419. Scaling Varo to $1B+, The Future of Banking, & Why the Biggest Opportunity in Fintech is Financial Inclusion (Colin Walsh)

419. Scaling Varo to $1B+, The Future of Banking, & Why the Biggest Opportunity in Fintech is Financial Inclusion (Colin Walsh)


Colin Walsh of Varo Bank joins Nate to discuss Scaling Varo to $1B+, The Future of Banking, & Why the Biggest Opportunity in Fintech is Financial Inclusion. In this episode we cover:

  • Entrepreneurship, Risk-Taking and Founding a Fintech Company
  • Financial Innovation and Customer Needs in the Industry
  • Financial Challenges and Technology Solutions
  • Becoming a Bank and Offering Financial Products to Consumers
  • AI’s Impact on Financial Services, Operational Risk, and Productivity

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Transcribed with AI:

0:18
Our guest today is Colin Walsh, the Co-Founder and CEO at Varo Bank, a unicorn startup building products for financial inclusion. Varo has raised nearly $1B from top-tier investors, including Warburg Pincus, BlackRock, and Lone Pine Capital. Prior to founding Varo, Colin was an executive vice president at American express specializing in proprietary card services and a Managing Director at Lloyds Banking Group.
Colin, welcome to the show!
0:46
Great to be on the show. Thanks, Nate. Yeah, of
0:49
course. So we’re going to spend quite a bit of time talking about varo. And where Fintech is headed, obviously. But first, I was curious if you could share a bit about your upbringing, you know, were you always entrepreneurial, or if you could give us a bit of background about yourself?
1:03
Sure. So I had kind of an interesting upbringing. So I grew up outside New York City. My dad was a brilliant educator and a mathematician, and he was a math teacher. But I have to say he was not the best with personal finance, or budgeting, which is where my mom came in. So she was definitely the person who managed the purse strings and our family and manage the household budget and realize that on a teacher’s salary, and there are four kids, we’re all gonna have to pitch in a little bit. And so she started start us in our first job when I was actually about six, in a modeling and acting career with myself and my siblings, which was kind of an interesting kind of early childhood experience. I did that for a number of years until I decided that I had had enough of that. And they wanted to drop out of that rat race at the right play young age of like 10, or 12. And, and they took a paper route. So I wanted to be a little bit more of a normal kid. And then I decided one paper out was not enough. So then I had to, and then I hit three. And I heard my sisters who at that point, we’re no longer in doing the modeling career. And they helped me have a little bit workload. So I started to have a have a bit of a staff at that point, although if you ask them, they would say, was probably not that not the most fun job. And then I also had a little bit of a side gig. While I was in high school, to make some money, I won’t even talk about them, I had a little business that I was in. And then after college, I went more the traditional route. So I went into bigger companies GE Capital right out of school, and then ended up at American Express at a pretty young age. And then I did two tours of duty at Amex. I did spend a bunch of time at Wells Fargo, and then at Lloyds in the UK. But I was always sort of more of an intrapreneur. So I take on big challenging projects, and ultimately grew into where I was actually starting businesses and unwinding businesses and doing acquisitions and all sorts of things inside these companies. So I would consider myself a little bit more of an intrapreneur until I ultimately decided that it was time to break out and create my own company. And that was really where Varro store story began.
3:12
So what was the string of insights that led to founding Morrow? Yeah,
3:17
I would say in those years pre varo, it became pretty clear to me because all my roles were in financial services, is that the system was pretty much built for the haves and not the have nots. And I think that started to become obvious as I was, in many different economic cycles you need, you have to make a lot of decisions around pricing, and really going deep into the business model and the economics of the institution. And I started to see all these instances where it felt like these traditional financial institutions were profiting off of what felt like a lot of consumer misfortune or hardship. So if you didn’t have enough money in your account, you were charged a minimum balance fee. If you fell short and went into a negative balance, you are charged NSF fees and non sufficient fund fees and overdraft fees. There were, you know, very punitive late payment fees, if you had a loan, if someone missed a credit card payment, by even just a couple of days, their APR shot up, folks were not getting paid on their savings accounts, like super low AP wise, because those deposits were you know, that’s kind of how the banks were making money. And so all of that, you know, over time seeing this again and again playing out, I felt that there was just a massive opportunity to build something leveraging technology to do it right for the consumer, particularly the everyday consumer that is trying to get ahead in their lives, but you know, they have stuff happening. And you know, we’ll talk more about kind of this massive what I would call tam target addressable market here in the US of folks that are living paycheck to paycheck but you know, they want to see a better future for themselves and their families. And so I felt like well Carl could be part of that solution and make the world a better place for a lot of folks and for society at large. If we got it right at scale it so we’ll talk more about that.
5:10
Yeah, I’m looking forward to going deeper in the business in a moment. But I do want to circle back to your career and being an entrepreneur, because it’s early stage investors, we’ve come across a number of founders that are spinning out of larger companies, and they’ve had the benefit of having a trove of resources at their disposal, it’s not the same amount of risk. And it always fascinates me when someone is able to come from those large enterprises, into the shoes of being a founder that’s very resource constrained and find success. Aside from resources, what do you think were the biggest learnings? Or what do you what do you find that someone has to have to find success as a founder when they’re coming from a large enterprise as an entrepreneur, to someone like yourself? Who is starting something from ground up and build? Yeah,
6:04
that’s a great question. And it was interesting, when I first started the company, there were some investors that saw it as a big plus that I, you know, run businesses, I had a playbook around how to get companies to survive different economic cycles, and had to make a lot of tough decisions along the way could recruit talent, you know, understood, you know, how to how to build at scale, all of that. But you’re right, like a lot of VCs were like horrified thinking like this guy, what did you What do you know about writing code or actually starting something from nothing, and, and that was actually one of the most exciting parts of this for me personally, but I also carry a lot of those biases, when I bring people in, from large companies where I worry like, are they going to be able to adapt, because I literally went from having 1000s of people under my watch running the European consumer business for American Express, you know, with this big brand, and, you know, jet in the all these, you know, countries and I was like the guy in charge, and you know, the country managers would line up and do all this, like formal presentations, very different from then suddenly, like, I’m in my living room with my dog, you know, and like computer saying, Okay, I’ve got to, like, invent the future of banking. And it’s just, it was just a total, totally different mindset and realizing that and I adopted some really principles like that, like everyday matters, you know, it’s just a race against time, you can’t afford to like, wait a week or a month to set up a meeting, because, you know, it’s just, you’re gonna run out of cash. And there’s like, so many things that like, there’s a sense of urgency, also that like, you just absolutely have to leave your ego at the door. Like, it doesn’t matter what big of a job you had, or what parties you’re used to get invited to, or what status you had on airlines and all that goes away when you’re an entrepreneur, like there’s no room for any ego, and especially when you’re bringing in people who have had big jobs, and big resumes and all of that. And then the other thing is that everybody has to do real work, like so like, I remember in the early days, we were in a shared workspace and I had this one guy who I’d worked with at another company, who’s like, who should I meet with, and I said, You should meet with your laptop and get to work either start writing policies or like, like, there’s no there’s, there’s nobody to meet with, like, you know, we’re all here to actually do something and build something, especially when you’re building from the ground up. So it did take quite a bit of rewiring. But after I left AmEx, I actually took a year, and advised a whole group of early stage founders to sort of get myself into that mindset. So it wasn’t like a complete, you know, whatever sort of shock to the system, like I spend time with these early stage founders, looking at how they were going about the problems that we’re solving, how they were thinking about everything from getting, you know, a first product into market, trying to raise money trying to attract talent. So by the time I actually pulled the trigger, and started the company, I had had a little bit of time and exposure in that world, which was incredibly valuable.
8:57
Do you think there’s anything during that year that would have made you think otherwise about starting borrow, besides, for sure, in the market opportunity, but like, Well, I’m just curious, from your perspective, like what could have come up that would have put you on the other side of not doing, you know, I
9:13
had to I was tempted by a number of things like big, lucrative paying jobs and like saying, like, oh, you know, it’d be really easy to just jump back into that world and have a great big paycheck again, and all of that and all the creature comforts that come with, you know, working for a big company, and I sort of dodged those bullets, you know, and just said, you know, just stick with it. You know, I think it helped for me, that I had that career and I didn’t, you know, wasn’t going to like be out on the street necessarily, if I didn’t like it or get something right away or make it work right away. And I feel like there was a little bit of that ability to take more risk. But yeah, there’s so much that you don’t know I mean, it’s today I you know, I talk with my board and investors around, you know, the probabilities of someone thing working out or something else not working out. And I said at the beginning, like everything could not work out. The probability of going to zero is is very high in the present in those first few years, because you just don’t know you don’t have product market fit yet. You don’t have real customers, you know, you’re building your investing. But once you start to get traction, you know, then that probability curve starts to narrow a bit more.
10:25
Yeah, at what point in the journey of building the business? Did you know you made the right decision? Well, I’ve
10:30
had no regrets ever. I mean, right from the bat, it’s been eight years now. And it’s been the most rewarding thing that I’ve ever done in my professional career. But it’s it’s an adrenaline rush for sure. I guess, you know, there’s always something there’s always some major complex problem that you have to solve some situation you have to navigate through. And we’ll talk more about, you know, some of the twists and turns along
10:52
the way. Yeah, so for those that don’t know, Pharrell, well, if you could describe the business in a bit more detail, and also specifically some of the other neobanks that are out there, like chime, etcetera, how do you guys fit into the landscape, and you alluded to it earlier, but we’d love to hear more about the company and in the vision behind it.
11:14
Yeah, first and foremost, we like to call ourselves a tech bank, we’re a real bank. So we’re an OCC chartered National Bank, we’re direct number of the FDIC, we’re a direct member of the Federal Reserve, when we started, we did have a partnership with the bank work as a sponsor bank. And that was a great partnership and allowed us to get into the market, you know, to really iterate on our product offering, really test the hypothesis that there’s a massive group of consumers that could benefit from from what we do. But then during that period, we went through a very rigorous almost three and a half year process of getting approved by all three regulatory agencies to be operating as a national bank. But But I think that in that, that affords us a lot of advantages that we’ll talk a little bit about. But I think as this tech bank, you know, our focus, and we have been very mission focused from the beginning, but it’s how do we build this really innovative financial platform that’s going to improve our customers lives, it’s going to empower them to improve their financial health, it’s going to help them make better decisions, it’s going to help them get real progress in their financial lives. And again, go back to what I was saying before, you know, folks that are trying to just get by and you know, if they slipped behind, if they miss a payment, or if they don’t have enough in their bank account to satisfy a minimum, you know, balance all of that, like all that kind of goes away. And we’ve been focused on trying to bring a set of solutions. And this is why the bank charter was so important, because it’s not just a single point solution, there’s really a whole bundle of things that you have to do to help customers make make that real progress in our lives. And the way we like to frame it is we’re trying to transform the daily relationships that our customers have with their money. And so it’s not only, you know, avoiding fees and charges, but it’s around instant payments, like moving money, whether it’s to another borrow user, or it’s someone on a bank platform through Zell or anyone that has a US debit card through things like borrower to anyone being able to improve their credit, we have a secured credit card that helps customers improve their credit, being able to give them access to credit. So we make short term loans, we’ve just actually increased the limit of to $500. For many of our customers. Now, this becomes a critical lifeline. Particularly, if you’re trying to get to that next paycheck, you have an unexpected expense come through that it really helps bridge and all of this is operating in real time alongside of one of the best savings propositions in the markets that allows customers to very seamlessly, you know, save part of their paycheck or round up and save the change whenever they make a transaction. So we’re trying to help them build that small dollar savings. And all of this is operating seamlessly in an integrated platform that is really changing customers lives. So our customer, our NPS, last week was like 85 hours of banking, in banking. I mean, our NPS was like minus 30 years, I’m gonna get some of these big financial institutions. And so I mean, it’s just, it’s just revolutionary for customers that are trying to sort of make that that that bridge towards, you know, feeling somewhat volatile and out of control to having a lot more agency in their lives and starting to get to a place where they’re responsibly managing money and building positive cash flow, and can start to think about bigger goals. And as we advance our roadmap, we want to be there and continue to iterate with our customers to help them in those next stages of their lives as
14:38
well. Yeah, well, your initial hypothesis that there is an unmet market need was clearly correct as you guys have grown incredibly quickly and have had a lot of success. Before the show. You mentioned that building something great takes time experimentation and their insights that help solve customer problems. What are As you reflect, well what are one or two core but non obvious reasons why Laura was able to grow so quickly out of the gate? Well,
15:08
sadly, the problem that we set out to solve eight years ago, of, you know, customers who are trying to get ahead, often find themselves living paycheck to paycheck has actually gotten worse. And and so if with the inflation and higher interest rates, and now more, consumers have to be repaying student debt that was kind of on hiatus for a while, it’s actually like 60 plus percent of this country. And so I think this is something that is a very real issue for many consumers. And to be able to have a solution that starts to address some of these fundamental needs that I was just talking about, is vital. And we just did a study, the Varro wealth watch survey that show that points to the fact that if you kind of unpack that you’re actually even groups like women is, three out of five of the folks that we surveyed are living paycheck to paycheck, I mean, it’s just extraordinary. And the amount of financial stress that comes on the back of not being sure if you’re going to make ends meet at the end of the month, has an impact on folks mental health as well, and their physical health and so, so being able to design something that puts people in a better state of mind that, again, going back to that sense of control, that sense of agency, I think is sort of the on your tech insight that you may not be as obvious that you’re actually doing something that is really affecting people at their core. And one of the things we like to think about as we’re designing our product, is how do we really be very central to customers financial lives, that we can be able to provide solutions for all of those critical jobs to be done that are happening in our customers live every single day, and make it’s completely seamless for them. And I think as we’ve been iterating on our product, and delivering against our product roadmap, we’re really seeing that happening. And I talked a little bit about the NPS score, you know, and you look at our you know, if you go to the Apple App Store, we about a 4.9 rating in the app store, like it really is quite transformational for many of our customers. Do
17:18
you think this problem of living paycheck to paycheck is only going to get worse? Or what are the forces that are driving that percentage higher over the past? I mean, it’s I feel like every single year, this problem gets worse to your point. As you project the next 10 years, do you think this problem gets worse? Does it get better? And why do you hold those beliefs? Yeah,
17:40
so I think a couple of things. I mean, the the confluence of the broader macro economic conditions with inflation and higher interest rates, they certainly don’t help. I also think that the industry has not done enough to provide the tools for folks to think about, you know, money coming in money going out, you know, how do they affordably and responsibly access credit? How do you build savings habits. And so you know, part of it is also you know, is are people earning enough what’s happening with wages, but even knowing that you might have access to other ways to bridge short term gaps through gig work, and I can our app, we have a whole Resource Center. Now for folks that might be between jobs, or they might need a little bit of extra income. And there are tools out there. And I think this is the beauty of technology is you can bring all this together in a holistic platform to make it easier for folks to understand, like, Wow, if I need to, like if I’ve lost a job, if I’ve been working two jobs, there’s actually a Can I apply for state benefits right now in our app, we can link folks to benefit sites so that they can get unemployment benefits or link to a marketplace where you can get temporary work. Okay, good work, and that can help sort of Alright, so there’s a lot of it is just having the tools available, and also being able to have that integrated view of what’s happening in your life at any point in time, your financial life. And, and I do so to your point, you know, are the macro trends going to change? Maybe not immediately. I do think, you know, obviously, I’ve been through a lot of cycles of economy, contracting and expanding. But I think over the long run, you know, there there will be continued positive economic growth. And then it’s really around helping folks sort of deal with these situations and give them the tools to be able to have, you know, again, I think that that empowerment to make better choices in their financial lives. And I do feel for many folks, that it is possible that they’re not living in that sort of cycle and experiencing all of that stress.
19:46
You think the way that traditional banks and credit unions in the way that they service this demographic of customers is likely to change or how do you how do you see the traditional banking system evolve over the next 10 years. Yeah,
20:02
so I’ve spent a lot of time with other folks in the industry, including both fin tech CEOs, as well as traditional bank CEOs. And, you know, not apt to be careful because, you know, I am part of the ecosystem, but but I do see some some level of sort of fear and confusion and uncertainty as technologies are evolving very rapidly. And, you know, so you’ve got everything like, you know, which nafs to someone like yourself, and to me seems very basic and obvious, but like things like mobile and cloud and digital banking, adoption, and all the rest of it. But for someone running a community bank that has their IT servers in the mailroom, the kids data, you solve that, you know, and they don’t even really have much of an app, or they have a core banking provider that does all this for them and does like, you know, monthly or three monthly release cycles, you know, so they don’t have the ability to iterate and learn quickly. And so I think a lot of those are going to struggle, I mean, I do appreciate the sort of community ethos, the focus on, you know, more personalized customer experience, but you know, being able to like give your dog a biscuit, and the branch is not going to replace the fact that you’ve got a mobile app that’s available 24/7, that’s solving the problems that you need solved immediately. Like, that’s a very different sort of approach to addressing customer experience. So I do think there’s going to be a lot more consolidation across the industry, I think the big players will continue to invest heavily in technology. And, and they’re capturing, you know, but the big players are really capturing the business, the folks that have money, like they want to make mortgages, they want to, you know, have folks sign up for wealth management services. But for the 60 plus percent of Americans that are, you know, driving for Uber or stocking shelves at Walgreens, or our you know, with the six dogs on the beach, or working in the gym training, folks, this is the lifeblood of America, like those are our customers. And so, so the ability to provide solutions to all of those folks, I don’t think the big banks are focused on that. And I think the fintechs have a fairly narrow set of things that they can do, because they’re in the sponsor bank relationships, where the sponsor banks are only given a finite number of permissions by the regulator in terms of what they can do. So that’s, again, another reason why becoming a bank was so important for us, because we wanted to innovate across the whole spectrum. And we wanted that could be sort of foundational to our business plan, which is why we also went the de novo route, because we wanted to build a plan, you know, get it sanctioned by the regulators, and approved to say that this is now you know, kind of the path we’re going to take, and it’s just about now executing against that. And for those that
22:41
don’t know, or aren’t familiar, can you also highlight what being a bank enables you to do versus solely working with a sponsor bank?
22:49
Sure, well, first and foremost, you kind of control your own regulatory destiny. So you’re not, you’re not delegating your regulatory relationships to another bank or multiple banks. So we deal directly with our regulators around around all aspects of our business. And then from a consumer facing perspective, you know, we can do much more with like, we offer up to 5% a py on our savings account. And, you know, when we when we gather deposits, which is not our primary focus, but those deposits, you know, many of them sit at the Federal Reserve, we’re earning interest on those in this interest rate environment, we can also lend on those deposits. And so we have a very low cost of funding. So if you’re a non bank lender, you’re out trying to source wholesale market funding, which has gotten very expensive, and covenants have changed. And so it’s requiring more capital for many of these, these lenders to be able to actually just provide lending services, we also are in the payment system. So not only can we offer Zell, there’s other innovations we can do on the payment side. So between savings and deposit taking and payments and lending. There’s a lot of advantages that we’re able to bring to bear also, fraud, risk management, you know, how we manage different parts of our business, we have an end to end business, and it’s not like part of it is managed by a bank. And part of its managed by us. It’s all managed by us. And so so the things we can do with our data and how we think about our end to end processes, and how we can drive efficiencies, I think it gives us a number of advantages. And we’ve seen that just through the cycle in terms of just the improvements we’ve been able to make in our unit economics. And as we’ve been able to scale the business, it’s been we’ve been able to really kind of pull on a number of those
24:26
levers. Yeah. And you talked about some of these financial products. And then you also talked about being able to connect them, connect them as your consumers to work if they’re in need of part time work through gig jobs, or whatever it might be, as you think about the future of borrow and where you’re taking the consumer experience wherever you want to take that whether it’s product oriented, or not. What do you envision for the future of the company in how does that translate to what consumers are your customers can expect from the company? Sure.
25:04
So I’ve never been more bullish, actually, to be honest, like, given what the kind of the state of where the industry is where the consumer is. And we estimate, there’s about 90 million consumers that would fit in our Tam, or target addressable market. You know, we’ve opened up accounts for 5 million for just checking accounts. So we’ve got probably more like eight or 9 million all across, you know, savings and lending, but just checking accounts. So we’ve only touched like about 5% of that, Tam. And so I look at I take a lot of inspiration for from companies like new, like new bank in Brazil, like they have 53% market share of all consumers in Brazil, I’d be happy with 50% market share of just that 90 million. And so yeah, and it’s about building continuing to iterate and build this, like we like to say, internally, like we want to build the world’s most innovative financial platform and again, solving building these solutions that solve for the everyday relationship that customers have with their money and being able to give them the tools and the solutions. So we’ve got a number of exciting things in our pipeline that I can’t really talk about yet, because the we’re gonna do a bunch of is sort of broad communications but but are going to just make this so much more intelligent and intuitive for consumers as well, not just financial products. But the actual experience itself of managing your money is something we’re working on that I think he’s going to be completely innovative and very transformational. And so so as we continue to do this, our goal is to ultimately become the national standard for for this this category, where customers would just say, Oh, you don’t have a bar account, you’re missing out, like, you just need to do this, because your credit score is gonna go up, you’re gonna start saving money, you have access to liquidity in terms of money, when you need it, you’re not going to pay all these fees and charges, you have all these options in terms of how you can pay instantly, you don’t have to wait for these clunky, you know, three, five day payments to clear. Again, we can get to that point where everybody in the country just wants this product, and they love the brand. And they love the experience that they have. That’s when I’ll say, okay, we can declare victory. So we’ve got some work to do. But I feel like we’ve got the right team and the right focus, and we’re investing in the things that will ultimately get us there.
27:22
What are the things that make you nervous? What do you think about because, as you talked about, this is the bull case. And I can clearly see it as well. But for sure, what are things we
27:35
use in this in this environment. And as a digital platform, you know, fraud is something that like, you know, I think we’ve done a very good job of anything, we may have gotten too good of a job because we keep the fraudsters out. But you know, we want to make sure that there’s enough flexibility for customers to move money. And as we, you know, as customers who are living paycheck to paycheck, you know, there’s people that have actually a fair amount of money that just maybe a little bit overextended, and the ability to move larger sums of money, like so. So fraud is something that I would say, absolutely, you know, would would keep us all up at night thinking about how to build this in a way that keeps it safe for everyone who’s using the platform. You know, you look at geopolitical activity, and, you know, what impact is that going to have on the broader economic cycle? And is it going to create more pressure on our economy? No, so far, we’ve been defying that, which is great to see, and continue to see healthy economic growth, despite the fact that there’s still a fair amount of hardship for folks that are trying to get by that, that, you know, are feeling more of the brunt of inflation and higher interest rates. But, but I think that those are things that that we think about, you know, just the overall kind of macro economic trends, the geopolitical trends. Cyber is another, you know, cybersecurity, and, you know, we’re an all digital platform. And so, you know, in some ways, the, the community bank that has their IT servers in the mail group is a little more protected, I guess. But, you know, we have, you know, world class cyber defenses, but that’s something that we have to constantly remain vigilant on. So so, you know, when I think about the kind of major risk factors, you know, definitely a lot of it is, you know, operational risk, you know, reputation risk, you know, continuing to deliver the things we say we’re going to do for our customers so that we can continue to enjoy that sort of really high promoter score and high app ratings. But you know, that it requires a consistency in the execution side. And so, and also, when you’re building a business like this, it takes its toll. It’s a you know, it’s it’s exciting, but I think for I think about all my colleagues and like, that worked so hard, you know, just to keep shipping and to keep iterating and testing and learning and, and so making sure that we give people a chance to sort of take a breath and, you know, sort of, you know, have to have a little bit of balance. But, you know, being in the VC world, I mean, building companies, especially great companies is really hard work.
29:53
Yeah, absolutely. And I am curious, your take on something very topical that I feel like I’m almost obligated to ask? And you don’t need to answer specific tomorrow, but more broadly speaking, how do you believe AI will change financial services at all? What are the areas of lowest hanging fruit? What do you see?
30:14
So many so many opportunities? And also, you know, there’s there’s risks as well, because of, you know, does it, you know, embed bias in credit lending decisions, does it create a avenue for bad actors to impersonate and get through authentication and other things and more social engineering. So I think there’s there’s those risk factors. But I think on the positive side, you know, whether it’s, you know, co piloting on writing code, or building out marketing much faster, or using machine learning, which we do today, as well, not necessarily generative AI, but we’re using machine learning algorithms to help us identify bad actors. And that’s been hugely effective, we use it to help us determine credit line assignments, we use it in the back office, to prioritize different work use. And so there’s a number of applications where it’s helped us drive, you know, a huge amount of productivity even in, you know, now we’ve got a over 50%, containment rate with our, our AI chat bot, which if you go into the app and just start having a conversation, it’s actually really intuitive. And it prompts you for what you’re wanting to know. And it gives you answers really quickly. And we find that customers actually are pretty satisfied with it’s giving them what they need, and as long as you can give them the information they need when they need it. So there’s all sorts of applications that are going to drive productivity or help improve personalizations. And for institutions that are not looking at these technologies, or understanding them or embracing them, you know, I think they could very much run the risk of even being left further behind. And so and you know, the regulators are also very cognizant of the risk factors and want to make sure that the financial institutions that are leveraging these technologies have proper governance in place and that they’re understanding the implications of what these technologies can do, which we’re all still learning to, because the technology is also evolving very rapidly.
32:11
Yeah, things. It’s crazy how fast we’re seeing AI evolve at the early stages of venture, that’s for sure. But I do
32:18
think you have to lean in because you know, sure of saying, well, we’ll wait and figure it out, you know, later is not I don’t think a winning winning solution. I
32:26
agree. I think it’s difficult to dispute the value that it’s going to create versus some of the other technologies that we’ve seen, perhaps become very overhyped, like blood three, or cryptocurrencies, etc. This shift feels more real. And it feels that it’s going to create real value versus some of the others that we’ve seen in recent history. What’s your job as a VC,
32:51
they create these hype cycles in crypto.
32:58
Yeah, we have, we have our own set of challenges, but I’ve
33:00
been accused of being boring and what we’re doing because we’re like focusing on many of the foundational things that customers have around their financial lives. I’d rather be boring and around and 50 and 100 years of my company of these, I won’t be here. I’m
33:14
here. I’m right there with you, honestly, for us if anything becomes overhyped, overheated when you end up paying for it. And it’s not a unique insight that everyone else has, which generally means it’s not the best place to be investing. So for us, what gets us excited is, you know, opportunities that are overlooked, somewhat unsexy. But seeing the way that AI has been applied to those areas, and is now enabling industries, such as legal to adopt technology at a much faster rate than we’ve seen before is absolutely
33:46
no doubt smart to get all sorts of use cases, particularly around productivity. Yeah,
33:51
absolutely. If we could feature anyone on the show, who should we interview and what topic would you like to hear them speak about? Well, given the
33:59
focus on building businesses and entrepreneurship, I mean, if you were able to bring Richard Branson on it, and so listen to his life story and the industries he’s disrupted, you know, it’s been so many different verticals that he’s he’s gotten involved in and built really interesting, exciting businesses around I think you’d be an interesting person to have on this trip.
34:20
Yeah, yeah, I would agree. On what book article or video would you recommend to our listeners, whether it’s something in recent memory that you found informative or inspiring, or one of the classics that you tend to go back to from time to time,
34:33
I read a lot like I actually just read like two books over Thanksgiving and like, Well, I’ve been on planes a lot too. So that that helps. And but I’d say two books that I’ve read this year that I’ve really enjoyed are Tony Fidel, who worked for Steve Jobs and he started the big built the iPod and the iPhone eventually, but he wrote a book build, which I found really interesting. And then he went on to found nest another book that I do it’s read by Amy Edmondson who’s a Harvard professor. It’s called the fearless organization. And it highlights a number of examples of how companies have created like, you know, high levels of psychological safety inside their organizations and how that’s helped them succeed. And companies that have not that have had, you know, a lot of fear and people don’t speak up, and they’ve run into a lot of problems. And I found that to be a really interesting book to particularly kind of navigating through, you know, the economic cycle that we’re in right now is sort of get making sure that all voices are heard, and then everybody’s contributing to the success of the company. So that was another interesting book. Yeah,
35:41
the ladder reminds me of Good to Great by Jim Collins have read it. And I’ve read that one a couple of times. Jim Collins is awesome. And then last column, what is the best way for listeners to connect with you or borrow,
35:54
they folks can go to our website, if they want to follow borrow and borrow money.com var o MO, N ey.com. Or they could also follow me on LinkedIn, I post fairly frequently about just thoughts around what’s happening broadly or updates on the company. But you know, when there’s economic events are things that might be impacting our customers, I tend to post some some ideas on that. And also, I have a podcast of oral prosperity podcast, where I also get on the other side where I’m actually doing the interviewing. And I’ve interviewed some really interesting guests that we talk a lot about, sort of wealth, equity issues, and how to build products and technology that can kind of help improve consumers lives.
36:37
Yeah. Well, Colin, thank you again, for coming on.
36:39
Best of luck in the near future.
36:41
Maybe keep an eye out for an IPO sometime in the next
36:43
we’ll let you know.
36:47
Sounds good. We’ll have to ring the bell. You might have to come back on. But it was great. Really. Thank you again for doing this. I really enjoyed it. Thanks, mate, likewise.
37:00
All right, that’ll wrap up today’s interview. If you enjoyed the episode or a previous one, let the guests know about it. Share your thoughts on social or shoot them an email, let them know what particularly resonated with you. I can’t tell you how much I appreciate that some of the smartest folks in venture are willing to take the time and share their insights with us. If you feel the same, a compliment goes a long way. Okay, that’s a wrap for today. Until next time, remember to over prepare, choose carefully and invest confidently thanks so much for listening