Building a Fintech Partner Ecosystem

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You're listening to Leaders and Lending from
Upstart, a podcast dedicated to helping consumer

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lenders grow their programs and improve their
product offerings. Each week, here,

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decision makers in the finance industry offer
insights into the future of the lending industry,

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best practices around digital transformation, and
more. Let's get into the show.

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Welcome to Leaders in Lending. I'm
your host, Jeff Kellner. This

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week's episode features my conversation with Kurt
Kreus, the president of Coastal Community Bank.

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Kurt and I cover a lot of
topics, starting with his family connections

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to the banking industry and his long
tenure there, how he came into banking.

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We dive into some of his beliefs
about AI, the future AI,

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the importance of engaging in fintech partnerships
for community banks, why they've engaged at

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Coastal and quite a large number of
them, how they manage those and kind

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better at managing the fintech relationships and
process says, both relationships and due diligence

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processes over time. And we dive
a little bit into what brought them to

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build a site in the metaverse,
why they think that's important, what they're

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learning from it. It's fascinating.
It's probably the first metaverse banking experience I've

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seen, and of course I went
in experience after talking to Kurt. We've

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covered a lot of ground, a
lot of interesting innovative topics that are off

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people's mind. So I think you
all enjoy, so please enjoy this conversation

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with Kurt. Kurt, thanks so
much for joining me today. I appreciate

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you making the time and welcome to
the podcast. Thanks, Jeff, it's

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great to be here. I'm looking
forward to this conversation. We had a

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wide ranging conversation advance, but I
kind of like to start with all my

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guests just talking about how you got
into the business and how you got to

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where you are. And you've got
a little bit more more history in the

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space than the most I talked to, so it's great. Yeah, so

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you just called me old as when
I heard but that's okay. No again,

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like we've been involved in this,
fit's like a family business for you,

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right, like you came you came
by the question honestly, Yeah,

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yeah, I actually I did because
my my fault, my dad was a

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banker and a small community bank in
New Orleans where I grew up and so

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you know, as a teenager,
I think I was about fifteen sixty.

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My first job at a bank was
sitting in the back office at his bank,

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running a coincounting machine and stamping mail. And then you know, at

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some point I graduated to to the
micro fish machine and the and the proof

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machines. Eventually then I became a
teller, and I worked as a teller

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through college and you know, graduated
an accounting but despite that, I remember

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I was in college and accounting major, and my dad said to me,

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uh, you know, at one
point says his son, whatever you do,

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don't be a banker, you know. And of course that's what a

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fight in my head because I was
the rebellious team, you know, with

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that kind of head knocking um relationship
with my dad, and it's like so

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in my mind, I remember,
you know, oh, I'm going to

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be a banker, and I'll be
a better banker than you ever are,

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you know, and so that that's
put me on that path. I don't

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think that was his intention, but
uh, you know, I got out

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of college, went to work for
one of the biggest banks in the country

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at the time through a management training
program, in the early eighties and you

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know, so now I've been and
you know, if you count that college

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graduation, I've now been doing this
for forty years, and which does make

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me old so or at least I
have a even at my age. I

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have a ten year old son and
he told me, don't worry about it

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dead, you're not old to year
sixty five. I said, well,

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that's good to know, so thank
you. So I know where the line

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is now, Well, yeah,
your son's got to call my sons,

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because my sons are pretty convinced I
crossed the line a long time ago.

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Uh, I mean gray hair.
They pops in, They go, I

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dad, you look a pretty old
man. Okay, right, right,

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right, But it doesn't matter.
M I was gonna ask, have you

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ever taken that that that reverse psychology
experience and actually tried to apply it in

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the positive with your own kids?
I always think about I should tell my

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kid not to do that I want
them to do, but I always worry

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acquire on me in the one instance
where I wanted to work. You ever

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tried to use that in your favor
with the kids? You know, I

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can't think of any time, but
because I'm a bit you know, sarcastic,

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right, and so my as my
kids grew up there, it's funny

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to watch young minds try to do
sarcasm because it doesn't come out of sarcasm,

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it comes out as mean. So
so I've tried to kind of temper

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my sarcasm. So so I think
I'm kind of stay away from the reverse

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psychology in case I might teach them
something that they shouldn't be doing. So

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I kind of temper it. Yeah, I always think about using it with

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my teams, but I go,
I don't know, if I tell them

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to do the thing I don't want
them to do and then they do it,

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yeah, then no other way do
I really had And you know the

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funny thing you so go back to
my dad is you know, so I

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got into banking and and his bank
actually ended up failing. It went under

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in the early nineties. So some
years later, um, and it was

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just a big downturn. He had
too much real estate concentration. But but

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you know, I was still earlier
in my career and then he just suddenly

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died, So you know, I
never got that chance for him to watch

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my career. Um, because when
he passed away, unexpectedly it was,

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you know, I was still in
my early stages. So yeah, you

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always wonder, you know, what
he would think about the twists and turns

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that I've taken, because I've gone
from you know, I've been in lending

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for a long time, commercial lending, corporate lending. Then you know,

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went for work for a startup,
you know, on the credit side,

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and now you know, I'm I'm
working president of a bank that's deep into

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the banking as a service, right
and and partnering with FinTechs and some more

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of that technology stuff. And so
it's been an interesting path. And you

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know, now when I got to
the role, you know, he was

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president CEO of his banking. When
I got to that role, it didn't

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feel the same like what he was
as a banker, right, I mean,

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everything was face to face. And
I remember the first teller job I

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had at his bank. If somebody
came up to the tailor window that I

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didn't know to cash a check on
the bank, we didn't even have a

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online system dummy terminal that I could
check. I had to go to a

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dot matrix print out on a counter
behind the teller cages and look up the

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account by hand right, and then
match it and see if they had enough

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money as of yesterday's clothes to cash
the check. So, you know,

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as far as technology goes, I
mean, I've watched all the evolution and

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it's interesting because it's an industry that's
always been deeply admitted with technology. But

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you know, now we're a whole
different space. Yeah, I want to

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dive into your fintech partnerships, But
first the comment you made about it,

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you know, it didn't feel like
it like it did when he was in

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that rot, And it always reminds
me that there's this there's two elements to

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that. I'm curious your thoughts on. One is the world changes between A

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and B and the nature of the
role or the experience is different. But

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I also think there's a particularly for
younger employees, more junior employees, all

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say, looking up the chain and
you kind of have this perspective of what

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it must be like in that person
knows all the answers and how's the confidence

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and does whatever? And then like
when you sit in the chair, you

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go, it does not feel sitting
in the chair the way I felt that

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it was when I was looking at
the person sitting in the chair, it

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feels it feels very different, so
that I don't think that's just because the

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world has changed between amb but the
experience of sitting in a given role,

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I don't think ever feels like what
people think. It feels like, particularly

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younger employees are looking up going hey, it's must be amazing to be there

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to go, and it's a little
different than when you actually get there.

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It never feels like what you expect
it will. I think at least that's

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been my experience. Yeah, I
agree with you one hundred percent. I

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you know, surprised after a while. You know, after I've become see

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you of a bank years ago,
and you know, after some time you

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realize, like, gosh, how
I am spending my days and it's just

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completely different, right, I mean, just things like dealing with the board

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everybody. You know, if you've
ever been in primary contact for boarder directors,

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you know that that's a whole thing
in and of itself, right,

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And then people that aren't doing that
don't understand that's a job itself managing.

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Right. Um, If you're privately
held versus publicly held, and I've I've

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worked in both environments, you know
you either have. If you're privately held,

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you have a key stakeholder that's you
know, got their own personality to

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do. With your publicly held,
you've got the markets to worry about,

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and you know you've more and more
of that stuff comes away from just fundamentally

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the job that you did to get
there. And I always tell people when

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they when they're at a certain point
in their career, when they're making that

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shift between management and leadership, you
know, and it's like, um,

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when you turn turn to be a
good if you want to be a strong

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leader, you've got to stop doing
the work you're doing right to some large

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extent rights if you if you made
it for me, I made most of

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my headway was being a credit you
know, a person right, a hunter

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scanner finding credit, you know,
corporate business threat, then a credit executive,

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and then you know, so on
another side of it, and and

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you know, you get to a
point where the things, the mechanics that

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you've got you there, things that
got you that position, you have to

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let somebody else do. You have
to lead them and you have to point

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because as a leader, you've got
a set vision, right, remove the

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obstacles and martial resources you know,
it's as simple as that me. So

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you know, um, that's the
hardest thing because the work is different and

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technology, I think we can see
the same thing. Right. It's like

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if you go into work every day
and your whole world is spent in your

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inbox and something's wrong with your work, set them with your infrastructure, right,

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you know, So people will feel
they'll be buried in keystrokes and things

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all day and they'll go home and
they're tired. It's like, oh,

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I worked hard today, but did
you move anything forward? Right? And

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if you didn't move anything forward,
did you really do what you're getting paid?

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It's a hard question. Yeah.
I always tell people if you,

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uh, your inbox is somebody else's
task list for you, and you don't

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want to spend too much time accomplishing
somebody that's somebody else. That's a whole

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bunch of other people's priorities for what
they want you to do. And maybe

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they're the right ones, but it's
your job to figure out what the priorities

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for you to do are based on
your your responsibilities and goals, and they

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may or may not be. I
was gonna say, similar to what I've

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called it, which is the ping
pong match, right, you know,

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you just kind of keep itting the
ball back and forth, and you know

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somebody's got a got a point to
an owner and say you go do this

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right and then report back and hopefully
in an automated way, not an email.

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But I feel like we're getting the
best career advice adventures. One of

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the things that I've always found is
that being willing to be the owner to

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step up and go I'm not gonna
ping pong it back or give you an

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opinion or say I don't like that, but say, hey, I will

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take this and own it and finish
it and bring you a completed product is

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a really powerful It's risky, right, I mean it feels risky to do

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because there's a you don't know how
always that you can manage it. But

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there's a lot of power. And
some advice for me to younger people's like,

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if you're willing to take on that, respond to I'm just going to

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take this thing and solve it and
manage the back and forth and come up

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to an answer. There's a lot
of value created and the people who are

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willing to to grab a hold of
things and do that because there's a lot

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of like gould throw my two cents
into the into the ether and like let

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it ping pong around and go with
other people. But nobody wants to own,

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you know, come into resolution on
a question or a debate or or

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a problem, and that's like a
lot of power and be willing to do

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that. Yeah, I think you
know, when you think of automation and

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for banking and a lot of industries, right, we think we're digitizing,

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right, how do you turn into
a digital organization? Right? I think

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the core in the back of it
for me is is you know there is

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a deep ownership necessary um when you're
doing this, when you're making that transformation,

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which you find is that um that
that you know, finger pointing and

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bouncing things back and forth across the
wall feels natural because banks kind of the

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vault the devolved probably into deep silos. I mean you look at traditional banking,

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it's very silo. And then when
you look at modern frameworks like agile

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and things like that, right,
it tries to break all apart. And

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when it works, it's amazing to
watch self forming teams and teams coming together

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and people taking ownership and when you
know, when people aren't scared when there's

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a safe space to take ownership and
fail at it or run into obstacles and

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but but fully informed, and then
you have the ability for leaders and then

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you know, help move things along
and get it going in the right direction.

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That kind of forward production is amazing
to watch when it gets traction and

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it takes just what she said right, And I've been saying this for years,

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or you know, ownership deep ownership. Don't be scared if you have

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people that take ownership career advice,
here, you go right, be the

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one that raises a hand to own
things. Take that risk, because those

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are the people that leaders pay attention
to, not the ones that talk the

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most in the meetings, not the
ones that have the fancies for power points,

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but the ones that actually will take
a burden, own it and get

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it to completion. Hey, Sarah
buch here, the VP of Consumer Lending

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at First Federal Bank of Kansas City. A few years back, our executive

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team knew we needed to grow our
unsecured personal loan portfolio, so we turned

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00:13:31.399 --> 00:13:33.919
to upstart. Three years later,
I am proud to share that we've scaled

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our loan volume target from five hundred
thousand a month to twelve million a month

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and acquired over a thousand new customers. If you want to hear more about

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our partnership, check out the full
case study on Upstart dot Com Forward slash

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Lenders. Once again, that's Upstart
dot Com Forward slash Lenders. All right,

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let's get back to the show.
All right, we've wandered a long

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way. But you mentioned the kind
of fintech partnerships, and I think it's

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true that you have more fintech partnerships
than you do branches. So you guys

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are on. You talk about banking
your service, but talk to me a

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little about the your approach and how
you view you know, why you've pursued

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that number of fintech partnerships and how
you think about them and managing that.

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Yeah, you know from the coastal
bank. Coastal Community Bank comes from a

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very traditional place, right um,
And right now we have fourteen branches here,

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um, you know, in the
Snowhomage County County area or Seattle and

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very strong community bank I mean really
strong, um. But you know,

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as as leaderships saw and the board
saw the transition and being up here in

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this tech space probably helped. I
mean one of the initial stories that I

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really love is that you know,
somewhere around two twenty thirteen, the Microsoft

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Gaming division and came and talked to
the leaders here at Coastal. Is that

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you know, we were thinking about
offering checking accounts to the to the player,

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right, the customers and the gaming
side. UM. And this is

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you know before bass banking as a
service was you know a term. And

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so they went down, they went
down that pathway and it ended up not

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coming out to be a business model
that ended up getting pursued, but it

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was an interesting kind of for it. And in the bank. You know,

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as most community banks, I go
to banking conventions, everybody's like,

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we're going to find new revenue.
Would being disintermediated all the different threats and

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yeah, you know, slowly but
surely consumers of all ages, right are

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assuming more and more products or more
and more places, um. And so

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you share the wants going down and
so you know, Coastal pivoted to play

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in the space and try it out. Took the fundamentals of operating a good

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community, strong community bank and put
those into play and through connections were growing.

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We now have twenty seven active partners
UM and they they range from FinTechs

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from early stage all the way to
mature brands m and growing and we're still

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growing um and with it, you
know, you you've had to kind of

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endure massive change, evolve into it. But really the view of acquiring and

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delivering, So coming from a family
that has a community banking background, right,

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UM, I still believe very deeply
in community banking. Um. When

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my dad did pass away, suddenly
went to his funeral and they're like over

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four hundred people there and asked,
you know, one of his friends are

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like, who are all these people? And it's like, well, these

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are people that you know, your
dad touched their lives, helped them out

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at some point, you know,
through the bank. And that's the lasting

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impact, you know. And I
think the opportunity is can you take the

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best of community banking, which is
really always fundamentally treated by getting to know

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the customer better and take that digital
sphere And I think the way to do

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that through modern technology, you know, things like AI and mL and data

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management and really getting to understand the
persona and then taking that very personalized kind

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of approach and delivering it. Well, the problem is if your community bank,

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what budget do you have to create
the new models, raise the money

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to go a chore, customers the
light and right with the biggest bust the

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size developing your model is acquiring customers
for a startup, right, especially if

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you're doing it a digital sphere um
And I think so the pathway of joining

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the two has made sense for a
long time for me. I know,

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we've gone back and forth in our
in our industry about you know, our

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FinTechs and banks competitors, are they
partners? They think where everything, you

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know, we're all part of the
same ecosystem is moving forward, and we

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just got to decide how to how
to play in that ecosystem. So Coastal

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made that decision and has been very
successful at it over the lass. What's

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your advice? I mean, I
feel like this is an area where lots

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of institutions are trying to build relationships
or partnerships, and I often hear from

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from banks and credit unions when I
talk to them that there's this challenge.

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There's there's kind of multiple challenges,
right, There's like how do I find

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the right partner for what I want? How do I diligence? Especially if

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you know, we'll talk about AI
maybe in a minute, but if they're

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doing things that I don't fully understand
and like I don't have expertise and understanding

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it. And then there's this third
part, which is like I see too

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many agreements. I think that gets
signed, and then like how do I

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go actually get how do I go
make this thing work and operationalize it and

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get to a rhythm and so walk
me through little bit how you how you

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think you guys do that effectively?
They're like finding the right partner, you

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know, getting through understanding, not
just first round, but like is this

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a good partner in managing those relationships
for success or long terms. I see

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a lot of failures at every step
along the way when financial institutions try and

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partner with you know, startups or
fintech type companies. Yeah, it's an

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evolution, I think, and it's
still happening, right, We're still learning

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constantly and as we are going through
it. Matter of fact, we were

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just talking internally about, you know, having a refresh on our due diligence

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protocols and kind of because we're there's
constantly new topics coming up. Of course,

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the regulators are great at throwing new
things on our plate as well,

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and concepts we had and maybe thought
about yet or maybe we thought about we

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weren't ready to address. But I
think the advice I I get is,

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um, you know, do there's
a lot of strong players in there.

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First of all, get online and
go go on LinkedIn and social media or

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Twitter where every you know, and
and start following some thought leaders and really

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start understanding space better. I mean
that's did that years ago. Uh,

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you know, connected and read voraciously
and you know, learned as much as

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I could. So don't sit back
as a leader part of the leadership team

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and find somebody young on your team. And since you as I said,

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hey, go run with this and
bring it back to us, I think

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that's not going to work. The
second thing is, you know, understand

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where you are the problem with a
lot of community banks, I think when

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it comes to tech right, they
have an infrastructure is not ready. Um.

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And so if you're gonna, if
you're gonna do it, you can't

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have a glorified kind of it desk
with a leader in your back back cup

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ground. And I think you're going
to be able to go and start addressing

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all these issues because at some point
you're going to be dealing with data and

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data ingestion and data management. UM, if you're going to do it right

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and you need a certain expertise,
you don't have to build a whole development

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team. We have, we do, and we will, but you don't

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need that. There's lots of intermediaries
that can help you along the way,

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and then you know, get get
the good consultants along with you to kind

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of help you, kind of guide
you in this. It's it's mature enough

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that there's experts. You have to
spend some money, you have to invest

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in it to get there, and
then experiment on a small basis until you

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get comfortable. And it's it's hard
to give general I do talk to a

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lot of executive leaders of banks.
We feel coastal bank, we feel we

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want to grow this ecosystem because we
think it creates stability and certainty to this

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world. So we are inviting constantly
encouraging other banks to get into space.

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Which seems weird because you think I
do have some other leader bank leaders that

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are in the bass space or such. There's like, oh, we're going

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to go in at early and strong
and control the market. I'm not sure

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because I think it takes layers and
layers of expertise and partnerships to get this

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done. I believe it's a deep
and big partnership game. And if you're

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going to do that, you know, um, I believe you need a

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strong ecosystem, which means strong players
throughout that can handle all the various things

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that can come up. So,
you know, I think we were we're

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in a very you know, infant
kind of stage of this. We've got

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a lot of growth to go,
um and you know, I welcome a

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lot more people in, but invest
in risk and invest in technology, invest

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risk. And the other thing you
mentioned that that struck that struck me was

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that you're in the middle of revamping
your due diligence protocol. And what occurs

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to me is I think many,
for many institutions to end up in the

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perfect is the enemy of the good, Like they're waiting to feel like they

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know what they're doing to get in
the game. And I feel like,

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you get in the game and you
figure it out, not that you don't

333
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want to have a plan, but
that you know what they say about plan

334
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no, No plan survives, no
battle, plan survives first contact with em

335
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Like you're gonna have to adapt to
the reality. You're gonna learn from doing.

336
00:22:29.200 --> 00:22:30.039
And so the kind of the best
way to get good at it is

337
00:22:30.039 --> 00:22:33.359
to so I some of the kids, you want to get good at something,

338
00:22:33.400 --> 00:22:34.359
you got to you gotta do it. You're not gonna start off good

339
00:22:34.519 --> 00:22:38.759
or having all the answers. And
so I think that's a something I heard.

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00:22:38.759 --> 00:22:41.880
And what you were saying is that
the willingness to get in the game

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before you've got it all figured out
and say hey, we're gonna like,

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00:22:42.960 --> 00:22:45.640
we're gonna learn, we're gonna do
that. We're gonna say, hey,

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this can be better, and we're
gonna improve, improve, and kind of

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evolve over time. Yeah, I
mean, you gotta and you gotta make

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00:22:52.079 --> 00:22:56.240
sure everybody's on board, the leadership, your board, um, and go

346
00:22:56.279 --> 00:23:00.640
out there and you know, get
them this continual improvement a cycle. But

347
00:23:00.039 --> 00:23:07.000
look, the first modern data platform
that I tried to build in twenty our

348
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team you know, tried to build
in twenty sixteen. I guess you know,

349
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two years later we were ripping it
apart and rebuilding it. And that

350
00:23:14.200 --> 00:23:17.920
means, you know, a million
dollar investment. Most of it was you

351
00:23:17.960 --> 00:23:21.480
know, burnt um. That didn't
stop us it probably maybe it should,

352
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I don't know, But that's this
world, right is like we didn't build

353
00:23:26.079 --> 00:23:27.680
it for the use of cases that
we were actually going to end up,

354
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you know, pursuing UM and it's
just a constant thing, and it's it's

355
00:23:33.480 --> 00:23:38.160
if you don't like change, then
you know, retire, go find some

356
00:23:38.200 --> 00:23:42.799
other place to door. You don't
have a choice, right, it's change

357
00:23:42.880 --> 00:23:48.319
or die at this point. So
I wanted to dive into two specific areas

358
00:23:48.359 --> 00:23:52.319
that you've You've got some experience in
the Finthic partnerships, but just in the

359
00:23:52.359 --> 00:23:56.359
technology, Joe. The first is
AI you mentioned ai mL you know,

360
00:23:56.400 --> 00:23:59.920
I think it's it's maybe next to
crypto, the thing that you can't go

361
00:24:00.079 --> 00:24:03.599
to a financial services event or conference
and not have somebody want to talk to

362
00:24:03.599 --> 00:24:07.079
you about positive negative. Everybody's going
to jail who does it? And everybody's

363
00:24:07.079 --> 00:24:10.200
gonna die who doesn't. And those
opinions are all over this place in terms

364
00:24:10.240 --> 00:24:14.319
of what this is, how do
you think about the capabilities of AI it,

365
00:24:14.519 --> 00:24:18.359
what its opportunities and abilities are to
improve the system, Like where do

366
00:24:18.400 --> 00:24:21.279
you see the biggest advantages for people
who can find a way to adopt it?

367
00:24:21.720 --> 00:24:23.480
Because this has been said over and
over again, so that this isn't

368
00:24:23.519 --> 00:24:26.759
not original thought. A matter of
fact, I don't think there's anything help

369
00:24:26.759 --> 00:24:29.519
here to it's original thought. Right. Everything is a plagiarism, right,

370
00:24:29.559 --> 00:24:33.039
and that gets to AI, particularly
to talk like chat GPT, and people

371
00:24:33.319 --> 00:24:37.759
you know are criticizing that. But
you know, everything in our brains we've

372
00:24:37.839 --> 00:24:42.319
learned from somewhere, right, and
so every thought comes out of a derivative

373
00:24:42.359 --> 00:24:48.640
of some other somebody else's thoughts for
me AI, and you know, so

374
00:24:48.759 --> 00:24:51.799
this is a statement. It takes
you from looking in your review nerror to

375
00:24:51.839 --> 00:24:55.440
looking ahead, right, that's one
of the most important things. And it

376
00:24:55.480 --> 00:25:00.720
creates that ability to really get more
and more progressive and individualized UM outcomes.

377
00:25:02.000 --> 00:25:04.400
And so I think that, you
know, it's amazing because I played around

378
00:25:04.400 --> 00:25:07.920
with some of this new technology and
it's like, um, I got on

379
00:25:07.920 --> 00:25:12.680
one piece of software not too long, I say, uh, maybe I

380
00:25:12.720 --> 00:25:18.319
think I typed in, you know, create a seven page power point of

381
00:25:18.440 --> 00:25:26.079
presentation about how execution is a critical
component of innovation. And it was great,

382
00:25:26.200 --> 00:25:30.319
right, it created I mean the
content, the copyright, the pictures

383
00:25:30.400 --> 00:25:37.480
until I got to the sixth slide
and the word execution somehow translated into good

384
00:25:37.559 --> 00:25:41.359
copy on the last slide, But
there was a picture and there was a

385
00:25:41.400 --> 00:25:44.559
woman sitting in a car behind the
wheel of a car who had a bullet

386
00:25:44.599 --> 00:25:49.279
hole in her head. So it
had taken execution right into right a wrong

387
00:25:49.319 --> 00:25:55.759
place, right wrong. So there's
you know, yeah, there's there's a

388
00:25:55.799 --> 00:26:00.000
lot of crazy things that could come
out of AI. But ultimately, um,

389
00:26:00.079 --> 00:26:03.359
you know, it's it's super what
would have taken me hours and hours

390
00:26:03.359 --> 00:26:06.400
to write. So I'll come in
and I'll clean it up right, and

391
00:26:06.440 --> 00:26:10.119
I'll take out that picture or maybe
I'll leave it in and and make fun

392
00:26:10.160 --> 00:26:11.920
of it, and you admit that
it was AI to help me do it,

393
00:26:11.960 --> 00:26:18.920
But either way, it's it's just
leap frog the ability then to do

394
00:26:18.079 --> 00:26:22.279
something like that, and and so
the productivity and it's just like when Google

395
00:26:22.319 --> 00:26:26.359
came out, right, Uh,
we had this debates about what it was

396
00:26:26.359 --> 00:26:30.440
going to do to education if kids
could look up the answer to everything,

397
00:26:30.920 --> 00:26:33.440
and it was going to display jobs, And here we are, and it's

398
00:26:33.480 --> 00:26:38.119
like it's a critical part of how
we do we live our lives. It

399
00:26:38.160 --> 00:26:45.559
hasn't really upbended or supplanted, but
it's it's you know, fast charges to

400
00:26:45.759 --> 00:26:49.240
more quality stuff. You know,
I'm a Starter fan because I watched the

401
00:26:49.799 --> 00:26:55.440
episodes as a as a young kid. And you know, but but that

402
00:26:55.480 --> 00:26:59.880
whole premise of you know, getting
into society where you know, you're talking

403
00:27:00.039 --> 00:27:03.640
to computers and there you know,
and even in the later ones you have

404
00:27:03.720 --> 00:27:07.599
data the android right next to you. That's a world that brings us to

405
00:27:07.960 --> 00:27:12.680
more quality, puts us points us
towards and more quality outcomes and more quality

406
00:27:12.720 --> 00:27:18.200
work. Um. I embrace it
wholeheartedly. But yeah, we have to

407
00:27:18.240 --> 00:27:22.720
balance it out. UM. You
know, there was a congressman or senator,

408
00:27:22.759 --> 00:27:26.240
I don't know who it was,
just yesterday, I think UM read

409
00:27:26.039 --> 00:27:32.440
a speech created by AI on the
floor of the House of the Senate whichever.

410
00:27:32.480 --> 00:27:37.000
The point was um and and first
you know, first time, BUT

411
00:27:37.240 --> 00:27:41.519
had asked it to to create,
you know, a two hundred word speech

412
00:27:41.279 --> 00:27:45.599
UM and but talked about the premise
of, you know, we need to

413
00:27:45.640 --> 00:27:51.319
think about this before right now we're
all anguishing about social media and effect on

414
00:27:51.400 --> 00:27:55.759
society. UM. And I think
that's he's he's got a good point is

415
00:27:55.839 --> 00:27:59.720
right now is to start to think
about Yeah, there's there's there's no pure

416
00:28:00.160 --> 00:28:03.759
about AI. It has good and
bad. So let's really think hard about

417
00:28:03.799 --> 00:28:07.720
and just put guardrails right about how
we approach AI, how we use it,

418
00:28:08.279 --> 00:28:11.720
because it's going to be a great
accelerator and it's already embedded in and

419
00:28:11.759 --> 00:28:17.519
a lot more things than we even
realize, and you know, let's manage

420
00:28:17.519 --> 00:28:22.599
it well, you know, help
it benefit society instead of the harm.

421
00:28:22.720 --> 00:28:26.440
Yeah, for sure, I'm curious
if you have thoughts on the limitation when

422
00:28:26.480 --> 00:28:30.519
you talk about it at being looking
looking ahead as opposed to the review.

423
00:28:30.640 --> 00:28:33.240
I think it's really interesting, but
I also think they're earth. We start

424
00:28:33.279 --> 00:28:36.680
with this as an AI first company, and we get a lot of questions

425
00:28:36.680 --> 00:28:41.680
about the macro, and my machine
learning guys go you know, forecasting the

426
00:28:41.720 --> 00:28:47.720
macroeconomic conditions nine months out is a
pretty bad use case for mL because there

427
00:28:47.759 --> 00:28:51.240
aren't that many real variables. Aren't
if you think about cycles, there's a

428
00:28:51.240 --> 00:28:52.279
lot of data points, but there
aren't a lot of cycles, and they

429
00:28:52.319 --> 00:28:56.559
all look a little different, and
it's it's a very challenging problem to predict,

430
00:28:56.599 --> 00:28:59.640
and lots of people have made and
lost money trying to make algorithms to

431
00:28:59.640 --> 00:29:03.160
predict market movement, which is one
input into you know what the macro might

432
00:29:03.200 --> 00:29:07.359
be in nine months. So I'm
curious if you think about like, places

433
00:29:07.359 --> 00:29:11.359
where it's capability to look in the
future are really powerful and impression and valuable

434
00:29:11.400 --> 00:29:14.319
to day in places where you go, hey, I, you know,

435
00:29:14.440 --> 00:29:15.960
it's like our version of the macro, we go that's just we can measure

436
00:29:17.000 --> 00:29:19.119
it, But predicting it is really
hard, UM and something that maybe we

437
00:29:19.160 --> 00:29:22.519
think it's not well designed for AI. Let's let's talk about credit for a

438
00:29:22.559 --> 00:29:26.559
second, because there's a there's an
interesting thing that happened during the pandemic and

439
00:29:26.599 --> 00:29:32.960
it's not PPP, right, but
it's somewhat related. UM. So you

440
00:29:33.000 --> 00:29:37.039
know bank I was at UM has
large equipment portfolio, so it's eighteen wheelers

441
00:29:37.039 --> 00:29:42.680
transportation equipment. You know. Part
of the relief Act, the regulators came

442
00:29:42.680 --> 00:29:48.640
and said, okay, you can
offer deferrals to your customers UM, and

443
00:29:48.920 --> 00:29:52.039
you don't have to count it towards
non performing loans on your books. Right,

444
00:29:52.039 --> 00:29:56.599
So the big penalty I'm performing loan
is is what it can do to

445
00:29:56.680 --> 00:30:02.640
your ratios, you know, et
ceter the capital most of things like that.

446
00:30:03.279 --> 00:30:06.319
So for the first time in my
career, the very lads are saying

447
00:30:06.359 --> 00:30:08.160
you can go ahead and let skip
payments all the way. And I think

448
00:30:08.160 --> 00:30:12.119
it was up to like seven months
if I remember correctly, for your customers

449
00:30:12.119 --> 00:30:19.200
to help them get through this initial
pandemic shutdown, and and different banks took

450
00:30:19.200 --> 00:30:22.160
different approaches. The bank, you
know, our executive team got together and

451
00:30:22.240 --> 00:30:26.279
say, we're all in on this. So here you have truck drivers who

452
00:30:26.599 --> 00:30:32.160
who you know, they're they're living
is dependent upon being able to pick a

453
00:30:32.200 --> 00:30:36.319
load up every day. Right,
economy ground to a halt. We just

454
00:30:36.640 --> 00:30:40.720
blanket went out and said, all
right, everybody that wants one, we're

455
00:30:40.720 --> 00:30:42.599
going to give them up. If
they want to defer payments right now.

456
00:30:42.640 --> 00:30:47.559
Some banks said, are we're going
to make them pay interest and they can

457
00:30:47.759 --> 00:30:49.920
skip principle, And you know,
I'm like, well, if somebody can't

458
00:30:49.920 --> 00:30:53.759
pick up a load, or if
somebody can't go to work, that doesn't

459
00:30:53.759 --> 00:30:56.200
help, right', you might as
well just leave it alone. Right,

460
00:30:56.200 --> 00:31:00.920
So we full and we allow customers
continue to extend them through the whole thing.

461
00:31:02.000 --> 00:31:06.279
Right, And so we tried to
predict out what might happen when we

462
00:31:06.359 --> 00:31:11.680
went back into repayment and the comedy
economy's rolling and everything else. We had

463
00:31:11.720 --> 00:31:17.559
no tools to do that right readily
at our disposal. That's where AI right.

464
00:31:18.079 --> 00:31:22.599
So what happened though was when we
finally stopped offering and to put everybody

465
00:31:22.640 --> 00:31:25.799
back in the full of payment.
So our non performance and our past duos

466
00:31:25.880 --> 00:31:30.559
never did surge because most I think
at one point close to fifty percent of

467
00:31:30.559 --> 00:31:37.880
our portfolio was on deferral and then
it went back into repayment and we expected

468
00:31:37.920 --> 00:31:44.240
past duos to surge and they didn't. It actually really helped beat this one

469
00:31:44.599 --> 00:31:49.519
external environmental thing challenge that the industry
went through, but we had no data

470
00:31:49.559 --> 00:31:52.400
to prove it was going to work. But now with AI we could have

471
00:31:52.519 --> 00:31:56.319
we could have taken we had data
points, we could have taken those data

472
00:31:56.319 --> 00:32:00.839
points, we really could have projected
and at least had some models to say,

473
00:32:00.920 --> 00:32:04.119
you know, what are the factors
we think you're going to contribute to

474
00:32:04.119 --> 00:32:09.039
whether somebody will get back you know, um into that ability to pay kind

475
00:32:09.039 --> 00:32:13.960
of good model. Right, So
those are the kind of things that think

476
00:32:14.039 --> 00:32:17.319
you know that if we really look
at credit. The other thing I think

477
00:32:17.359 --> 00:32:22.279
about is like, how can we
there's origination of credit, then there's there's

478
00:32:22.359 --> 00:32:27.720
management of credit, right, and
and we all focus on originating credit.

479
00:32:27.799 --> 00:32:30.920
But one of the more interesting parts
for me is and particularly we talk about

480
00:32:30.960 --> 00:32:37.079
like underbanked and and high interest credit
and things like that, most of those

481
00:32:37.599 --> 00:32:43.279
are caused by a mismatch in funding, right, so temporary job loss maybe,

482
00:32:43.400 --> 00:32:47.000
or a big bill to pay car
repair, you know, medical bills

483
00:32:47.119 --> 00:32:52.680
something like that. So it's and
be isolated. Well, how can we

484
00:32:52.839 --> 00:32:55.759
create a picture around that individual.
It's more than finco, more than payment

485
00:32:55.799 --> 00:33:01.039
performance, which are all historic.
Gives us a picture, takes an account

486
00:33:01.039 --> 00:33:05.240
this thing, and then gives us
a probability that that person can return back

487
00:33:05.240 --> 00:33:09.000
to regular payments once this event resolves
itself. Right, you have to build

488
00:33:09.000 --> 00:33:15.799
a model around somewhat you know,
very tight cohorts or individuals m AI you

489
00:33:15.839 --> 00:33:21.519
know um. And that's where you
know you can you can use all kinds

490
00:33:21.519 --> 00:33:27.680
of inputs. But just imagine if
we could instead of passing credit from institution

491
00:33:27.880 --> 00:33:31.480
institution. A lot of fintech um
was born out of refinance, right,

492
00:33:31.559 --> 00:33:37.880
which basically taking ill constructed credit and
and you know, consolidating credit cards into

493
00:33:37.920 --> 00:33:42.880
a personal term. You know,
it's expensive to acquire a customer. What

494
00:33:42.920 --> 00:33:46.319
if I could have kept that customer
by just offering them you know an adjustment,

495
00:33:46.400 --> 00:33:51.720
right, maybe my credit structure to
be variable. Um, that's what

496
00:33:51.880 --> 00:33:55.599
AI could could start to like tell
us, right, can you vary payments?

497
00:33:55.680 --> 00:34:00.839
Can you very interest rates? If
somebody's you know, performing is positive?

498
00:34:00.960 --> 00:34:06.279
Right? We all we all if
you're in credit, uh pool credit

499
00:34:06.640 --> 00:34:10.000
for a while, you you understand
about peak loss loss curves, cohorts.

500
00:34:10.559 --> 00:34:15.440
Um, you know you stop learning
all those points that the truth is right?

501
00:34:15.559 --> 00:34:19.320
Everybody everybody can You can look at
any portfolio you can find at some

502
00:34:19.400 --> 00:34:23.679
level past the peak loss curve,
that mature season part. Everybody would want

503
00:34:23.679 --> 00:34:28.559
to take that credit because you know
you can predict very well what's going to

504
00:34:28.679 --> 00:34:32.639
happen. Right. Um. But
the people that that you know got into

505
00:34:32.639 --> 00:34:35.800
that credit, well, if they're
the best, you know, has their

506
00:34:35.840 --> 00:34:39.239
interest rate gone down? There's their
payment terms gotten better because they are the

507
00:34:39.280 --> 00:34:45.280
better ort of that whole group.
Um. Nothing to just right and eventually

508
00:34:45.159 --> 00:34:50.719
AI all the rest of this will
provide us that ability to do things.

509
00:34:50.760 --> 00:34:52.440
So I don't know, I love
thinking about the what ifs. When I'm

510
00:34:52.440 --> 00:34:55.000
in a hammock. I won't be
around, you know, my career to

511
00:34:55.079 --> 00:35:00.199
see a lot of come to fruition. But m there's tremendous use cases.

512
00:35:00.239 --> 00:35:05.920
But yeah, predict the economy over
the next twelve months. Bad news,

513
00:35:06.320 --> 00:35:09.280
very bad. So let me ask
you about one more area because I know

514
00:35:09.280 --> 00:35:12.599
you guys have made some investments in
the metaverse, and the metaverse is one

515
00:35:12.599 --> 00:35:15.719
of these things that I have not
really played with, but I'm curious about

516
00:35:15.760 --> 00:35:17.480
and curious what people see the opportunity. And you guys have actually done some

517
00:35:17.480 --> 00:35:20.519
stuff in the space, and tell
me a little bit about you know,

518
00:35:20.559 --> 00:35:22.159
what you've been what you've been looking
at or doing in the future that you

519
00:35:22.199 --> 00:35:27.920
see in the metaverse. Yeah,
So we we built a world we called

520
00:35:28.000 --> 00:35:30.119
it's called Coastal World dot com.
So you can go in there and take

521
00:35:30.159 --> 00:35:35.159
a look, and it's basically we've
got you know, a dozen plus of

522
00:35:35.159 --> 00:35:39.760
our fintech partners on there as well
as Coastal Bank, and it's gamified world

523
00:35:39.800 --> 00:35:44.679
that you have your avatar and you
move around here. Um. The idea

524
00:35:45.000 --> 00:35:49.119
for us is, you know,
um, a self contained metaverse, but

525
00:35:49.199 --> 00:35:52.679
also one that can integrate with other
metaverse players. And we kind of looked

526
00:35:52.719 --> 00:35:55.400
at the space and it's like,
do we want to go biden real estate

527
00:35:55.440 --> 00:36:00.719
in the ether? That seem crazy
um, we want to take a bank

528
00:36:00.760 --> 00:36:04.559
branch, and nobody really wants to
go to and put a bank branch in

529
00:36:04.599 --> 00:36:08.920
the in the ether. No idea, um, And so you know our

530
00:36:08.960 --> 00:36:14.960
idea. And this again goes back
to having engaged with like Microsoft's you know,

531
00:36:15.239 --> 00:36:17.719
an Xbox everything. I mean,
one of the interesting comments out of

532
00:36:17.719 --> 00:36:24.000
that early experience was the biggest cohort
of gamers at the time or forty five

533
00:36:24.079 --> 00:36:29.920
to fifty five year old women play
an animal crossing. Right, females play

534
00:36:29.920 --> 00:36:34.159
an animal cross You would have expected
that, right. People people like to

535
00:36:34.199 --> 00:36:38.079
be engaged. So we have Coastalworld
dot com. Um, it's in it's

536
00:36:38.119 --> 00:36:42.280
not in full launch, but you
could you can go play. But even

537
00:36:42.360 --> 00:36:44.880
without a full launch, you know, we have six to eight hundred users

538
00:36:44.880 --> 00:36:49.559
a day and an average engagement time
where they're active on the site of eight

539
00:36:49.599 --> 00:36:52.840
minutes. And so we've got their
attention for eight minutes. We'll think of

540
00:36:52.840 --> 00:36:58.400
the what ifs on that, right? Can you um, can you take

541
00:36:58.440 --> 00:37:02.960
that then and go into financial education? Can you build a PFM a personal

542
00:37:02.960 --> 00:37:07.880
financial management tool around that that not
only takes the transactional data, right,

543
00:37:07.960 --> 00:37:12.599
it's underneath it comes from your checking
account, your card spend and all that.

544
00:37:13.159 --> 00:37:16.880
It also allows you to like with
your with your engagement and then into

545
00:37:16.920 --> 00:37:22.039
the world you get the kind of
direct towards things that you know are part

546
00:37:22.039 --> 00:37:24.320
of your future. So if if
you're engaging with the world and you're out

547
00:37:24.360 --> 00:37:30.320
there investigating um uh, you know, sending your kids to college or college

548
00:37:30.360 --> 00:37:35.239
funds, right, that's not in
your transactional data necessarily today, but that's

549
00:37:35.400 --> 00:37:38.800
open aspiration. So if you can
start to build an ecosystem, of a

550
00:37:38.880 --> 00:37:45.079
gated ecosystem where there's where there's data, you know, controls, where you

551
00:37:45.119 --> 00:37:50.559
can build and use AI to like
start to help formulate a real persona around

552
00:37:50.599 --> 00:37:54.519
the person right where I can start
to collect important data points and frames around

553
00:37:55.000 --> 00:37:58.719
who I am, where I want
to go, what I want my financial

554
00:37:58.719 --> 00:38:01.440
world to be like, and you
know all that. Then you can really

555
00:38:01.480 --> 00:38:07.960
start to leverage those kinds of things
in a world where um, you can

556
00:38:07.000 --> 00:38:12.199
attract more and more people to engage
in that eco system, And the possibilities

557
00:38:12.199 --> 00:38:16.039
are pretty pretty interesting for us.
I mean, we're working behind the scenes

558
00:38:16.119 --> 00:38:21.800
on building some muscle memory in that
space, trying to you know, build

559
00:38:22.159 --> 00:38:25.159
just onboarding for our employees and first
of all to see how does it work

560
00:38:25.199 --> 00:38:29.960
when we start engaging more and more
into this world, um, and then

561
00:38:30.159 --> 00:38:31.920
you know, we'll see what happens
with it. Um. There's a lot

562
00:38:31.920 --> 00:38:36.480
of a lot of fun about it. But underneath it all, you know,

563
00:38:37.039 --> 00:38:40.199
it does come down to data,
data controls, data management, privacy

564
00:38:40.360 --> 00:38:45.360
security. We believe in the data
protocols where you know, you want to

565
00:38:45.400 --> 00:38:51.480
minimize the amount of data flowing,
where tokenize and mask things so that you

566
00:38:51.519 --> 00:38:57.719
know, can I can I validate
somebody's identity without passing their critical personal BII

567
00:38:58.440 --> 00:39:04.320
across the internet right, and blockchain
and all those things give you those capabilities.

568
00:39:04.360 --> 00:39:07.239
I mean, imagine in a credit
world if I could carry around a

569
00:39:07.320 --> 00:39:12.280
set of important data points about me
when I apply for credit, right,

570
00:39:12.400 --> 00:39:16.119
how much I have it own retirement
account? How much have savings? Um?

571
00:39:16.880 --> 00:39:20.920
You know, do what I have
health insurance? So am I properly

572
00:39:20.920 --> 00:39:24.039
insured on my house? Right?
So that I'm ready for disasters? You

573
00:39:24.079 --> 00:39:28.280
know, all all of these things, And if you can start incorporating those

574
00:39:28.280 --> 00:39:32.360
in the data models, then FICO
becomes what I don't know what FIGHTCO tells

575
00:39:32.360 --> 00:39:37.119
me anymore, It becomes them probably
the least useful data point if you can

576
00:39:37.119 --> 00:39:43.559
really paint a different picture. Yeah, very interesting. It's certainly that idea

577
00:39:43.559 --> 00:39:45.360
of being able to carry around the
information about you and have some ownership of

578
00:39:45.400 --> 00:39:50.559
it is really fascinating too, because
right now that data exists sort of but

579
00:39:50.639 --> 00:39:52.079
it's not it's not yours. I
mean, it's it's it's very weird that

580
00:39:52.119 --> 00:39:55.800
both are the data about our financial
lives and the data often about our health

581
00:39:55.800 --> 00:40:01.039
lives are like owned by these entities
not by us, and when we go

582
00:40:01.119 --> 00:40:05.400
into intoity, we kind of like
lose stuff that we don't have control over

583
00:40:05.440 --> 00:40:08.400
it in some way that it feels
very very strange in terms of, well,

584
00:40:08.400 --> 00:40:12.519
how you think about the data about
you and your history and what you

585
00:40:12.800 --> 00:40:16.360
you know, loans you kind of
Yeah, I've literally, at least a

586
00:40:16.360 --> 00:40:21.639
half a dozen times have been in
front of a bunch of younger people and

587
00:40:22.320 --> 00:40:25.440
had to tell them there was a
time that if you switched phone companies you

588
00:40:25.480 --> 00:40:29.360
had to get a new phone then, and they're like, what do you

589
00:40:29.360 --> 00:40:31.599
mean? You know, Yeah,
it's just like if you switched banks,

590
00:40:32.639 --> 00:40:39.039
um, you know, today you
start over right accumulating and the information they're

591
00:40:39.039 --> 00:40:44.199
going to get from you is the
whatever is in your credit score, your

592
00:40:44.239 --> 00:40:49.400
credit file. M Other than that, it's a big gap, right,

593
00:40:49.440 --> 00:40:53.000
I mean, just imagine if you
start building a portable, self contained kind

594
00:40:53.000 --> 00:40:57.920
of assessment of your financial health and
your financial picture. Well, Kurt,

595
00:40:57.960 --> 00:41:00.840
we are unfortunately running out of time. Though I've really enjoyed at our conversation.

596
00:41:00.039 --> 00:41:02.880
I do have three questions I ask
everybody at the end, and you

597
00:41:02.960 --> 00:41:07.320
kind of we kind of stumbled upon
it. Answer to the first, I'll

598
00:41:07.320 --> 00:41:07.920
ask if you want to stick with
it against it, which was like,

599
00:41:08.079 --> 00:41:10.599
what's the best piece of career advice
you've ever gotten? We kind of like

600
00:41:10.679 --> 00:41:15.360
did a little career advice earlier in
the conversation. But is there anything else

601
00:41:15.400 --> 00:41:17.000
you would add to that or you
want to want to leave that one stand

602
00:41:17.000 --> 00:41:22.199
as your career advice? Well,
you know, I would say embrace change.

603
00:41:22.719 --> 00:41:24.639
If you're going to be in the
financial services industry, you know,

604
00:41:25.280 --> 00:41:29.800
the things that got us here aren't
going to take us forward as the saying

605
00:41:29.840 --> 00:41:37.039
goes, and the organizations and the
people that can embrace change and be part

606
00:41:37.039 --> 00:41:39.679
of it and ownership, right we
talked about earlier, Right, the people

607
00:41:39.679 --> 00:41:44.239
would say, Hey, I want
to be a part of whatever change it

608
00:41:44.280 --> 00:41:49.599
is. That's happening in the universe
that will get you added fancy power.

609
00:41:50.800 --> 00:41:52.880
I like it. There's your there's
your career advice. My second question is

610
00:41:53.840 --> 00:41:58.039
what is the best piece of advice
you've gotten about the consumer banking or consumer

611
00:41:58.079 --> 00:42:04.280
lending industry generally? You know,
I probably that don't follow the herd.

612
00:42:05.000 --> 00:42:09.000
The money is to be made right
in the stuff that's harder to do right,

613
00:42:09.199 --> 00:42:13.519
and that again, this relates back
to credit scores. Right, if

614
00:42:13.559 --> 00:42:17.440
you can figure out how to lend
successfully between you know, six to twenty

615
00:42:17.559 --> 00:42:21.920
and seven hundred, you'll make a
lot more money than the person that's lending

616
00:42:22.239 --> 00:42:27.480
only to seven twenty and above.
So you know, um, you know,

617
00:42:27.519 --> 00:42:32.039
the easy things are where people migrate
and then everybody fights over those same

618
00:42:32.079 --> 00:42:37.440
customers. Right, the moneys in
consumers be made helping the people that need

619
00:42:37.480 --> 00:42:40.000
it. Got it? That's great? Don't follow the hurt it's uh,

620
00:42:40.519 --> 00:42:45.599
it's great advice. The common wisdom
is what the stuff everybody knows every does,

621
00:42:45.639 --> 00:42:49.239
so finding ways to do something different
is where the opportunity lies. Last

622
00:42:49.320 --> 00:42:52.760
question. We've talked about a lot
of future areas, but I'm gonna ask

623
00:42:52.760 --> 00:42:55.920
you for one bold prediction about the
future what's a bold, bold prediction you

624
00:42:57.000 --> 00:42:59.559
got about. I like to think
of this is the thing I can invite

625
00:42:59.559 --> 00:43:01.159
you back and you know, we
can have a chat about whether you were

626
00:43:01.199 --> 00:43:07.360
right or wrong. Um So,
so my prediction really falls on something we've

627
00:43:07.400 --> 00:43:13.360
already talked about, which is this
metaverse, right, because I watched I

628
00:43:13.480 --> 00:43:16.440
watched my kids and look, I
don't know how. I really can't define

629
00:43:16.480 --> 00:43:21.920
it. I'm not that smart,
but I watch. You know, here's

630
00:43:21.960 --> 00:43:24.880
the tech point, right, first
time I had Coastal World up my laptop

631
00:43:24.920 --> 00:43:29.199
at home and my son, who
was nine at the time, saw it.

632
00:43:29.280 --> 00:43:30.840
He immediately reached and grabbed my mouth
and said, Dad, you gotta

633
00:43:31.159 --> 00:43:37.440
change your avatar. You can't go
around looking like that and new intuitively how

634
00:43:37.480 --> 00:43:40.000
to do everything and navigated. He's
asked me to try to come and play

635
00:43:40.320 --> 00:43:44.360
in Minecraft, and I can't even
move around, right, He's just just

636
00:43:44.440 --> 00:43:46.159
followed me, and I was like, I can't. Right. This is

637
00:43:46.320 --> 00:43:51.679
native to the younger generation, right, And I don't know they're I'd say

638
00:43:51.719 --> 00:43:55.639
it's metaverse where we're going to be. But this kind of new world where

639
00:43:55.719 --> 00:44:00.280
you're just kind of everything is a
digital and electronic and you and you've got

640
00:44:00.280 --> 00:44:06.079
a mirrored personality, right, because
you start to see even I read something

641
00:44:06.119 --> 00:44:09.880
the other day, fashion is following
the metaverse, and the metaverse and fashion

642
00:44:09.920 --> 00:44:15.639
are together and watching my you know
daughter, my twelve year old daughter,

643
00:44:15.480 --> 00:44:20.559
her her avatars and the different things
she does and her the way she dresses.

644
00:44:21.199 --> 00:44:23.800
Right, it's the same. And
I'm like, so, it's so

645
00:44:23.800 --> 00:44:27.679
so, you know, I think
there's a lot to be said in this

646
00:44:27.760 --> 00:44:30.559
space. I just don't know what
to say about her. I'm not that

647
00:44:30.760 --> 00:44:34.159
smart, but I think, you
know the future, when you look at

648
00:44:34.199 --> 00:44:38.599
twenty thirty and twenty forty, we're
going to be living in a multidimensional kind

649
00:44:38.639 --> 00:44:42.800
of interplay that's going to be part
of how we go about our lives.

650
00:44:42.880 --> 00:44:45.719
Just like I couldn't leave home with
this. It's interesting. I hear what

651
00:44:45.760 --> 00:44:50.119
you're saying. And I used to
have this debate about you know, digital

652
00:44:50.199 --> 00:44:52.039
goods and why people want to buy
digital you know, gonna buy shoes for

653
00:44:52.079 --> 00:44:54.480
you, like we got to buy
real shoes for your feet, but you

654
00:44:54.519 --> 00:44:57.079
know you don't have to buy shoes
for your avata. What are you?

655
00:44:57.079 --> 00:44:59.719
What are you doing? And you
know, when you really break down think

656
00:44:59.719 --> 00:45:02.840
about it, somebody kind of made
the comments me the other day that kind

657
00:45:02.840 --> 00:45:05.760
of resonate, which is like,
you know, people spend a lot of

658
00:45:05.800 --> 00:45:08.960
money that's not just effective, and
it's like not optimize for the most cost

659
00:45:09.000 --> 00:45:13.039
effective what you buy a watch because
you want to make a fascist statement.

660
00:45:13.119 --> 00:45:15.639
You buy a different piece of clothing
or a para of shoes, and you

661
00:45:15.679 --> 00:45:17.039
buy the cheapest para of shoes.
You buy the pair of shoes that you

662
00:45:17.079 --> 00:45:20.159
want to have, and that say, that's a fascist statement, and like,

663
00:45:20.519 --> 00:45:22.800
why would you think that when we
move to a digital persona where somebody

664
00:45:22.800 --> 00:45:27.400
of us spend so much more time
that you wouldn't similarly like buy the equivalent

665
00:45:27.400 --> 00:45:30.480
of a nice watch or a nice
shirt, or a nice hat or a

666
00:45:30.559 --> 00:45:32.519
nice whatever, you know, buy
a nice car. You don't just buy

667
00:45:32.519 --> 00:45:36.360
the car that's like the cheapest thing
that actually effectively gets you to work.

668
00:45:36.400 --> 00:45:38.079
People buy the car that they want
for whatever reason. And a lot of

669
00:45:38.079 --> 00:45:42.840
that is about you know, fashion
and desire, and that translates to the

670
00:45:42.880 --> 00:45:45.599
metaverse and you're seeing that really I
think I take off or whether that's whatever

671
00:45:45.719 --> 00:45:49.719
version of metaverse, your digital personality
you want to come through it just the

672
00:45:49.760 --> 00:45:52.159
way you do your personality in real
life through the things you own and things

673
00:45:52.159 --> 00:45:57.280
you wear. So that's not new. I mean I remember being in college

674
00:45:57.280 --> 00:46:00.440
and being really pissed off because I
couldn't afford those shirts with the little yeah

675
00:46:01.920 --> 00:46:06.079
because that was the standard, right, and that was the status symbol,

676
00:46:06.199 --> 00:46:08.280
right, and they were they were
expensive for the time. Um. And

677
00:46:08.320 --> 00:46:12.320
that's the same thing about art,
right. I mean I have a good

678
00:46:12.360 --> 00:46:15.320
friend and owns modern, large,
modern art gallery and I've asked him and

679
00:46:15.360 --> 00:46:19.320
he's like, well, I said, why wolst I pay that much money,

680
00:46:19.360 --> 00:46:22.239
you know? And and he's like
this, this is a world that

681
00:46:22.360 --> 00:46:28.880
exists, and you're questioning and fundamentally
like you know, yes you he says.

682
00:46:28.960 --> 00:46:31.119
My line is, do what really
moves you from art? But the

683
00:46:31.119 --> 00:46:36.400
truth is most of art is soul
because it's a status symbol and people want

684
00:46:36.840 --> 00:46:39.159
that's to own a piece of that
status symbol. It's image, you know,

685
00:46:39.239 --> 00:46:43.440
and we pay for it all the
time. So yeah, I don't

686
00:46:43.440 --> 00:46:45.880
doubt it all right, Kurt.
I appreciate your time to this as a

687
00:46:45.880 --> 00:46:49.480
fascinating conversation. Thanks for making the
time and sharing your thoughts of the audience.

688
00:46:49.800 --> 00:46:52.639
Yeah. Thanks, it's been great. Upstart partners with banks and credit

689
00:46:52.719 --> 00:46:58.400
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690
00:46:58.480 --> 00:47:02.800
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691
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692
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693
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698
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700
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and growing your business by visiting upstart
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701
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upstart dot com slash four dash banks. You've been listening to leaders and lending

702
00:48:01.079 --> 00:48:06.199
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703
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704
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705
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