Name: Reimagining community banking: How can you adapt your strategy to changing customer needs?
Uploaded: 2024-07-12T10:26:44.824Z
Duration: 741.41
Description: John Waupsh, Chief Revenue Officer of Manifest Financial, discusses the importance of defining the strategic purpose for community banks. The conversation covers the importance of adapting business strategies to evolving customer needs and John emphasizes the value of primary research.

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English

{{00:00:05}}
Hi, I'm David Penn, Research
Analyst with Finovate.

{{00:00:07}}
We're here at FinovateSpring in San
Francisco, and joining me is John Waupsh.

{{00:00:10}}
He is the Chief Revenue Officer
with Manifest Financial.

{{00:00:13}}
Thanks for joining us, John.

{{00:00:14}}
A pleasure.

{{00:00:15}}
It's fantastic to have you here.

{{00:00:16}}
I thought before we started talking about
some of the issues regarding community

{{00:00:19}}
banks and some of the challenges they're
facing, maybe we could just start off

{{00:00:21}}
with you telling us a little bit about the
work you're doing at Manifest Financial.

{{00:00:24}}
Sure.

{{00:00:25}}
I'm the Chief Revenue
Officer for Manifest.

{{00:00:29}}
We do banking for creators.

{{00:00:32}}
So we have a platform that, think of
it as APIs that allow companies that

{{00:00:40}}
serve creators, to better serve them
by using our embedded banking services

{{00:00:47}}
that, exist inside of those platforms.

{{00:00:50}}
Interesting.

{{00:00:50}}
So as Chief Revenue Officer, I help make
sure that those partnerships happen.

{{00:00:56}}
And  in charge of the money,
making sure we bring in money.

{{00:00:59}}
Yeah.

{{00:00:59}}
Really interesting.

{{00:01:01}}
that's gotta be an incredibly
interesting category that in many

{{00:01:03}}
respects hardly existed, let alone was
a monetizable category not long ago.

{{00:01:06}}
Yeah.

{{00:01:07}}
Believe it or not,  within
about three years  we're talking

{{00:01:11}}
about, half a trillion dollars.

{{00:01:14}}
Wow.

{{00:01:14}}
In revenue for creators worldwide.

{{00:01:16}}
So it's exploded in the  last
10 years or so for sure.

{{00:01:21}}
The and then prior to that, of course,  I
was involved with from about 2005 to 2019

{{00:01:28}}
with a company that's now called Kasasa.

{{00:01:30}}
We serve about 900 community
banks and credit unions.

{{00:01:34}}
So community banking is almost deep in
my blood and part of that  is of course

{{00:01:41}}
deposit gathering, which I think is what
we're going to be talking about today.

{{00:01:45}}
Absolutely.

{{00:01:45}}
We're going to be talking a lot about that
as well as community banks writ large.

{{00:01:48}}
I thought we'd start off as a big,
high level question, three, 30, 000

{{00:01:51}}
feet kind of question, but in terms of
some of the challenges that community

{{00:01:54}}
banks are facing, quite a number of
them, but what are the ones that you

{{00:01:56}}
think are really the most critical ones
that they're going to need to address?

{{00:01:59}}
It's really easy to talk topical and say,
now we're in this need for deposits and

{{00:02:03}}
then it'll be loans again, and then it'll
be deposits again, and everyone scrambles.

{{00:02:09}}
Probably bigger than that is, in my
opinion, is more of a strategic concern.

{{00:02:15}}
I think a lot of community institutions
in particular have grown up in this

{{00:02:21}}
world of jack of all trades, we're
the master bank, anything you need,

{{00:02:25}}
we've got the options for you.

{{00:02:28}}
And in the world  that  so dramatically
shifted in the last 20 something

{{00:02:36}}
years  I think a lot of community
banks are left wondering what

{{00:02:42}}
is their real strategic purpose?

{{00:02:46}}
Beyond the hills, rivers, and streams
that used to be our footprint,

{{00:02:51}}
if you want to, use that term,

{{00:02:57}}
Who do we want to serve?

{{00:02:58}}
How do we want to serve them?

{{00:03:01}}
And what will we be best in the world at?

{{00:03:03}}
Not what we know a lot about.

{{00:03:09}}
That really speaks to the heart of,
whether it's deposit gathering or loans

{{00:03:13}}
or whatever, it's what kind of deposits,
what kind of loans and, what are you going

{{00:03:17}}
to offer that's so dramatically different
than the thousands of other institutions

{{00:03:23}}
that are out there, than the very
large organizations, Google, whatever,

{{00:03:30}}
Twitter, X, et cetera, that are either
in that game today or certainly will

{{00:03:37}}
be here over the next couple of years.

{{00:03:39}}
Yeah, it's the way you talk about it
helps really underscore what kind of

{{00:03:42}}
moment this is for community banks.

{{00:03:44}}
And I think you make a good point
about pushing back a little bit

{{00:03:46}}
from the specific topics to really
think about how community banks

{{00:03:51}}
have to reimagine themselves.

{{00:03:52}}
And it's a very popular way of phrase,
but, really it does seem like they're

{{00:03:55}}
going to have to figure out both in
the intermediate term in the long term.

{{00:03:59}}
What are we doing here?

{{00:04:00}}
And who are we doing it for?

{{00:04:01}}
I'm wondering from your point of view
given the experience you have worked

{{00:04:04}}
with community banks, how would you
embark upon that kind of planning,

{{00:04:08}}
that kind of strategic thinking?

{{00:04:10}}
Some of its in their DNA, you know
There are some organizations that

{{00:04:15}}
we've seen shift that focus on
for instance without naming names.

{{00:04:20}}
I'll say women entrepreneurs.

{{00:04:23}}
And  when that organization looked
at the makeup of their executive

{{00:04:29}}
team and even the leadership
team before them, it was deep  in

{{00:04:35}}
entrepreneurship and women led businesses.

{{00:04:39}}
And so it was natural for that
shift to be like, Hey, let's, okay.

{{00:04:45}}
We're not, no one's silly enough
to just kill the cash cow and say,

{{00:04:48}}
we're no longer banking, people
with money, or whatever, let's shift

{{00:04:53}}
to go to talk to kids or whatever.

{{00:04:56}}
that's not going to happen, but, what the
purposeful sort of venture is, whether

{{00:05:03}}
it's women entrepreneurs are becoming, A
sponsor bank for credit cards or whatever

{{00:05:08}}
the case is where what has served us?

{{00:05:10}}
And what are we the best at today as
in mixed with what do we want to be?

{{00:05:15}}
Where do we want to where do we
think we can make a sizable dent?

{{00:05:21}}
Where is the need that sort
of thing and when you look at

{{00:05:27}}
banks that have made that transition are
in that process of that more strategic

{{00:05:31}}
focus, what they do is they'll, focus
their marketing, they'll focus their,

{{00:05:35}}
even their products  that's on their
website, they may have these other

{{00:05:40}}
products, senior checking or whatever,
but most of, in the case of the business,

{{00:05:47}}
the bank that's focused  on business,
they've got products that really

{{00:05:52}}
speak to the needs of an entrepreneur
and somebody who's trying to learn,

{{00:06:02}}
What she can do to better a
business, to acquire customers.

{{00:06:06}}
Things that are well beyond maybe
the traditional financial services

{{00:06:10}}
landscape,  but educational components
that a bank can surely offer up and get

{{00:06:17}}
people interested in, no matter where
they are in the country in this case.

{{00:06:20}}
And so they can attend these sessions
through Zoom or physically if they

{{00:06:26}}
happen to be around the corner.

{{00:06:27}}
And use that as a platform
to say, Hey, you know what?

{{00:06:30}}
We also happen to offer this
stuff, services that can help you.

{{00:06:34}}
But, but if you're here to learn,
we're here to have that conversation.

{{00:06:39}}
Right, that's really interesting.

{{00:06:41}}
The way you talk about the idea
of, banks, financial institutions,

{{00:06:43}}
going back to their DNA, to
my mind, that's a relatively.

{{00:06:46}}
It's a very optimistic or hopeful
sense of things and think instead of

{{00:06:49}}
thinking, you've got to get a bunch
of people around a table with a bunch

{{00:06:52}}
of brainstorming, you're thinking of
the future and projecting forward.

{{00:06:55}}
So often we're thinking about banks, say
we're writing about a partnership, we want

{{00:06:58}}
to talk about the bank and you go back
to the history where the bank was founded

{{00:07:01}}
and almost invariably they're fascinating.

{{00:07:03}}
It was a small little thing.

{{00:07:04}}
They met at the basement of a
schoolhouse and it was for the teachers,

{{00:07:06}}
it was for these farmers, whatever.

{{00:07:07}}
And then they become a bank and
they're like everybody else.

{{00:07:09}}
Yeah.

{{00:07:10}}
And it's really interesting because
I listen to that and it almost sounds

{{00:07:12}}
not so much a retreat, but almost a
refreshing of, wait a minute,  why would

{{00:07:16}}
we be doing this in the first place?

{{00:07:17}}
For some often very specific, very
key, obvious, important reasons.

{{00:07:20}}
And  what I'm hearing, at least in part,
is that some level of rediscovering that

{{00:07:26}}
might help them plan for the future.

{{00:07:27}}
That's exactly right.

{{00:07:28}}
It is, in a lot of ways, going back to
the idea of a community, and at some

{{00:07:37}}
point the community became defined as the
railroad tracks and the hills and  the

{{00:07:41}}
defining area that the FDIC or whatever
has said that this is our community.

{{00:07:46}}
But so many institutions were
founded in, we serve an agricultural

{{00:07:51}}
need, or to your point, teachers or
whatever that case is, auto workers

{{00:08:02}}
people came knocking and said,
Hey, can you also do this for me?

{{00:08:04}}
And then, before you know
it, it was an experience.

{{00:08:06}}
Yeah, we can do everything.

{{00:08:07}}
And it's just taking that
hard assessment though.

{{00:08:12}}
When you're in that space, there are
some things that come out where you're

{{00:08:18}}
like, Hey, We can't do lending for
taxi cab medallions anymore, right?

{{00:08:23}}
Maybe that's not necessarily the
business we want to continue, but,

{{00:08:27}}
maybe there is still a business here.

{{00:08:29}}
I don't, I'm just throwing that out there.

{{00:08:32}}
I would say, there's that hard work of
saying, this is not who we want to be

{{00:08:37}}
anymore, or we can't be that anymore.

{{00:08:43}}
The intelligence that drove that in
the past or the connection that had

{{00:08:46}}
that in the past is no longer here.

{{00:08:49}}
And maybe that's not where we want to be.

{{00:08:52}}
What is our next step?

{{00:08:53}}
And, it is sometimes, it does
lead to questions about, Hey,

{{00:08:59}}
maybe, we need to be acquired.

{{00:09:00}}
Maybe it's time to, for whatever
reason, or maybe it's time to think

{{00:09:04}}
about acquiring another bank and
growing in because they have a strong

{{00:09:08}}
foothold here and we want to get in
there, and they've got the knowledge

{{00:09:12}}
base or whatever the case is.

{{00:09:13}}
So yeah, it's very strategic
thinking, which is never easy.

{{00:09:19}}
You're doing it right.

{{00:09:20}}
It's uncomfortable.

{{00:09:21}}
And pisses people off, right?

{{00:09:25}}
But, if you're a team, you get to
the  right decisions ultimately.

{{00:09:30}}
Yeah, really, interesting.

{{00:09:31}}
I'm really enjoying our conversation.

{{00:09:33}}
Unfortunately, we're running out of time.

{{00:09:34}}
I did have one thing I wanted to
talk to you a little bit about.

{{00:09:36}}
We've heard a lot here  about customers,
customer experience, native new customers.

{{00:09:41}}
We had a presentation
talking about the Gen Z.

{{00:09:43}}
You're talking about the
creatives now that you're

{{00:09:44}}
dealing with Manifest Financial.

{{00:09:46}}
It's has bloomed out of nowhere, it feels.

{{00:09:48}}
What are your thoughts
about the new customer?

{{00:09:50}}
We hear people talk
about the new customer.

{{00:09:51}}
When you hear that, what are you thinking
in terms of, okay, yeah, That is the new

{{00:09:55}}
person who we really weren't thinking
about serving before, but we better

{{00:09:57}}
be thinking about serving them now.

{{00:09:58}}
Oh boy.

{{00:10:00}}
when I think about new customer, I
clearly am thinking  about maybe a

{{00:10:04}}
different one than, somebody who's
on stage talking about, alpha or,

{{00:10:10}}
Gen Z or, whatever the case may be.

{{00:10:13}}
When they think about a retail
customer, and  maybe I have

{{00:10:20}}
too simplistic of an opinion.

{{00:10:22}}
But my opinion is, define your
customer and find out what they want.

{{00:10:29}}
Talk to them.

{{00:10:31}}
and, that's, where Manifest previously
Nerve, that's where our products that came

{{00:10:37}}
from was creators were telling us, Hey,
in fact, it came out of that pandemic.

{{00:10:42}}
Hey, our money's getting
tighter than ever.

{{00:10:44}}
We're, in the case of musicians,
we're pulled off the road.

{{00:10:48}}
we're not able to even have our day
jobs to provide  and we lack the access

{{00:10:56}}
and the education, around how to manage
our money, how to think about building

{{00:11:01}}
our businesses and that sort of thing.

{{00:11:04}}
Nothing should happen at your bank
without deeply understanding your

{{00:11:09}}
customers' ever changing needs and who
they're currently using to serve those

{{00:11:14}}
needs and how they access those needs.

{{00:11:19}}
It almost, in my opinion, and whatever
it's worth, your customer, they will

{{00:11:25}}
always have particularities around
how they think about the world and

{{00:11:29}}
how they, how they acquire certain
things or how they do certain things.

{{00:11:33}}
And that's an important makeup.

{{00:11:37}}
But in my opinion, that
comes from primary research.

{{00:11:40}}
Secondary research can help help you
figure out the size of the prize.

{{00:11:44}}
So there are enough of these
customers to support the

{{00:11:46}}
business, all that kind of stuff.

{{00:11:48}}
But primary research is what should
drive your product set, your strategic,

{{00:11:53}}
in all the strategic inputs you
need in order to  push forward.

{{00:11:58}}
Interesting.

{{00:11:58}}


{{00:11:59}}
again, I had a really fascinating time.

{{00:12:01}}
This has been really interesting.

{{00:12:01}}
Again, some of the points you brought
up with regard to customers and

{{00:12:04}}
with regard to how some of  that
necessary strategic thinking can

{{00:12:07}}
really begin and really be fruitful.

{{00:12:09}}
Really some valuable insights, I think.

{{00:12:11}}
Thank you.

{{00:12:12}}
It's such a pleasure, David.

{{00:12:13}}
Absolutely.

{{00:12:13}}
Thank you.

{{00:12:14}}
And thank you for joining us as well.

{{00:12:15}}
Thank you.

Hi, I'm David Penn, Research
Analyst with Finovate.

We're here at FinovateSpring in San
Francisco, and joining me is John Waupsh.

He is the Chief Revenue Officer
with Manifest Financial.

I thought before we started talking about
some of the issues regarding community

banks and some of the challenges they're
facing, maybe we could just start off

with you telling us a little bit about the
work you're doing at Manifest Financial.

I'm the Chief Revenue
Officer for Manifest.

So we have a platform that, think of
it as APIs that allow companies that

serve creators, to better serve them
by using our embedded banking services

So as Chief Revenue Officer, I help make
sure that those partnerships happen.

And  in charge of the money,
making sure we bring in money.

that's gotta be an incredibly
interesting category that in many

respects hardly existed, let alone was
a monetizable category not long ago.

Believe it or not,  within
about three years  we're talking

So it's exploded in the  last
10 years or so for sure.

The and then prior to that, of course,  I
was involved with from about 2005 to 2019

We serve about 900 community
banks and credit unions.

So community banking is almost deep in
my blood and part of that  is of course

deposit gathering, which I think is what
we're going to be talking about today.

We're going to be talking a lot about that
as well as community banks writ large.

I thought we'd start off as a big,
high level question, three, 30, 000

feet kind of question, but in terms of
some of the challenges that community

banks are facing, quite a number of
them, but what are the ones that you

think are really the most critical ones
that they're going to need to address?

It's really easy to talk topical and say,
now we're in this need for deposits and

then it'll be loans again, and then it'll
be deposits again, and everyone scrambles.

Probably bigger than that is, in my
opinion, is more of a strategic concern.

I think a lot of community institutions
in particular have grown up in this

world of jack of all trades, we're
the master bank, anything you need,

And in the world  that  so dramatically
shifted in the last 20 something

years  I think a lot of community
banks are left wondering what

Beyond the hills, rivers, and streams
that used to be our footprint,

And what will we be best in the world at?

That really speaks to the heart of,
whether it's deposit gathering or loans

or whatever, it's what kind of deposits,
what kind of loans and, what are you going

to offer that's so dramatically different
than the thousands of other institutions

that are out there, than the very
large organizations, Google, whatever,

Twitter, X, et cetera, that are either
in that game today or certainly will

Yeah, it's the way you talk about it
helps really underscore what kind of

And I think you make a good point
about pushing back a little bit

from the specific topics to really
think about how community banks

And it's a very popular way of phrase,
but, really it does seem like they're

going to have to figure out both in
the intermediate term in the long term.

I'm wondering from your point of view
given the experience you have worked

with community banks, how would you
embark upon that kind of planning,

Some of its in their DNA, you know
There are some organizations that

we've seen shift that focus on
for instance without naming names.

And  when that organization looked
at the makeup of their executive

team and even the leadership
team before them, it was deep  in

entrepreneurship and women led businesses.

And so it was natural for that
shift to be like, Hey, let's, okay.

We're not, no one's silly enough
to just kill the cash cow and say,

we're no longer banking, people
with money, or whatever, let's shift

that's not going to happen, but, what the
purposeful sort of venture is, whether

it's women entrepreneurs are becoming, A
sponsor bank for credit cards or whatever

And what are we the best at today as
in mixed with what do we want to be?

Where do we want to where do we
think we can make a sizable dent?

Where is the need that sort
of thing and when you look at

banks that have made that transition are
in that process of that more strategic

focus, what they do is they'll, focus
their marketing, they'll focus their,

even their products  that's on their
website, they may have these other

products, senior checking or whatever,
but most of, in the case of the business,

the bank that's focused  on business,
they've got products that really

speak to the needs of an entrepreneur
and somebody who's trying to learn,

What she can do to better a
business, to acquire customers.

Things that are well beyond maybe
the traditional financial services

landscape,  but educational components
that a bank can surely offer up and get

people interested in, no matter where
they are in the country in this case.

And so they can attend these sessions
through Zoom or physically if they

FinovateSpring

Expert Insight

John Waupsh, Chief Revenue Officer of Manifest Financial, discusses the importance of defining the strategic purpose for community banks. The conversation covers the importance of adapting business strategies to evolving customer needs and John emphasizes the value of primary research.