Blend’s Head of Business Development says the kind of solutions his company offers work best if a customer is willing to incorporate them in an overall commitment to reimagine how it does business.
Among the biggest problems Brian Martin observes when mortgage and other financial services companies start to consider technological innovations: Too many people are thinking too small.
Head of Business Development at San Francisco technology company Blend, Martin remembers a company that just wanted to take a button from their loan origination software (LOS) to order a report and have it on Blend’s platform. That was the extent of the change, he recalled.
“That was how they were going to innovate. And they were dead set on this,” he said. “And to me, taking a button and moving it from one place to another is not really changing very much. It’s just changing where someone clicks that button. What we’re trying to do is really think about how do we remove the button entirely. I think the challenge for a lender is to dream big, to think of bigger increments, not to think in marginal differences.”
Martin discussed dreaming big in the mortgage industry in general, and Blend’s contributions in particular, during a conversation with Mortgage Media’s Dave Matthews at the California MBA Innovators’ Conference. He viewed the conference as a great opportunity to look for potential partners to “really create a best in class experience for borrowers, for loan officers who utilize our product.”
Blend offers a digital lending platform. It’s a comprehensive space for loan officers to collaborate with consumers on their loan application in a simplified and time-effective manner, generate a pre-approval and handle all the tasks needed for closing. It uses a conversational interface to make the process user-friendly for consumers. Blend has some 170 customers. They’re primarily financial institutions, independent mortgage bankers, credit unions and includes such large lenders as Wells Fargo.
“Blend really is an omni-channel solution that works regardless of which approach you want to take. And it really depends on how you want to use our product,” he said. “We see some people who are with very successful direct-to-consumer companies using it. We see other people who utilize us as a kind of top-of-funnel marketing tool, to really capture and bring people into their funnel and then progress through the application eventually to a mortgage. So, Blend is pretty flexible in the way that it can be used.”
According to Martin, Blend’s founders were at Palantir Technologies during the mortgage credit crisis, working with large institutions trying to work through their mortgage portfolios and address the crisis.
“And what they discovered, is that all of the data was captured in documents,” he said. “Nothing was digital, nothing was structured. There was no way to analyze this problem, let alone get your hands around the problem. So that problem and that recognition of the problem was the genesis for Blend being formed.”
Martin explained that Blend is trying to reimagine the origination process.
“It’s extremely expensive. It’s very time-consuming to originate a mortgage,” he said. “How can we use technology to change that? How can we use particularly data to change that? And we really want to move from a document-centric world to a data-driven world.”
There’s plenty of progress down that road, he noted. But there’s still quite a bit more road to travel.
“I think that the problems we have to tackle today are still pretty big,” Martin said. “We’ve made great progress in the years that I’ve been here, but we still have a lot more that we can do, whether it be with machine learning or data extraction from documents to really turbo-charge the retail experience.”
Having spent most of his career on Wall Street, working at hedge funds doing convertible bond arbitrage and then moving on to Citigroup, Martin was inspired when he met Nima Ghamsari, who would become the Co-Founder and CEO of Blend.
“I think he’s one of the few people who I’ve ever met who can not only see dots that you and I don’t see, but he can connect the dots in amazing ways,” said Martin.
Embracing Real Change
What’s the biggest challenge to implementing FinTech solutions in the industry? Martin says it’s not really a technological challenge, it’s more of a cultural, philosophical challenge — how companies approach the idea and reality of change.
“Where we see Blend customers be successful versus where we see them havinge difficulty is in how they embrace the change management around implementing a new technology,” Martin said. “And those organizations that truly want to change themselves, we’re just an enabler to allow them to change effectively.”
The less successful scenario is when a customer company just figures using Blend’s platform will fix everything, and they don’t need to make any changes — not around processing, underwriting and , downstream effects that follow an application submission.
“You need to really reimagine those when you’re bringing in a FinTech company like Blend, and for a lot of people that’s really difficult,” Martin said. “It’s difficult for individuals to do, and it’s difficult to do at scale, to do that at the organizational level, across divisions, across groups, across many, many people. You really need to have a growth mindset and be adaptable and flexible.”
Blend’s approach with clients is two-pronged. First, get the buy in from the executives to implement Blend’s solution. And, as it gets closer to implementation and development, also work from the ground up and get loan officers and processors committed to and integrated with the tech. In other words, Martin said, they start top-down but wouldn’t be successful without going bottom-up.
Martin is finding executives to be more willing and eager to embrace innovation — change that will, in the long run, create efficiencies and customer satisfaction and help the bottom line — than in years past.
“While they may not be the most well versed in technical terms or how the technology works, they certainly are embracing of it and we actually have some of our best engagement with the ‘C-suite’ executives because they want to change. They recognize the need to change,” he said. “The challenge falls to their people to implement that change. But from a technology perspective, we find most of the executives to be really engaged, who are highly motivated to change and make their organizations more effective.”
Martin says they see eight to 10 days saved in terms of manufacturing alone.
“We don’t view ourselves as a vendor, actually, we view ourselves as a partner,” he said. “And I think this is what has made us successful — is when we go into a new engagement, whether it be one of the largest lenders in America or one of the smallest lenders, we view the partnership the same. And we’re really there to help them change their organizations, to implement the technology and to become more profitable and more effective.”