Allison Cerra, Laura Broderick, Sam Das & Brian Bauer // Fintech Hustle 2x17

Well, hello out there. Welcome back to another great episode of Fintech Hustle.

I’m your host, Cornerstone Advisors Managing Director Sam Kilmer, and I am really pleased, not only because it’s summertime and I’ve got my nice summer tip of the hat here on, but also because I’ve got a rock-star guest lineup today.

I think this may be a record for us in terms of number of guests and number of rock-star guests.

Without any further ado, I’m just going to jump right in and give you a little background about who we’ve got assembled in this esteemed group.

We’ve got Allison Cerra, who’s the CMO of Alkami.

Welcome, Allison.

Thank you, Sam.

We’ve got Laura Briscoe, who’s the CMO of Abrigo.

Welcome, Laura.

Good to see you both again.

We’ve got TruStage Ventures Managing Director Sam Das.

Welcome, Sam.

Thanks, Sam. Great to be here.

Yeah, by the way, great first name there.

I think we’re going to come back to that later, perhaps.

Also, our CEO in the group, Rivio CEO Brian Bauer.

Welcome, Brian.

Yeah, thanks, Sam. Thanks for having me.

I should also point out I’m joined by our co-host with the most, Mary Wisniewski, our editor at large from Cornerstone Advisors.

Thanks for joining, Mary.

Yeah, I’m happy to, Sam. Thanks for having me.

You bet.

I should also point out Mary’s also got a podcast of her own that I’m hoping someday I get to crash.

Money Isn’t Everything, right?

Money Isn’t Everything, yeah, where we explore really early-stage ideas and a little bit of nonsense.

Very good.

Thanks for joining, everyone.

It’s been a really interesting summer tour.

I think now that The Financial Brand Forum and Finovate and lots of the other events that are out there from spring are behind us and everybody’s getting ready for fall, we probably have some perspectives fresh in our minds.

But I really just want to start with your experiences.

I can’t tell you how many times I’ve heard people say, “Oh, you don’t want to hear about my day. I just work at a blah.”

It’s like, “No, no. I think people really enjoy hearing about your days in the life.”

So I thought I would start.

Allison, why don’t we start with you?

Tell us a little bit about the day in the life of Allison Cerra over at Alkami.

What’s your day look like?

Oh gosh.

Well, no two days are the same.

If you’re in this space, the good news is if you don’t like today, stick around for 24 hours because tomorrow will be different.

I think every day is just a little bit different for all of us.

But it varies for me.

One day I could be working on making sure the demand-gen flywheel of Alkami is humming at full speed, and then the next day I could be sitting thinking about a thought leadership piece or narrative or company positioning for the long game.

So every day is different.

One day you’re running the sprint, and every day you’re building to the marathon for the future.

So, a lot of fun.

Sprints and marathons.

I like it.

I have seen you out a lot, whether it’s on Jim Marous’s show or some of the things he’s been doing.

So I do see some of your content that you’ve been doing a lot of out there.

I can vouch for some of that.

Laura, what about you?

What’s a day in the life of Laura Briscoe at Abrigo look like?

Yeah.

Similar to Allison, I’m also chief marketing officer, so lead gen is always top of mind.

Obviously, sort of the traditional B2B driving the tech leads.

We just wrapped up our big annual conference, Sam.

We had that in Phoenix.

We had about 800 people.

So sort of digesting all the cool trends and feedback we got from that.

Trying to spend a lot of time listening to customers and really understanding what’s on their minds.

Then, obviously, a little real-world Friday.

We spent a lot of time doing customer comms just given the big global outage of CrowdStrike and Windows.

Just as a reminder of how integral all of us are to the banking industry.

I know even Fiserv was down for a period of time.

So just to Allison’s point, every day is different.

But I just love the base.

I love the mission supporting community banks and credit unions.

So it just gets me excited.

Well, yeah.

You’re the chief marketing officer, but also the chief message officer.

At a time when something like CrowdStrike happens, I’m glad you brought that up because, as it was happening, I was thinking to myself, wow, a big tip of the hat to all the IT professionals who were burning the midnight oil.

Not only following up with clients but making sure that the lights were getting back on.

I’m glad you pointed that out, Laura.

It goes to show that a day in the life oftentimes turns into a day in the night and an overnight in the life for some of us.

Sam, as the investor, TruStage Ventures, you’re an inside-industry investor.

I bet your day looks maybe a little bit different than some of the rest of ours.

What does it look like?

Well, I think there’s going to be a common theme amongst everyone here.

Everyone’s wearing multiple hats.

Depending on the time of day.

Yeah, see, look, Sam’s changing his hat.

There you go.

It goes from taking calls from portfolio companies on board matters to, as a strategic investor, we’re always trying to figure out how are we best optimizing our connections to help the portfolio companies really penetrate the credit union market and really address their needs.

But at the same time, I’m fielding calls and having conversations with credit union execs.

So I get to hear both sides of the story, what they’re dying to get their hands on, new technologies, what are they trying to learn about, and then making those connections.

It’s great.

I get both sides of the story and help provide that connective tissue to make things happen.

So we stay in the thick of it constantly.

Well, we’ll come back to that.

What do they want to learn about?

You’ve got me devilishly curious about what some of the top two or three things are that you’re hearing in some of those conversations.

But we’ll come back to that.

Brian, what’s the day in the life?

I suspect I know because we were supposed to be together at The Financial Brand Forum, sitting down, and you gave me the last-minute flare and said, “Hey, Sammy, I’m not going to make it.”

I greatly appreciate it and totally get that kind of day in the life.

But when it’s not crazy town like that, what does the rest of your day look like?

Well, just like Sam, Laura and Allison, we’re on Fintech Hustle, but we live the fintech hustle.

That means constantly mode-shifting between talking to customers or prospective customers, getting a read on the market, and then shifting over to product development and working with engineers.

But the real day in the life here, I like to wake up early.

If I’m in my routine and it’s good, I like to start the day with reading a book.

If I can get that 30 or 40 minutes, that’s kind of to myself.

Also helping educate myself on topics that are maybe not even related to financial services, banking or fintech.

Some of that focus time in the morning before I shift over toward those conversations.

So it is a juggle between what I like to spend time talking to customers about, working on our product and helping the engineers and product team develop that.

But of course, always getting pulled into administrative directions as well, as we all have to.

Interesting.

I like the “living the hustle,” by the way.

In the spirit of living the hustle, why don’t we just jump right in?

I’d love your take, kind of back to something you brought up in your introduction, Sam, which is what are the things that credit unions or banks or other potential investors, any side of this space, are talking about?

It’s a very messy space.

I remember when I started out in this space, you kind of had the bankers at one cocktail party, the vendors or fintechs at another one, and then you had the investors.

They were kind of three different cocktail parties.

Then it became like Wedding Crashers, and it’s all one now.

Allison, let’s start with you.

What are some of the things that you’re hearing?

What are some of the big topics that, when you’re out and about and talking with folks in your client and prospect base, are rising to the top of the fintech conversation?

I think this is dizzying to be in this industry.

Every day we say today has more change than yesterday, but the rate of change now is exponential.

It’s coming at financial institutions from all sides.

Whether we’re looking at the great intergenerational wealth transfer to millennials, largely, and what that means to their account holders and how that demographic is changing, to the great intergenerational work transfer to the Gen Zs entering the workforce and for the first time this year outnumbering the boomers.

They’re dealing with workforce complexion changes, account-holder complexion changes.

They’re dealing in an inflationary rate environment they haven’t seen in quite some time.

They’re dealing with new technologies like AI and what does that mean?

How do they have to get their data house in order?

Because we’ve been talking about big data enough in this industry for more than a decade.

It’s time.

They know that others are ahead of them, megabanks in particular, because they have the lead on the data house and now applying artificial intelligence to that.

Then they’ve got government regulations, which are uncertain at best, maybe even risky or threatening at worst.

So they’ve got challenges all around them and, at the same time, opportunities all around them, depending on how they seize these inflection points that are tectonic shifts in the industry on multiple levels.

Yeah.

Sam, does that line up with some of the topics that you’re hearing on the calls that you’re having with credit unions, investors and others?

Since you brought the question up, I thought it was a good one.

What are you hearing?

What’s coming up in more conversations than less?

Yeah.

You would probably not be overly surprised around the number of conversations I have talking about the ins and outs of AI, which is great, to be honest.

If you think about it, over the last five or 10 years, so many institutions, TruStage included in that, have been going through this digital transformation.

So much of those initial years were focused on improving that customer journey and trying to remove friction from that experience.

But I think we’re transitioning now to the efficiency transformation.

How can an organization become more efficient utilizing the technologies that are now more readily available?

Utilizing AI, Gen AI, process automation, et cetera.

Really thinking about how to streamline organizations.

The one thing that I hear constantly is lack of bandwidth to implement things, even just human capital issues that are coming up.

That’s where really utilizing that human capital in the most efficient way to optimize experience and leveraging technology to fill in the gaps and make those improvements is top of mind across the board.

Right now, we’re coming out of summer shortly.

Credit unions are in planning mode.

I have half a dozen different conversations with management teams and boards and credit unions lined up for the fall to talk about all these topics and really get a good deep dive as to what they should be focusing on.

More importantly, how should they be prioritizing their own budget dollars across the different solutions that they’re going to need to invest in?

The good news is they realize that is an imperative now.

I would say five years ago it was a nice-to-have.

Now I feel like there’s a really big shift in mindset, including the boards at credit unions, which I think is a more recent phenomenon.

Very interesting.

Laura, is that consistent with what you were running up against at your ThinkBIG conference?

I think what Sam’s really hitting on is it’s not just driving efficiency to take cost.

It’s really driving efficiency to go secure growth.

One of the biggest challenges that financial institutions, particularly community financial institutions, have is access to talent.

They’re just not able to get the talent or the experienced talent that they need.

So relying on their partners to help them with technology that can bring better, faster and AI-infused capabilities is really critical.

So many of them, I think about 20%, are considering investing themselves in Gen AI.

But almost all of them are saying they really want to rely on their partners to help bring AI into the system starting next year.

Whether that’s with credit narratives, we’re in the compliance business and the loan origination business, so generating suspicious activity reports, really all the things that normal people are starting to do in ChatGPT.

How do we bring that into our products?

I think our customers were a little scared of that maybe two years ago, and now they’re saying, “Gosh, we’ve got to get on it.”

Both to keep up with the big banks, which are, you know, Jamie Dimon’s got trillions of dollars invested in this, it seems like, and 600 data scientists or something crazy.

Just to try to help these CFIs compete, it’s so paramount.

They have to invest in technology because they don’t have the people and they still need to go after growth.

Those trends are very consistent with what Sam was saying.

Yeah.

It’s like they’re not making data scientists fast enough.

They’re $250,000 a pop, and they’re not going to want to go work at a small bank in rural Indiana.

So it’s like, how do you tap into that on a consortium basis?

How do we bring that to bear for them?

That point too, you bring up a great issue about attracting talent.

One of the things I see preventing that type of talent from going to community FIs is the fact that in many instances they don’t have a rock-solid data strategy or access to the data that they need.

Someone who is potentially going to inherit that as an issue, that’s a tall order.

“What do you expect me to do when I can’t even get to the type of data that I need?”

They’ve got to fill the lake.

The lake doesn’t exist.

They’ve got to go get the water and dig the hole and get the data in there.

So, yeah.

Janitorial work.

Wild.

But it actually might pull some people in.

There are a lot of people who want a job just because they’re like, “Wow, this problem is so big. Let me go and get it.”

Mary, I want to just echo that because even as we talk about the generational work transfer happening right now with Gen Zs outnumbering boomers for the first time, I don’t think we can put a bigger emphasis on that because I think it goes to what the employee experience is going to be in the future and what they expect.

We looked at this a couple of years ago when the Great Resignation was happening.

We asked the younger generations, Gen Zs and millennials in particular, “Would you be interested in working for a regional or community FI?”

More than two-thirds said yes, they would.

The reason might surprise you, or maybe it doesn’t.

Gen Zs in particular, what regional and community FIs have that other companies like big tech don’t have is the financial education that they can give Gen Zs.

Gen Z has seen millennials go through the Great Recession and come out of it many times worse than entering it, being the generation most impacted by it.

They don’t want that life.

They don’t want a life where buying a home actually hinders wealth versus building it.

They want to start building wealth now.

They’re very financially savvy.

So regional and community FIs can actually tap into giving these younger generations access to a master class in managing your finances and getting on a solid financial foundation that other companies can’t compete against.

So tap into what they naturally can do to attract a generation that is sitting there going, “I’m not going to be where the other generations are in a few years, where I’m looking at how am I going to build wealth into my retirement?”

Hey, Brian, I want to get your thoughts here.

Are any other themes, or any of these, resonating with some of your calls with clients and others out in the market?

Oh, for sure.

A couple of points here touched on.

I think in the macro of the market forces that our customers are in right now, we’ve all experienced the rise in acquisition cost, the rise in deposit acquisition and customer acquisition cost, which for a lot of community banks has really put pressure on their primary business model of lending, especially small and midsize businesses.

That’s really been the bread and butter over the last 10 or 15 years, especially, if not longer.

But what that really in turn results in is the need for more customer insight.

So zooming in a little bit on data and analytics and AI.

It’s really about, what can I understand and know about my customer and the customer’s unmet needs and potential needs, leveraging the information that we have or the information that’s available?

On the flip side, there is a talent problem as well in this industry.

Once I have that insight, what do I do with it?

There are all kinds of digital channels that we can engage our customers on, but community and regional banks also have to balance that with a hybrid approach of how do I empower that relationship that my individual bankers can have?

When it comes to these comments around Jamie Dimon and JPMorgan and the other large FIs and fintechs that are out there, they’ve invested heavily.

They’ve invested 100,000 times more than most of these community and regional banks can invest into a data strategy.

That’s leading to the rise in acquisition costs.

It’s not just the fact that the interest rates have adjusted that has led to that deposit competition.

It’s the amount of customer intelligence, customer information that these large FIs and fintechs are leveraging that are really causing these community and regionals to have to compete harder for those customers and those deposits.

Those topics are so intertwined and interrelated between acquisition costs, customer insights and talent.

Those are really three pillars of what we’re hearing in the market.

Yeah.

I love the fact that in a group of tech-focused individuals and leaders, this is not the first time this has happened, we keep coming back to people as opposed to automation.

Although automation, the people who drive the automation are obviously important.

It’s not that automation isn’t the thing.

It’s just that the people who drive it are very different.

Mary, I know you’ve been doing a lot of interviewing with what I would call challenger fintechs too, beyond those that are beefing up the banks and credit unions, but also going directly to market.

To Brian’s point around customer acquisition cost, I know that’s been a little bit of a barrier for some of the direct fintechs.

Are these topics consistent with what you’ve been hearing?

Or is there anything else, any big topics coming up in your conversations?

Yeah.

What it makes me think of right now, Sam, is one of the startups called Debbie, which sells to credit unions.

It’s an engagement tool to pay down debt or save money, and it rewards you based on doing these things.

The founder, Frida, had worked at Goldman Sachs.

She had mentioned that unlimited resources was actually a burden.

Now, not having that at a startup helps you keep your focus.

So that’s one added dimension I’d mention.

Another dimension that I’m really curious about, everyone here’s opinion on this, we’ve mentioned Chase a couple of times.

I know there was sort of a hot article in The Wall Street Journal from a Chase executive saying, “Hey, if all these regulations pass, we’re charging more.”

But they already charge for accounts.

There are just loopholes.

I’m wondering, and this is speculative, but I’m curious if anyone has a strong point of view.

If Chase started charging more or removed some of the loopholes to make, let’s say, a checking account free, what kind of ripple effect would that have for credit union accounts?

Or what opportunity?

Maybe there’s no answer yet, but I’m really curious about that.

Mary, it’s a good point.

The Wall Street Journal reported probably about a year ago that over the past 10 years, U.S. consumers have forfeited $600 billion in deposit interest alone by keeping their deposits in the top five banks.

Clearly, this isn’t just a case of, “Look, it’s because I can get better rates at a regional or community FI.”

That game has been won because regional and community FIs have been shown to provide the better rates.

I think the challenge really is, how do you acquire that account holder, and how do you drive a differentiated user experience on top of that?

So if Chase does that, obviously they’re big enough in the industry that it’s going to have some kind of cascading effect.

But I think that is not going to be sufficient for regional and community FIs to think that’s enough because they’ve already essentially been providing better service, better rates, and yet Chase and the megabanks still have the lion’s share of the deposit holders.

So there has to be something else to that.

I think that makes me think of your other comments about ages.

I’m really curious about that too, both from a Gen Z standpoint but also from an older-adult standpoint.

Something I am seeing is Charlie, which is a neobank for the over-62 crowd, recently launched a feature called SpeedBump, which slows down a money transfer for six hours in case it’s fraud.

That’s an example of what might attract someone to that brand.

They also focus on the Facebook community to try to recruit customers.

Then on the Gen Z side, I am fascinated because it’s such a tension.

You hear a lot of jokes of people not really understanding their work styles.

But freedom and flexibility seem to be prevalent.

I mean, Sam’s got his bucket hat on, so he’s very Gen Z.

I think appealing to a personality type that might be working two jobs, might be freelancing on the side in a way that’s a little bit different than years past, I think that will be a curiosity too.

Yeah.

The gig economy, obviously.

I feel these are all kind of interconnected topics.

To your point, if Chase is forcing the marketplace to adjust how institutions charge back their consumers, there is a forcing function here to invest in business-model innovation and figuring out how to adapt what banking is today and where that’s going to go in the future.

It’s not just adopting fintechs.

It’s thinking more holistically.

It’s how do you maintain credit union businesses, bank businesses going forward?

Because it’s already starting to change.

There’s already so much pressure on bank fees that’s been curtailed.

I have countless conversations with credit unions about, how do we really focus in on a strategy for our non-interest income opportunities?

But that ultimately leads back to, how are we serving our members in the best way possible?

Are we providing them the services that they will need, but may also generate opportunity for us as an institution, for our P&L?

These are all great conversations.

It’s the domino effect.

Once you solve for one, you start innovating and it continues.

I think it’s good for the marketplace to have these conversations because at the end of the day, the people who are going to win are consumers.

They’re going to get the solution that they need at the right price that they’re willing to pay, and that supports the banking industry.

I think, you know, Kevin was kind of brewing that thought myself as we were having this conversation.

Consumers, especially, are inundated with subscription fees today, and they’re used to being charged for services in that way.

But if you’re looking at it on the fee side, refocusing the lens to the value side of what that is and what am I offering as an institution?

That’s where I think, and I’m not going to claim any clairvoyance here into the best innovative new deposit product that might be available, but I really do think that’s where rethinking what it means to be a financial services provider to a retail consumer especially comes in.

Banks on the relationship level, especially community and regionals, do a very good job with their SMBs and mid-market businesses because, guess what, you can pick up the phone and call somebody.

But how do you deliver that innovative business model to that consumer today whose expectations are not what they were 20 years ago, but what most FIs are delivering is the expectation of 20 years ago?

How do we innovate there?

I don’t know if anyone has any ideas there, but certainly looking out into the market, especially a lot of these fintechs who sometimes come up with some great ideas whenever they go to market with their business models.

You kind of get to ride on a venture capitalist’s R&D budget when you see a fintech go to market.

Sometimes you see FIs kind of copy those best practices.

Sometimes those best practices blow up and that fintech fizzles away.

But that’s kind of the experimentation that’s ultimately needed in the market.

I would hope to see more actual community and regional banks kind of grab the reins on that innovation and really try to drive and create best practices and new examples of what’s the new innovative deposit product that really encompasses the customer’s financial life and services.

I think it’s interesting to me that if you look at whether it’s a lot of the startup fintechs or even startup neobanks or whatever, they usually have one or two, probably no more than two, hooks.

They just have a really salient hook.

It may even be a hook that many banks and credit unions already have in their arsenal.

But I think it’s just unmistakable that they have a sprint or a continuous review of their digital tech, whatever their primary reach is.

Then, let’s just call it what it is.

None of them, and we’ve got two CMOs here on this podcast, these people are not skimping on marketing.

I can’t tell you the number of times I’ve been inside of a bank or credit union that has said, “Well, we really don’t have anything in our product portfolio that’s really any different than anybody else.”

And, “Well, we really aren’t very good at marketing.”

It’s like, yeah, you might want to get both of those things.

Free consulting.

Hello.

I don’t mean to be too flip about it, but seriously, that’s existential at this stage.

Laura, I think you were about ready to make a comment.

No, I totally agree.

My side job is looking at bank websites and offering them, telling the AE that’s trying to sell them a loan product, “Hey, your website could use some improvement here.”

But I do think one of the things I love about this space is just the personal touch that these bankers have.

So anything we can do with the technology to get them out into the market even more.

I think maybe that’s the Gen Z grab.

As these Gen Zers are starting their own businesses and they’re looking to have both consumer needs and business needs, is it coming back to the human touch?

I don’t know.

But that’s the thesis that’s really driving these community institutions, that personal touch.

Anything we can do to help them, because their websites are terrible, but the human contact that they have is really paramount for them.

So how do we put that on steroids?

That’s at the heart of why community FIs work.

Yeah.

I remember when I moved and I opened up a new credit union account.

My wife actually went into the branch and set it up.

I went in a couple days later and I was talking to the teller there.

I was just trying to do, I don’t know, just get some money out.

But she already knew who I was, and I had never even stepped there.

She just knew that from the conversation she had with my wife.

She got a lot of information from my wife.

Happens to me all the time, Sam.

It’s almost like we’re kindred spirits.

We were having a real conversation.

She was developing this bond with me.

Where we are now is, to Sam’s point, you ask some folks within a community FI and they’ll just say, “We’re doing what everyone else is doing.”

But that’s not really true because you’re actually now at a point where you can take those human relationships and institutionalize them using technology and get to that level of personalization across lots of different channels.

If you can harness that power, you have an organization that can take a run at any large bank.

That’s what people need.

When people are in trouble, they want that connection with their institution to help them solve that problem.

That goes a long way.

Yeah.

It can’t be exclusively digital, in my opinion.

That’s where I think a lot of banks, and there have been a lot of providers out there that have spent a lot of money to market to banks to say, “Digital only, digital only, digital only.”

That’s where the lion’s share of the focus has been.

It’s really that hybrid approach.

We like to talk about empowering the relationship channel, which is that human connection that Sam was just talking about.

Guess what?

Wells Fargo, they can outspend you 10,000 to one, but they actually can’t have that relationship channel that you have with the customer.

You get inundated with digital offers all day long.

But as Sam recalls that interaction that he had with his community FI down the street, it’s meaningful and memorable.

I don’t remember the last email I got from Credit Karma, but I would remember that conversation.

I do remember the last conversation I had with my community banker about an important topic or just engaged in casual conversation.

This is where being able to go from a chatbot conversation to transfer to my cell phone, jump in my car and then end up at a branch and talk to someone with a full continuity of that relationship.

That’s what a community FI can do and do well and really serve on that omnichannel approach wherever that consumer is going to be.

But let’s be real with each other here.

Let’s be intellectually honest because megabanks are using technology to replicate that hyper-personalization and customer intimacy that regional and community FIs have become known for at scale.

So yes, totally agree with what everybody is saying here, but we also can’t be deceived into thinking that the megabanks aren’t looking at this on the flip side.

Technology is always the great equalizer on either side of that fence.

Where megabanks are basically going to close that gap, or attempt to, is by leveraging the technology to a tech-reliant generation, both Gen Zs and millennials, who are increasingly the wealth bearers, to basically draw them in.

So we’ve got to make sure the regional and community FIs know that so that they can continue to position against it.

Oh yeah.

It’s definitely, in my opinion, a hybrid approach here where you have to have all of the expected digital conveniences and personalization through those channels.

Because, guess what?

In a world where I can go on Amazon and I can click the button and have it tomorrow, that has shifted the user expectation for everything else.

That’s right.

Including banking.

In my opinion, it’s the table stakes just to be in the game these days.

You have to have that broad digital convenience.

But it’s the relationship aspect that I believe is not replicable very easily with those large FIs.

I think the differentiating factor here, when it comes to the 68%, call it 70%, of assets that the top 25 banks have, that’s where I think the community can compete and pull away some.

So it is a both.

No doubt.

Exactly.

Brian, I don’t disagree.

Our CFIs have been here because of that community connection.

I just think where some of them may be looking at this threat is now megabanks are leveraging technology to try to replicate that at scale.

That’s something that I think we just have to be mindful of.

To everybody’s point here, we started this talk about efficiency.

For a long time, where we’re starting to see the largest FIs differentiate now is on, we talked about employee efficiency at the top of this, it’s the employee experience.

It’s like the UX on the customer or the account holder experience.

If you’re already kind of in rarified air there, and you can’t rest on laurels because, Brian, to your point, the Amazons of the world are not resting on laurels.

They’ll keep setting the bar higher.

But now what we’re starting to see in our research is that FIs are saying employees are no longer second-class citizens.

That’s not just an AI conversation.

That is really taking an honest look at the experience of the employee and the outdated consoles many times provided by vendors that these FIs have tolerated for far too long, that interrupt that experience.

Because a UX, as we all know, is a fluid, unified thing.

The employee experience is hindering, unintentionally, the customer experience.

That’s now the area that these larger FIs are starting to focus on to close that gap.

All right.

We’ve just got a few minutes left here.

That’s a nice exchange we had going there.

In the spirit of, since I’m a consultant, I have a tendency to go negative.

Sorry, it’s kind of my way.

So in the spirit of problem solving in the industry, let’s just go negative for a minute.

I’d love everybody’s quick take, maybe 30 seconds or so, on something that you think is broken in the industry, whether it’s in fintech or banking or whatever, that could need fixing and could use some attention right now.

I’m really open-minded on who goes first.

But since Allison, we just wrapped up with you and Brian having a conversation, how about Sam or Laura?

Either one of you guys have a take on something you see broken out in the business that you think could use some TLC?

The thing that irks me is I have numerous conversations with FIs who put fraud at the top of their concern list.

Rightfully so.

Fraud is just more prevalent than I think anyone really understands and observes.

The disconnect I see, though, is they’re not necessarily investing the way that they invest in new-member acquisition strategies and in other areas.

That’s going to catch up to folks sooner rather than later.

Credit unions and community banks are seeing delinquency rates starting to increase, and a lot of that is fraud-related.

It’s going to come to a head.

So fraud would...

Fraud is a buzzkill as opposed to fraud as a serious area of addressing.

Part of that disconnect is just a level of education and level-setting within the FIs themselves to understand how pervasive the risk ultimately is.

Because I think once that, unlike some of the other areas where they are investing, they have a firm understanding of where the interest rate environment is and what their deposit capacity is and how they could potentially seek out new members to join the organization.

That’s all territory that they have a good grounding on.

Fraud is a whole other frontier, and it goes hand in hand with the AI conversation.

We are in an AI arms race.

What do you think, Laura?

It’s funny.

At first I was going to say fraud too.

We are in the compliance business.

One of the things that I’ve come up to speed on in the last year is how prevalent check fraud is.

You would think people aren’t writing checks, but the government issues all these checks.

We just had a recent Postal Service worker do a webinar with us.

The rise of attacks on postal workers to steal these checks that basically shortchange the bank.

All these banks are just getting ripped off by all this check fraud, fake checks, synthetic checks.

It’s fascinating to me that what’s old is new again.

I just heard also that VHS systems are coming back in vogue.

So we had vinyl records and VHS.

Well, check fraud is here to stay also.

So I think where we’re so excited about AI, guess what?

Bad actors love AI.

Any technology that can be used for good absolutely can be used for evil.

So we’re seeing that.

I agree.

Well, look, it would be easy to say customer insights, but you’ve got a couple of people on this call, at least, that are solving in that category.

I think outside of that, the biggest challenge in the industry, the biggest gap, is a sales culture developed in banking.

Look, this has been a bad word in banking for a long time, sales.

If you think of sales as the person you might buy a used car from, then I understand why you have that conception.

But if you think of sales as maybe the person you would engage with at the Tiffany’s counter who is very helpful and consultative in their approach, then I think maybe you have a better example.

I think the industry really needs to look at sales culture in a way that they’ve not looked at maybe in decades.

We’ve got to engage our customers on a human level.

If you are doing sales correctly, in my opinion, you are serving the customer’s best interests.

If, as a bank, you’re going to reflect on that, maybe you have a challenge with, “Oh man, if we fix the sales culture problem, but what about our offering?”

Well, then that’s your first indication that you need to look internally at the offering and maybe look at the product mix of the bank and ensure that what you actually have is not just the easiest thing to offer, but is really what your customers needed.

Because if you’ve got that good sales culture, you should feel comfortable getting out there and engaging.

Hashtag look internally.

Allison?

I’m going to echo what Brian just said because our research shows, we talk culture strategy, it’s a mindset shift.

We’ve seen smaller FIs that score equally as high as the largest FIs in the U.S. on just kind of digital and data maturity.

They do it not by a technology strategy.

They do it first by a cultural mindset change.

So it goes to what Brian just said.

How do they think about sales and service in their organization?

Is sales a pejorative word, or is sales opportunistic based on helping the account holder achieve their financial goals and dreams?

It goes into talent acquisition strategy, which we’ve talked about on this call.

Do they look only insularly at this industry, or do they look outside of the industry for new talent?

It goes to who they see as their competition.

Do they see the regional bank or credit union down the street still as their primary competition?

Or are they setting their sights higher at the megabanks who actually hold the lion’s share of deposit account holders in the U.S.?

It goes to a lot of different things.

But at the end of the day, it’s their mindset change.

Do they prioritize data and insights, to Brian’s point?

Or do they prioritize their gut instinct and their own knowledge and experience to make decisions?

It starts at the tone at the top.

It starts at the strategy at the top of the culture that that institution has.

It does not come down to asset size to determine this.

It really comes down to their mindset on how they compete and if they’re going to succeed.

Mindsets over assets.

Hashtag.

Mary, anything else?

Yeah.

Sam, I was hopeful when you said there’s a change in the board mentality because one thing I think can be a big problem is members of the board.

I know I’ve spoken to several females who will go to a banker conference, maybe more of a traditional one, and they say they still get the questions of, like, “How old are you?”

Which is not okay.

So I would say that is a problem to work on as an industry.

I’m excited for the board member to continue to evolve, let’s say.

Very good.

Listen, guys, I know you all have rocking busy schedules as leaders, so I want to be mindful of your time.

But I do want to stop and thank all of you.

Laura Briscoe, CMO of Abrigo.

Allison Cerra, CMO of Alkami.

Sam Das, managing director of TruStage Ventures.

And Brian Bauer, CEO of Rivio.

To the point that you raised earlier, Laura, about the return of vinyl records, I want you all to know that you are all going to be receiving, watch your mail, this coveted vinyl record set.

Don’t try to play them.

Those are coasters.

Put your bourbon on there or your coffee or whatever your speed is.

The check is in the mail, or the vinyl is in the mail, as they say.

We really appreciate you joining us.

Mary, thanks for joining us again and sharing some insights with the team.

Thanks again for joining us all on an episode of Fintech Hustle.

We’ll see you all out there on the road.