AI Summary
5 min readHow Valon Rebuilt a $13 Trillion Industry From Scratch
Mortgage servicing is one of the largest undisrupted industries in existence—$13 trillion of consumer debt running on a single incumbent's system built before the internet. Valon's co-founders Linda Dew and Andrew Wang chose to rebuild it from scratch, not as a software vendor selling into incumbents, but by becoming a mortgage servicer first and proving the technology worked at scale before selling it to competitors. The result: a system three times more efficient than legacy alternatives, now being adopted by major players like NewRez, which is transferring 4 million loans—nearly 10% of the market—onto Valon's platform.
Why They Became a Servicer Before Selling Software
When Valon evaluated how to break into mortgage servicing, they considered three paths. The first—building software and selling it to incumbents—was rejected because no regulated servicer would trust a de novo system, and any marquee customer would force the product to look like existing legacy infrastructure. The second—buying an existing servicer and injecting new technology module by module—would constrain platform design and create intellectual property entanglements.
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What you'll learn
- 1 (00:00) **The $13 Trillion Opportunity** - Linda Dew frames mortgage servicing as one of the most undisrupted industries, running on pre-internet systems.
- 2 (05:04) **The Human Cost of Broken Infrastructure** - Andrew Wang explains how legacy data models create real suffering for homeowners during life events.
- 3 (10:16) **Why Valon Chose the Hardest Path** - Linda and Andrew explain why they built their own servicer from scratch rather than selling software or doing a roll-up.
- 4 (12:50) **The Licensing Nightmare** - Andrew recounts the three-year ordeal of getting regulatory approvals, including a trip to a mailroom.
- 5 (16:28) **Turning Decades of Regulation Into Code** - Linda describes the brute-force process of reading every federal and state regulation and refactoring them into an abstract software framework.
- 6 (18:34) **Getting the First Loans on the System** - The economic flywheel that convinced asset managers to trust a new platform.
- 7 (21:04) **The Pivot to Software (The Original Plan)** - Why Valon sold the servicer and is now selling the operating system to the entire industry.
+ Full timestamped outline available in the app
Show Notes
a16z General Partner Angela Strange sits down with Valon’s Andrew Wang and Linda Du to unpack what it takes to rebuild the infrastructure underneath a $13 trillion mortgage market that still relies heavily on systems designed before the internet.
Linda and Andrew explain why Valon chose the hardest path: becoming a regulated mortgage servicer, translating decades of federal and state regulation into software, and proving the platform on its own loans before selling it to the industry. That foundation made Valon roughly three times as efficient as traditional servicing and created the system of record it is now using to bring AI into complex mortgage workflows. They also discuss what AI makes possible on top of that infrastructure, from agents handling long-tail servicing tasks to voice interfaces and more personalized customer experiences. And they explain why deploying the technology into large regulated enterprises is ultimately as much a change-management challenge as a technical one.
Resources:
Follow Angela Strange: https://x.com/astrange
Follow Andrew Wang: https://www.linkedin.com/in/wangandrewd
Follow Linda Du: https://www.linkedin.com/in/xlindadu/
Learn more about Valon: https://valon.com
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