Disrupt Radio interview with CEO Anthony Baum.

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Transcript

Lucinda Hartley here and speaking with me now is Anthony Baum, founder and CEO of Tiimely, a fintech company who's got a claim to fame of being a world-first with a cheaper home loan, delivered faster, less than one hour from starting your application to delivery. Anthony, thank you so much for joining me this morning.

Thank you for having me, Lucinda.

So your technology on disrupting the home loan sector sounds pretty exciting. I think most of us have had the experience of trying to get our heads around how to get a home loan, and it's quite a complex process of contacting someone who asks you for pages of information and crunches numbers and takes quite a long time to get back to you. You're claiming you can do that in less than an hour. Can you talk me through how your technology is put together?

Of course, I can. Thank you for the question. So we realised in about 2015 that it was possible through the collation of various data sources available in the market technologies like OCR, to basically build a platform that enriched and automated the entire home loan lending process. There are about 134 different business type rules, decisions that need to be automated to complete a home loan process. And what we did was set on a mission to create the World's First Instant Home Loan, which we actually trademarked.

We launched in 2017, so we spent about a year building that platform with capital from the founding team, me predominantly, and also Bendigo and Adelaide Bank, who became a shareholder. And we launched in 2017 under the brand Tic:Toc, which we've rebranded for obvious reasons and basically have been refining that technology, developing our machine learning and automation capabilities religiously and consistently.

Since then, we've now invested over $100 million in the platform today and as a consequence, it's very good at real-time assessment of you as a customer. It's very good at achieving a responsible lending outcome. And I don't think we talk about that enough in Australia. It also takes a whole lot of cost out of the process of onboarding a customer for a home loan. So that's everything from actually collating and collecting the information in the first place, right through to credit assessment and then settlement.

So do you replace a mortgage brokers role in that scenario? Could a consumer just directly use your platform and get approved for a bank loan?

Yes. Correct.

So we have five brands in market that offer a direct digital home loan today on our platform. They're obviously the Tiimely home brand, which is our proving ground. They are the Bendigo Express home loan. UP, the digital bank uses our technology for its home loan. Qantas Money Home Loans. You get a Qantas Money Home Loan, that is us and also NRMA Insurance now have a home loan and that is also us.

So, I imagine each of these banks have quite different criteria that they're looking at this. This sounds like it's a perfect case for automation.

Yes, that's right, because policy automation is predominately now we built the platform configuration. Effectively, if you think of us, we're like this shared infrastructure that enables a digital home loan and we're actually more than that and will come onto it. But our core proposition that we've been working on since 2015 is really it's a digital home loan infrastructure that enables everything from webchat to settlement to be incorporated in a single platform with extremely high levels of automation and therefore consistency of credit policy application and consistency of customer decision and you know, that is really exciting because the reality is, is that the point you raised earlier, until you go into that home loan process with who you choose, it will be quite bespoke, complex and frankly, you can complete it online with our platform under any of those brands faster than you can drive to visit your broker or your bank branch.

Yeah, I can imagine that. And I'm actually going through that process right now myself. So I'm very familiar with the pain points that you're discussing. Certainly from a customer perspective, there's a lot of barriers. I’m interested to know what's next for the platform. But before we talk about that, how did you arrive at this kind of technology? So you've got a background in finance. How was it this pain point that was one that you just really decided that you wanted to give time and effort to?

So my background is, as you point out, a banker by trade. So I'd run large banking businesses. I was a group exec at Bendigo and Adelaide Bank for a decade. One of the businesses I'd run was a third-party mortgage business, which was a large business, a billion dollars of home loan activity a month.

I then went and ran a fintech that was listed based out of Perth that developed really good technology to automate the provision of finance at point of sale, effectively a predecessor to Afterpay. And so what I saw with that role before we sold that business, and in fact part of that business was ultimately acquired by Afterpay, it was actually possible to automate any type of consumer lending process, given where AI-based technology to machine learning models or enrichment had evolved, and by 2010 we were doing that, and then by 2014 we sold that business.

Then I started consulting in the banking industry for a short period and built a quite successful team of consultants. And we were advising banks on the digitalisation of the lending process and they would pay a lot of money to tell them how to do it and literally you would watch that know-how go in a draw.

I watched the million dollars worth of consulting work go in a draw and I said that's the blueprint. That is the blueprint to building great digital lending capability and not just for home loans. And the reason we chose home loans is because it was actually the biggest problem area in consumer lending. It had the highest cost of origination, the worst process for the consumer, the biggest opportunity to take cost out and therefore drive consumer benefit.

So it sounds like you've got a really great way of meeting a pretty high pain threshold for a consumer, but also a pretty systemic problem for a lot of banks. You've built a really exciting product with faster, cheaper home loan assessments. You also raised capital in February this year for Tiimely. I'm interested to know what's next for the platform, i.e. is there more in the home loan space? Are you moving into other areas of financial services?

What we've found is there's a lot of demand, for specific parts of our platform. So automation of a specific part of a lending origination process or hardship assessment, a lot of digital nurturing, and customer empowerment.

Can you explain digital nurturing? It’s a term I haven't come across before.

So for example, if you're interested in a financial product or service, 'am I eligible for that product or service before I formally apply?' is something that a lot of consumers have an interest in because once you get into the actual application process, people are putting a stamp on your credit file that they've looked at your credit worthiness. They are formally digging into your financial position, which you need to provide them to provide.

Do you want the product? Will the product lend you the amount of money you're looking for? Is the purpose that you're looking to borrow for a purpose that is eligible? And so now using our API’s and our enrichment and automation functionality, you can build really good digital consumer engagement experiences, leveraging that functionality without needing to try and build it all yourself and integrate into your overall consumer proposition. The ability for the consumer to gain that empowered position and understanding before they make a decision whether to actually move forward with your product or service.

A lot more transparency, I imagine?

Yeah, control, comfort and it's really good for the financial institution or product provider because you know, the reality is, is that if the customer's not certain and then you go and do a whole bunch of activity, even including third party charges like calling the credit bureau, if the customer does not proceed, you've still got and have borne that cost base. So we're finding that the calculators that everyone's built in the past in terms of lending eligibility and things like that, just don't cut it anymore.

Sounds like there’s some really important areas across the banking space that this technology applies to. And I love the approach that you've got to the broader consumer market because I think everyday consumer interaction with banks isn't always the most seamless, positive customer experience. It sounds like it's the right technology.

I just want to turn to just fintech more broadly for a moment. You've obviously built a really successful fintech company here. Australia has seen some fantastic success stories in FinTech. You mentioned even your previous business was acquired by Afterpay. That's probably one of the unicorns, but there are many others. Do you think Australia is a really great global environment for fintechs and or not?

What my experience has been building Tiimely and in the industry before, that the ones we build and get to scale like Tiimely and are successful, are really good and have really good technology and really good capability. I think it is a very, very competitive environment and that's why those that do rise to the top do really well. For those that don't. It's a really challenging environment because it is still quite a concentrated market. We have four big banks. We don't have sufficient competition. They would disagree with that. But you know, and some of them are our customers for our technology. At Tiimely we have two of the big six banks using our software as a service products that I just described to you, so they're our customers, but it is a very competitive environment. But we do build some really good FinTechs. So when it works, it works really well and otherwise it's quite a concentrated environment.

Anthony, that's all we've got time for, but I'm really excited by your product, Tiimely. Thanks for joining us on the show today.