The Business Time Machine

Hello and welcome to The Purposeful Banker, the leading commercial banking podcast brought to you by Q2, where we discuss the big topics on the minds of today's best bankers. I'm Dallas Wells. Welcome to the show.

Today I'm welcoming back Sam Maule to the podcast. Sam is head of business development at Moov, which provides a modern digital payments platform, and he's also slated to speak at our upcoming BankOnPurpose leadership conference in November. So Sam, welcome back to the show.

Thanks, Dallas. Good to be here.

Yeah. So not your first rodeo here on The Purposeful Banker. So you were with us back in 2020, which in the grand scheme of things was not all that long ago, but kind of seems like a lifetime ago. We had you slated for that BankOnPurpose, which, like everything else that year, got canceled and rearranged. So we finally got around to getting everything back on the slate there. At the time you were with 11FS. So over those last few years, tell us maybe a little bit about what you've been up to and especially what you're doing now at Moov.

Yeah, so it seems like a lifetime ago, doesn't it?

Yeah, it does.

We've had a whole decade in about two years. Yeah, it's been a lot of fun. So I had joined 11FS around 2017, consultancy firm out of the U.K. One of the co-founders had co-founded Monzo and Starling Banks, two of the huge neobanks in the U.K. Had a ton of fun doing startup life. And then, right as COVID hit, I joined Google to work in Google Cloud.

Oh yeah, that's right.

Yeah, a good friend of mine was a VP at Google and someone over to ... I had said, Dallas, I would never join a global monolith company again in my life. 

Yeah.

And obviously, I had an escape clause to say, but I would join Google.

Right.

So I did the Google thing for a couple of years. And then talking with Wade Arnold at Moov, a chance to get back deep into payments, into startup life again, I just couldn't pass it up. I have to be honest.

Yeah, yeah.

So I have some internal flaw in me that really likes pain.

A glutton for punishment, aren't you?

Yeah, obviously. So I joined around February and honestly having a lot of fun. It's good to be back in this space.

Yeah, cool. Give us the quick rundown on Moov for anybody that's not familiar.

Oh, I love how Wade describes it. We are a network of networks when it comes to payments. It's in the name, everybody, Moov, M-O-O-V. We move money. Money in, money out.

Sounds simple, right? Yeah.

I love that. And that's always the challenge when you try to sell it because they're like, "Oh, OK." And you're like, no, no, no, you don't understand.

Yeah, yeah.

The sheer pain that's doing bare metal direct connections is unbelievably hard. Simple is hard. Right, Dallas?

Yeah, that's right. That's right.

You know at Q2, simple's hard.

Yeah, absolutely. So since 2020 last time we talked, so you've had a couple moves, a couple changes. The industry's changed a lot too in those four years. So lots of digital transformation, banks and fintech still doing this dance of are we friends or enemies or both?

AI all of a sudden makes this, what feels like a quantum leap to the top of everybody's either wish list or fear list, or again, maybe both. So maybe we can talk about a few of those wherever you want to jump in, but where do you feel like there's big changes in those realms coming in the next few years?

And especially when we talk about, for this particular audience, generally skews a little more on the commercial side. I think we see a lot of press about what's happening in the consumer landscape. The commercial tends to be bigger but quieter in a lot of ways. So maybe talk about what you're seeing out there.

Yeah. And Dallas, I'm so glad you brought that up on the commercial side. When fintech really kicked off, I was actually living in London in 2008. When we kind of talk about the birth of fintech, even though Dallas, you and I both know fintech's been around since tech has been around.

Yeah, yeah.

Let's be honest, we just gave it a name. But we have seen such incredible growth happen just over the past few years. Going through a global pandemic and everybody's shift to digital had a lot to do with that, and we all know that. We're seeing, when it comes to a bit of a reset back to the trajectory growth we saw pre-COVID, when it comes to digital adoption.

But then we throw in AI, and I had a front row seat to that when I was at Google. When ChatGPT came out and OpenAI, and you take your pick and everybody's heads exploded and hype curves and you take your pick. Every article, every speaker talking about AI and everybody changing their domain to .ai. It's amazing how many AI companies there are out there now.

Yeah. All of a sudden, yeah.

Yeah. Probably my favorite thing about AI is I believe it's the island of Antigua now derives 20% of their GDP from domains registering as an .ai. You can't make this stuff up.

Yeah, that's fantastic. You know what? Good for them.

Hey, there's a ton of different ways to make money and when you make money you have to move money and store it. Right, Q2? Right, Moov?

Yeah, that's right.

But AI is fascinating because it's not new. This has been going on ... Really, you can go back to World War II to look at the science of AI and where this has gone and the whole family of products that fall under AI. What changed about a year and a half ago is now we had a GUI. Now we have an interface.

Right.

ChatGPT comes along. Claude.ai, you take your pick. Gemini. You now have an interface that the masses can go out and play with. The technology was always sitting there, but now we start building up these large language models, we can really start to contextualize what this can do. This happened way back when, when Apple and Steve Jobs actually built an interface, a GUI, to actually use computers. And we went through a revolution there.

That's what's happening now. We are still so nascent in this. This comes back to what we've hyped up for the past 10 years, which is big data and being able to actually go in and analyze and crunch and use the data that we're collecting on structured data for the most part.

And where, again I would agree with you, where the exciting part of this is on the commercial side, because you're talking extensive amounts of data that you can pull in horizontally and vertically, work with it to anonymize it, and in real time and via streaming data components, make real-time decisions and real-time impact. I'm trying not to be too excited here, but I'm incredibly excited about where this is going to go and I'm incredibly aware that we are in such early stages. Everyone's looking for ROI right now. Calm down. It's coming. It's coming. Calm down a little bit. Okay? Our attention spans are so short.

Yeah, I like where you went there with putting an interface to it. Data, in particular, it's such an abstraction. It's like everybody sort of gets it conceptually. Yeah, there's a lot of data there. Surely we can do something with it. And ChatGPT, although that is certainly not the final interface and not the one that is really seeing most of the, I would say, commercial use cases now, but it's the one that people can wrap their brains around and they can start to make some sense of like, “Oh, I see what these models are doing.”

But in the commercial world, and interestingly enough, I think where we see as people do seek out the ROI, the first place they seem to be landing is in fraud. And that's AI being weaponized both directions there.

Good place to start.

Yeah.

Good place to start.

Massive amounts of data and lots of patterns to go try to recognize. And I had an interesting conversation with a bank yesterday where we were talking about why that's one of the early places that Q2 has jumped in in using AI. And where the conversation went is if we were to try to use even a chat interface and make a recommendation to a business or to a consumer, to an end user in our online banking platform, and say like, “Hey, you do have enough money to buy that car,” or “You should open a CD,” or “Don't pay your rent yet because you don't have the money in there.”

If we're wrong in one of those recommendations, there's not a lot of forgiveness there. It's like you harmed me with the technology. You bludgeoned me with it. Versus if we're doing it to detect fraud and we surface this thing and say, "Hey, this looks suspicious. Are you sure this is right?" And we don't have to be right all the time there. We can have some false positives. And they're like, "No, that's good. I want you to be hypervigilant and bring some of those things to me."

But it feels like we're, to your point, in the early innings, we got to find these places where there can still be a human in the loop. We have a little bit of room to sand the rough edges off the technology. But behind the scenes we're finding lots of new potential fraud. We're doing it with a fraction of the overhead that we would need. There's real returns there, but it can still be a little messy in these early innings.

Yeah. One of my favorite quotes about this, there's two that I really like. And one is as we're moving money faster and faster, so we talk about real-time payments or FedNow or you just take your pick, right? ACT, OCT, money movement. If you're going to have real-time payments, you're going to have real-time fraud and you have to be able to respond.

Yeah.

And you have to be able to analyze. And with what you said, it is OK to err, even though it's really not err, it's being precautionary to say, "Hey, we're seeing this pattern," and to give that nudge because you're building trust when you do that. The opposite is the case you gave before that, right? To say, "Hey, do you really want to make that payment now?"

I have four kids and for any of those that have kids and we're trying to provide advice to our kids, if you're coming in it from that standpoint, that never works. If you do the flip side of it, those nudges tend to be a heck of a lot better. And I think fraud is a great place to start when we're talking about big data and AI and real-time decisioning because of just the escalation that we're seeing.

The reality is the fraudsters are very good at tech. Q2, you know that, right? At Moov, we know that. They're incredibly good about this. They go out and read ISO-8520 and every other standard, probably know it better than a lot of the people in payments. And so they're constantly looking for those holes and those areas where there's vulnerability. And being able to do that analysis in real time requires, I do think, these large data sets, these algorithms that we can tweak.

But I love your other point about the human in the loop. I was on stage with Beverly Anderson, she's the CEO of Boeing Employee Credit Union, fifth-largest credit union in the country. And we were talking about AI and her statement was, "Our approach is this: digital first, human always." I love that.

Yeah.

A great, great concept. The fact that we can use these tools to augment our employees, to make them superheroes, to be able to respond that much faster and that much more intelligently. I would agree. You're still going to have that human in the loop, and I love that, personally, because the superpowers.

Yeah, absolutely. I think the other place this conversation naturally goes when we start talking about data and especially the way you described Moov, as a network of networks, and we certainly see the same thing on our end of the payment ecosystem. The money movement ecosystem's gotten really complex, and it's splintered I think in a lot of good ways. There's a lot of innovation there. There's a lot of choice.

And I think there's clear uses for data and technology to find the most efficient, most effective route for the money, whatever we're trying to do with it. But all those connection points also feel like, those cracks, are exactly what the fraudsters are seeking out. And where we tend to see the fraud happen is in those handoffs. From one place to another, there's inevitably some blind spots there. There's some timing gaps. There's whatever.

And so to me, the interesting trick that we're facing is getting enough of the data out there and shared where all those various networks that touch each other have all the information they need to efficiently move the money to fight the fraud, but that's also a potential liability of now that data is out there. And I mean, heck, every one of us just had apparently our Social Security numbers exposed by our friends at the U.S. government. So maybe it doesn't even matter anymore.

But it feels like this is the trade-off that we're all kind of trying to evaluate. And the regulators are right in the middle of this too, of this balance between data security and data use cases. Which has always been the trade-off but, man, we are just running headlong into that. So thoughts there on, is this a fork in the road where we have to pick a place or is this just a battle we keep fighting forever?

Yeah. I believe that the more and more as technology becomes part of us ... And man, that sounds weird, but let's be honest, right?

Yeah, we're there.

How close is your phone to you, right?

Yeah.

It's closer than my kids.

Yeah. This idea now that we are always plugged in. And we are. I am sure your phone is in the nightstand next to your bed. I'm sure, like me, you check it before you go to bed and in the mornings, even though we know we shouldn't be doing that. We have to resist the to check it when we wake up at night.

Yep.

It has become part of our lives, and we just see that woven in across all aspects. And this is beyond banking and payments. This is just us as humans. This is becoming an integral part of us, both good and bad obviously.

We're not going backward, which means we have to regulate. That's incredibly hard. I do feel bad for ... Hey, I'm in payments, but I'll say it. I feel bad for the regulators because the pace of change, the pace of technology, has accelerated beyond any control that we can have of putting guidelines around this. That's incredibly hard. For the most part, from a regulatory standpoint, we're still acting like we're on landlines, which is understandable because when it comes to banking and payments, we're operating on systems for the most part that were pre-internet. Pre-mobile phones.

And by the way, let's say this, and it's just shout out for Q2 and the U.S. banking system. We're the gold standard in the world. We just are. Everyone talks about, they look at the U.S. and they're like, "Oh my God, you have 4,000 banks and 5,000 credit unions and what a mess."

And we're like, "Yeah. And by the way, you work off the dollar and your money comes here."

Yeah, it kind of works. Yeah.

Was it Churchill said, democracy is the worst form of government. But ...

Except all others. Yeah.

Amen, right? So how do we operate within that environment? This is just going to be continuous change. We're going to have to be able to move faster. I do think the convergence of AI and cloud and big data and the internet of things all help with this.

I mean, think about this, Dallas. From a fraud standpoint, the amount of tools we have now to combat fraud. So your mobile device, that's a touchpoint. I can authenticate where I'm at in the world. The biometrics integration with that. That's another protection point, touchpoint that I can use. The identity of the tools that I use, where I'm at, geolocation, patterns and behaviors that I have, heck, the way I do my keystrokes. You know all this, right?

Mm-hmm.

The pace at which I walk is unique. Evidently, the odor of my underarm is unique. My pulse is unique. My fingerprints are unique. The more we learn about the human body in conjunction with the devices that we're using, whether it be our car, devices in our home, you take your pick, it makes us incredibly more complicated.

To your point, it gives us more touchpoints to where we can be exposed to fraud. But at the same time, we should be able to respond that much faster. Unfortunately, we're still working on that. I'm going to get the stat wrong, but the number of days that it takes to actually realize you've been breached in a data breach, I believe, is still above 220 days to identify the breach. Man, that's depressing.

Yeah. It is. It's essentially an eternity that equates to forever.

It's reality. It's reality. That's the reality we live in. Data breach is going to happen. There's going to be exposure. Like you said, everybody's Social Security number is sitting out there. When it comes to health care, our records are sitting out there. If you really want to get depressed, go on the dark web sometime. Well, don't do that. Have somebody who knows what they're doing …

There you go.

... Go on the dark web for you. And it just means you have to be hyperdiligent and vigilant. And the same is true for us as technology providers. We need to provide that level. That's something we're going to have to live with going forward. That's the downside. The upside is … how long have we been trying to crack the nut that's PFM?

Yeah.

The promise of hey, this is the card you should use to optimize your point, or this is the report groups you can use. We've never been close to solving that. I think we're going to start to get close to solving that. I really do.

And I believe companies like Q2 and Moov and others will be vital to that. And the ecosystem that we build and work in together, that we can start to finally get to this promise that we've had of helping people build wealth, make better financial decisions to get those nudges, and help move those along. I think you can see it in the distance now, whereas before it was a pipe dream.

Yeah. And it's almost like we've figured out by stepping in it a few times that this big scary thing that we were afraid of, "Oh my gosh, they're going to get my data. They're going to know my Social Security number and my date of birth."

Yes, they are.

Well, it turns out they have it. And even if a checking account is compromised. OK. We know what to do. There's systems in place where we know who's on the hook for that money, and we close the account and we open a new one, and it's kind of a pain, but life moves on.

And so I think as technology providers, our job is to make sure that, yeah, we're going to introduce some friction. Some of those things are going to ... It's going to happen to everybody at some point, but is there value that's worth it? And that goes back to that PFM thing of OK, as we first moved to the cloud, everybody had these servers literally locked in their basement and they're like hey, it's under lock and key. It's fine. Nobody can get to that information. But it was also stuck under lock and key in the bank's basement.

And so as we make use of it, there's upside, and then there's a little bit of a tax to pay for that, which is, yeah, we're going to have some exposure to this and we're going to have to figure out how to deal with that and pay for it. The interesting evolution that we're seeing from banks and credit unions in this, and it's been like everybody's top thing they want to talk about over the last few years, is there's so much fraud. "Help us figure out how to fight this."

OK, we're in the trenches with you on this, but help us define how much is too much? You say there's too much fraud. What's an acceptable amount? It's like credit losses. If credit losses are zero, you're probably not doing it right. You accept some level of past due loans in the business of making loans. We'll accept some amount of fraud in the business of moving money, but where is that threshold?

And I think that's the part that we're circling around, is what is the cost of doing business here? It feels like it's too high. I think everybody agrees with that, but now we invest and we get it down, but we got to come to some level of what feels appropriate there.

Yeah. My first job ... Well, my first job was in the Army, but we'll skip that. That's a whole ‘nother story. But the second job was in the Navy, and I didn't spend that time on surface ships. I was on submarines. We call surface ships targets. Everybody does.

Yeah, makes sense.

The thing about surface ships is they all leak. Every single one of them leak. There's an acceptable amount of water that can go onto a boat, but they have bilge pumps and they have systems to counteract that. It's an accepted part of being on the ocean. If you want to operate in, to be blunt, the most dangerous environment in the world, which are our oceans—everybody, go spend some time out there—you're going to have to accept that there's leaks that occur. It's part of life and you manage through it. 

And just like you said, there's an acceptable amount. You know that. How do you manage that and how do you counteract if you can and recognize where it's happening? A lot of it is awareness. It's a hundred percent. And awareness in real time of understanding where you're at and having that data and being able to react off of it.

But on the flip side of it, you discover whole new worlds. If Columbus, if Galileo ... Not Galileo. Hey everybody, you didn't know this, but Galileo was a sailor. Magellan. I wanted to say Magellan. Cooler. If Magellan hadn't set out to sea, think of what wasn't discovered before he actually went out there and braved it. And that's what we're seeing now with the data elements that we have, with the work that we can do with AI, the work that we can do in machine learning. The new worlds we can discover and the new services that we can discover and provide.

And by the way, allow Q2's customers to compete with the likes of a JPMC. JP Morgan is ... God, they're a great tech company.

Yeah, they're really good.

And they can afford to build these products out. My community bank down the road, not so much. But in working with partners like Q2 and Moov and others, you can compete. You really can. So to me, that's exciting. I am not a technology doomsday person. I am one that says, this is reality.

Yeah.

You're not going to go backward. So let's go.

A couple of episodes ago, we had Q2's chief technology officer, Adam Blue, who has, we'll say, a way with words. So the ones that we're allowed to publish are usually really good. He called this concept that I think we're talking about kind of business nihilism where it's like we're in this rut of we're doing something the way we've always done it. And we can see around us, that there's this opportunity, but it's like, yeah, but I don't want to be first. That seems hard, that seems risky. Maybe I lose my job. So we get in this pattern where we stay where we are.

And that feels like, I used the phrase a little while ago, fork in the road. I think that maybe is the fork in the road, is the institutions that are deciding, all right, technology is a positive thing. It's the great equalizer. It's how I can stand on a similar place as JP Morgan, and I can compete with all the advantages that I have in being small and nimble and local and all those things.

Or I can look at it and just throw my hands up and say, it's too much. I can't afford all the things. The regulation is too much. Just like you nail down the for sale sign in the front lawn of the bank and call it a day.

So this openness to change and maybe change management in an industry that has a reputation for not being great at that, are you seeing some changes there? Or maybe it's that maybe it's like the haves and have-nots there.

Maybe I'm an internal optimist. I don't know. Yeah, I think we're seeing that because here's reality. This is a podcast, so you all can't see me and how good I look, but I'll be …

You are looking good. Yeah.

... Yeah. But I'm in my much later 50s. And I always laugh because 10 years ago we would've taken a picture of a boomer and put it out there and them trying to work a computer and the memes you see and all that. Here's the reality. I'm pushing 60. I play on the Xbox like crazy. I use AI every day to help with my writing. I am out there experimenting and using just about every tool, and I'm adept at it.

And everybody, don't get excited, but I have a degree from Southern Illinois in workforce education and development. That degree, by the way, got me a job at Google, everybody. So there's hope.

There you go.

My God, there's hope. But it gets back to we live this way. We have a whole generation of, oh God, I'm saying it, the millennials, that word that by the way are 40s now. They've grown up with the technology.

Mortgages and kids.

And are leading companies. This is a reality that we're in, and I am highly encouraged by this, right? I'm dealing with bank CEOs. I'm dealing with boards where 10, 15 years ago, I was arguing with them whether Uber would work or not. This concept of I will go and have a stranger pick me up and having people tell me that'll never happen. It happened, everybody.

I'm highly encouraged now because the discussions go so much deeper on the technology front, and there's not a fear of this. And that's why I am incredibly optimistic for the U.S. in the banking front, and when it comes to payments and integration with, oh my Lord, take your pick. Every vertical SaaS company out there. I'm incredibly excited to see where the next 10 years takes us and how much this concept of banking changes.

And I'll circle back to what you started with, on the commercial side. We spent the first 10 years of fintech for the most part, just talking about consumers. Love them. I'm a consumer. But on the commercial side, man, the leaps and bounds where we can take this? Incredibly exciting.

Yeah. Real efficiency, real potential upside, and to impact their employees, their customers. When you make things better for a business, there's a whole group of folks that benefit from that.

When you allow them, and I say them, when you allow a small company to focus on what they built the company for. If you're a bakery, you want to focus on bakery and baking. You don't want to be invoicing and payroll management and forecast.

Yeah, sorting receipts all night. Yeah.

And by the way, you just said the secret word. You do that at night.

Right.

You have your day job, which by the way is 12 to 15 hours running that bakery or restaurant. And then at night you're doing your second job, which is the finance of banking components of this. The more we can take advantage of the data that we have, take advantage of our subject matter expertise to make their lives easier and to give them those nudges and guidance, the better. And better for the economy, the better for our communities. I mean, take your pick.

Yeah. I just recently had a generator put in at our house, and the installation crew came, did their thing, and from their tablet was able to immediately invoice and accept payment. And they walked away and all the paperwork was done. And so probably even five years ago, that was the thing where that guy, at night, would've had to go home, create an invoice, stick it in the mail, wait for me to get it, write a check, send it back to him. Right? There would've been multiple steps and many days in between that, versus now they walk away. That's the efficiency that I think is at our fingertips now in all directions.

Man, and expand on that, right? Yeah, same thing. I had an HVAC work done on my house here in Florida. That's not cheap.

No.

The idea of, great, I could do lending right then and there. The number of touchpoints, what we've done with technology is we've moved it from, you had to work in banking hours of 9 to 5, to an ATM, to then a mobile phone, to now where literally everything I'm doing about treasury management and that relationship is now in my hand.

We've taken that closer and closer and closer to the point of need and the point of opportunity, even if it is cross-selling, doing a loan, bringing in yet another ... A marketplace partner to do that additional work and making those decisions right then and there.

Basically, we've created time machines where we've condensed time down to literally that point of need and those decision points right then and there. And again, that's what companies like Q2, Moov, and others are doing. We're time bandits, buddy. We're lowering that engagement and those touchpoints right down to that point of need. And to me, that's exciting.

That's the magic, right? Yeah. Love it.

That's the magic.

Before we part ways here, as we said in the intro, you're going to talk at our BankOnPurpose, our leadership event that we put on. We also typically share out those talks after they're done for those who aren't able to attend. So without too many spoilers, give us an idea of what you'll be talking about there.

Yeah, man, it's going to be a lot of fun. One, thank you for hosting it in Austin in November.

Yeah.

Not in August.

Yeah. We've learned that. We've done both and …

Genius.

... It seems like people like November better. Yeah.

Yeah. I can actually step outside without melting.

Yeah.

I'm really looking forward to this. I touched on this earlier in our conversation, but my first real job was on submarines. I spent 10 years in the ‘80s and early ‘90s bouncing around underneath the water. And there's so many lessons that I still apply 30 years later now in my career in banking and payments that, especially from a leadership standpoint, that tie back to those lessons that I learned.

Because if you think about it, a submarine is purposely built to sink. And by the way, operates incredibly well underwater. A submarine on the surface is horrible, by the way. It's like being on a roller coaster at Six Flags for three months straight, by the way. No break. Don't recommend that. It's a great diet plan.

But when a submarine is made to go run silent and run deep, which means it's operating under pressure 24/7. When I say pressure, for every hundred feet you descend, the sea pressure increases 44 pounds per square inch. So you can do math, right?

Yeah.

But the secret is you want to run deep. You operate in that pressured environment. That's like the sweet spot for a submarine. Man, if that doesn't sound like banking, external internal pressure that is put on you and how do you operate and make decisions? And by the way, no leaks. Leaks are bad.

Yeah, leaks are bad there.

Talking about fraud, leaks bad. But how do you operate in an environment like that and how does that actually equate to what I've seen now over the past 30 years? I'm going to tie those two topics together and share some good sea stories.

Answer the age-old question of what's the greatest submarine movie that was ever made because y'all are getting it wrong. I will talk about it when we're there. It is a lot of fun. It's always fun to go back and look and reflect on those sea stories under pressure. So that's what I'll be talking about.

All right. Good stuff, Sam. Looking forward to it. Really appreciate you coming back, having a good talk through this. Enjoyed it and look forward to seeing you in November.

Excellent. Thanks, Dallas.

And thanks to everybody else for listening to this week's episode of the Purposeful Banker. If you want to catch more episodes, please subscribe to the show wherever you like to listen to podcasts, including Apple Podcasts, Spotify, Stitcher, and iHeart Radio. As always, we'd love to hear what you think in the comments, and you can learn more about the company behind the content visiting Q2.com. Until next time, this Dallas Wells and you've been listening to The Purposeful Banker.