In this interview segment, Avlok Kohli reflects on his 2.5‑year tenure at Square, highlighting two core lessons that shaped his approach at AngelList. First, he describes financial services as an ongoing process of unbundling existing offerings and then rebundling them into new, user‑centric products. Second, he emphasizes the critical importance of minimizing friction for the core customer—illustrated by Square’s rapid onboarding for payment acceptance and Cash App’s instant bank‑account creation. Kohli connects these insights to AngelList, noting that once a marketplace or deposit base is established, a suite of downstream services can be layered on, mirroring Square’s strategy.
You have now work at or worked at two of the most exciting companies, I think, in finance and fintech. Let's start with Square first. You were there for 2.5 years, went through the IPO as you described. What were your takeaways from working at that business?
Yeah, that's a great question. I would say two primary takeaways. One is financial services are basically an unbundling and rebundling of services. And the second one is reducing friction as much as possible for your core customer is super important. You can actually build a sizable business by just focusing on that one thing. And so if we actually take a look at what Square did, and you think about, you know, you download an app and you get to accept payments within seconds, a decade ago that was unthinkable, right? The process a decade ago was You have to call someone, talk to someone, fill out these paper forms just to get the ability to accept payments. Oh, and then by the way, you're gonna pay an arm and a leg for that. Square came in and said, nope, this should be as simple as tapping a button and you get, you actually get an account to start accepting payments. And from that, they had a giant multi-billion dollar business line that came out of it and a brand that people love. And they did the exact same thing again with Cash App, right? They reduce the friction. Um, so you can literally tap a button and now you get a bank account, and then you get all of these other things along with it. Uh, so I'd say that was the other key takeaway for me.
Yeah. And as you were kind of, um, there, one of the things that, uh, really seems to stick out today is this focus on deposits, right? And once you get the deposits, you can kind of build all the services around it. Um, I think kind of comparing that to AngelList there's not necessarily deposits, but there's a similar mechanism of once you get the marketplace set up, you can build all of these services around it. So maybe talk a little bit just about how the experience at Square either helped or prepared you for what you're doing now at AngelList.
Yeah, it's a really good question. So the framing that has helped me a lot and what's comparable between Square and AngelList Venture is once you're in the flow, so as you're building out a marketplace or a platform, once you're in the flow of a transaction, you are in a position to own everything downstream of that transaction. I'll use a real example. Square started off with just accepting payments. And you know, it was interesting, for the longest time, and I was there when this was happening, for the longest time there was this feeling that Square's margins are just going to get compressed. Because just accepting payments means it's low margin and you're going to compress because you get larger clients, they're going to negotiate their fees, et cetera, et cetera, et cetera. What that was missing though was the fact that Square was in a position where they were accepting payments, which means today those payments go to a bank account that the merchant or their customer may have somewhere else. But because they're in the flow of the payments, you could almost think of it as like a router. Sure, today it goes to the merchant's bank account, but what if tomorrow Square builds a better product and says, why don't you just keep it here? And it's easy. And the underlying principle there, it's the path of least resistance, right? Customers will always choose the path of least resistance when there is a ton of value also attached to it. Uh, so that I carry that with me to this day with AngelList Venture, where the thing that struck me when I was originally looking at it was It's this massive platform, tons of LPs all over the world, tons of fund managers using it, tons of startups indirectly getting funded, of course, because of all these fund managers. Um, and we're really in the flow of all of that financial activity, and you essentially own everything downstream of it, right? So it's just a function of time, uh, and it's a function of that rebundling process where you can own everything downstream.
