Ep 158: Nima Ghamsari on Blend's Comeback & the Power of AI Agents and Infinite Workforce

0:00I don't think there's a deep enough understanding of what agentic AI can and will do. Imagine a world where you have an infinitely scalable workforce. Every industry has to be re-architected. You famously showed up to Palantir as a new grad with an Aston Martin DB9. The reason I joined Palantir is because you're working with the smartest people in the world. In 2012, you launched Blend. We started this company with the idea that you could have a fully self-driving mortgage. Became one of the kind of hot SaaS companies in Silicon Valley. the value of billions of dollars. The mortgage industry crashed.

0:31It's like the Warren Buffett saying about, you know, the tide goes down. You can see he's not wearing any pants. You launched two months ago your AI agent autopilot. We definitely have the most deployed agents in financial services right now. I think the 2030s are going to be the most booming decade in 100 years.

0:52Before we begin, a quick disclosure. Joe Lonsdale has a longstanding personal and professional relationship with Blend and its CEO, including having been an early investor, advisor, and board member. Joe is a principal of 8VC, and its managed funds currently hold shares of Blend. American Optimist is Joe's personal podcast. This episode reflects Joe's personal views and is not investment advice or a recommendation to buy, sell, or hold any security. Nima Gamasari was one of our stars from Palantir after graduating Stanford. I was the first investor in Blend 14 years ago. He's now in the middle of an Act 2.

1:21It's one of the Act 2s I'm really bullish on taking a great core company that already had a lot of success in its industry, in this case, the mortgage industry, adding in most advanced AI and AI agents and having it grow a lot faster and serve the industry better. Nima is also an optimist on AI and all what's possible now in America. He's an exciting entrepreneur to hear from. Welcome to the American Optimist. We're here with my friend Nima Gansari today. Nima, thanks for joining us. Thanks for having me. We're old friends. You studied computer science at Stanford right after me, and we worked together at Palantir for a long time.

1:52Some fun stories from there. You know, originally, I think your family immigrated to the US from Iran. Tell us about your upbringing. Yeah, I was born in Iran in the 80s, right after the revolution. And we came to America, you know, first to the Midwest, first to Michigan, and then to Ohio, and my parents were professors there. And I was in Ohio until I was 18. Then I went to Stanford and studied computer science. What were your parents professors of? My dad is a professor in math and physics and my mom was a chemistry professor. Awesome. So all of the sciences. All the sciences. Did you always want to do computer science or was that like, did that come from your parents?

2:28You know, it's interesting because my parents are a little bit more old school. You know, they wanted me to be reading books and doing math proofs. But I loved computers as a kid in the mid-90s when the computer boom was happening. I would be locked up in my room building computers, you know, coding in basic. and learning the latest and greatest, whatever the most cutting edge thing was. And it was super controversial because the internet was getting going and now it's been all my time then on the internet playing these text-based games that I was trying to learn how to also code myself. And it was not the most alignment, you know, it's like they came from a different generation where the internet and computers were not a thing.

3:06And so they didn't understand what it was going to become. And, you know, so it was a little bit controversial, but I enjoyed it ever since I was eight years old. And you were playing text-based games and building them. You also, I remember playing online poker and making a lot of money on that. Was that a college thing? That was a college thing. The story there is, I remember this so vividly. I was a freshman at Stanford. I was in this dorm called Donner. And I was getting ready. I was going interviewing. Even though Stanford is really good about financial aid for people who don't, for families who don't make a lot of money.

3:36And they'd offer to cover our full tuition with financial aid. What they didn't cover though was room and board and books and those kinds of things. And so I had to go get a job and I was going to go get a job at Starbucks. And I went and interviewed at Starbucks and they're like, well, you had a job at Starbucks back in Cincinnati. So of course we'll hire you. And I had a job offer. I shouldn't say job offer, but like, yeah, a job offer from them. And I was talking to one of my doormates and he said, you're going to go work at Starbucks. You should try this online poker thing. You don't even need to be good.

4:06You just have to be good enough to play hands without losing money. and the poker sites were trying to garner up interest. And so they would just pay out monthly money to people who could play enough hands and keep the tables busy. Not a huge amount, like a couple grand, but that's all I needed. And then that got me on the poker career. And I ended up... One other cool story about that. First week, they gave you$25 to sign up. I had no money. I had literally no money in my bank account. Negative$6. And I started playing on this poker site. I lost the$25 within 24 hours because I'd never played poker in my life.

4:42Oh, no. And then that Friday, every Friday, PartyPoker.com had a free roll tournament for all the new players, thousands of new players that week. And I somehow lucked my way into third place and won 700 bucks, which was the most money I'd ever seen in my life. And my friend was like, oh, and I was like, oh, how do I protect this? And my friend was like, okay, if you want to protect this, like this, like wealth that you've accumulated, you have to go and read all these poker books and get on these poker forums. And so that weekend, I started reading all these poker books and getting on these forums and asking questions, trying to understand the psychology of poker.

5:15And I ended up, I remember it was September when that was going on. It was just my first month of Sanford. By December, I had already made like 150 grand playing poker. I turned out I was really good at it. I love it. And then made a lot more money after that. You famously showed up to Palantir as a new grad with an Aston Martin DB9, which we were very skeptical. Why is this kid driving a DB9? But, you know, he's good at poker online. What can I say? right? You and Carp made me not bring it to the office because you thought it didn't reflect well on the culture of Palantir. Well, the culture, I mean, do you agree looking back like that, what the culture was like a monastery, right?

5:47Where you're all working hard and you're not living well and you're not throwing money around, right? I don't know. Yeah, there may or may not have been beds in the office to sleep there. The most money people had were these magic cards that were all over the office and we were early mining Bitcoin. And so, yeah, it was a different culture and I had to adapt to it, which I really enjoyed actually. I want to get to a blend, which you launched in 2012 but was there anything you took with you from palantir into building blend now you didn't have as many magic cards at the blend office i noticed yeah well i will say the the thing that i loved about palantir is that we always i was the reason i joined palantir instead of continuing with online poker i mean i still played a little bit at nights and weekends when i had time but it's because you're working with the smartest people in the world um and it's like, obviously you're very smart, but it wasn't just you.

6:36You recruited the best people in the world that you could find to come and work at this company that nobody had ever heard of. And we were a small company at the time. But it was so fun working with the smartest people ever. And then, but the even bigger learning, which was a big learning for me, but the even bigger learning for me was we were deployed in the field and focused on solving customer problems, which was sort of the, everyone talks about companies and software companies being success oriented, but not in the same. People don't understand what success oriented is until you go and you see how Palantir approaches success orientation, where it's like the customer's outcomes, the software doesn't matter.

7:15The quality of the product doesn't matter. The APIs don't matter. It's just like, did you deliver that$100 million outcome for them or not? And that's all that mattered. And that was such a unique experience. I'm so lucky I had that early on. I love it. Well, we all learned a lot from it, Neema, and you had a lot of value there. So in 2012, you launched Blend. You're a co-founder. You're the CEO. Tell us about the mortgage industry. How does it work? How big is the mortgage industry? How many mortgages are you guys processing per day now? Yeah, there's about... At the time when we started the company, the mortgage industry was coming...

7:47It's 2012. You think about the timing of when that was in history. 2008 was a big crisis caused by the mortgage industry, where a lot of people were given mortgages that they weren't able to pay because there was a recession. And the government basically had to step in and say, we're going to find a way to make it so that 20 % of Americans don't get their homes foreclosed. That would have been a disastrous outcome. And Palantir was knee deep in that. And I left that experience with Palantir and starting Blend thinking, there's got to be a better way the system should work for the American consumer so that this doesn't happen again.

8:25This kind of thing doesn't happen again. And leveraging the latest trends of most of these banks and lenders that were doing this were not digital yet. They weren't even working in a digital way. So you couldn't get real information. And it was kind of like a trust me thing versus a verify everything workflow. And that shift had to happen because of the crisis. And so that was kind of the core concept of Blenden. So how do you make it so that you can verify everything in the mortgage and give the people who can afford mortgages and should get mortgages, mortgages, but build a better system around it, but build a better system around that.

8:57And that was the origin of Blend. I left with a few other colleagues at Palantir in 2012, started Blend, had some great early investors. And we just started running out at a hundred miles an hour and had no idea what we were doing. I was your first outside board member, which you four founders and me, I remember. And And I was also an investor. So I'm a proud investor from the start. You were an early advisor. You were an early investor, early board member. Had a lot of fun. I remember the old offices together going there. I think we had pivoted a little bit. But the mission was, the mission obviously was a really important mission, a very inspiring mission.

9:35So how many mortgages do you process on a daily basis now? How big is the market? Yeah. So the market this year, it's like the mortgage market is at like a historic low right now. And it has been since 2023. And so in a typical year, there will be something like 7 or 8 million mortgages. There's about 4 to 5 million mortgages happening this year. And Blend is about 20 % of those, maybe just under 20 % of those. And the mortgage industry is something where it is dependent on a lot of other factors, housing affordability, rate sensitivity, interest rates, because people can't afford mortgages, the mortgage rates double.

10:13And so I think as that market's evolved, we're still about 20 % of the market. We've expanded into a whole other suite of products because we have 300 banks and lenders on our system now that do home equity lines of credit. Home equity loans are just super important for debt consolidation. If the consumer starts to get less financially healthy, that's a great product that's getting a lot of traction. So home equity lines of credit is like a second lien beyond the mortgage, right? Yeah. Exactly. So if you have a$300 ,000 home and you have a$100 ,000 mortgage, our customers can give you a hundred thousand dollar home equity line of credit which you can use for renovation or college or starting a small business but you could also use it or for online poker but i wouldn't wouldn't recommend that because it's a lean on your house but it's up to you but uh but you can also use that if you're revolving on credit card debt which a lot of consumers are yeah so you should probably shift your credit card debt to your house it's much lower much lower uh interest rate obviously if you're responsible about it going forward yeah the interest rate is like almost a third of what it would be on a credit card and so it's a big difference for consumers.

11:09So we've branched down into that. We're also 20 % of the home equity loans and lines in the country, as well as being about 20 % of the mortgage market. And yeah, I think it's been a... And then we've all expanded. We do a lot of personal loans. We work with 300 financial institutions across the country, powering the origination workflows for these products. And so how do you go back a little bit to the early on? So banks, obviously, banks are very cautious, right? I think of Mary Poppins when I think of the banks, which is probably not right either. But they're not known for being innovative and taking risks.

11:40A lot of them are still a little bit stuffy or very slow, which is maybe a good thing. You don't want places with your money to be throwing stuff around. How do you want these places over? Why do they start using Blend? It started with skepticism from the banks. And by the way, we're seeing the same thing now with the Gentic AI. So it's like a perfect analog for that time. Yeah. But you start with early skepticism because people are saying, well, are people going to really apply for a mortgage on their mobile device and then upload all these documents on their mobile device. And at the time, it wasn't a foregone conclusion that mobile would even be a thing.

12:14And I remember these conversations where I'd be trying to convince these people, hey, you've got to be digital, you've got to be mobile, because that's where the consumer is going. And that will also help you get the process done faster with the right documents, with real documents, so you can actually document this hundreds of thousands of dollars changing hands. And it was an uphill battle. When I think of a mortgage, I just think of a really painful process that takes forever and is a mess. And it's like, as in the old days, it was just this like crazy manual thing with like stacks of paper and you're signing stuff and you have no idea what's going on.

12:43Like, how do you even know where to start? It was a giant process. Yeah. Well, I'd say knowing where to start came from a little bit from, you know, we had a vision that we could digitize and automate this whole process. And that would lead to a safer ecosystem around mortgages. And so we started with the very first touch that a consumer gives to a mortgage. And we started pitching that to our customers or prospects, I should say. And it was interesting because some of the things, I still have the early demos from 2013 that we were making for customers. And the concept of the product hasn't changed.

13:18And now there's this big technological leap, obviously, that's happened with Agentec AI. but the concept hasn't changed because it makes sense that as a consumer is going through the process, things should be really amazing and simple and frictionless for them. But then the processing of that, because a lot of money is changing hands, you have to look at these documents. You can't just trust that Joe is good for a$500 ,000 mortgage without knowing that Joe makes enough income to pay that back. And without knowing whether or not Joe has a bankruptcy recently or without checking the title on the property to make sure that if they do even get that mortgage, that they're clear and they could own that property outright.

13:58And so there's things you have to check. And our vision was, let's make this as we could fully automate this and have a consumer go through it in a matter of minutes, be ready to close that mortgage. That was the vision from day one. And that is where we started. And I remember we actually kind of got lucky because in January 2016, there was these rumblings of what was called Quicken Loans at the time. Now it's called Rocket Mortgage that was going to launch something called Push Button Get Mortgage. And everyone was kind of like, oh, is that even possible? It seems like marketing spin. And in February 2016, during the Super Bowl, they spent millions of dollars on this really cool ad that was somebody pushing a button and getting a mortgage.

14:43and it's funny i had we had early customers at that time some good banks first republic bank which is no longer around you know we had some good mortgage companies um but but all these other banks who are kind of to your point slow and cautious had been talking to us for a couple years and then all of a sudden they had this catalyst where they were like crap we got to get our stuff together quickly and i it's funny the following week i remember this so vividly we had this big bank that we've been talking to for two years. And the guy who ran the mortgage business there called me Monday after the Superbowl.

15:16And he says, Nima, I know the timing of this looks suspicious because we've been talking to you for so long. I promise it's not a reaction to this Superbowl ad that quick and just did yesterday. Well, we want, we're ready to move forward. This is one of the things in the country. And I was like, Michael, I don't have any view or care of why you're doing it. Let's just do it. Like it's time. It's a good thing for your customers. and then it sort of like snowballed from there. I mean, there's a little bit of luck, I think, in every business. You need some things to balance your way. And then sometimes there's bad luck, which is what we're seeing with the mortgage industry right now with where rates are.

15:50So this business really accelerated in 2016. It became one of the kind of hot SaaS companies in Silicon Valley, valued into the unicorn, valued into billions of dollars. You went public in 2021, which was a little bit of a bubbly time in tech where their valuations were quite high. You were growing really fast. You're spending a lot of money at the time, which didn't really matter because you're growing really fast and the market didn't care. And then the entire market changed. Right. So basically you have this inflation from all the covid money handed out. We're now seeing a ton of it was fraud.

16:20When you give people free hundreds of billions of dollars that spent fraudulently, you get inflation and rates. Rates go up in the economy when rates go up. People don't take as many mortgages. So all of a sudden everything slows down massively and your stock price got slammed. And in fact, I think this is actually a company I'm bullish on while we're doing the interview as well. But the company price lost like 90 % of the value or even more than that at one point. Yeah, more. Tell us why it happened. I guess the mortgage industry crashed. Are there things you would have done differently going into it if you go back and do it?

16:53Yeah. The thing that I didn't appreciate at the time was how far off I was from knowing how to run a business. And it's made me now every time I look at it, even myself, even today, I'm like, what could I be doing differently that I'm not thinking about today at Blend as an example? But to your point, everyone was kind of spending a lot of money and multiples were super high and capital was very cheap. And I think a lot of us, myself included, lost sight of the fact that the interesting and important measure of a business is not how much it gets done in an absolute sense, but how much it gets done.

17:36And ideally with a smaller number per person, basically. Yeah. If you can have a great impact on the world and you can do it with a small number of people, now you're seeing this with some companies that have been started since then that are super interesting, amazing companies that are a small number of superhumans doing that. I think we lost sight of that. And we probably... The other thing that I would fall on the sword of is I got us into too many pies at once. Instead of saying, this is our bet, this is what we're going to go all in on. And we had acquired a title company, we had started a home insurance agency, we'd expanded too many product lines too quickly, an income verification company.

18:18There's too many things we were doing. Instead of the thing that was like, what's the big alpha generator for our customers and for us that we could do that we're so uniquely positioned to do. And I wasn't doing that at the time in 2021. I mean, it's almost, you know, it's like the Warren Buffett saying about, you know, when the tide goes down, you can see he's not wearing any pants, but, and a lot of companies I think were caught by that, but that was a big learning. And now I view everything. And, you know, going back to that, it was like one focus so important. It doesn't matter how big of a company you want.

18:50What is your bet? What is your unique thing that you're so uniquely positioned to do? And how do you put all your energy behind that thing? I love it. So you would have done a lot fewer things. Maybe there's ways you weren't really paying attention as much to some of the expenditures. I remember there, there's some people didn't seem like they needed to be there. So you're more disciplined on that now, which is good. And you always had amazing talent, but I think you have amazing talent plus people you don't need to hire. It's like a fat times. Now you've focused in, if you're not allowed to say anything to don't say it, but I'm curious to ask.

19:17So what was revenue last year now in 2025? Like what'd you guys do last year? Yeah, we did in the high 110s, 120s range last year, and we'll be growing roughly, call it, there's nothing public that we've shared here, but the analysts have us growing at roughly 10-ish percent this year. Well, the analysts have been growing 10%, but then you launched two months ago, your AI agent autopilot. So you could potentially grow faster than them, but you haven't shared any of this yet, obviously. So you got to be careful. Yeah, I got to be careful. But I'd say, you know, Autopilot, we've shared some numbers around this.

19:47We launched this thing in March, early March. So about almost exactly two months from - And what is Autopilot? And Autopilot, it sort of takes the vision that I talked about earlier to completion. Meaning we started this company with the idea that you could have a fully self-driving mortgage. The problem was that there's so much unstructured information and there's thousands of pages of rules. and humans were stepping in because you can't actually build a high quality working system that can manage those thousands and thousands of pages of rules and those thousands and thousands of pages of documents and every single consumer's individual situation well.

20:26It was too hard without humans until this year now with agents you're saying. And so with what Autopilot does it's an agent that's deployed alongside a mortgage and it as soon as a new piece of information a new piece of data a new document comes in And it has full context of the rules, full context of what that specific financial situation is for the consumer, full context of everything that's happened on that loan. Could be at two in the morning, spins up an agent, does the work on that one additional piece of information in the context of everything else, and spins it down, just like a human would do at a lender.

20:58And so that moves our customers, humans, the team members there, more of air traffic control, making sure the agents are doing the right things across hundreds. it basically gives them infinite workforce to then have their team manage these hundreds or thousands of agentic things that are running in real time as the consumer is doing work. And it's really cool to watch it because the agent picks it up and is like, oh, I see that you just uploaded your pay stub. Oh, I noticed that you have a bonus in your pay stub. I need to get into your pay stubs and ask the consumer in real time, oh, your end of your pay stubs came in.

21:31Great. Now I need to calculate your full income with the end of your pay stubs. or your income is your pay stub say that your bonus is declining. So I have to take your lower one. It thinks like a human. Autopilot thinks like a human. It's just not a human. And it does that work. So by the time the lender gets it, it's pretty good to go. And we launched this thing. And I was skeptical because last year, I don't know exactly what it was. There was a fear from our lenders that a genetic AI or AI would, whether it was hallucinate or have data. It was kind of like the cloud to me where people were so worried about it.

22:02Yeah. The cloud was too scary at first. yeah exactly and then um we launched it we made it really easy to turn on it's one check box and you suddenly had agents watching everything that's happening in your mortgage and we made it and now we have 70 this is we said this publicly we have 70 lenders who have turned it on already of our 300 or so lenders are you charging are you charging them for it yet or what what's the idea so yes and we talked about this in the young job we gave them the three-month period because they were all going to be skeptical give them a three-month period to try it wow and our overwhelming response from lenders is like, thank goodness that this technology leap happened.

22:36And thank goodness that Blend is on the forefront. Even though maybe Blend is, we're long in the tooth in the age of AI, it's like, we're on the forefront. We definitely have the most deployed agents in my, at least from everything I know, the most deployed agents in financial services right now. And they're the coolest agents too. They're not just like shitty agents that are looking at one pay stub and saying, here's the answer. It's like, it does everything. So a lot of people believe Nima in efficient markets. I do not believe in efficient markets. So I just want to go over the numbers one more time because I think the market - Nor do I.