Strategy question
Which area should Affirm expand its loan product to next? Home improvement, elective health products, or automotives? Please stack rank your priorities.
- Affirm
- Strategy
- Hard
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What this question tests
Strategic prioritization with an explicit ranking requirement: can you evaluate three expansion options against consistent criteria and commit to an order.
How to approach it
- Set evaluation criteria upfront: market size, repayment risk, purchase frequency, and fit with Affirm's existing merchant relationships.
- Assess home improvement: large average order value and existing merchant relationships through retailers like Lowe's, but longer repayment terms raise risk.
- Assess elective health: growing demand and often affluent, lower risk borrowers, but requires new provider partnerships and has regulatory complexity.
- Assess automotive: very large ticket sizes but longer underwriting cycles and stronger existing competition from dedicated auto lenders.
- Rank them: home improvement first given existing merchant relationships and moderate risk, elective health second for strong margins despite partnership effort, automotive last given competitive intensity and complexity.
- State the metric to validate the ranking, default rate and repeat borrowing within the first cohort in the chosen category.
What a strong answer includes
- Uses consistent, named criteria across all three options rather than ad hoc reasoning for each.
- Gives a definitive stack rank instead of hedging, which is exactly what the question asks for.
- Ties the top choice to Affirm's existing strength, merchant partnerships, rather than picking the flashiest option.
Common mistakes
- Describing each option without ever producing an actual ranked order.
- Ignoring risk and underwriting complexity, which matter enormously for a lending product.
Likely follow-up questions
- What would change your ranking if underwriting costs were much higher than expected?
- How would you test demand before fully committing to the top choice?
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Learn the skill behind it
Chapters of the AI PM course that teach what this question tests.
- Chapter 4: Discovery and strategy for AI products
- Chapter 9: Prove it paid off: outcomes, economics, and pricing
- Chapter 14: Get the job: the AI PM interview loop