Leaders in Lending
Leaders in Lending

Episode · 1 year ago

The Rise of Cloud Core Banking Systems

ABOUT THIS EPISODE

In a digital world, legacy core banking systems just aren’t allowing banks to meet the demands of the modern customer. With the rise of digital banking, cloud core banking systems are entering the picture.


Tyler Craft, SVP, Head of VirtualBank & Fintech at First Horizon Bank, shares why his team decided to transition the VirtualBank brand to a cloud core system and how the lessons from that experiment are transferred across the larger First Horizon ecosystem.

Tyler heads VirtualBank, a digital-only division of First Horizon Bank. First Horizon Bank has been around since 1864 and its mission is to provide the best service to its customers, one opportunity at a time.

We discuss:

- The process of transitioning VirtualBank to cloud core

- Why VirtualBank remained a separate brand

- The thought process behind new products to VirtualBank

- Insight into a bank’s fintech strategy

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Getting more smart people engage in the process that are the care a lot about the wellbeing of our clients and the industry, and that kind of think that's that's really valuable. You are listening to leaders and lending from upstart a podcast dedicated to helping consumer lenders grow their programs and improve their product offerings. Each week here, decision makers in the finance industry offer insights into the future of the lending industry best practices around digital transformation. In more let's get into the show. Welcome to leaders and lending. I'm your host, Jeff Keltner. This week we're featuring my conversation with tyler craft, who leads the virtual bank and Fintech at first Horizon Bank. I think it's a really interesting conversation. We talked through some of what first horizon is doing and standing up virtual bank, which is an all digital bank, really actually not standing up as much as growing that brand, and I think it's a fascining discussion of how they're doing that, why they choose to go down that path on some lessons you can learn also a little bit about some of what tyler seeing in Fintech and the way they approach that space, which is a pretty unique approach. And finally, some career and, my may I say, life advice from from Tyler. That, I think, is something I'll be taking to heart and hoping to do a little bit better job of in the future. So a lot of great tidbits for you. I hope you enjoyed the conversation. Hey, tyler, thanks so much for joining us today on the podcast. Awesome. I'm excited to be here. I you know, I was really interested in this conversation. I know we've had it on the on the books for a while, but you guys have taken an interesting approach to the the digital transition in terms of, I think, what you're calling virtual bank. I'd love to hear a little bit about the story of what you guys are doing in that vein and why? cuse I think it's quite different than what others in the space are doing and I think it's a really fascinating approach. Yeah, I'm happy to talk about that and you're right, it is an exciting thing that we're doing. It's a little bit different of an approach and it's something that we're pumped about words going to take us as a company potentially so virtual bank, just to sort of set a little bit of Brown work here. Yeah, is a brand. It's a division of First Horizon Bank, really part of the bank, just a separate brand designed to be an online only brand. Virtual Bankcom is the website for that and it's actually a brand that has been around for over two decades. And so it's started as its own independent bank called Virtual Bank and, through a series of murders and all sorts of things along the way, eventually landed with Iberia Bank, which is merging. The first ride in. It is legally merge with our stries in two thousand and twenty and two thousand and twenty one we're doing the conversion of that merger. So we started off with this opportunity by virtue of a murder. And in two thousand and twenty, around the time that we were finishing up our legal murder and getting ready for the new organization to kick off, we looked at virtual bank. I knew that we had some ideas. Is On our road maps at first rise in and then Iberia Bank was also looking at some of these things for long term around looking in new cores, looking at new capabilities, moving things into the cloud, riding on Api dri than rails, versus more etl like. What is that? What is that modernization going to look like over time? And we kind of had the realization, well, we can convert virtual bank to the same chord as everything else, or we can take advantage of the opportunity. It's a narrower scope of products, specific set of customers exped to interact with US digitally, pretty much. Only we don't have branches for virtual banks. It's a digital ecosystem. So let's take advantage of that opportunity in the necessity of a conversion and go look at doing some some modernization. They're now RAPP and what we did in that process is assessed the field of players and talked a lot different people and then did a conversion of virtual bank that we successfully did in July two thousand and twenty one. Converted Virtual Bank to a cloud core, which is fins act, which many people are probless, with cloud based servicing layer called Savannah,...

...which really integrates well with thins act, and then new online banking, online account opening website tool called aperture, which also has interacted with that ecosystem in the past and converted our clients onto it. There's a litany of other pieces to the puzzle that that are also parts of this that are helping move everything fide and processing to Ach Money Movement to deposit capture and all of those things are captured with other tools and kind of building out the EGOSYSTEM, but those are three core components and we partnered with whip row and built this out. We actually one of my favorite parts of this, reflecting back on just truly something else. We W three hundred and seventy days from the first meeting with things act to go live, two hundred and twenty seven days from contract signatures to go a lot. We obviously put it fast team to people were really focused on it. We were able to do some of the between day three, seventy, two twenty seven. We did a lot of planning, obviously, but you really moved fast and efficiently and state very focused on what our true objectives were in saying the first steps of what could be a bigger modernization opportunity for first drive. How do you think you were able to to move? I mean I typically see a lot of institutions in the financial services space that have goals to move quickly. I've had many a bank. Tommy will be the fastest you've worked with. And then you know, internal processes set in, committees get involved and they end up being typically slower execute than most of the business leaders want do to just internal structures, committees, approval processes, etc. How do you think you guys were able to kind of be faster? I think you told me that you were. You signed with FINZAC later than a couple companies, but one live before are some of them because you were faster through the pipes and I'm turious what, if there's any advice you have or things you felt helped make you more effective at driving that process more quickly. Yeah, this is something we've talked a lot about internally, talked with with others about that. We never going through similar journeys as well, and for us there were a few factors. One, and you can't be overshaded, is we knew we had a narroscope of product so we offer consumer, money market and CD products. We didn't try to bite off every product in the bank for the first of this. We knew where we were starting and we really focused on that. So that that does clarify things of that. The other reality is we have a conversion in two thousand and twenty one. So there was a little bit of necessity, as the mother of invention, or necessity of this Bab was was the mother of, you know, getting this done on time and on spedule, and so that that helps day focus. And really all that did is just provide clarity along the way when you need to make a decision, of what what can help you make decisions. And then, lastly, we had some really good principles that we set out back in two thousand and twenty when we were planning all this, that we stuck to and we came back to. When you come to a fork in the road, think about simplification, right. So don't don't overengineer something, because the odds are we're going to learn a lot of lessons in the first iteration and we're going to need to to improve over time and we're going to need to add new capabilities and we're going to learn a lot. Huh, let's not over engineer our first processors so that we have to go undo that later when we want to change our approach a little better will wed. Let's focus on take a simplification process. If you can obviously do it correctly first, but where possible since and so we really stuck to that and we tried to model that when we made decisions. So we one of the things that we would make decisions for our project team as a team, in meetings together and be very transparent about what we're thinking through. And sometimes that means, okay, we're not going to roll out with this capability when we go live, or we're going to wait and that's going to be phase one dot one or one dot five versus one Dotoh, because that is going to add risk to the testing process. And why would we want to do that...

...when we don't have to risk are testing processes? We've rather, yea more for testing and test things well versus less reager to test them mored. So we did that over and over and over again, and we had a really good line of communication. Also the executive management. I think this is the last factor that helped a lot, is we've structured virtual bank under its reviewed by an oversight board that has our CEO, CFO, head of business transformation, who's my boss, chief digital officer and head of regional bank strategy and delivery. So you've got people from all different aspects of the bank, kind of keeping anisle this as we also worked really closely with our merger project office because this is part of the merger do you've got another set of folks in their achieve for ask officer your other both sides of the bank sitting in math. So you're getting perspective from a lot of different people, being very transparent. Everybody's aligned or what we're trying to accomplish. So you get those hut questions out early, work through them, get clear answers and keep pushing forward. So good, clearly purpose. We have the last thing too, and this is probably most important for really struct team. We were very fortunate the people that we've had working on this project. We've had a mix of Legacy Iberia Bank Legacy First Rise in bank. Obviously the whip pro team has been phenomenal, and then our vendor team also has come to the table and rolled up their sleeves into the partner. The first meeting we had we said we want to build something that we can all be proud of, and that goes for every for the visitors as well as for the bank. It's not just about the vendors. are kind of you know, getting us a service that we pay far enough the end of the convertation that we want to all be proud of this send and by the end of the project you sort of hear people talk about like virtual bank as their baby and they're so proud of it and they're people that don't work for the bank and so bring in the process and and speaking through questions and helping solve problems that they feel connected to. And I think that attitude that everybody bought in on made a big difference when you had to make tough decisions or when you had to work extra or whatever to move I like to a strong team, keep the scope simple and then rate, I think, and in support from the top. I think it's critical because it is it's different having the CFO or the chief risk cops are involved that in a risk committee. That's, you know, a layer. But the other thing I like about that, so I'm curious if this was internal or external, is kind of a forcing function. You said we we knew we had a two thousand and twenty one conversion and sometimes, like a brick wall, is a pretty useful, pretty useful forcing function. was that something you had decided internally was there a reason that you had? I'm kind of curious cause I've seen both real forcing functions, like with market external reality, and sometimes you just kind of create them out of whole cloth because you know, the team needs a deadline that with some sort of sort of rigidity to it to run towards, and I'm curious that was like a more of an artificial thing. You guys created it to drive motivation or just a reality you were dealing with. It's the bigger murder conversion, bride, Your Bank and birth driving. Yeah, because this is coming over from Iberia Bank. That conversion is in two thousand and twenty one and we wanted to it's gotta go somewhere. We went for exactly when a virtual bank to go first, but ahead of the rest that convergence. You didn't have these like boting old events where you're converting virtual bank in the same time everything else is converting and you're just sort of taking your resources and spraying them more thinly. You wanted to be able to have so that was our that was the wall, that was the forcing function. was that we had forcing function? Yeah, yeah, they are. They are useful, though, and I have seen them artificially created for these purposes, which is we just can't see. Was Not to see it was it was. Yeah, it's Nice if you don't have to make it up, but it can be valuable as a tool because it is very useful. I want to ask a little bit about you've kept virtual bank as a separate brand, and one strategy you could have taken at point of conversion was, and I see many banks, most Ma's right, go this way where you end up wanting to have a singular brand, and obviously...

I think you're doing that on the Iberia First Fries inside, but you left Virtual Bank as a digital bank on its own, and I'm curious to rationale for that, because I think many people will go hey, we need to make our core offerings more digitally enabled, but we don't want to have a different thing that's digital only on the side that that's not integrated. And you guys did not choose that path. We talked a bit about the practicality of getting there and the integration the conversion, but strategically, why was that the path you guys thought was was useful? Like why did you go down the path of keeping virtual bank a separate thing, a separate brand, a different core than what you're what you're doing for the larger bank. I mean, the way I think about it it is probably just a function of my own background and banking and things that going to pass. I wor think about it as a regression of how many variables can I control? Don't like it. And byling all of this together I've got I'm introducing new independent variables and I don't know what's causing what. Always. And so virtual bank, because we really are about ninety five plus percent on different tech than then moll rest of the leg this bank, and we'd limited. Obviously we've got these a general ledger integrated and and some of the risk and fraud files were integrated with tightly, because those you need it enterprise scale for it an eighty seven billion dollar bank. That's a those are very critical. But but within the ecosystem we're really stealf contained there, and so that gives us clarity into what we're learning and what it's related to. So we're not ever confused on our learning something because this client interacts with the branches that were here and then they use this digital channel and we put them into the new APP. Also, we're learning things that are specific to Rical Bank and, as I mentioned earlier, because we have this oversight board that includes leadership from our regional bank, includes our chief digital officer and it is interacting with leadership across the bank, we're able to find ways to learn lessons that are applicable to the resting. So we're learning the core lessons. Try. We're learning about cloud course and real time seven courts. We're learning about new servicing systems. We're learning about new online obviously, but we're also learning about do business on those things. We're learning about integrating new tools into those things and some of those tools may have immediate use cases in other business lines and we can learn them narrower scope, at smaller scale and then say yeah, we you should go do that big project around this. At least based on what we've seen so far, it makes sense. Or you know what, actually just made us bless efficient and it was a little bit harder to do than we thought it was going to be. We might want to keep looking for a better solution. We can learn it in keeping that open conversation going with leadership across the bank is just as critical as having virtual event built out in its own box to learn it. H I really like that idea of, you know, limiting your scope so you can move more quickly, because I do see one of the things that large banks as they go through transition to digital, it's like there's so many things you have to do it's hard to learn and control and move quickly because you're just you got so many products to bring. So I think that's a really interesting approach that would probably allow you guys to move much more quickly. So I've kind of curious two things on that front. The first is what's the vision for, you know, bringing new products into Virtual Bank? You talked about mostly depository accounts being kind of the core history of of the virtual bank customer base and the current product offering. Where are you going in terms of what you want to make available through that offering and the time frame for expanding into you know, it could be we're going to be everything a bank could be as quickly as possible, or is it going to be a more, you know, tempered approach to rolling out over time? So I'll start without when I got other ones, but I'm kind of cares where we where you going with them with that rate than lending I guess that's where you're trying to get you. Well, I didn't have to be but yeah, I'm curious, like, what's your strategy is to move beyond because I don't think you would stand this up just to just to keep a bunch of DA accounts around and maybe try and grab some more some more deposits. You're going to do something bigger. So I'm just kind of curious how you think about what that is and what the kind of road map is for moving into more products.

Yeah, so there's three big strategic buckets for virtual bank. One is that it's an online liquidity tool. Right, it's what it's been for the last see when you and so we have that we did give any of that capability up. You know, as with most banks, that banks have lots of liquidity these days. So that's less urgent of a strategic thing, but but the tools still there. We didn't reduce our tool set at all. The second piece is what we just talked to you a lot, which is sort of this opportunity for us to develop the infrastructure of the future for the rest of the bank or parts of the bank or specific use gas. The third piece is building a true digital only vertical, and there are a segment of climates who expect to interact with a digital bank, who don't go into branches anymore or who have a different expectation for what their interactions are with the bank, and we want to think about what it might mean to deliver services to the we're doing a lot of work in the second half of the year, two thousand and twenty one, on different versions of how that can play out and in different road master products. So we've got kind of a green field here where you do have doing it any of the products set in any particular direction to align with specific niche audiences. How broad do we want to appeel out of the gate and what kind of Road Mapps? That's like six months, eighteen month, five year horizon on what we can do, and we're actually doing a lot of work around that right now. So I'm being somewhat circumspect because inspect, because whatever I say now will be rolling sticks months on a certainly instead, I don't want to after first course. Yeah, s advised to say that. Third Bucket is really thinking about product. Right now. We're already working on new capabilities being introduced into Virtual Bank Huh this year that we're not there previously. That don't currently exist. Its scale across first horizon that will be introducing later in the year. That give us this kind of first glimpses of really doing some unique things because we're digital first, because we have a real time cloud core, because we're able, any rate so tightly through apis across our online servicing in core platforms. We're looking at introducing some things that will look like that. And no product services but also product. Yeah, I like your your focus on speed and keeping your optionality open. I was reminded the old sign was that no battle plans survives first contact with the enemy. Whatever you say is I think maybe we did revise. No go to market plan survives first contact with the customer. Maybe is. I don't want to call customer the enemy, but it is true that you have your plan and then you go to market. And that paraphrase, yeah, about getting punched when you get in the ring. Yeah, that's right, it's there. I think they're all kind of saying the same thing. But you know, once you get out there, you got it. You got to react what you see and it's interesting strategy. How much do you think of your learnings and and how intentional is it that the learnings you have in the context of virtual bank have an impact on the strategy or decisions it would be made for first horizon more generally, because I imagine you you can be a separate thing, that is a virtual bank that's not all digital but not not sharing its insights, and then there's a model of this where the kind of the sharp into the spear for things that maybe the broader first Horizon Bank wants to take advantage of and learn from, and I'm curious if that's strategically where you're going in, if so, how you think about facilitating the learnings from one to the other? Very much is about sharing the learning. That is Corp what we're doing, I think I should stay, is we are a sharp end of this beer, not be sharping because you look at our products, at being near and we can't cover everything in virtual bank. That's not a strangle whole. Second Bank within the bank, I'm so I'm pretty strong functions that there, but you don't have everything. We've got teams that are doing things on the tradery management front with API banking. There you've got our morrtgage team has done some really front for the things in digital...

...interaction. Obvious there. Digital team really crossed the bank that are are doing things that are very fun fled as well, but don't or don't always have overlap with what we're doing. So I want to say that because this is a company those thing of how we can all learn each other and stay in contact with each other as much as it is a virtual so the answer your question is it's very much about that communication back and forth. To me when we went live, you know, shocker, we've had not zero complaints like some people don't like, and that is probably least surprising things that they'll and and so you know, you get an email. Someone said, I liked the way this used to be in online bank. Very common thing. So one of the emails that we got, I can tell the way it was written and we haven't gotten overallming number, but we have. We perceived some. I was reading them and one was written and I was like, I think this person works in software developed. They're using words that only people that work in software developments reviews. And so I just called her and we had a really interesting conversation about her see experience and I kind of told her like here's what we're working on, here's what the future looks like. A virtual bank in your account is basically I'm changed. Let's talk about where we're headed. I would love to include you in some CX labs that were doing so we she had was really positive conversation. She was very appretiure reached out immediately tire, head of CEX, right after that for first Rizon, instead of Jeff. You know, I would love to make sure that we have this on the road map and let's see include this pliant in this conversations. And so jeff is like, yeah, here's a set of ideas I have that we've learned from other areas that I do, seex labs doing monitoring or whatever else, and we can apply this to virtual bank because we've already learned some lessons and also, by the way, I've been really thinking about this. Can we start to like look at some of that in Virtual Bank for the first time? And Steve, it applies for the parts of company. So that was a really bit micro cause. And of yeah, we had a customer that had a question. We talked about I want to loop in CX. We got learning from CX sex sense of ideas that they want to start with virtual bank, and that's the kind of model that will have. I think there are others that are more technical or systems that yeah as well. Yeah, do you have a more like a structured or formal way to share that feedback through regular sets of MECAS? That I always wonder if you know it's great when you have a relationship with Jeffs, not me, job with the other jeff all right, and you can give a phone call and you think to do that, but it's also easy to for you know, as you as a cut as the organization grows, that that customer idea comes in, it gets lost, it doesn't get shared, and having the pipes kind of built that facilitates that is important. Have you thought about ways, or do you have structures for kind of ensuring that that ongoing dialog stays healthy and study? Yeah, the first one is our overshect board. And who's on that, ever, sector, but again, because you have aross functional people, there a lot of what that group does. It says, Hey, can you talk to this person about this, this person about this, and and then it's also that next round right outside the board of stakeholders that I just stay in regular in contact the other half of my job, I think virtual bank, but also we can textrated people a company, and so that happens. Is Really About having those conversations with league tames and leaders and executives across the company to know where our opportunities are nowhere. We want to look for fintech solutions that we don't have today and spending time there. And so you know, that's a lot of time with our CRO OUR CMO, those types of people, Jaff or C X are hencx other teams like that from the Commercial Bank specialty, thank whatever the case may be. Those conversations also lead to computings about the Purple Bank. So there's a little bit of natural condition, but because of the role both that I sit in and the way our board of structured, it's opening those doors in a very formal way. Of You need to talk to the CMO about this and you guys work together on one how you might both try some new marketing things and think about the...

...niche targeting the virtual bank long term as you do product development, and also are the things that marketing team wants to learn from Virtil Bank doing a invest of what we're doing with digital marketing. firstureize and then do a be will virtual bank. There are lots of opportunities. There's there are a lots. So you open the door to a whole nother area of conversation. Tyler, which I go around of time, but he said you had a Fintex strategy as well as running virtual bank. So talk to a little bit about from a Fintex strategy point of view, like what are the big areas you're focused on? Problem you challenge that the bank you look you to address our opportunities you see, I feel like it's there's a lot of stuff going on in Fintech. Even today there's like some major acquisition going on in the FINTEX space. So I'm just curious, like where do you see as a big opportunities when you look out strategically? What are the kind of categories of stuff you're focused on? Is the big opportunities for the bank? Yeah, so I'll did a couple things on this. First of all, the way we approach this question is, yeah, I'm sure of the three broad buckets around Fintac, one is venture, and so we're like adventures alliance as well as doing some venture investment of our own that we've done, hi, some one off cables. We also look at fintach partnerships as a tool for solving problems, and so I always telling my thesis here is probably we're not encountering problems for the first time, and I'll go a step further and say probably somebody built a company around solving this problem. Let's go find and so we have a something that we're working on, whether it's infrastructure, client experience or anything in between. Is there somebody that's built a company around this and the best cases it's somebody that we're invested in or thinking about investing in or may yeah, making that investment, and we sit at the table from that point of view. We sit at the table from we need your services and would love to have a contract. And Oh, by the way, we love to sit down you and think about how you're developing your road map and spend time talking about so we're trying to get that clicked about it. The last pieces, we do a little bit of banking as a service as well, and so we have some bankers. They really specialize in that and been able to have a few YEP, fintech clients that need that, and so we also have that as a perfect to that's three Bushian I three broad buckets of stuff that you do. It's really brought ups the Sir when the third bucket there. We have this banker team that really focuses on that. So that's that's certainly poll outside of my scope. The second one we really have a group of people across the bank that are working together and looking at the technology side, to the XI, Yep, the customer sales side, whatever the case may be, and talking about like what we need from Vintech. And in the first one we have we stood up adventure subsidiary, have an investment board in that kind of thing as well. So it's, you know, a collaborative process of a lot of people. From your initial question of like the big trends. Yes, for me it's sort of taking the next step on what we get from a lot of things. So the last few years has been a lot of work around data, there's been a lot of work around insights. Now I think we're getting increasingly and maybe this is happening faster than I realized, in some cases, seems actionable inside. And so taking that date and take the models that people will want to put in place, whether it's citizens, scientists or products that are really built out with really sharp ai, but then turning that into actionable things on the ground, whether it's for bankers meeting with clients or bankers in the back off its knowing word of energy and reviews, or for clients actually, and I've seen several companies come up lately that are doing a lot of work around this, driving insights to clients that that I apply and action and can help a client really do what they're trying to do, which is have better management of their money and understand their financial situation. Yeah, foundational, but because we have these data layers now that there a lot of people couldn't place over the last several years and understanding around the model of that data, you're now getting into this next phase. The other space that I think is is really interesting and there's some couple companies I'm really excited about that are doing great things here, and it's some risk space.

I think there's a lot of opportunity there. But what we all know is every time we get smarter, the bad guys also get smarter and they think about ways fraud or or do something negative to our clients or to Bens or whatever, and there's so much opportunity there for companies to help solve that problem, identify issues before their issues, help clients a kind of goes into that actionable insight phase a little bit people understandable happening and what matters the most, but really focusing on bringing data together from outside sources that can be used to make better decisions on the front end or identify things. There's there a couple companies. They are doing smart things that I'm excited about, but I think we're going to be a lot more. And then the last one is broadly in the commercial space of really solving for big commercial relationship type of things. There's some I certain I have a mild boss used to say that if you get car companies, they tend to start building the you know, the e class or the set and series first and they get everything built out there like okay, we can scale this part up and that will eventually make its way down to the sea class for the three series or Tesla. Right started with the roadster, went to the eye likes. Start at the high end work it's way down and the vision of the three them like the teacher, you're going to matter, and so we're just going to build it and then we're going to we're going to push it down and in some ways, if you think that, vintex i's the opposite. been tacking a lot of places to started. Yeah, just like we start with basic mass market things that they're sort of the simple use cases and we're not going to really get into when somebody has a really complex treasury management relationship and participation one in those. Because of you're starting to see more companies think about that, the more fintex think about that. Obviously banks that are in the space or looking for technology opportunities. I've mentioned earlier. Trader Management Team is doing some really cool things with their technology stack. I think we're going to continue to see more of that as we sort of see people solve problems. Once a problem is solved, once we understand how to create better tools, with ntext or large and Traduy management type companies, you're going to see that get push the market quickly. They're the huge value that from me, and so that may take the form of process automation and orchestration all the way through the lending process, all the way through to how people actually handle their cash flow, which is which is really interesting. So I think that's one that we're not quite really in yet. But I've seen some really, really safe companies doing some cool stuff there. On the money movement fine for Lord, helps things up for money movements so they can interesting getting the money where they want and any writing. That all together to really tight solutions. I think is we're getting into. That that's has I certainly hear a lot about data and insights. I think that's just like a common theme for my conversations. Risk that the large COMMERCI relationships is a different one. Ask You one more question the space and then we should let you get on with your day. But you know the of your three modes of interacting with fintex right. The Venture, I get the the bankings of service makes sense. The partnerships makes a lot of sense. But I'm I'm curious how you think about that as differing from in some ways I feel like everything old is new again. Like fintext that are partnership opportunities are kind of like like old school. Not that on old school, but they're the relationship can be either more of a partnership or more of a traditional FIS, fiserve Jack. I mean it's like there are technology provider and many ways to a bank. I'm curious to be think of managing those relationships. Finally, partners substantially differently than more established technology players, because I I think, I think some of those guys really upset, like Fintex so sexy that we've been Fintech for thirty years, fifty years we've been fintech. Do you think of that kind of newer company Fintech Partnership Model, where you're talking about bringing something in to solve a problem inside the institution or take advantage of an opportunity that's harder for you to do internally, as substantially different than your more established technology player relationships in important ways, because they are in some ways very...

...similar, right to how you would just buy a legacy core system in and we're partner with that individuals. There's kind of curious how you think about the difference between sentech partnerships and more established technology of vender type relationships? Yeah, so I'm going to pull a weird analogy for this, but it's, I like it, typware analogist and the timing is funny. It's talking to somebody the other day that didn't realize they no more Taritaville was a song, the Neve was a restaurant, and so it's explaining to the idea of Margaritaville is a state of mind more than anything. It's a state of mind. Yeah, and so partnership is the state of mind that's right. Going to that like it's not. There's not like a magic sauce and talking to Jackiary, if I surprivor for Stato or, you know, Fins Act or Aperture Savannah or anybody specific, there isn't just a magic to the fact that they're, you know, by virtue of their person as a start there. It's an attitude in the mind set to chapter being. I have in the pass work very closely with with FIS, first days of Jack Henry, all of those companies on projects and done some cool things there. I think when we look at our partnership model of part of intent tribe were saying, we see that their new capabilities emerging. We see people getting to market really quickly with things. We see that customers are very delighted by some of the new things that come to mark. And what should we be learning from that? What should we be taking back into the bank that we need to be able to provide this reliable, long term where a hundred and sixty year old company, give or take, and so we need to help to think in a very long term type way about we're providing you stability and security and structure, and also we want you to be happy about what you're being provided. And there are companies that seem to be very good at that and they seem to typically be companies that are more in the fintech bucket of more merging fan ta yea than maybe established intact. And so is there a mindset there that we can work with them both to internalize the mindset and in our own company and also to take some of those capabilities to market to both solve our problems internally, whether it's just making something run more smoothly or in a more modern way or be up twenty four seven, because it's not only batch process or whatever, and then also take a fine and give them the advantage of it and think in new ways on the half of our clients and in partnership with their clients. I think it's a mindset. Think it has to start there. I think in some ways there's a reality that a company that is five years old has a different set of priorities than a company that, you know, is a hundred million dollars in revenue or something like that, and they're going to nest approach things differently. And so when you say, Hey, we love to be in your next CAP table, in your next round, and we'd also be interested in like taking your product and solving this specific problem, would you sit down with us for the next three months and think about what the architecture of that would be? Yeah, there's a different idea of what that can look like with companies that are a little bit younger. Yeah, I think it particularly to find up venture investment. But it's on these things that it's you know, getting more smart people engage in the process that are then care a lot about the wellbeing of our clients and in the industry and that kind of thing. That's that's really valuable. Excellent. Well, this has been fascinating conversations. I feel like we could keep going forever. We haven't even gotten to like a Memphis, which is where you are and where I grew up. So I mean row you are in Raleigh, but the bank is in is in Memphis, right. The bank is in Memphis. Headquartered banks and could the Memphis we've got. WE'RE MEMPHIS. Iberia was the Lofe at Louisiana, and well, Louisia. There's a lot of people still there all around thoms. It's Florida. So we're Nice. How are you guys doing the virtual I mean, not that we do want to get to the last re questions, but how have you guys managed the transition to virtual world or covid? Go back to off as I feel like at particularly in the context of Virtual Bank? It's it's probably interesting conversation because you don't have to go back in the branches, which is certainly a forcing function for for many institutions to go back. But where are you guys at? It sounds like you get a very distributed team for what I'm used to it many financial institutions.

Yeah, absolutely, I mean I think we were some that set up successfully for that because we're bringing coming together where people were distributing. Ibery Bank as a long tradition of bringing banks together and having people all over the place. So that was helpful. And then PPP, speaking of forcing functions, the PPP process where we were all working from home. I worked a lot on that and we had a lot of people that really put a lot of effort into solving problems really quickly and thinking well about technology and virtual solutions and people worry from home and then just interacting like we were sitting next to each other for a few weeks, especially early on in the PPP process. So that was a great example of how people were like okay, well, we're this is how we're going to work now and let's do that. Guess it was a it's steep in the learning curve, I imagine, PPP, but also it's somewhat of a positive way because, yeah, yeah, to forcing fucus, you had to figure out how to make it work and then you're you kind of probably built some processes and muscles that were yeah, we're good to the longer term. So I typically in this podcast with the same three questions. I'm going to I'm not throw them match you now with the rapid fire. Hope you read them in advancing. I was coming. But the number one was what what's the best piece of career advice you've ever gotten? So I'm going to break the rules here and give you two answers. It's now rules, no rules here. What one? The first one is my great aunt. When I was nine years old, one time I was nervous about talking to someone that that we saw at a museum and she got down like eye level with me and said, tyler, everyone puts on their pants the same way every morning. You and the Queen of Evel, and I took away from that like treating people always, no matter what they're doing, as important by virtue of being a person and their individuality matters and they are important as a human first and foremost, and that's that's really where it stops, and treated a body the same based on that reality. That's been really important to me in my career because I try to out. The second piece is my mom when she dropped me off at school, every single day that she dropped me off at school, because I'm a bit of a talker. As we gathered in the lines every single thing with my mom brought me off at school, she would look at me in the eye and kind of like begging me more than telling me, should say, please be a listener today because I talk so much. She still said that to you want to hang up the phone. That I think being a listener is another one, because you learn a lot more when your mouth shut your years. Right. Yeah, so it's good. I like that. That's that's the second person this week that's given me that piece of advice to listen. More so, if that's the targeted to me or just general life vice. I'm not supposed to talk on the podcast. Eyes about about your perspectives, not mine. So my second question. What's the best piece of advice about consumer lending or consumer banking you've gotten since you've been in the industry? Yeah, I think it's a great that's actually a hard question because I don't like it. It is a hard question. I kind of think I don't know what I would say if I were asked. So I feel bad for asking if I think like a good answer. So yeah, I think it kind of goes back. This is so fundamental that it's borderline Cliche, but it's listened to your customers and there's two implications that I've always taken away with that. I worked a lot on strategy plans and past and where you often come to start with the strategy plan is know what you mean for your customers to be. And so if you're hearing from people your products don't make sense to them or it's not aligned them, like, are you even talking to the people you meant to talk to? Have you built products for a whole different set of customers than the customers you have? And you really need to understand who your customers are, you want to be when we grow up, if you will, and what they're telling you about that and be open to that. And so that applies and beeking consumer lending and deposits in any kind of consumer interaction, especially because you know, consumers are not monolithic. There is a whole different segments with...

...their segments on segments, on segments here of how people expect to interact with their bank, what they're looking for, what problems they're trying to solve, and you have to really presently what we are and here's what we're not in, here's what we're trying to do, set the right expectations, deliver on that and when you learn a lesson learning and go go apply those learning. So it's problem, much, much more wrong than consumer lending, for sure. But I mean, yeah, I think very prussure from somebody coming from strategy, because strategies in my experience, where that often because upside down, where you say this is what we would like everyone to want, because this is what strategically would fit in the banks long plan, and then it turns out maybe your customers don't don't want that, don't need that, and so flipping that around. I think it's really important. Good coming from strategy guy, because I think often strategies where you go no, no, this is way we want the world, the fat versus what the world we actually have to work over a vision like. I think delivering a vision to Yep, marketplace is important because that's how you can really tell people about something they may have never imagined. Or clearly somebody may look at and say, you know what, this isn't for me, it's for somebody else. Is Solving somebody else's and that's okay too, because if they're you don't want them trying to solve problems that that you can't solve with your brother. Yeah, so I think it's really understanding that dyning. Yeah, all right, my last question. What's a bold prediction for the future? HMM, this is my favorite because, yeah, all sorts of ways like this one. You go a lot of different reactions to this, but I think that a bold prediction for the future of consumer lending, start with just consumer lending, is that consumer lending will be even more point of stale or into the future so on. You know, the long term that on this would be that that, you know, in a few decades, people buy their house by scanning a Qr Code and everything else take care of itself and just shortening the timelines significantly, which probably and the other maybe part of the bold prediction is I don't think it goes to people just going willing Nelly. So my real bold prediction for consumer products in general is that actually, people don't want all the speed that we give them sometimes, and we we give because we can, because we can press the pedal to the metal, we do, but sometimes people want a little friction. But people just don't want the friction where it is today. They don't want the friction the approval process, which means somebody else goes and pays all cash for the House and they lose out on it. What they have is process that helps them make them know when they go to buy the house, it's the House that they wanted. And so how do you produce time. That versus time into getting through the process of a mortar song or you know, how do you introduce time into planning for your future and what you want to do, where you want to go on vacation next year and building the the financial plan around that, versus having to spend a bunch of time moving money back and forth and looking for my throw deposits and all of those little things that are just the tactical pieces before we can set the tactical great, but it's so that we can add time into the strategic in the customers in line with the customers bills, shift the time from the tactical to the strategic. I love it. That's that's beautiful. It's a great way to end the the discussion. So I'll just say thanks so much for joining me today. This was a fascinating discussion and I appreciate your taking the time. Yeah, yeah, I enjoyed it. Up Start Partners with thanks and credit unions to help grow their consumer loan portfolios and deliver a modern, all digital lending experience. As the average consumer becomes more digitally savvy, it only makes sense that their bank does too. Up Starts AI landing platform uses sophisticated machine learning models to more accurately identify risk and approve more applicants than traditional credit models. With fraud rates near zero. Upstarts all digital experience reduces manual processing for banks and offers a simple and convenient experience for consumers. Whether you're looking to grow and enhance your existing personal and auto lenning programs or you're just...

...getting started, upstart can help. Upstart offers an into end solution that can help you find more credit worthy borrowers within your risk profile, with all digital underwriting, onboarding, loan closing and servicing. It's all possible with upstart in your corner. Learn more about finding new borrowers, enhancing your credit decisioning process and growing your business by visiting UPSTARTCOM forward dash banks. That's UPSTARTCOM FORWARD DA banks. You've been listening to leaders and lending from upstart. Make sure you never miss an episode. Subscribe to leaders and lending in your favorite podcast player using apple podcast. Leave as a quick rating by tapping the number of stars you think the show deserves. Thanks for listening. Until next time. The views and opinions expressed by the host and guests on the leaders and lending podcast are their own and their participation in this podcast does not imply an endorsement of such views by their organization or themselves. The content provided is for informational purposes only and the discussion between the host and guests should not be taken as financial advice by companies or individuals.

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