wines and olive oil. [00:36:45] S0: Trading wines and olive oil? Yeah. And you just started all this on this. Did you have people working for you? Like, how do you have time to manage all these businesses? [00:36:52] S1: I just work harder. I work every day, fifteen hours a day. Like, I I basically worked more than fifteen hours a day from the age of 16 till last year. [00:37:02] S0: So how much how much money were were you making at that point in time? [00:37:06] S1: A couple million odds a year. A year? [00:37:08] S0: And then split it with your cofounder? Myself. [00:37:11] S1: I was making a few million dollars myself.