02

Interview with Nick Elders: Customer Experience in Financial Services

In this episode

In this conversation, Nick Elders, co-founder and CEO of SPARK, discusses his background and journey into fintech. He shares the story of how SPARK–an ​​end-to-end solution for small business lending–was created, as well as the crucial role that the company plays in community and economic development. Nick highlights the challenges faced by SPARK and the broader financial services industry, provides an overview of SPARK’s future plans, and delivers some compelling insights into the potential of fintech in the coming years. Finally, Nick offers advice to those interested in entering the world of fintech and financial services.

Key takeaways

  • SPARK plays a crucial role in community and economic development: digital infrastructure for lenders, and digital partner for small business owners.
  • Traditional financial services often lag behind other industries in terms of user-friendly digital experiences—that’s why customer experience is a key focus for SPARK.
  • Distribution and awareness are major challenges for SPARK and other fintech companies.
  • The future of fintech lies in solving current problems and meeting customer demands.
  • To enter the fintech field, you must solve a problem that exists today and focus on creating value for customers.

Transcript

Rory Holland

Well, good to see you, Nick.

Nick Elders

Good to see you.

Rory Holland

Nick Elder with SPARK.

Nick Elders

Elders with an S – Elders – like plural.

Rory Holland

He’s one of the Elders. It works perfectly for you from SPARK. It’s so good to have you here and I wanted to start out, where home is for you?

Nick Elders

Home is two places. So I grew up in Washington State and in a very rural area of Washington State. So, and that kind of matters from a sort of dynamic ground, upbringing and background. Graduated with like 17 people in my high school class, played eight man football. So I was like, it was really a small little town, and then I came to the Twin Cities in Minneapolis in 1997, and so I’ve been in the Twin Cities since then, almost a resident. I fought through the coldness of Minnesota nice. It’s a passive-aggressive nice.

Rory Holland

So your town, I guess what’s something most people don’t know about it?

Nick Elders

So, I would say the interesting thing about Minneapolis that some people know, but most people don’t is the whole reason that Minneapolis exists is because of the flour industry. And there was a very large naturally occurring waterfall in the twin cities and of course, can we be controversial? Yeah, colonizers came and ruined it all and you know, turned it into basically a flour mill. So they could take advantage of the water falling down, use that to power all of the flour milling that was going on and taking all of the flour out of the Midwest and basically turning it into flour. So like, for example, like the Pillsbury A mill, like Pillsbury flour, is still there. They just recently turned it into condos. It’s like a dream place to go live, but it basically has the big A on it. And that’s like where, and then right across the river, not to be outdone, is Gold Metal flour. And so like those two huge flour industries are kind of like why Minneapolis exists. And then the other piece was James J Hill, who basically built the railroad west. His like robber baron idea, like that, was him. So, there is a whole bunch of backstory about that. 

Rory Holland

That’s cool. So we’re educational.

Nick Elders

Yeah. I’ve always been a fan of knowing why something exists. Yeah, and then it all just kind of spread out from there. Yeah. There’s really no reason other than that for Minneapolis to exist because it’s very cold in the winter. Like, I thought about that often. Like, OK, back up to like 1795, why is anybody here? How do you survive? I don’t know.

Rory Holland

I grew up in Detroit. So, I definitely can relate.

Nick Elders

What is the stat about the size of Detroit? Can’t you put like five –  like San Francisco, Boston, New York, can’t you put a bunch of cities in Detroit?

Rory Holland

Yeah. The footprint of metropolitan Detroit is one of the biggest cities in the country. And so hence the tax base it takes to support that infrastructure is part of the challenge that Detroit’s been under for years. Yeah. That’s been. That’s one of the fun facts.

Nick Elders

We did a lot of work in Detroit in my prior life, which was community and economic development. We did a Detroit home mortgage program in Detroit to kind of raise property values in Detroit.

Rory Holland

That leads me to, that’s a great transition into my next question, how did you get into fintech?

Nick Elders

Yeah so fintech, like most folks, I think is sort of an accidental career choice. I started out, I came out of college in 2001 and so fresh off the heels of the dot com bust, and fresh off the heels of December 11th, which I think were two kind of big events that sort of shaped the job landscape and what was available to folks graduating at that time. And again, back to kind of like the roots of where you came from, I was the first one in my family to ever go to college. So it was, it was a little bit, you didn’t really know, you kind of thought, well, oh, everybody that goes to college just gets a job. And so as a result, my job search didn’t go that well coming out of college and I ended up finding myself framing single family houses and then moved to the lucrative world of industrial sheetrock after that and kind of figured out I was making more money with my back instead of my brain and ended up reaching out to an old professor and was just like, hey man, I kind of got to get this econ degree that I have like active, what are some options that you might know of? And there was a small little nonprofit in downtown Minneapolis that was needing some sort of database intern to do a survey project. So kind of long story long, ended up where the Federal Home Loanmaker of Des Moines had sponsored a survey of all of their member banks to see if they could get into some sort of lending programs. And they hired this nonprofit out of Minneapolis called Community Reinvestment Fund to run that survey. And it was a paper-based survey and so we were the responsible, human beings of getting the paper. Turning into a database and making it searchable and all that stuff. And so that was sort of like what kind of dipped the toe in the water and I basically just refused to leave until they hired me. And at the time, CRF was pursuing a fairly innovative model that involved purchasing loans from other nonprofit organizations, pulling those loans and then securitizing them. So sort of bringing these for-profit ideas to the nonprofit sector and kind of turbocharging economic development, which I was like, this is sweet. This is exactly what needs to happen is to bring a lot more of these for -profit ideas to the nonprofit the profit sector because the nonprofits are just generally should be the second stop, not the last stop for any business owner that can’t get traditional financing. And so we started, there wasn’t a lot of software in the market for nonprofits that were buying loans from other nonprofits, pulling them and then selling them to Wall Street. So, we had to start building software out of necessity at a very early age and I got into that probably from 2002, 2003. 

Rory Holland

So, you started building software at CRF back then.

Nick Elders

Yeah, and we were pretty advanced for a nonprofit. We were using, one example, we were using virtual desktops that were served to you over the internet in 2001, 2002, which if the internet goes down, you don’t have a desktop. It was that type of stuff that was going on there. But we always felt like that was a better use than building out all the server architecture, hiring people to run it. All of that, we were sort of outsourcing all those costs to that model. And it worked fairly well. But then it got to a point where CRF just sort of advanced too far beyond what the service providers could provide because you’re sort of lumped in with all these other providers, all these other companies at the same time. And so we made the decision, and I kind of led the group that made the decision to sort of actually go down the path of building all of the infrastructure internally. And so I was sort of like, I kind of moved from this database role to more of like an IT admin role and basically built the entire server architecture and apps architecture and managed all the desktops and did all that work and then started writing the custom software in 2003. 

Rory Holland

So that, full disclosure, we work with Nick at SPARK helping grow their business. But we also work together at CRF.

Nick Elders

With Connect to Capital.

Rory Holland

Yeah, with Connect to Capital.

Rory Holland

Yeah, so tell me a little bit more about how that transition happened between CRF and then into creating SPARK and then. Yeah, so maybe a little bit before that, or as you do that, a little bit about SPARK so that everybody can understand what y’all are all about.

Nick Elders

Sure. So the story with CRF was, we started building a lot of, we got to the point where we needed to start pushing because what we would essentially do is create the standardization. It’s like loans made by, as you can imagine, like just say 10 different nonprofits, those loans are all going to look very different and CRF’s role standing in the middle between the lenders and the purchasers was to sort of create the standardization. And so that’s what we were building technology to do is sort of intake all of these different kind of loans from all these different nonprofits, normalize it, and make it something that an investor could get kind of get confidence in and sort of stand behind. And so where that led to and we were starting to push that out into ,we were getting ready to push our software that created the standardization out to the lending partners in 2007 and then the mortgage collapse occurred and that basically melted down the entire securitization landscape, there securitization just died as a business model and as a result, our software kind of died. But you sort of caught the bug at that point of like, oh, we can get, if we can get other people to use this, that will make our lives easier. We can gain more scale, more traction, get and turbocharged community economic development even further if we can get others to adopt it. And so that sort of caught the bug of like, oh, and you didn’t really know it, but you’re like, that’s a, that’s a software business model. And so that kind of died in 07. And then we became kind of like the dog chasing the car between 07 and 09 where we were like oh, I know we’ll go buy an SBA license and will become an SBA lender and that was, that was like the dog chasing the car, and then we caught the car and then like, what the hell do we do with this? And so we looked at SBA and said, well, this is just all rules, like there’s 700 pages of them, that’s a lot. But technology is good. At operationalizing 700 pages. And so a friend of mine from college, Eric Swenson, we just got started on basically, we kind of read the whole documentation, started building process maps, building process flows, helping people understand that this is how this was gonna work. And calling back to CRF’s roots of relying on technology and not people, we started building software to manage the SBA 7A process and that was really the beginning of SPARK. And that was sort of like 2010, 2012. And our first proof of concept was, can we get somebody to be able to collect this information online from a business owner? Because fintech had exploded at that point. A lot of companies were born in that 07, 08 collapse and they all kind of brought these innovative methods of basically interacting with the borrower directly versus coming into the branch or coming in to talk to us. And so we kind of looked at that and we said, oh, well, we can adopt that methodology in the context of an SBA loan. And others were doing that, too. So it wasn’t like a novel idea, but that’s where SPARK started. So now, fast forward, we’re probably like 2012 to 2014. We kind of go on a pretty massive build cause 2010 to 2012 was sort of like proof of concept. It was going to work, but then it needed, when we looked out at the landscape, we said, well, what, who else is doing this? And nobody was really doing it, everybody was doing like individual slivers of it, but nobody was really doing the full end to end. And we said, well, heck, that’s an opportunity. And so if we can get that right, we’ll get it right for the other 1,400 banks that are doing SBA lending. And that’s a built -in customer base that we can go attack. So there’s a business here. Now, if you could do it over again, I would not recommend to anybody to ever start a technology business inside of a nonprofit and then spin it out. It’s a… that’s a really bad idea.

Rory Holland

Yeah, I could imagine. So that was around the time I think that we started working around 14, 15, 16 maybe, so was that technology being used inside of CRF for Connect to Capital or was that completely different?

Nick Elders

So Connect to Capital, that kind of came about through work that Goldman Sachs essentially sponsored at the Opportunity Finance Network level. So Opportunity Finance Network is a membership organization for CDFIs. They’ve got about, I think at the time they had about a thousand members. And they would bring us together as a group and cohort and we would kind of brainstorm on ideas about how to essentially do this better. How to essentially be community development fintechs. And one of the ideas that we came up with as a group in a session was like, hey man, these marketplace ideas are really coming forward fast and that was Fundera was doing it, Biz to Credit was doing it. A lot of these places where you could go and search for capital and then get matched up to a lender, that was something that was gaining traction, but there wasn’t one that was focused on CDFIs. And so we thought, well, heck man, what if we, what if we put together that marketplace idea of matching small business owners with CDFIs and there could be one front door to all 1,000 or so CDFIs that wanted to be a part of it.

Rory Holland

If those listening might not know, CDFIs are…

Nick Elders

Community Development Financial Institutions. So it’s a division of the treasury. You have to gain certification by the treasury. It’s a mixture of both loan funds, banks, and credit unions that can all gain that certification. I think today there’s probably about 2,000 or so institutions that do that that have that certification today, but you have to lend to 60% of your loans have to be in women minority veteran owned businesses or to low income targeted populations, LITP. The government is never good at acronyms, but that’s generally how it works.

Rory Holland

And so tell us a little bit about SPARK, where you guys are today and then the market you serve.

Nick Elders

Yeah, so our whole idea with connected capital and SPARK together was we would create this essentially like high-functioning infrastructure for community and economic development that could serve a variety of constituents, but essentially, think about if you’re going from left to right, small business owners coming from the left being able to find sources of capital and then, what would happen if we were successful in that endeavor is everybody who’s going to serve those small businesses would need digital infrastructure to operate. And so sort of connected capital was kind of serving as like the front door and then SPARK would serve as the origination engine for all of the essentially nodes on the network and then that would kind of go out the back door, create all the standardization to investors on the other side. So it was sort of this like end to end systems thinking, infrastructure thinking idea. And SPARK was really what kind of made it all work from sort of like the middle out. So you would make no sense to sort of flood the network that can’t execute like that. That makes no sense. So that like the network needed to be and still needs to be established that comprises of, you know, sort of like the full depth and breadth of products and services that small business owners need. So that means you need banks. That means you need credit unions. That means you need CDFIs. That means you need this whole variety of lenders running on that operating infrastructure to be successful at coming in the front door. And so what SPARK is doing today is assembling that network of lenders that can serve the needs of a small business owner and essentially being their digital partner. And so today we serve a combination of banks, credit unions, specialty lenders, non-banks, there’s a variety of customers that use it today. From an activity standpoint, we’ll probably fund, the network will probably fund somewhere between three and five billion of SBA loans, and it will probably fund as equal amount of non-SBA loans, so conventional, fleet and equipment leasing, term loans. Essentially, every loan product, if you go onto a modern banking website, and you click the business pillar and you’ll see things like term loan, lease, conventional loan, commercial loan, SBA loan. We want to run all those process flows for our customers.

Rory Holland

And so what is the, how would you describe the biggest problem that SPARK is solving?

Nick Elders

Yeah, you know, I would say the biggest problem that we are solving today is customer experience, which I think, I think there’s still a long way to go in traditional financial services. I still don’t think banks understand and others don’t understand that when you come to a digital presence, somebody’s digital presence online, a customer makes an immediate value judgment right away. Like it’s the first thing that happens is like if it’s confusing, if it’s hard to navigate, if we don’t understand how it works, if I can’t engage, if I have to go into the branch, if it’s an inconvenience in any way, people are going to stop. And you have to think about as a user of technology, things like Airbnb, Turo, like all of these experiences that are just designed to engage you and have you act, I don’t know why financial services and lending is still so far behind that curve, but SPARK is essentially serving as the digital footprint for allowing a customer to engage directly with you. And that’s one that we’re solving. I think we’re also solving for data. We’re solving for decisioning. We’re solving for documentation. We’re solving for process. We’re solving for expansion. We’re solving for future proof. Like there’s all of, there’s probably far too many solutions that we are bringing to a customer that we could, with a partner, that we could do a lot better job of positioning ourselves as what we are actually solving for. Because I think like we’ve talked with, it’s interesting, we’ve talked with investors before that have said, man, you guys have got like, you have like six companies in here. We’re, you know, we have like Dropbox, we basically built our own alloy, not Alloy Labs, but like alloy, the process flow, the automation engine. We’ve built our own web forms. We’ve built our own, you get a lot with the software. And I think what we experience on the other side of that is apathy. That’s the thing that I think we fight the hardest against is this idea that what we have is good enough.

Rory Holland

What we have is good enough. Yeah, and I think that’s one of the most frustrating things that we see in the industry if I speak for kind of some of the things we’ve talked about in the past, and what we see is there’s not enough of that adoption fast enough because the software is there, and you can positively impact your customer base and serve them in a more meaningful way and fulfill on the promise of getting more people funded loans,  loans funded so they can go out and start operate or scale their businesses in those underserved communities. But it doesn’t happen fast enough.

Nick Elders

I think what I think would be a very interesting social experiment is what we learned during PPP. So, Paycheck Protection Program. We found out really quickly that banks and others can make decisions, they can adopt technology, they can rapidly scale, they can do all of these things that in normal times they say they can’t. But they can. I think it’s the opportunity, do they see the opportunity there? Do they see the external factor forcing them to act? Like that’s, I think, what is missing from the equation today. And I think you’ve seen that in the rise of these sort of non-traditional sources of capital that are not banks, that are not traditional financing, I think you’ve seen the growth in those sectors. It seems like everyone’s just willing to cede that to these other sort of non-bank lending entities and be like, OK with that. And I don’t know that private equity, private capital, private lending is going to be what is good for society broadly. But that is what is effectively happening today.

Rory Holland

PPP was that forcing factor that forced us all to make choices. And it did expose the fact that banks can move pretty fast.

Nick Elders

And I think it exposed the people that were not… that didn’t that weren’t technology forward suffered mightily. They burned their people out. They burned their processes out. They burned it all out trying to just basically just trying to serve the customers they had, trying to get their own customers, PPP loans. Yeah. Like when you didn’t have a digital partner, when you didn’t have somebody like SPARK who was, you know, basically our job is to operationalize the whole program. For you and bring that opportunity to you. And we did that for all of our customers.

Rory Holland

Yeah, I remember, we used to work with a number of CDFI lenders, as you know, and I remember thousands and thousands and thousands of applications flooding in and just asking us, can we stop? Can we stop it? Like digitally, could we just pause? And in some cases we had to just because they couldn’t process and it took weeks for them to catch up. Yeah. 

Nick Elders

I’ll never forget the first day that we had a customer turn on an acceptance form and face it at the internet for PPP. And they were kind of like the Chaos Monkey profile, they just didn’t know what they didn’t know. And we advised against doing it and we said, hey, like, this is a bad idea. And sure enough, they didn’t listen and they exposed us to the world and every business owner in the world seemingly found this thing at once and started just plowing their information into it. And they get us on the call. And they’re like, hey, this is happening. And we’re like, yeah. And we’re trying to troubleshoot. And they’re sharing their screen. And I’m seeing what we typically do is when somebody submits an inquiry, we’ll do an email notification to a lead manager to say, hey, you got a new inquiry. And this guy has his inbox up and on the refresh interval for Outlook, which is every five seconds, 12 emails. 

Rory Holland

Oh, goodness. 

Nick Elders

16 emails. 12 at a time. They’re just flowing in. 16 more. Yeah. 10 more, eight more. And this is like in five minutes, he gets probably like 400 apps in like five minutes. And you’re like, they wouldn’t get 400 apps in a year. Yeah. How do you process that? Yeah, exactly. And so that, but that there again, without a digital partner, you know, we started building all of these tools to allow people to like bulk process and bulk move and bulk, you know, tech, that was the power of technology is you could take a small team and process a massive amount of impact quickly, submit it to the SBA. And, you know, we had people that we had, sadly, they’re First Republic. You know, when they talk about customer service, they would get their borrower on the phone, do a Zoom call, and they were using our tech, and they would say, we’re going to submit your PPP loan to the SBA and get your funding for you. And they’re like, no way. And then they would like they would share the screen they would pull up SPARK, go to that person’s loan, submit to the SBA, a loan number comes back and they would say congratulations your PPP loan has been funded, people start crying like, that was the good stuff.

Rory Holland

That’s the good stuff and I think that the media doesn’t share enough of the positive stuff. And there was so much, I remember thousands and thousands of business owners that would have really suffered and or lost their businesses in some of the communities across the country survived as a result of some of the work SPARK did. You had mentioned forcing factors, we talked about adoption. What is one of the biggest challenges you’re facing right now?

Nick Elders

Yeah, I think right now, the biggest challenge that we face is the scale question that I think most businesses like ours suffer from. We’ve invested wholeheartedly in product. We continue to do that. We continue to invest in capability. Distribution is what we typically suffer from right now. And that’s not unique to SPARK as a technology startup. I mean, we’ve been around conceptually for a while, but really only as a company since October of 2020.

Rory Holland

Yeah, it’s fairly recent.

Nick Elders

So it’s fairly recent that we’re kind of off on our own, out in the ocean with the boat we have. So distribution, I think, is probably the hardest thing that we struggle with. And there’s a variety of reasons for that that I think we can solve for, but that I think, you know, we compete against companies that are much more heavily funded than we are and so you really have to be scrappy you really have to like meet people form relationships form partnerships I think we’re still in our infancy as it learned it was as we learned how to partner that’s that’s something that I think we can spend some time on but it’s hard because it’s like I don’t think it’s the product, like the product is amazing. I don’t think it’s the team. The team is ready to go. It’s really adoption that I think we struggle with the most.

Rory Holland

Sounds like awareness and adoption. Enough of the market doesn’t know yet about SPARK.

Nick Elders

Yeah, and you’re kind of like, well, what is going to work? Because I think we would be willing to, and that’s the age old question for all businesses, I think is what will work? But we’d invest in whatever we know would work. I don’t think we have any challenges there, but it’s difficult. I mean, interesting from your perspective, too. I mean, you’re trying to help companies like ours penetrate this segment and it’s really difficult. I don’t know how, it still seems to be, I guess there aren’t too many banks around yet, but it still seems to be a very closed off network, where if you know somebody or if they know somebody that knows you and they make a recommendation, that’s generally what will win the day.

Rory Holland

Yeah, that age old referral, we hear a lot, how do I build a referral network to fill my pipeline?

Nick Elders

But referrals aren’t scalable. They just are not.

Rory Holland

It’s like a component of doing great work. And that is a question I want to ask you too, is knowing SPARK the way that I know you guys, what is one thing that people don’t know about SPARK that you’d like them to know?

Nick Elders

Gosh. I would say, I think the one thing that’s really interesting, when we started off with SPARK, it was probably right at the time, there was a strong focus on SBA as the thing that we did, that we did really well. And that was the messaging that got out in the community and so people know us for that, and they should; we’re gonna do a lot of it, and we’re gonna continue to be the best at SBA that there is. I think the thing that we want others to know is that we do a lot more than that and that there’s a lot more yet for us to do. So I think, you know, we talked a little bit about it in the beginning with the numbers, but we’ll do as much non-SBA as we will do SBA this year. And conventional teams, we’ve had many say, well, gosh, we didn’t even look at you guys because we didn’t think you did anything other than SBA. And it’s like, well, hold on. Like, no. I mean, we’ve got a customer down in North Carolina, the Bancor, and they started with SBA as their primary business line in probably 2019. Shortly thereafter, they brought their fleet and equipment leasing team to the business in 2020. Then, they added their institutional banking team to the business. Now they’re adding their fleet, their wholesale lending business, and no purchase business to it. So it’s like, this thing just continues to expand where you go, we’re now running their entire pillar of the bank and like, that opportunity exists for every customer of ours to continue to expand and have this kind of like one platform for all inside of business banking. That’s really what we want to be. And so I think the more people that know that about us, the better in terms of as far as I could tell.

Rory Holland

Awesome. We’re going to make that happen.

Nick Elders

Yeah. Absolutely.

Rory Holland

What’s next for SPARK? And the follow on to that is what do you see what’s next, the two, three, four, five years of fintech?

Nick Elders

Yeah, so for us, I think we get pushed, so again, we sort of sit in the middle. We’ve stayed in our lane generally in terms of origination of a loan, which arguably is the hardest part to get right. If you think about the variety of inputs that come into an origination system, you’re basically creating the standardization and agreeing to what’s going to happen in the future. Well, we don’t track that future, meaning we don’t track the life of the loan. So sort of like what happens when somebody agrees to do a 10 year term loan. Well, we’re outsourcing that servicing to somebody else. In the case of a bank, it’s a core system. In the case of a non-bank, it’s a servicing platform. Um, I think one of our thrusts that we want to make is to head into that journey. So, the ongoing servicing obligations that a lender has to a business owner and support that experience digitally the same way that we support an origination journey. The challenge is of course we sort of like we don’t ship crappy products. So that has to be a really good experience. We can’t just fall into that accidentally. That has to be very intentional. We’re also getting pushed to go the other way. So the traditional banking sector is still run very heavily and depends very heavily on loan brokers of some kind. And so we want to help more brokers equip themselves with the front end of SPARK to feed the origination engine. So that way we, again, we can get, because we’re powering traditional finance, we’re not interested in powering predatory lending models. We’ve said no to a lot more of those folks than we’ve ever said yes to, like we’ve said no to all of them, as a matter of fact. We want more people using the traditional financing ecosystem but serve the needs of small business owners through that network. Meaning, for prime customers, those are going to go to our banks. For less than prime, those are going to go to our CDFIs. That’s really the vision that we’re trying to paint. And so you’ll start to see us head more towards the front end, empowering more brokers, essentially feeding that network. You’ll see us probably scaling the network itself. So more CDFIs, more banks, more credit unions, etc. And then you’ll probably see us move into the servicing journey because once we do that, we can start feeding, we can start understanding, we’re creating a data stream now because we’re making origination decisions. We’re sort of setting that borrower up for a relationship. Well, if we can get better at knowing the outcome, then we can do this like recursive self-improvement of knowing how these loans performed and better feed the front end of the engine so that we can inform the decisions that are being made at the beginning.

Rory Holland

Yeah, that’s great. That’s good. That’s a big vision. Where do you see fintech in the next five years?

Nick Elders

I think you will see some of these, because again, we talked a little bit in the beginning. What’s missing is this force that’s acting on fintech, on the traditional fintech sector. And banks, yes, are in there, but I think you’ll start to see pressure, more pressure, I think, from Amazon, more pressure from Apple, more pressure from some of these Google, perhaps, some of these larger businesses that can move into financing. They already have in a lot of ways. But I think you’ll start to see more of that pressure force these people that have kind of seeded some of that activity to try to pull it back. Banks, CDFIs, credit unions, etc. they’re good at lending. And they’ve been good at lending. Lending has been going on for thousands and thousands of years. It’s not new. But people that are good at it, I think if they can just move away from this good enough mindset to one where we want to be the best, I think you’re gonna see that happen in the fintech sector and it will take companies like ours, Numerated, and CNOTE, if they ever get their act together, folks like that to power this next generational shift. But we look at it from a customer experience standpoint. Because again, if you think about your daily life and what you’re surrounded by, I mean, this thing, like financial services is in here, but it’s not in here to the degree that some of these other experiences are. And I think that will happen. It’s already happening in some ways, but customers, I think, will begin to demand it. And whether the segment can meet the demand, that, I think, is the big question for fintech, useful fintech. I don’t think that you can change anything from the outside. I think you have to change it from the inside, personally. And that’s kind of what we’re doing. We’re trying to do.

Rory Holland

So a couple more questions. What advice do you have for someone wanting to enter the fintech field? If you’re thinking about your old self.

Nick Elders

Yeah, so I still think entering the fintech field the way we did makes sense, meaning either incredibly smart or incredibly stupid we have yet to figure it out, but like we chose the hardest thing that a customer could deal with, the origination of an SBA loan, and we did that really well. That I think, I think solving a problem that somebody has today will set you up to then work on your big grand vision of how you can change the world. But you have to I think start with a problem that somebody has today. Like building a generative AI model that can read the SBA SOP model and spit out recommendations is fine, but it doesn’t make any sense unless you have then this is how you go actualize that. So unless you’re just trying to, I’ll stop. But I think that solving a problem that somebody has today is, so a good one, here’s a free one, somebody needs to build a microsite infrastructure that banks and like a sidecar brand that banks can just adopt that is an all in one solution that has lead forms embedded in a microsite with a modern digital core, like that needs to just exist. Because I don’t, I think it’s very difficult to say, let’s go change 110 year old brand and push it into the future. It’s just not going to work. Like, but you can start a brand separate and apart from your 110 year old brand that is different, that is built on modern technology and wire it to the old one. That I think is an idea worth pursuing.

Rory Holland

Yeah, and that’s, that’s something we’re seeing more and more. Companies coming, wanting to create a new brand or a new identity that is an offshoot of the core brand to do some of these newer things.

Nick Elders

But I think where this, where this starts to fall down, these like great ideas is that doesn’t create shareholder value immediately. And shareholder share price is what determines a lot of decision making in these public companies.

Rory Holland

Yeah, and that’s a whole nother conversation.

Nick Elders

That’s a whole nother conversation.

Rory Holland

Yeah, for doing what’s right, doing what’s good, what’s going to move this country forward and the global economy forward, I think there’s a lot of decisions that need to be made in investing what’s invested in for the greater good that might not be shareholder value.

Nick Elders

But that’s where the public benefit corporation comes into play.

Rory Holland

Yeah. Well, it’s been great, man. I really appreciate you coming.

Nick Elders

Appreciate you having me.

Rory Holland

So good to have you here in Austin. Yeah. Look forward to a future conversation.

Nick Elders

We’re going to have to go see if La Barbecue is open yet.

Rory Holland

Oh, yes. I know there’s probably a line. Good choice. Thanks, Nick. Good to see you, brother.

Nick Elders

Good to see you.

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