Transcript
All right. Hey out there. Welcome to another edition of the Fintech Hustle podcast. I’m Sam Kilmer, managing director of Cornerstone Advisors and host of Fintech Hustle.
This is a really special edition on about 18 different levels that I’m not going to spend too much time on.
One of the levels is that this is our first Carpool Edition.
The backstory is we are live here in the hall. Kind of. Not really in the hall. That’s also complicated. I’ll get to that in a minute.
We were in the hall at the AOBA conference, Bank Director’s Acquire or Be Acquired conference.
The story is, so I’m told, the Marriott, the JW and Bank Director did not want us in the hall, which we totally get. They wanted us in the hall, but not recording a podcast.
So we decided to do a little carpool action and go on a little bit of an adventure.
I took these guys on a wild ride they really were not anticipating, which we might talk about a little later.
I’m joined by my co-host with the most pocket squares, ambassador of Quan, Cornerstone Advisors partner Al Dominick.
Welcome, Al.
We have a rock-star cast of characters who have been very gracious with their time and patience today as I wandered around the desert with them on our commute to the AOBA event.
Let me quickly introduce who we’ve got here, and we’re going to jump right into what these folks are seeing going on in the business.
Other than, we have a group of firemen here working out, which could be an interesting calendar edition or something we’re going to bust out later.
Let me introduce our guests today.
We have CEO and co-founder of Mantl, Nathaniel Harley, over here in the white.
Awesome.
We have Patriot Financial Partners partner and Ampersand CEO Kelly Brown.
Thanks for joining us.
We have senior vice president and CMO of COCC, Sue Sledzik.
Very sparkly jacket you brought.
Well, it’s Fintech Hustle, right?
True. Let’s go.
It could also work if maybe we have an episode in Vegas too.
I really love this jacket.
Last and certainly not least, COO of Encore Bank, Erin Simpson.
Thanks for joining us, Erin.
Hello. Thanks for having us, Sam.
Adventure.
It’s a total adventure.
With that in mind, let’s kick right off here and tell me a little bit about the day in the life of Erin Simpson.
What’s your typical day at the office look like?
I know you were on a call earlier, hustling down some stuff.
Tell us a little bit about the day in the life of Erin.
Yeah.
The day starts early in the morning with lots of emails, but trying to just keep all operations in check at the bank, make sure everything’s running the way that it should, make sure there’s nothing broken for the day, and that everybody gets their questions answered and we can run smoothly.
Excellent.
Smoothly running better than the car trip on the way here.
Very good.
That was, by the way, I’m blaming the integration between Google Pins and Apple Maps.
We thought that there probably is a fintech metaphor there between the origination system or the mobile, whatever.
You’ve got to be able to fix it as you’re hustling in.
Can I just hop in?
Erin’s not really giving a lot of credit to Encore.
I would say in the United States there are some banks that are doing some really, really cool things on the tech front, and I use Encore as one of the shining examples of how you can do really amazing things if you get the people in place and the products to align with different business outcomes.
I think this bank is one that folks need to pay really close attention to when they think about creating value for their customers because you guys have done an amazing job.
Well, thank you.
Thanks, Al.
Our goal is to have the best end-to-end technology that’s available out there for our clients, for our partners, and that includes our internal teams too.
We want to use what’s on the forefront there, but also what all connects.
We want to make sure that what’s out there for our clients gives them the best experience possible.
We’re committed to doing that on the deposit front, on the lending front, on the treasury management front, and we’ve got great partners that we work with who make that possible for us.
Excellent.
What about a day in the life of Sue Sledzik?
What’s that looking like, Sue?
Just revving day in and day out.
No, but pretty much it’s a balance between finding new business and making sure our existing clients are happy as well.
We partner with a lot of great providers, and it’s making sure that our clients have that experience, very much like what you’re talking about, and just day in and day out living the dream and trying to create good interconnections between financial institutions and technology.
Excellent.
Kelly, you’ve got a lot of irons in the fire with Patriot.
Tell us about the day in the life of Kelly.
Lucky me, I get to wear a lot of hats.
I think the great thing that I look forward to every day is being in the banking industry.
I’ve enjoyed it since I was 19 years old, and now I get to do it with hundreds of banks, either through Patriot Financial, which, if anyone listening knows Patriot Financial, you know how unbelievable this team is, and to be the CEO of one of those companies that we’ve invested in along with JAM FINTOP, and lead a team that I’ve worked with, I think the best in the deposit game, every single day, and then talk to banks every single day.
That’s how I spend my day.
Anything we can do to help banks on the deposit side, or if they need capital, it’s like we’re a one-stop shop.
What do you need?
You need deposits, you need fees, you need capital, we can help.
One of the things about Kelly that’s cool, and I love the same showing up where it’s blazingly hot, she’s going all black.
She’s like Johnny Cash coming for us.
But what she doesn’t have is the GonzoBanker logo anywhere close, which is too bad because Kelly was recognized for something that Sam and I saw in Nashville, Tennessee, in October with JAM FINTOP, where they were bringing folks up on stage, asking for the two-minute pitch.
Kelly, to her credit, was like, “You’re giving me two minutes? I need one.”
And she nailed it.
Drops the mic, walks off, and really set the example of how do you explain what you do as a business in a way that’s memorable and actually impacts people.
So Sam and I left thinking, man, that was a really cool way of introducing what Ampersand does.
To bring it all over to the Hustle, I think it’s a really neat thing, to your point, Sam.
Yeah, absolutely.
That was one of our 2023 Gonzo Awards just because, unfortunately, there are a lot of lame pitches out there.
It’s something that the industry really needs to work on.
It’s important, though.
It’s important to point out, though, I think in 2005 you guys sent, I’m an OG with Cornerstone, you guys sent me a T-shirt with the Gonzo logo.
I thought, how edgy are these guys and how cool?
I used to read the newsletter every...
Used to read it?
You still read it.
I still do.
This is when I was a banker.
But it was really refreshing, and so I was really proud to get your T-shirt way back in the day.
Well, and Al, as you point out, as I start sweating bullets here in the blazing hot black shirt, I’m reminded also that Nathaniel at Mantl actually won a GonzoBanker Golden Cufflinks Award because you guys seem to really crush it.
Where are those?
I forgot those today.
Buddies and cufflinks.
That’s an idea.
Tell us about a day in the life of Nathaniel.
Yeah.
Every day is different today, but the first half of the year to me is about spending as much time with our customers as possible.
We just saw some pretty amazing growth over last year, and to me there is no more important thing than spending time with our customers, new prospects, and really learning what their problems are, what their needs are.
At the end of the day, I feel like I’m a very product-minded CEO.
What that really allows me to do is get on the front lines, understand where the puck is going, bring that back to the team, and then hopefully make sure we’re delivering a product that, as you were saying, helps drive deposits, helps drive efficiency, and ultimately makes our partners really happy.
When you’re saying product, are you talking product?
Definitely.
Because when you’re saying what’s a day in the life, you’ve got some of the best hair in the business, and that doesn’t just wake up like that.
I’m sure you’re taking a good hour to make sure it’s all looking just on point.
It’s funny.
We started the company and we named the company Mantl.
Six months after starting the company, you Google Mantl and all of a sudden there’s another company named Mantle, and there are men’s hair products.
Fast forward six more months, there’s another men’s product and it’s called Jack Henry.
I think they looked at the enterprise banking software space and were like, “All right, these names are working for us.”
Note to self to talk too much later about this hair product line because that introduction...
That’s a concept.
I love it.
Well, I’m also glad that you two and your coiffures are bringing up the team.
Put that away.
Anyway, listen.
I have to ask, since we are kind of at AOBA across the, let’s just call it across the street in the desert.
There’s a nice movie theater over here too if we need to step out later.
I’m just curious if you had one big takeaway from this conference, or one thing that really grabbed you by the lapels.
Anybody have one on that?
For me, from where we stand today, mine was that everybody’s struggling with some of the same things.
Everybody’s goal is to bring in deposits.
Everybody’s focus has shifted from lending over to deposits and what are the best solutions out there to help you bring those in.
I’d say the other thing is data management.
Everyone seems to be getting into the data warehouse space.
We’re getting into that space, but there’s uncertainty around how do we make sure that the data is accurate, that there’s integrity there.
I’m just trying to find somebody that’s a specialist in that and help us.
But I think there’s a lot of opportunity there.
That’s what I’ll be taking back to my board, just how do we protect that?
How do we do that?
Can we use some of the vendors here that we met with and just tell them what we’ve learned about driving deposits and who we can work with?
One of those partners is Mantl.
It’s interesting.
I totally agree.
I feel like last year was very much about, how do we drive as many deposits as possible?
A lot of liquidity left the system.
I feel like there’s been a little bit of a shift in tone also because now there’s much more focus on pricing.
People are trying to figure out, all right, how do we stop paying top rate to go get these deposits?
So that’s been an interesting tone change.
I think everyone’s waiting to see what the Fed does, to see how deep do we go into lending and when do we start to turn that on.
Also, totally agree on the data management side.
I think everyone is focused on how do we use our data to drive more efficient marketing or fraud or all these things.
When I got out of university, which by the way wasn’t recently, and I entered the banking market, I found that at the time credit analyst was the good entry-level job.
It was like credit analyst, lender, chief lending officer, CEO.
That was the career path of the rock-star banker.
It’s almost like now data scientist or data science, statistician, something like that, that may be the new credit analyst career track that we’re talking about.
As you’re talking about this, I’d kind of like to elevate the conversation away from the tools and the nitty-gritty stuff to a broader concern that I have just listening to the bankers that are here.
I’ve been coming for a while.
The succession challenges that many banks are facing are so pronounced.
When you think about using technology, you have to have practical experience with what’s worked and also what hasn’t worked.
You can’t fake that.
You need time and experience.
If I look at certain banks, especially as you get smaller, the CEO may not have a true number two ready to roll.
If you’re going to stay relevant and competitive, it starts with the people.
It’s not the cliche, “Well, we’ve got great relationships with our customers.”
You’ve got to look at your team and say, do we have the right teams in place?
If not, how are we attracting folks who understand how to leverage a Mantl-type product?
How do they go to COCC and say, how are we a better partner together?
It’s not a vendor relationship.
It’s a, we’re all in a survival game.
But I would also add to that, from a succession standpoint, when we’ve had as much M&A as we’ve had, training programs have gone by the wayside.
The typical track that I was on with credit management training, all of those things are shrinking.
We’ve got to do more as an industry to promote youth, young people wanting to get into our industry.
Yeah.
In the state of Wisconsin, we started the Marquette University banking program that’s specific to finance majors, and got a group of banks nationwide to help us with that because succession is the key.
Huge.
It’s huge.
That’s spot on because I think that for COCC, we created a leadership program specifically for that.
We had younger individuals who needed to understand a little bit more about leadership specifically.
They had the tech skills, they could understand that, but it’s the leadership piece that was missing for them.
That was really important for us to see with our own employees, and being a great place to work is really a driving factor for many individuals looking for a new job.
Yeah.
But I think it’s not only just succession for us.
It’s backup, right?
I don’t want to have one person who is the only person that knows how to do all of these things and manage all of this.
I want multiple experts.
What we’ve done is we’ve built growth plans for everyone that’s on our team and a mentorship program, and we’ve made the leaders responsible for making sure there’s somebody coming up underneath them who understands those things.
Specifically on the data side, we didn’t have a data management team until this year, and now we’ve got that.
But I think the partnerships with the vendors are still so critical there in understanding.
That’s where I think right now people don’t know quite yet because it’s so new.
What’s the responsibility of the person managing your data warehouse in that company or your middleware layer, and what’s the responsibility of the bank to make sure everything is so accurate there?
Erin, are you bringing people in from the outside?
So they’re not bankers traditionally that...
For us, to be data analysts, we’re fortunate enough that we had a bang-up project manager in Erin Melton who managed our Q2 project.
She had interest in coming over and learning about it.
She’s going to learn under our person who’s over data, who’s also a rock star, Carla Dial.
We feel real confident with them.
It’s better because you’ve got somebody who knows the data in your system and your core systems.
If you have somebody who doesn’t know that, then you’ve got to teach them all that.
You’ve got to know the structure.
That makes it harder.
So now that they know that, it’s going to be much easier.
It’s interesting just hearing that one of the things you guys are doing is bringing people who have a technology background into the bank.
From the startup perspective, what we’re trying to do is we have a bunch of technology folks, and we’re trying to bring bankers into the company to up-level what we’re doing and really understanding.
So it’s successful.
Yeah.
But stay away from our people.
We need our people.
I’ll say it all day, every day.
Every technology company should have bankers in it.
Every one of them.
Because you’ve got to know what they need and what functionality they expect.
To quote Bill Murray from Caddyshack, we have dogs and cats living together. Mass hysteria.
Having been on both sides of that table in my career, I loved going back and forth, but there just haven’t been that many people who have done that as much.
We have to go hunting.
Listen, I know we have to get you guys back into sessions.
I want to be mindful of the Bank Director team as well.
I think some of you, like Nathan, might be heading to the airport after we roast here in our...
You want me to open the door for you?
There’s an actual car that will take him to the airport.
But I can’t help myself.
In true GonzoBanker spirit, we like to go negative a little bit and just ask the question, is there something you guys see that’s just not working well in the industry?
Something that could really get some attention, get some TLC, get some love?
Is there anything you guys see that you just wish was working better in the industry?
It’s a problem waiting for someone to solve that you don’t think is getting enough love right now.
Anybody want to take a shot at that unscripted question?
Yeah.
The one thing I would say is stronger ownership around if you’re implementing technology, make sure that you have strong ownership.
You can’t place it and then expect it to do something for you.
You really have to manage it.
You have to have a lot of care and feeding around it, and then you have to get buy-in throughout your entire organization.
There were a couple of times in the sessions where it’s like, have you ever tried using this account-opening product?
Have you ever done it as a bank executive?
“Well, no.”
Why not?
You need to be invested in the technology if you want it to succeed.
Yeah.
I think the biggest thing that I’m seeing is complacency.
It’s kind of a cultural shift that maybe five years ago was way worse than it is today.
But there are so many forward-thinking banks like Erin at Encore.
We work with ConnectOne and Grasshopper and all these banks that are on the front line.
But there are so many other banks and bank CEOs and bank executives who are just kind of waiting and seeing right now.
That’s scary.
It’s scary for them because the industry is changing.
There’s so much competition, and now is the time to really invest in that modernization to make sure that you’re going to be around for years to come.
I would say the thing that I’m struggling with is I want everybody to connect.
I want all the fintech partners to connect with one another because I don’t want to enter anything twice.
I think it’s inefficient.
Just getting everyone to work together so we’ve got end-to-end processes that truly leave no room for inefficiency.
I would say outside of technology, from a regulatory perspective, banks getting more involved and being more vocal with their lobbyists and with their associations to get some of these...
What I’m hearing from what people are being subjected to from a regulatory perspective is frightening.
It’s unwritten rules that you can’t figure out, and we’ve got to, as an industry, get a lot more aggressive.
It’s very costly.
Extremely costly.
That’s what I would say from a regulatory perspective.
Al, anything you’d add to that?
I like what you’re surfacing as a concern because we do have this massive opportunity to do great things.
But if we’re going to be slow and deliberate, banks are just going to be bypassed.
One of the big things that was coming up early at Acquire or Be Acquired was these nonbanks and the megabanks are just killing it in some places.
You can say, “Well, I don’t really care about the individual customer.”
That’s nonsense.
That’s just giving yourself an excuse that you shouldn’t have to do.
If they can figure out how to get huge organizations that have technical debt and legacy mindsets and teams that are inclined not to change because you don’t get promoted for doing anything but not failing, and you’re letting them win, then what are you doing for yourself?
Are you really pushing yourself out of your comfort zone and figuring out how do I explore something that’s uncomfortable but is going to create some type of differentiation that I can rely on?
It’s a mindset.
It’s a mindset.
Again, it’s all people-related.
The tools are so cool, but you can’t start with the tools.
You can’t start with the tech.
You’ve got to start with, what’s my business?
What’s my culture?
What do I want to keep?
What do I not want to change?
That needs a little bit more discussion because you can’t just chase everything.
Otherwise, you’re wasting your time.
You can’t be afraid.
I think there’s so much fear.
What Nathaniel was saying is people are just afraid to be the first one out there, or even the second, third or fifth.
Don’t be afraid of it.
These guys work super hard, and they build these companies.
They don’t start them yesterday.
They’ve been working on them for years and years and years.
If they can solve a problem, if they give you a solution to solve a problem, then let them help you.
They’re not going to let you fail.
Just try it.
Don’t be afraid to change.
I’ll tell you just real quickly, Erin was being humble earlier.
But Al, to your point around Encore Bank, and also Erin, your session, I think Brad Smith, our colleague, had said it was the longest line waiting for a speaker at the end of a session that he’s ever seen.
Mad respect to the Bank Director team for having people like all of you on the agenda and having really great sessions.
Mad respect for the event.
This is very well planned.
It’s one of the preeminent, if not the preeminent, events of the industry.
We’re glad to be here.
I’m very grateful for a couple things.
One is I’m grateful for these great guests who allowed me to take them for a lengthy commute in the desert today.
Also, mad respect right there to Bailey Wishard, our producer, for setting up shop here in the desert.
No scorpion bites yet.
And mad respect for the air conditioning you’re going to use as soon as you get in the car because there’s no way that Sam Kilmer is not going to be melting if we do this for any more than another 30 seconds.
It’s a new weight-loss technique.
It’s called sweat.
Anyway, that’s it for this episode of Fintech Hustle, the first edition of Fintech Hustle Carpool Edition.
Thanks for joining us.
See you out there on the road in the next podcast.
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