Unlock the Power of Personal Loans with Happy Money's Expertise

Joe Heck: 00:00:00

it's kind of inherent in the American economy

Joe Heck: 00:00:02

spend more, figure it out later.

Joe Heck: 00:00:04

happy spends are things that like I feel good about spending my money on.

Joe Heck: 00:00:08

The number one happy spend was it is savings.

Joe Heck: 00:00:11

The number one sad spend is.

Joe Heck: 00:00:13

Paying credit card debt.

Joe Heck: 00:00:14

if we can drive more happy spends, fewer sad spends,

Joe Heck: 00:00:18

it was going to lead to better outcomes for the consumer.

Joe Heck: 00:00:21

So the best way to impact that was to try to help accelerate the pay down of

Joe Heck: 00:00:27

credit card debt and eliminate that burden

Joe Heck: 00:00:32

Tedd Huff - Fintech Confidential: Welcome to Fintech Confidential, bringing

Joe Heck: 00:00:35

you the people, tech, and companies that change how you pay and get paid.

Tedd Huff: 00:00:41

Welcome to Accrued, the FinTech confidential series presented by LoanPro.

Tedd Huff: 00:00:46

In this series, we're deconstructing the complexities of lending and

Tedd Huff: 00:00:50

exploring compliance, optimization, modernization, and personalization

Tedd Huff: 00:00:55

through insightful conversations with the industry's best.

Tedd Huff: 00:00:59

I'm Tedd Huff and with my co host Colton Pond, we'll be guiding you

Tedd Huff: 00:01:03

through the intricate lending world.

Tedd Huff: 00:01:04

Whether you're deep in the Lintech scene or just intrigued by how

Tedd Huff: 00:01:08

technology is reshaping lending, you're in the right place.

Tedd Huff: 00:01:12

now let's dive into this episode of accrued Colton.

Tedd Huff: 00:01:16

It's great to have you back with me again, man.

Colton Pond: 00:01:19

Thanks, Ted.

Colton Pond: 00:01:20

It's good to see you again.

Colton Pond: 00:01:21

We're, we're here with a really special guest today, so I'm

Colton Pond: 00:01:23

excited for this episode.

Tedd Huff: 00:01:25

Yeah, today I'm, I'm super excited.

Tedd Huff: 00:01:27

I know you are to welcome Joe Heck, the chief executive officer

Tedd Huff: 00:01:31

from happy money to the show.

Tedd Huff: 00:01:34

Joe, it's fantastic to have you with us.

Joe Heck: 00:01:37

Thanks guys.

Joe Heck: 00:01:37

I really appreciate it.

Joe Heck: 00:01:38

Excited to be with you.

Tedd Huff: 00:01:40

let's go ahead and kickstart this episode and give

Tedd Huff: 00:01:43

you an overview of Happy Money.

Tedd Huff: 00:01:47

Happy Money is changing the game when it comes to personal lending,

Tedd Huff: 00:01:51

focusing on driving the best possible outcomes for consumers personal loans.

Tedd Huff: 00:01:56

The focus of Happy Money is consolidating credit card debt into lower interest

Tedd Huff: 00:02:00

rate unsecured personal loans to reduce debt and reliance on credit cards.

Tedd Huff: 00:02:06

Happy Money is a company that offers personal loans.

Tedd Huff: 00:02:09

With a focus on customer happiness and financial wellbeing.

Tedd Huff: 00:02:14

Happy Money is disrupting the extremely competitive personal lending

Tedd Huff: 00:02:18

industry, making a difference in the lives of their over 300, 000 members.

Tedd Huff: 00:02:24

They funded to the tune of over 6 billion in loans and have been awarded

Tedd Huff: 00:02:29

Forbes as the top most customer centric company in finance.

Tedd Huff: 00:02:34

Joe, you've recently been appointed as a chief executive officer at Happy Money.

Tedd Huff: 00:02:38

But I've been with the organization for over five years, driving growth

Tedd Huff: 00:02:42

in several of the fundamental roles.

Tedd Huff: 00:02:44

One of the things that I noticed is that Happy Money recently closed

Tedd Huff: 00:02:48

a strategic transaction led by TruStage Ventures, which we had as

Tedd Huff: 00:02:53

a guest on episode 51 of the FinTech Confidentials Leaders One on One series.

Tedd Huff: 00:02:58

And you also had other institutional investors that participated in that.

Tedd Huff: 00:03:03

And it really looks like it's set.

Tedd Huff: 00:03:05

The company up to be positioned to deliver best in class lending products.

Tedd Huff: 00:03:10

And I'm excited to dive into that a little bit later as we move on Colton.

Tedd Huff: 00:03:15

I would love for you.

Tedd Huff: 00:03:16

to share some of your insights on the team over at happy money.

Colton Pond: 00:03:20

Well, Joe, it's great to have you.

Colton Pond: 00:03:23

The happy money team, uh, knows very well of my passion, uh, towards

Colton Pond: 00:03:28

happy money and the, the impact that y'all are having in the market

Colton Pond: 00:03:30

and the personal lending industry.

Colton Pond: 00:03:32

Uh, we met along, I met the happy money team a long time ago.

Colton Pond: 00:03:36

The thing I will say is everyone I've met at the happy money team, whether

Colton Pond: 00:03:39

it's Joe at the very top as the CEO.

Colton Pond: 00:03:42

Down to Chris Courtney, who leads data science and Killian Brackey, who leads

Colton Pond: 00:03:46

engineering and Nick and Maria and Adam on the product side, the entire group

Colton Pond: 00:03:50

are fundamentally great people, like aimed and positioned, trying to make

Colton Pond: 00:03:54

an impact and, and doing so through, um, helping consumers get out of debt,

Colton Pond: 00:03:59

which is a super honorable mission.

Colton Pond: 00:04:01

Joe's been super fundamental and, and.

Colton Pond: 00:04:05

other aspects, I find that the best company leaders are also the best people.

Colton Pond: 00:04:08

Joe definitely emulates that together.

Colton Pond: 00:04:10

So Joe would love your insights on intro, how you've come to where you're at today.

Colton Pond: 00:04:16

And also kind of key things that you focus on, on leadership and life and, and the

Colton Pond: 00:04:21

direction that happy money is moving.

Joe Heck: 00:04:55

Thanks, guys.

Joe Heck: 00:04:56

I again appreciate being here and sharing a little bit of my story.

Joe Heck: 00:05:00

Um, and appreciate the kind words.

Joe Heck: 00:05:02

Colton.

Joe Heck: 00:05:02

The journey to happy money was about the people and about

Joe Heck: 00:05:06

the mission of the company.

Joe Heck: 00:05:07

Um, I left, I actually worked for a long time at, uh, the.

Joe Heck: 00:05:12

Uh, well, TruStage is now I'm still getting used to that.

Joe Heck: 00:05:15

It was CUNA mutual for my entire tenure.

Joe Heck: 00:05:18

One of the things that attracted me to happy money was just that, that people

Joe Heck: 00:05:21

centric mission and the talent that we are able to accumulate here, um, we do

Joe Heck: 00:05:26

think about the world differently and, um, I think it's really hard to hold that

Joe Heck: 00:05:31

true in a digitally native environment, and I know we'll jump into some of

Joe Heck: 00:05:35

these questions a little bit later.

Joe Heck: 00:05:36

When I think about just how challenging it is to take.

Joe Heck: 00:05:40

Like a credit union mission and put it digitally.

Joe Heck: 00:05:43

Like that was something that attracted me to how happy money operates and,

Joe Heck: 00:05:47

uh, and the people that are here.

Joe Heck: 00:05:49

Um, so I appreciate that.

Joe Heck: 00:05:52

I think the other thing that's always been important to me, look, I'm a Midwest guy.

Joe Heck: 00:05:56

I value grit and, uh, and solving hard things.

Joe Heck: 00:06:01

Try to do things that are gonna feel good.

Joe Heck: 00:06:04

everything we do here at happy money tends to go through lenses around that.

Joe Heck: 00:06:09

great people create great products.

Joe Heck: 00:06:11

And, um, it, it may also makes it fun to work at.

Tedd Huff: 00:06:14

Joe, I have to ask this question.

Tedd Huff: 00:06:18

How is happy money creating

Tedd Huff: 00:06:21

a happier way of lending?

Joe Heck: 00:06:23

I'll go back to my old, old, old credit union days.

Joe Heck: 00:06:26

Um, I used to be an underwriter at a credit union forever ago.

Joe Heck: 00:06:29

the whole credit union mantra of like people helping people, um, showed up

Joe Heck: 00:06:34

primarily in the underwriting process and how that showed up was a consumer came

Joe Heck: 00:06:39

in, sat at your desk, told you about the situation, what they're trying to do.

Joe Heck: 00:06:43

And you as an underwriter.

Joe Heck: 00:06:44

We're meant to, like, help figure out the right way to

Joe Heck: 00:06:47

solve their financial problem.

Joe Heck: 00:06:49

Um, mapping that digitally was really an interesting endeavor, and

Joe Heck: 00:06:55

it was something that I think Happy Money got a really good jump on.

Joe Heck: 00:06:58

I would say there's two different ways that are probably the most exciting here.

Joe Heck: 00:07:02

We take a behavioral science approach.

Joe Heck: 00:07:04

So really trying to understand The ability and intent to pay,

Joe Heck: 00:07:08

and leveraging data because again, I think everybody's aware, like, you can't

Joe Heck: 00:07:13

drive a bunch of friction into the funnel.

Joe Heck: 00:07:15

I can't ask a million questions and expect somebody to come out

Joe Heck: 00:07:18

on the other end of my funnel.

Joe Heck: 00:07:20

How do I engage in a way that, like.

Joe Heck: 00:07:23

The give get on data is helpful to both of us.

Joe Heck: 00:07:26

Um, so I think that's, that's one piece of it.

Joe Heck: 00:07:28

we rely on a lot of cash flow data to understand that.

Joe Heck: 00:07:31

It's something I think we do as well as anybody.

Joe Heck: 00:07:34

And ultimately, what comes out of that is we start with a human centric approach.

Joe Heck: 00:07:38

We have a digitally native underwriting approach that takes into account.

Joe Heck: 00:07:42

The human being on the other end in their financial situation, which

Joe Heck: 00:07:45

allows us to, you know, stretch a little bit beyond of like what just

Joe Heck: 00:07:49

a FICO score would give us, which,

Joe Heck: 00:07:53

really slow to react to the changing circumstances of a human.

Joe Heck: 00:07:57

it is built into our DNA to design a happier way of, of engaging the consumer.

Joe Heck: 00:08:04

for both the consumer ourselves and our partners.

Tedd Huff: 00:08:07

Could you quickly run us through The journey of happy

Tedd Huff: 00:08:10

money from the inception and the idea when it started to where it is

Joe Heck: 00:08:15

I wasn't here for the entire journey.

Joe Heck: 00:08:17

Um, shockingly, we've been around for 14, almost 15 years now.

Joe Heck: 00:08:22

I'll give a ton of credit and, um, uh, appreciation for the vision.

Joe Heck: 00:08:29

That the founder had the founder really talked about coming

Joe Heck: 00:08:32

out of the 0809 crisis with,

Joe Heck: 00:08:33

this really bright view that like companies had really

Joe Heck: 00:08:39

fragile balance sheets, right?

Joe Heck: 00:08:41

Anything could tip them over, but the consumer did too.

Joe Heck: 00:08:44

when you think about this concept of resiliency for the consumer, it was

Joe Heck: 00:08:48

something that was really being sub optimized with the way the world works.

Joe Heck: 00:08:52

we were able to kind of engage in that as a company, you were starting to

Joe Heck: 00:08:56

see things that show up persistently, which is the more debt somebody had,

Joe Heck: 00:09:01

the more limited their cashflow had, the increased like levels of stress

Joe Heck: 00:09:06

that they had to manage through.

Joe Heck: 00:09:07

Um, we did an academically rigorous, uh, uh, assessment around cashflow versus

Joe Heck: 00:09:14

stress and found really clear signal.

Joe Heck: 00:09:17

the symptoms were showing up and really challenging somebody's life.

Joe Heck: 00:09:21

So it was like,

Joe Heck: 00:09:21

because my stress levels high because of my My financial

Joe Heck: 00:09:25

situation, I'm losing sleep.

Joe Heck: 00:09:28

I'm avoiding opening my bank statements.

Joe Heck: 00:09:30

I'm avoiding opening the bills and you start to just see the snowball effect of,

Joe Heck: 00:09:35

negative, outcomes.

Joe Heck: 00:09:37

And really that was one of the founding kind of principles of this

Joe Heck: 00:09:41

is like, if we could help people,

Joe Heck: 00:09:42

drive more financially savvy decisions and help them like

Joe Heck: 00:09:49

understand their cashflow position,

Joe Heck: 00:09:51

then they would ultimately have better outcomes and,

Joe Heck: 00:09:55

hopefully return and reduce their levels of stress, which by the way, like

Joe Heck: 00:10:00

reduces risk on the loan asset as well.

Joe Heck: 00:10:02

So everybody creates a better winning.

Joe Heck: 00:10:05

Um, outcome in that environment.

Colton Pond: 00:10:08

I have a, uh, passion towards happy money and the mission

Colton Pond: 00:10:11

and vision y'all are working on.

Colton Pond: 00:10:12

Um, when I was at MX technologies, I became a good friend with the CTO, the

Colton Pond: 00:10:17

co founder and CTO, Brandon DeWitt, and a lot of people know his story,

Colton Pond: 00:10:21

but he was diagnosed with stage four cancer and had 30 days to live.

Colton Pond: 00:10:25

Brandon started doing research and looking at the impact of

Colton Pond: 00:10:28

financial stress on people.

Colton Pond: 00:10:30

The highest, uh, leads to the highest rate of suicide.

Colton Pond: 00:10:33

Highest predictor of suicide is financial stress, highest predictor

Colton Pond: 00:10:37

of divorce, financial stress.

Colton Pond: 00:10:39

And, and they came to this conclusion that, man,

Colton Pond: 00:10:41

There are problems bigger in the world than even stuff that Brandon

Colton Pond: 00:10:45

was going through and others and financial stress that people have in

Colton Pond: 00:10:48

their lives is tremendous and leads to a lot of downstream consequences

Colton Pond: 00:10:52

and especially where happy money being focused on this market of taking your

Colton Pond: 00:10:58

credit card debt and refinancing that credit card debt into a lower interest

Colton Pond: 00:11:01

personal loan that you eventually pay off.

Colton Pond: 00:11:03

Help us understand the decision to focus there and the impact that that's

Colton Pond: 00:11:07

had on on the company's direction.

Joe Heck: 00:11:09

The, like number one driver of financial stress is

Joe Heck: 00:11:12

typically credit card debt.

Joe Heck: 00:11:13

We're at.

Joe Heck: 00:11:14

records amount again.

Joe Heck: 00:11:16

Um, and I, I say again, because I've been here five years and I think we've

Joe Heck: 00:11:20

hit records a couple of different times.

Joe Heck: 00:11:22

It's kind of inherent in the American economy as well.

Joe Heck: 00:11:25

Um, is spend more, figure it out later.

Joe Heck: 00:11:29

Um, and when we looked at a lot of the data set, it was like,

Joe Heck: 00:11:33

Hey, the saddest spend for people.

Joe Heck: 00:11:35

The happy money kind of ethos is like hey happy Spends are things that like

Joe Heck: 00:11:40

I feel good about spending my money on.

Joe Heck: 00:11:42

The number one happy spend was it is savings.

Joe Heck: 00:11:46

the number one sad spend is.

Joe Heck: 00:11:48

Paying credit card debt.

Joe Heck: 00:11:49

Um, and so one of the big drivers here is like, Hey, if we can drive

Joe Heck: 00:11:54

more happy spends, fewer sad spends, and this is back in call it 2014, 15.

Joe Heck: 00:12:00

it was going to lead to better outcomes for the consumer.

Joe Heck: 00:12:02

So the best way to impact that was to try to help accelerate the

Joe Heck: 00:12:08

pay down of credit card debt and eliminate that burden, if you will.

Joe Heck: 00:12:12

we actually don't call our loan a credit card.

Joe Heck: 00:12:15

That consolidation loan, we call it a debt elimination loan because we

Joe Heck: 00:12:19

are looking for aligned consumers and aligned partners that are trying to

Joe Heck: 00:12:25

help people get completely out of debt.

Joe Heck: 00:12:27

We're looking to make sure that we're aligning interests across the value chain.

Joe Heck: 00:12:32

And I would say like one additional item that I think gets under appreciated

Joe Heck: 00:12:37

about our model is just how valuable an ethos aligned partner group of credit

Joe Heck: 00:12:43

unions really is because it allows a lot of flexibility to like go back to that

Joe Heck: 00:12:48

original mission of people helping people.

Tedd Huff: 00:12:51

Hey, Tedd Huff here.

Tedd Huff: 00:12:52

Ever thought about how you could streamline your application

Tedd Huff: 00:12:55

and underwriting process?

Tedd Huff: 00:12:56

Well, let me introduce you to UNDER.

Tedd Huff: 00:12:58

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Tedd Huff: 00:13:02

digitize them effortlessly?

Tedd Huff: 00:13:04

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Tedd Huff: 00:13:09

voila, you're set for the digital age.

Tedd Huff: 00:13:11

Are you curious how to make that happen?

Tedd Huff: 00:13:13

Head over to under.

Tedd Huff: 00:13:14

io forward slash FTC and get started for free.

Tedd Huff: 00:13:18

It's really that simple.

Tedd Huff: 00:13:21

it's interesting to listen to how you guys have differentiated yourselves

Tedd Huff: 00:13:25

in, in a number of different areas.

Tedd Huff: 00:13:28

And it's funny for me because a lot of times.

Tedd Huff: 00:13:31

Market differentiation tends to be a slogan or a new website design or a new

Tedd Huff: 00:13:37

new topic that they want to talk about,

Tedd Huff: 00:13:40

if you were to summarize down what Happy Money's top three differentiators

Tedd Huff: 00:13:46

are, especially in the personal lending market, What would they be?

Joe Heck: 00:13:50

I'm going to shoot from the hip a little bit here.

Joe Heck: 00:13:52

I think one is our ethos aligned partners.

Joe Heck: 00:13:55

Um, like having credit unions as our partners, I think holds the

Joe Heck: 00:14:00

entire value chain accountable to doing the right thing.

Joe Heck: 00:14:04

Um, and I think that, you know, we don't struggle with that accountability.

Joe Heck: 00:14:08

It's one we embrace.

Joe Heck: 00:14:09

Um, and I think having them be a part of our mission, vision and product set,

Joe Heck: 00:14:14

they're not transactional partners.

Joe Heck: 00:14:16

They're strategic.

Joe Heck: 00:14:17

the second piece, I would say

Joe Heck: 00:14:19

we look at risk differently.

Joe Heck: 00:14:21

We're not myopically focused on on a FICO score.

Joe Heck: 00:14:25

We look at that as a piece of the data set.

Joe Heck: 00:14:27

But we're really trying to understand the cash flow position of an individual

Joe Heck: 00:14:33

and underwrite to that individual.

Joe Heck: 00:14:35

So,

Joe Heck: 00:14:35

I think we have an ability to personalize that scale that a lot of,

Joe Heck: 00:14:39

uh, a lot of others kind of miss on.

Joe Heck: 00:14:43

that creates really good alignment.

Joe Heck: 00:14:45

The 3rd is just, I would think of how we think about our product.

Joe Heck: 00:14:49

Our product isn't.

Joe Heck: 00:14:51

The team thinks differently.

Joe Heck: 00:14:52

They're not traditional finance people, so they're looking for, um, they're

Joe Heck: 00:14:57

leveraging their experience outside the financial industry and putting it

Joe Heck: 00:15:00

to work inside the financial industry.

Joe Heck: 00:15:03

So rather than us being, you know, complacent in our product set, um,

Joe Heck: 00:15:08

we worked with TruStage to develop a product that, you know, would pay,

Joe Heck: 00:15:12

payments for the consumer, uh, during a point of instability.

Joe Heck: 00:15:17

So if they're, if they become unemployed, we'll pick up payments

Joe Heck: 00:15:20

for them for a period of time.

Joe Heck: 00:15:22

Same if they became disabled and couldn't afford it.

Joe Heck: 00:15:24

Um, so when you go back and bleed that back to

Joe Heck: 00:15:27

how we think about stress impacting, like we're now implementing a product,

Joe Heck: 00:15:33

uh, within a feature within our product that will reduce stress and

Joe Heck: 00:15:38

arguably one of the most stressful events anybody could undercur, which

Joe Heck: 00:15:41

is loss of job or loss of income.

Joe Heck: 00:15:44

We're bridging them for a period of time.

Joe Heck: 00:15:46

It also pulls the risk down with our partners.

Joe Heck: 00:15:48

So it's a win for the consumer.

Joe Heck: 00:15:50

It's a win for us at happy money, and it's a win for our credit union partners.

Joe Heck: 00:15:55

I would say it's products and features like that that show up here

Joe Heck: 00:15:59

in our innovation that, um, that represent like ongoing continued, uh,

Joe Heck: 00:16:04

differentiation for us as a company.

Colton Pond: 00:16:06

One of the themes we've talked about in this mini series has

Colton Pond: 00:16:09

been taking the lending experience from transaction based to relationship based

Colton Pond: 00:16:14

and happy money is the perfect example.

Colton Pond: 00:16:16

I've had lots of conversations with the data science team and Chris Courtney

Colton Pond: 00:16:19

around and you mentioned it not looking at consumer at a FICO number, but looking at

Colton Pond: 00:16:24

broader aspects on cash flow, underwriting cash flow position and other data points.

Colton Pond: 00:16:29

I feel like this is once again, a key differentiator

Colton Pond: 00:16:31

Help the audience if you don't mind understand how you think about

Colton Pond: 00:16:34

underwriting from a high level

Joe Heck: 00:16:37

Let me maybe start with what a perception of the world right

Joe Heck: 00:16:42

now is like, and I think most would agree is like during this COVID cycle.

Joe Heck: 00:16:47

Uh, underwriting risk has become, I would say, more than challenging.

Joe Heck: 00:16:51

I would say one of the big drivers of that is like a lack of fidelity really

Joe Heck: 00:16:56

in or even a lack of confidence in that the FICO is telling the necessary story.

Joe Heck: 00:17:02

most have seen credit score migration,

Joe Heck: 00:17:05

I would say it's almost a full tier.

Joe Heck: 00:17:07

Elevation across the board.

Joe Heck: 00:17:09

super primes acting more like prime primes acting more like near prime

Joe Heck: 00:17:13

and near primes acting more like

Joe Heck: 00:17:15

trying to, like, calibrate to that is a really difficult equation.

Joe Heck: 00:17:19

Not trying to claim that we're getting it right every day, but, um,

Joe Heck: 00:17:22

I do think I'd look at our tool set.

Joe Heck: 00:17:24

And say like the humanistic approach and looking more real time at cashflow data,

Joe Heck: 00:17:29

um, has helped us adapt more quickly, um, to changing economic circumstances.

Joe Heck: 00:17:36

I find it a really interesting way to dig into how,

Joe Heck: 00:17:42

we do a hundred percent income verification at happy money.

Joe Heck: 00:17:46

And the way we do that helps us see how people are.

Joe Heck: 00:17:50

Living their day to day lives.

Joe Heck: 00:17:51

We're looking at trended data across the board.

Joe Heck: 00:17:53

Um, and that helps us see, like, which way, which direction is the

Joe Heck: 00:17:57

data starting to move and that compilation of both the both sides

Joe Heck: 00:18:03

of the consumer's balance sheet.

Joe Heck: 00:18:05

We're looking for people that, like, have the right income, lack the right tools.

Joe Heck: 00:18:09

And so, you know, when you fine tune your underwriting engine

Joe Heck: 00:18:12

to look for that use case.

Joe Heck: 00:18:15

I look forward to a day where we can just be like, oh, it's

Joe Heck: 00:18:17

going to be a normal year.

Joe Heck: 00:18:18

Um, I, I've been here five years and I haven't, I haven't seen a normal year.

Tedd Huff: 00:18:24

Is there such thing as a normal

Joe Heck: 00:18:25

I don't know, there used to be.

Colton Pond: 00:18:28

Not anymore in financial services,

Joe Heck: 00:18:29

Yeah,

Tedd Huff: 00:18:31

as you, as you described all the different things that

Tedd Huff: 00:18:33

you at happy money do to identify and, and really work through the

Tedd Huff: 00:18:39

understanding of the risk of each one of these individual personal loans.

Tedd Huff: 00:18:44

What's the impactthat you've seen?

Tedd Huff: 00:18:46

Using the cash flow underwriting on the influence of reducing your overall

Tedd Huff: 00:18:51

risk, reducing the overall default rates, and in turn, reducing the credit

Tedd Huff: 00:18:55

losses for your capital partners.

Joe Heck: 00:18:57

I think it's top of mind for everybody right now.

Joe Heck: 00:18:59

our portfolio, just like everybody else's is experienced

Joe Heck: 00:19:02

stress throughout this cycle.

Joe Heck: 00:19:04

we continue to manage that.

Joe Heck: 00:19:06

I think, as we look forward, I feel like, from a tool set standpoint, we're

Joe Heck: 00:19:11

super well positioned to continue to understand and react to risk changes.

Joe Heck: 00:19:16

And I think when you think about anybody in this world,

Joe Heck: 00:19:21

it's really about like the agility and the ability to understand and

Joe Heck: 00:19:27

see change, look around corners.

Joe Heck: 00:19:29

you got to continue to manage the risks that you,

Joe Heck: 00:19:32

take.

Joe Heck: 00:19:32

But, um, the way I view the world around this is like FICO is a little

Joe Heck: 00:19:38

bit of a stale representative of where a consumer's financial position is,

Joe Heck: 00:19:43

doesn't react to income very quickly.

Joe Heck: 00:19:44

doesn't react to loss of job

Joe Heck: 00:19:46

quickly at all.

Joe Heck: 00:19:47

Um, and we think about, like, the savings and resiliency of a consumer.

Joe Heck: 00:19:51

Like you can prop up your FICO score for quite a while.

Joe Heck: 00:19:54

the way we kind of think about the whole experience allows us to see

Joe Heck: 00:19:58

into that better, which ultimately.

Joe Heck: 00:20:02

Provides better risk return

Joe Heck: 00:20:04

profile for all of our partners down the line.

Joe Heck: 00:20:07

look, most people innovate around rate.

Joe Heck: 00:20:09

I think that's a 1 piece of agility.

Joe Heck: 00:20:12

You can have,

Joe Heck: 00:20:13

what are we missing in the profile to rate better?

Joe Heck: 00:20:16

well, there's other things that consumer can do that are showing

Joe Heck: 00:20:18

us the right behaviors that show us that it's a risk profile.

Joe Heck: 00:20:22

That's better than a FICO score.

Joe Heck: 00:20:24

That's better than what we're seeing.

Joe Heck: 00:20:25

We continue to innovate around those edges because I think that's the only

Joe Heck: 00:20:30

way to continue to win in this market.

Joe Heck: 00:20:32

We do an unsecured loan.

Joe Heck: 00:20:33

It's focused on a use case.

Joe Heck: 00:20:34

We're really good at it.

Joe Heck: 00:20:36

But look, an unsecured loan has been around for what?

Joe Heck: 00:20:39

Thousands of years.

Joe Heck: 00:20:40

we're making it easy.

Joe Heck: 00:20:41

we're looking at it differently.

Joe Heck: 00:20:43

Consumers just don't look at products the same way all of us in

Joe Heck: 00:20:47

the financial services space do.

Joe Heck: 00:20:49

It's our language, it's our,

Joe Heck: 00:20:51

our world we live in, and we just expect everybody else to understand it.

Joe Heck: 00:20:55

when we start to move beyond that.

Joe Heck: 00:20:57

And start to simplify and make products that people can make better decisions

Joe Heck: 00:21:02

fix their problems with.

Joe Heck: 00:21:04

I think that's when we'll start to move forward beyond just like offline to

Joe Heck: 00:21:08

online productization, which is a little bit of how I still feel we're stuck.

Tedd Huff: 00:21:13

As you're talking about the Alternative credit models and

Tedd Huff: 00:21:17

alternative ways to get information, looking at cash

Tedd Huff: 00:21:20

flow as an underwriting process

Tedd Huff: 00:21:23

as we've gone through this series, it's been really interesting to hear

Tedd Huff: 00:21:27

how many of the lenders are starting to look at this Additional alternative

Tedd Huff: 00:21:33

on these air quotes, alternative data.

Tedd Huff: 00:21:35

It's data that's there.

Tedd Huff: 00:21:36

I don't know why we call it alternative, but

Tedd Huff: 00:21:38

what are you seeing as the linchpin for mass adoption of this

Tedd Huff: 00:21:42

alternative data, like the cashflow underwriting and evaluating way

Tedd Huff: 00:21:47

beyond just the credit scores?

Joe Heck: 00:21:49

Tedd, I looked at your background a little bit before

Joe Heck: 00:21:52

this, and I can, I can tell you're, you're a product guy.

Joe Heck: 00:21:55

when I think about product and,

Joe Heck: 00:21:58

taking things beyond where they're at today.

Joe Heck: 00:22:01

It's not dragging customers to where you want to be.

Joe Heck: 00:22:07

And so this idea of, like, alternative data is going to

Joe Heck: 00:22:11

help me, help me, help me.

Joe Heck: 00:22:13

there's this give get relationship that has to be uncovered.

Joe Heck: 00:22:17

Uh, like, what value is the consumer going to get for giving you

Joe Heck: 00:22:21

data, and what value do they get?

Joe Heck: 00:22:23

It in that transaction, some of it's like efficiency and ease of use.

Joe Heck: 00:22:27

Some of it's better pricing.

Joe Heck: 00:22:29

unless you have that DNA in your building, like, it's a very difficult

Joe Heck: 00:22:34

proposition to uncover longer term.

Joe Heck: 00:22:37

Where I see this idea of alternative data, uh, I think the value prop

Joe Heck: 00:22:42

around how do you acquire it and help the consumer understand why

Joe Heck: 00:22:47

it's of value to them as well.

Joe Heck: 00:22:49

I, I feel like that's the missing linchpin and,

Joe Heck: 00:22:52

I just think it's going to be the product, uh, focused.

Joe Heck: 00:22:56

Consumer focused, uh, entities that really tap into that over

Joe Heck: 00:23:00

time, but that's a DNA thing.

Joe Heck: 00:23:02

And it look, it, it can go off track really, really quickly.

Joe Heck: 00:23:05

the ego and the tribal knowledge inside your walls.

Joe Heck: 00:23:09

And again, I, I'll claim victimhood on this.

Joe Heck: 00:23:12

I've done it to myself.

Joe Heck: 00:23:13

I've done it to my customers.

Joe Heck: 00:23:15

I know better than what they're saying there,

Joe Heck: 00:23:17

you've got to involve the customer in that process, and it's one of

Joe Heck: 00:23:20

the things I really value about,

Joe Heck: 00:23:23

our DNA is like our customers, our credit unions, our strategic

Joe Heck: 00:23:27

partners, so they're part of that, the consumers we get feedback from.

Joe Heck: 00:23:31

That is the piece that largely.

Joe Heck: 00:23:34

underleveraged.

Colton Pond: 00:23:35

I feel like oftentimes, and you were at CUNA mutual or TruStage for a

Colton Pond: 00:23:39

long time, you know this, but the credit union market sometimes gets overlooked.

Colton Pond: 00:23:43

And people are so focused on banks and not what the impact

Colton Pond: 00:23:46

that credit unions can have.

Colton Pond: 00:23:48

help us understand and share with the audience Happy Money's decision and

Colton Pond: 00:23:51

reason behind partnering with credit unions and capital partners and how that's

Colton Pond: 00:23:55

giving you different edge in the market.

Joe Heck: 00:23:58

Happy money, it was down this path, um, pretty significantly

Joe Heck: 00:24:01

when I came here, I helped them scale it beyond where they were at.

Joe Heck: 00:24:04

I spent a lot of time with our early customers to try to

Joe Heck: 00:24:08

understand what was it about happy money that they liked and what,

Joe Heck: 00:24:12

they didn't like about happy money.

Joe Heck: 00:24:13

one of the things that always continued to resonate was This idea

Joe Heck: 00:24:18

that, like, we were trying to align The consumer's best interest with the

Joe Heck: 00:24:25

financial institution's best interest.

Joe Heck: 00:24:27

And doing that digitally native and at scale is something,

Joe Heck: 00:24:32

all credit unions and sub scale FIs in general, Really will struggle with it's

Joe Heck: 00:24:38

a significant investment into tech.

Joe Heck: 00:24:40

It's a significant investment into people in process.

Joe Heck: 00:24:43

there's a lack of individual scale to be able to access certain channels.

Joe Heck: 00:24:47

Like an NerdWallet.

Joe Heck: 00:24:50

Those are two great partners for us where.

Joe Heck: 00:24:54

Consumers are going to try to understand their financial well being,

Joe Heck: 00:24:58

they're getting all these offers from banks and,

Joe Heck: 00:25:00

Capital One and all, yeah, and, um, credit unions don't have the scale

Joe Heck: 00:25:05

to be on page one there typically.

Joe Heck: 00:25:08

Our model brings a brand and, um, an ethos that's aligned with theirs

Joe Heck: 00:25:14

and brings that access point.

Joe Heck: 00:25:16

With, like, more of an aggregate scale.

Joe Heck: 00:25:18

opening up new channels that would otherwise be relatively inaccessible.

Joe Heck: 00:25:23

The most common cause of bad customer experience isn't that high tech.

Joe Heck: 00:25:29

It's embarrassingly simple.

Joe Heck: 00:25:31

Yep, it's answering questions.

Joe Heck: 00:25:34

In e commerce, it's really easy to get bogged down with common questions.

Joe Heck: 00:25:39

Whether that's, where's my package?

Joe Heck: 00:25:41

How do I return or exchange this item or just to cancel a subscription?

Joe Heck: 00:25:46

Dolph path is an AI driven customer support system that enhances the customer

Joe Heck: 00:25:52

experience with visual formats and self serve technology to empower your customers

Joe Heck: 00:25:58

to handle their own support requests.

Joe Heck: 00:26:00

Get the best customer support system for your business.

Joe Heck: 00:26:05

Get SolvePath.

Joe Heck: 00:26:06

Get started by visiting GetSolvePath.

Joe Heck: 00:26:09

com.

Tedd Huff: 00:26:15

So you, we've talked a lot about credit unions and your,

Tedd Huff: 00:26:19

your partnership in that area.

Tedd Huff: 00:26:22

What other areas are you looking to expand the happy money capital

Tedd Huff: 00:26:26

partner network and Is there a specific focus that you're targeting?

Joe Heck: 00:26:32

We're staying within the credit union sector for the large part.

Joe Heck: 00:26:36

we value that alignment.

Joe Heck: 00:26:38

what's important to me.

Joe Heck: 00:26:39

Is, is how do we set up happy money for what I would consider the future of

Joe Heck: 00:26:45

FinTech, which is how do we engage the consumer and help solve their problems?

Joe Heck: 00:26:51

we can't solve everybody's problem with an unsecured loan.

Joe Heck: 00:26:54

It's like hammer running around looking for nails.

Joe Heck: 00:26:57

It just doesn't work that way.

Tedd Huff: 00:27:00

You've mentioned this a couple times is taking everything you

Tedd Huff: 00:27:04

do from the product development to the,

Tedd Huff: 00:27:08

the customers, sorry, member support.

Tedd Huff: 00:27:10

See, I did it right there, the member support and looking at it

Tedd Huff: 00:27:13

through the credit union lens.

Tedd Huff: 00:27:15

And in other episodes,

Tedd Huff: 00:27:18

We've spoken about the shift in lending from that transactional.

Tedd Huff: 00:27:25

I'm going to give you this unsecured loan.

Tedd Huff: 00:27:27

You're going to pay me back.

Tedd Huff: 00:27:28

And hopefully we never have to talk to each other again.

Tedd Huff: 00:27:32

And moving that over to more of a relationship basis where the members

Tedd Huff: 00:27:37

in your case are having ongoing experiences with happy money,

Tedd Huff: 00:27:43

how has that transition In the marketplace in general impacted the

Tedd Huff: 00:27:49

way you treat borrowers like members.

Joe Heck: 00:27:53

to me, this is probably again, I probably feel like I'm belaboring

Joe Heck: 00:27:56

the partnership side of this, but, um, the, the reality is, is what

Joe Heck: 00:28:00

we're trying to do is we're trying to acquire a digitally native consumer.

Joe Heck: 00:28:04

That's showing the.

Joe Heck: 00:28:07

You know, the right,

Joe Heck: 00:28:08

behavior attitude that they want to be out of debt.

Joe Heck: 00:28:11

Um, we bring them, introduce them to one of our credit union partners.

Joe Heck: 00:28:15

And they have a good experience with us because we're

Joe Heck: 00:28:17

representative of our partners.

Joe Heck: 00:28:19

But I think the second is, how do we make them aware of other products and

Joe Heck: 00:28:24

services that the credit union has?

Joe Heck: 00:28:26

So we've, we continue to run tests on that.

Joe Heck: 00:28:29

no surprise in 2024, we ran a lot of deposit tests to try to

Joe Heck: 00:28:33

help with the deposit liquidity crunch that most FIs were under.

Joe Heck: 00:28:37

in that case, like within our servicing, We would highlight,

Joe Heck: 00:28:41

the deposit rates of our partners.

Joe Heck: 00:28:43

We would highlight,

Joe Heck: 00:28:44

whatever CD rate they might have on special.

Joe Heck: 00:28:47

To me, it's like, how do we create like that?

Joe Heck: 00:28:50

Well, strategic partnerships are bidirectional and that means it

Joe Heck: 00:28:54

can't always be about us doing.

Joe Heck: 00:28:56

Like asking them for more, like they get, they, they should have the pipeline

Joe Heck: 00:28:59

to ask us for help on things too.

Joe Heck: 00:29:01

And we should have the capacity to help on that front.

Joe Heck: 00:29:04

I think longer term,

Joe Heck: 00:29:05

we have an ability to drive more engagement with our borrowers,

Joe Heck: 00:29:11

Into, um, these credit unions that can can bring better products

Joe Heck: 00:29:16

and services than most people.

Joe Heck: 00:29:18

Um, and, whether it be from a rate perspective, or just a community centric

Joe Heck: 00:29:23

focus, like, these guys are are in the best interest of the consumer.

Joe Heck: 00:29:28

And they don't just try to cram products down their throats.

Joe Heck: 00:29:31

It's much more of a needs based approach, which I think is, again, back to this

Joe Heck: 00:29:36

alignment of how we treat people.

Colton Pond: 00:29:38

Joe, we've talked a little bit about how focusing on

Colton Pond: 00:29:42

the borrower and borrower centric approach influences things like credit

Colton Pond: 00:29:46

losses and default rates, what we haven't drilled into that I'd love

Colton Pond: 00:29:49

to understand is how it influences happy money's perspective on things

Colton Pond: 00:29:53

like technology spend and personalized experiences and things like that.

Colton Pond: 00:29:58

Get, give us some perspective on your thoughts there of the need to focus and,

Colton Pond: 00:30:03

and drive investment in those areas.

Joe Heck: 00:30:05

I look at like our tech stack, and I look at how we operate

Joe Heck: 00:30:09

from a value prop perspective, and I try to bucket things into three buckets.

Joe Heck: 00:30:13

there's our systems of infrastructure, which,

Joe Heck: 00:30:16

I consider that like a nuclear reactor.

Joe Heck: 00:30:18

Like, you know, blast radius is really big if we screw something up, and

Joe Heck: 00:30:22

, you want to be careful with that.

Joe Heck: 00:30:23

Um,

Tedd Huff: 00:30:25

All I can think of in my mind is Homer Simpson.

Tedd Huff: 00:30:28

Sorry, I'm thinking Homer Simpson, pressing the wrong button.

Joe Heck: 00:30:32

Right.

Joe Heck: 00:30:32

And you don't want someone to press that wrong button, right?

Joe Heck: 00:30:35

So, um, the second bucket is more,

Joe Heck: 00:30:39

I don't need a bunch of agility.

Joe Heck: 00:30:40

I don't need a bunch of bells and whistles.

Joe Heck: 00:30:42

I just need it to work all day, every day.

Joe Heck: 00:30:45

And I need to like.

Joe Heck: 00:30:47

I need to just be careful.

Joe Heck: 00:30:49

Then I think of systems of differentiation.

Joe Heck: 00:30:51

And I think about this again at the value prop level.

Joe Heck: 00:30:53

Like, where do we want to, like, really win in the market?

Joe Heck: 00:30:56

We want to continue to invest and be on the edge there.

Joe Heck: 00:31:00

Um, We have to be nimble.

Joe Heck: 00:31:02

We have to be smart, and we have to continue to make keep that our edge.

Joe Heck: 00:31:06

Um, and then there's systems of innovation where we should experiment.

Joe Heck: 00:31:11

We should break things.

Joe Heck: 00:31:12

But the blast radius is really small.

Joe Heck: 00:31:14

I'm not going to go out to market with a product that I don't have high

Joe Heck: 00:31:18

confidence already provides value.

Joe Heck: 00:31:20

I should have put that in my systems of innovation, tested it, figured it out.

Joe Heck: 00:31:24

And then flex it into my systems of differentiation

Joe Heck: 00:31:27

and the reason I say it that way is because I, I think all

Joe Heck: 00:31:30

too frequently, everything's differentiation or innovation.

Joe Heck: 00:31:34

I'll quote one of my good buddies from forever ago, it's everything's

Joe Heck: 00:31:37

special, nothing's special.

Joe Heck: 00:31:38

A lot of FinTech lenders treat their lending partners As infrastructure,

Joe Heck: 00:31:45

we treat ours as differentiation.

Joe Heck: 00:31:47

And I think like that and how we invest in them, how we think about them, it's

Joe Heck: 00:31:52

really important that we like categorize that correctly, or you end up under

Joe Heck: 00:31:56

investing and kind of ignoring it.

Joe Heck: 00:31:58

And then,

Joe Heck: 00:31:58

you know, you wake up three years from now and everything's like your foundation's

Joe Heck: 00:32:02

completely crumbling because you, didn't take the proper care and feeding.

Tedd Huff: 00:32:07

Joe, we we've come to the time in the episode where I'd

Tedd Huff: 00:32:10

like to ask our guest to pull out their crystal ball and look into

Tedd Huff: 00:32:16

it to see a head into the future.

Tedd Huff: 00:32:20

Where do you see the trends in financing heading?

Tedd Huff: 00:32:24

especially with happy money leading the charge.

Joe Heck: 00:32:28

Wow.

Joe Heck: 00:32:29

Um, if there's anything that I've learned in the last five years is I don't

Joe Heck: 00:32:33

have a clue where the world is going.

Joe Heck: 00:32:36

Um, I

Joe Heck: 00:32:38

continue to be surprised.

Joe Heck: 00:32:40

Um, The, uh, I mean, to be clear, we didn't ever launch a crypto coin.

Joe Heck: 00:32:46

So I feel like really good.

Joe Heck: 00:32:48

We didn't get distracted in that one, but, um, I, I do, I look at AI in

Joe Heck: 00:32:53

particular, um, and I look at that not as a solution, but, um, more as a

Joe Heck: 00:33:00

tool that I think can help solve some challenges that have been here forever.

Joe Heck: 00:33:05

When I think of the difference between.

Joe Heck: 00:33:07

Moving from offline to online, I think, you know, for the most part,

Joe Heck: 00:33:11

FinTech has been there, um, as I think about the next stage of the journey,

Joe Heck: 00:33:15

it's how do we reinvent the products to make them simpler

Joe Heck: 00:33:18

and easier to engage with?

Joe Heck: 00:33:19

And when I look at where AI is going, like one of the real big needs in the

Joe Heck: 00:33:24

market is around personalizing at scale.

Joe Heck: 00:33:27

People don't want to pick up the phone.

Joe Heck: 00:33:29

they want things to work, but they also want The advice and where

Joe Heck: 00:33:32

they want to feel smart about their decisions and finance is uncomfortable.

Joe Heck: 00:33:37

When I think about what AI can help bridge during that period

Joe Heck: 00:33:42

is like, I view our company as like, we want to continue to automate

Joe Heck: 00:33:45

and make easy the mundane, and we want to humanize the experience.

Joe Heck: 00:33:49

And I think like, that's where we're super well positioned

Joe Heck: 00:33:54

is to continue down this road.

Joe Heck: 00:33:55

We have an incredible data set.

Joe Heck: 00:33:57

That we understand how consumers react and manage their money.

Joe Heck: 00:34:00

We understand how they engage with debt.

Joe Heck: 00:34:02

We understand how they engage with their, their savings.

Joe Heck: 00:34:05

we have a really interesting data set to continue to drive that

Joe Heck: 00:34:10

personalization with a whole new tool set that like arguably didn't exist.

Joe Heck: 00:34:16

Three to five years ago, so I'm excited about the scale and efficiency that these

Joe Heck: 00:34:21

new tools are going to be able to provide and really change the way we interact.

Joe Heck: 00:34:27

And again, I think our DNA is that advantage

Colton Pond: 00:34:31

You know what, Ted, this last section, we should just name

Colton Pond: 00:34:33

it AI because almost every time we

Tedd Huff: 00:34:35

I know, I

Colton Pond: 00:34:37

enough, mentions AI and it's one of two directions.

Colton Pond: 00:34:40

It's either as future or like AI is overrated.

Colton Pond: 00:34:43

I don't know about it, but it's never in the middle.

Colton Pond: 00:34:46

It's always one or two.

Colton Pond: 00:34:47

Um,

Tedd Huff: 00:34:48

it's definitely a polarized, uh, discussion when we we bring in AI

Colton Pond: 00:34:55

and overrated or underrated, uh, for sure.

Joe Heck: 00:34:58

see the way.

Joe Heck: 00:35:00

I'll take it from two different approaches.

Joe Heck: 00:35:01

One is, uh, like, cause I came from enterprise land.

Joe Heck: 00:35:05

when I look at AI for enterprise land, it's like good luck getting

Joe Heck: 00:35:10

through the firewalls, right?

Joe Heck: 00:35:11

Um, I think those guys are going to be such slow adopters and like leveraging

Joe Heck: 00:35:16

it as like complimentary tools.

Joe Heck: 00:35:18

I look at our business and it's like, okay, on one hand, there's the consumer

Joe Heck: 00:35:21

element that I get excited about.

Joe Heck: 00:35:23

Like a lot of people don't know this, but we have a patent on, Like these

Joe Heck: 00:35:27

personalized chatbots that give advice.

Joe Heck: 00:35:29

we had them launched a while ago.

Joe Heck: 00:35:31

Don't really use them right now.

Joe Heck: 00:35:32

But like when I think about AI enabling those, it's an incredible, like, you

Joe Heck: 00:35:36

know, cause we had like a sassy chatbot.

Joe Heck: 00:35:38

We had all sorts of fun stuff on that front.

Joe Heck: 00:35:41

Um,

Joe Heck: 00:35:42

Yeah, it was.

Joe Heck: 00:35:43

It was like matching a personality that chatbot with

Joe Heck: 00:35:45

the personality of the consumer.

Joe Heck: 00:35:47

Um, so super cool way to actually do that now versus like having someone in

Joe Heck: 00:35:52

the back office rip scripts out, right?

Joe Heck: 00:35:54

the other side is like, I do think like happy money is in a sweet spot.

Joe Heck: 00:35:58

It'll be interesting how this shapes where We have the money and we have

Joe Heck: 00:36:02

like the lack of scale where we can implement a I in a real way that lets

Joe Heck: 00:36:06

us scale our business differently.

Joe Heck: 00:36:09

Then larger companies are going to be able to do it.

Joe Heck: 00:36:12

Um,

Tedd Huff: 00:36:13

Well, you just brought up something Joe that like,

Tedd Huff: 00:36:17

I've, I guess in the back of my mind, I've been thinking about,

Tedd Huff: 00:36:20

but the way you just said it

Tedd Huff: 00:36:22

The level of scale that a business has today, whether it be lending,

Tedd Huff: 00:36:26

whether it be anything, but the less scale that a business has in that

Tedd Huff: 00:36:31

space, the easier it's going to be for them to adopt AI and other tools.

Tedd Huff: 00:36:38

Going back is it you're right.

Tedd Huff: 00:36:39

I'm a product guy, but going back to that piece of it, you

Tedd Huff: 00:36:43

know, I look back and when I was looking at the buy build partner.

Tedd Huff: 00:36:47

And I still do that quite a bit.

Tedd Huff: 00:36:50

I really look at how do I bring that scalability into those organizations?

Tedd Huff: 00:36:55

And I hadn't really thought about that being a massive determination between not

Tedd Huff: 00:37:02

just if, but how and what types of AI get brought in to a financial organization,

Tedd Huff: 00:37:10

especially, especially around consumer

Joe Heck: 00:37:13

well, think about the pace of adoption.

Joe Heck: 00:37:14

And I would say there's a little bit of a Goldilocks scenario with this where.

Joe Heck: 00:37:19

Like the really small, like, I don't know if you've looked at a subscription

Joe Heck: 00:37:21

to open a I, but it ain't cheap.

Joe Heck: 00:37:23

Um, so when I look at, like, the smalls, they don't have enough

Joe Heck: 00:37:28

money to actually leverage it.

Joe Heck: 00:37:29

What if you could build fast, but not break privacy?

Joe Heck: 00:37:33

What if you could ensure data privacy, governance, and compliance

Joe Heck: 00:37:37

with just a few API calls?

Joe Heck: 00:37:39

What if you could worry less about PCI requirements while actually

Joe Heck: 00:37:43

improving privacy and security?

Joe Heck: 00:37:44

How much more time would your team have to truly innovate?

Joe Heck: 00:37:48

How much faster could you build and ship new features?

Joe Heck: 00:37:52

How much more powerful could your app be?

Joe Heck: 00:37:55

Skyflow is a zero trust data privacy vault delivered as an API.

Joe Heck: 00:37:59

Skyflow's radically simple design lets you use color.

Joe Heck: 00:38:02

secure and tokenized personal information like card data and payment details.

Joe Heck: 00:38:06

And with built in features like encrypted data analysis and sharing,

Joe Heck: 00:38:10

anonymization and advanced governance, your days of choosing between data

Joe Heck: 00:38:13

security and data usability are over.

Joe Heck: 00:38:16

Whether you're just concerned with PCI compliance.

Joe Heck: 00:38:18

Or need to go further to include CCPA, GDPR, SOC 2, and beyond.

Joe Heck: 00:38:23

Skyflow has you covered.

Joe Heck: 00:38:24

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Joe Heck: 00:38:28

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Joe Heck: 00:38:28

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Joe Heck: 00:38:29

Visit skyflowsecure.

Joe Heck: 00:38:30

com today to learn how.

Joe Heck: 00:38:32

The bigs have too much potential, like, tech debt and

Joe Heck: 00:38:36

inertia to like retool like I think these midsize ones that

Joe Heck: 00:38:41

have the money and lack the

Joe Heck: 00:38:42

sacred cows, if you will, um, I think that's where the Goldilocks scenario is

Joe Heck: 00:38:48

going to live for the, the early adopters.

Joe Heck: 00:38:51

It's something we talk about internally, because I'm like, I do

Joe Heck: 00:38:54

feel like we're uniquely positioned to.

Joe Heck: 00:38:57

Optimize, um, and rebuild the way and not even rebuild, but like scale

Joe Heck: 00:39:03

the company differently than than a lot of our competitive set that

Joe Heck: 00:39:06

have already scaled and are now trying to figure out how to retool.

Joe Heck: 00:39:10

We've scaled significantly, but not to the point where, like,

Joe Heck: 00:39:13

we can't undo some things.

Colton Pond: 00:39:16

I love it.

Colton Pond: 00:39:16

Joe, you officially have the best answer for AI section of the mini series.

Colton Pond: 00:39:20

Congratulations for sure.

Colton Pond: 00:39:22

I also can't, uh, help, but think about, and Tedd will like this.

Colton Pond: 00:39:25

Cause he thinks about, envisions things that we have these, have these episodes.

Colton Pond: 00:39:29

Salesforce has been doing commercials on like Matthew McConaughey seems a rabbit

Colton Pond: 00:39:34

and like, will the future of AI go anyway?

Colton Pond: 00:39:36

And it like, so ambiguous is like,

Colton Pond: 00:39:39

let's actually get to things that,

Colton Pond: 00:39:40

can drive an impact and difference.

Colton Pond: 00:39:42

And I agree with your perspective and that, that

Colton Pond: 00:39:44

middle organization is poised to

Colton Pond: 00:39:47

use AI in the right way to drive significant impact for happy money.

Joe Heck: 00:39:51

No, definitely.

Joe Heck: 00:39:52

And I, I appreciate it, guys.

Joe Heck: 00:39:53

I think, look, there's no crystal ball anymore.

Joe Heck: 00:39:56

Um, and if it does,

Joe Heck: 00:39:58

it

Joe Heck: 00:39:58

sees, well, it sees like maybe three weeks in advance.

Joe Heck: 00:40:01

Um, you know, you know, maybe to the next fed funds, uh, discussion,

Joe Heck: 00:40:06

the constant for all of us has continued to be like, look, we

Joe Heck: 00:40:09

got to have business agility.

Joe Heck: 00:40:11

We got to invest in our differentiation in our innovation

Joe Heck: 00:40:14

we do those things.

Joe Heck: 00:40:16

I think, like, we'll continue to, to, to march along and,

Joe Heck: 00:40:20

build products and services that actually have a positive outcome for

Joe Heck: 00:40:24

both our consumers and our partners.

Joe Heck: 00:40:25

that remains our focus.

Joe Heck: 00:40:27

And we just have to stay true to that.

Joe Heck: 00:40:29

And I think all the decisions kind of like map to that get a lot easier.

Tedd Huff: 00:40:35

Well, Joe, you, you, you teed me up so perfectly for

Tedd Huff: 00:40:39

my last question of the episode.

Tedd Huff: 00:40:40

So I appreciate that very much.

Tedd Huff: 00:40:43

You've talked about being agile.

Tedd Huff: 00:40:45

You've talked about making sure that you deliver the right things to the customers.

Tedd Huff: 00:40:49

You've talked about continuing to move forward with new technologies.

Tedd Huff: 00:40:54

Infrastructure is one of the things that a lot of people think about

Tedd Huff: 00:40:57

last and it has a massive impact.

Tedd Huff: 00:41:00

And just like we talked about with scale, you have to choose the right things.

Tedd Huff: 00:41:06

How have you been looking at infrastructure and keeping up with

Tedd Huff: 00:41:11

what your customers, your members need.

Joe Heck: 00:41:13

I'll maybe frame my thought process is like in a lot of the way I

Joe Heck: 00:41:18

think about the world is people process technology Um And in reverse order,

Joe Heck: 00:41:24

and I would say the way I think about your question is more bad

Joe Heck: 00:41:29

technology can drive bad process,

Joe Heck: 00:41:31

and cost into the equation.

Joe Heck: 00:41:34

when we look at our infrastructure, even the nuclear reactor, um, has

Joe Heck: 00:41:39

to, like, be designed in a way that's efficient for people to use.

Joe Heck: 00:41:44

It's got to be designed in a way that we can plug and play our systems of

Joe Heck: 00:41:48

differentiation into it efficiently.

Joe Heck: 00:41:52

I like to think about all of this is like an ROI on, you

Joe Heck: 00:41:55

know, degrees of confidence that,

Joe Heck: 00:41:57

I'm going to get the value that I, that I think I'm going to get.

Joe Heck: 00:42:00

Um, I like to think about, you know, the cost of the time value of

Joe Heck: 00:42:05

putting the energy and money into it.

Joe Heck: 00:42:07

If it doesn't, you know, all it does is burden me with.

Joe Heck: 00:42:11

Obstacles

Joe Heck: 00:42:12

where I really want to be is, which is with my customer figuring out

Joe Heck: 00:42:15

how do I solve their problems?

Joe Heck: 00:42:17

Like, I don't want my people thinking about,

Joe Heck: 00:42:20

Oh my God, it's going to be like, you know, 700 APIs to integrate

Joe Heck: 00:42:25

and tie off and test and learn.

Joe Heck: 00:42:27

It's the inefficient speed to market.

Colton Pond: 00:42:29

A theme of, of this mini series.

Colton Pond: 00:42:31

Of optimization and how to optimize what you're doing.

Colton Pond: 00:42:34

We're at our CEO talks about technology is the bottom layer of

Colton Pond: 00:42:37

the cake, but there's other cake layers like process and people and,

Colton Pond: 00:42:41

all of those things that if the technology is, or infrastructure in the background

Colton Pond: 00:42:45

and just operates, it allows you to truly innovate and drive efficiency forward.

Joe Heck: 00:42:50

Well, let me let me just maybe add to that because, um, I, like, again,

Joe Heck: 00:42:55

kind of back to, like, philosophical here.

Joe Heck: 00:42:58

Like, I think my role as a CEO, um, and my role as any leader versus manager is.

Joe Heck: 00:43:07

I wake up every day thinking, how can I optimize my people?

Joe Heck: 00:43:11

Um, and going back to the AI topic, the infrastructure

Joe Heck: 00:43:14

topic, like those are all tools.

Joe Heck: 00:43:16

I don't think about technology replacing people.

Joe Heck: 00:43:20

I think about is optimizing

Joe Heck: 00:43:21

people.

Joe Heck: 00:43:22

And, that's got to be our, our line of thinking, because I think you get yourself

Joe Heck: 00:43:27

in a really replaceable position with your customer, if all you're trying to do is

Joe Heck: 00:43:32

implement tech to replace people, like then you just become this giant

Joe Heck: 00:43:36

commodity that nobody really cares about.

Joe Heck: 00:43:39

And there's very limited differentiation left.

Joe Heck: 00:43:42

The people are the ones who designed the differentiation.

Joe Heck: 00:43:44

And if I don't have great talent there and,

Joe Heck: 00:43:47

they're thinking about that every day, then I'm losing.

Joe Heck: 00:43:51

I say this, uh, far more frequently than I care to admit,

Joe Heck: 00:43:54

I want to play to win, I don't want to play not to lose and, and

Joe Heck: 00:43:58

that's how I want my team acting.

Colton Pond: 00:44:01

love it.

Colton Pond: 00:44:01

Um, Joe, thank you for the insights.

Colton Pond: 00:44:04

Super insightful.

Colton Pond: 00:44:05

If I think back to our conversation today and all of the things we said,

Colton Pond: 00:44:09

one core message comes out, uh, from my perspective is, uh, back to

Colton Pond: 00:44:14

the basics, focus on the customer.

Colton Pond: 00:44:16

so often we forget about the customer and focus everything we do from product

Colton Pond: 00:44:20

development, from how we engage from a new technology span, from how we think

Colton Pond: 00:44:25

about on the lending collection strategy.

Colton Pond: 00:44:28

In the end, talk to your customer, understand the job they're trying to

Colton Pond: 00:44:31

solve, the job to be done, and go solve that job in a more efficient way for them.

Colton Pond: 00:44:36

And I love what Happy Money is doing in driving differentiation

Tedd Huff: 00:44:39

If I stated it one way, you're only as good as your partners.

Tedd Huff: 00:44:43

And it's really nice to see how happy money is strategically aligning with

Tedd Huff: 00:44:47

specific partners to deliver the best possible experience for their members.

Tedd Huff: 00:44:52

And that's one of the things that I really enjoyed learning today.

Tedd Huff: 00:44:55

Mm hmm.

Tedd Huff: 00:44:55

Well, sitting down with you, Joe,

Joe Heck: 00:44:56

Yeah.

Joe Heck: 00:44:57

No, thanks guys.

Joe Heck: 00:44:57

I appreciate it.

Joe Heck: 00:44:58

I think you're both aligned with how I think about it.

Joe Heck: 00:45:01

I appreciate, uh, the partnership with you guys as well.

Tedd Huff: 00:45:04

Well, that's another episode of a crude, a FinTech confidential

Tedd Huff: 00:45:08

series presented to you by LoanPro.

Tedd Huff: 00:45:11

If you haven't already, and if you've made it this far, go ahead, subscribe,

Tedd Huff: 00:45:15

like all that other fun stuff and sign up for the weekly email newsletter to

Tedd Huff: 00:45:21

let you know about all the great things that we're talking about, as well as

Tedd Huff: 00:45:25

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Tedd Huff: 00:45:28

As we wrap up today's episode, I've got one last thing for you.

Tedd Huff: 00:45:32

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Tedd Huff: 00:45:36

know it's a complex battlefield.

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transaction monitoring, and dynamic customer risk rating come into play.

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Tedd Huff: 00:46:11

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Lily: 00:46:13

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