Latest / Leaders In Payments / The Financial Connectivity Layer with Jose Bethancourt, Co-Founder & CEO of Method | Episode 498

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The Financial Connectivity Layer with Jose Bethancourt, Co-Founder & CEO of Method | Episode 498 · Leaders In Payments

• 0:00
  SPEAKER_00: Welcome to the Leaders and Payments Podcast, where we talk to sea level leaders from across the payments landscape, and we'll be discussing the products and services that impact the payment space today, as well as trends and predictions for the future of payments.
• 0:14
  SPEAKER_00: We will also hear stories from our guests about their journeys to the topic.
• 0:18
  SPEAKER_02: Hello, everyone, and welcome to the Leaders and Payments Podcast.
• 0:21
  SPEAKER_02: I'm your host, Greg Myers.
• 0:22
  SPEAKER_02: And today's special guest is Jose Bethancourt, the co-founder and CEO of Method.
• 0:27
  SPEAKER_02: So, Jose, thank you so much for being here and welcome to the show.
• 0:29
  SPEAKER_01: Thank you for having me, Greg.
• 0:30
  SPEAKER_01: Longtime listener.
• 0:31
  SPEAKER_01: And we just turned out to be a neighbors here in Texas, not too far from each other.
• 0:35
  SPEAKER_01: So it's great to have a fellow, fellow Texan here in the payments world.
• 0:38
  SPEAKER_02: Yeah, great.
• 0:39
  SPEAKER_02: So I look forward to the conversation today.
• 0:41
  SPEAKER_02: So before we dive into your career and the company, can you give us a quick snapshot of your personal background, maybe where you grew up, where you call home today, a few things like that?
• 0:49
  SPEAKER_01: Yeah, so I'm a longtime Texan, so we'll keep on with the Texan story here.
• 0:53
  SPEAKER_01: I grew up in in South Texas and the border with Mexico.
• 0:56
  SPEAKER_01: So for those who are not familiar, you know, Texas borders Mexico, of course.
• 1:01
  SPEAKER_01: But where I grew up is actually very close.
• 1:03
  SPEAKER_01: So towns like McCallan, Brownsville, those ring a bell for folks.
• 1:08
  SPEAKER_01: And my childhood was kind of interesting where we actually grew up on both sides of the border, where it was a five-minute drive to go from one side America and go to Mexico.
• 1:17
  SPEAKER_01: So there were times where we would go to lunch in Mexico and come back for dinner in the US, right?
• 1:22
  SPEAKER_01: Which is just such a fascinating kind of childhood growing up.
• 1:25
  SPEAKER_01: You know, as I was growing up and moving into what's adult life, college and whatnot, I've always been, you know, a tinkerer, a building, you know, you know, doing stuff.
• 1:35
  SPEAKER_01: I remember back in the day, I had some back when you could jailbreak iPhones and yeah, like uh the iPhone 4 and the iPhone 4S.
• 1:41
  SPEAKER_01: Those were the times, you know, it's changed since then.
• 1:44
  SPEAKER_01: But I've always just been so intrigued in building.
• 1:47
  SPEAKER_01: And uh past that growing, going to college and all that stuff, you know, you can see the Texas blood here.
• 1:53
  SPEAKER_01: I decided to stay and go to school in UT Austin, and and now almost 10 years since graduating my undergrad, I am thankful and uh every single day to call Austin home, where I've been now for almost uh 11 years and where Method is officially headquartered, even though our biggest office is New York.
• 2:11
  SPEAKER_01: I still tell people we're uh we're an Austin company, even though we have four times the people in in New York.
• 2:17
  SPEAKER_02: Okay.
• 2:18
  SPEAKER_02: All right.
• 2:18
  SPEAKER_02: Well, do you mind walking us through your professional journey and maybe how and why you started Method?
• 2:23
  SPEAKER_01: Totally.
• 2:24
  SPEAKER_01: So, I mean, as I was alluding to, like I've always just been a tinkerer.
• 2:27
  SPEAKER_01: I love building, and I love you know that feeling of having something in your hands, right?
• 2:31
  SPEAKER_01: Like, you know, you're building something, you can actually use it and seeing other people using it.
• 2:35
  SPEAKER_01: It's just energizing.
• 2:37
  SPEAKER_01: And through college, I've always, you know, we've always, my co-founders and I, we met in college and we've always been just experimenting and trying new things and building new things.
• 2:45
  SPEAKER_01: When we're coming up in our senior year and getting ready to graduate and kind of live our professional, professional lives, we we ran into this problem that we were facing ourselves, which was student loan debt.
• 2:56
  SPEAKER_01: We had kind of forgotten that we, you know, freshman year signed up for a bunch of student loan debt, and we just kind of moved on.
• 3:04
  SPEAKER_01: And you know, as we were graduating, you know, we got a letter from UT Austin saying, hey, you actually owe$50,000 each in student loan debt, like get ready to pay it.
• 3:14
  SPEAKER_01: And we were like, What?
• 3:15
  SPEAKER_01: Where do I, how do I, you know, we had no idea.
• 3:18
  SPEAKER_01: And, you know, we think of ourselves as fairly smart, like we can build you know, iOS apps and stuff like that.
• 3:25
  SPEAKER_01: But when it came to all this financial side, it was net new to us.
• 3:29
  SPEAKER_01: And we found that a lot of the folks that were coming out of college with us in our cohort had the same experiences that, you know, this is net new, who owns this loan, how do I pay it?
• 3:38
  SPEAKER_01: Do I pay$5 extra every month to get out of debt faster?
• 3:41
  SPEAKER_01: Like all those permutations and calculations we were doing by hand.
• 3:45
  SPEAKER_01: And we thought, hey, wouldn't it be cool if we could build an app or a system where folks could log in, find all their debts and specifically for student loans, and figure out the best way to pay it off and get out of debt faster.
• 3:59
  SPEAKER_01: So we set out to build this kind of side project kind of app, really initially for us, right?
• 4:04
  SPEAKER_01: Because we wanted to manage our own debt.
• 4:06
  SPEAKER_01: And eventually we started to give it to friends, to give it to other people.
• 4:10
  SPEAKER_01: And everybody was just really excited about the opportunity to manage their debt and understand it and see it in a way that wasn't before available, right?
• 4:18
  SPEAKER_01: Before you would have to log into five different servicers, pull a PDF, try and figure out what your interest rate was.
• 4:26
  SPEAKER_01: And then if you got a loan in 2015 versus 2019, each one of those had different interest rates.
• 4:31
  SPEAKER_01: So it was just a lot of manual work that was just too much of a pain.
• 4:36
  SPEAKER_01: So the app automated all that, and we ended up making it into an actual brand, and it ended up being called grad joy, so graduation joy by getting ready, getting bringing some joy to that graduation, even though you have a lot of student alone debt.
• 4:49
  SPEAKER_01: So we built it out and then we decided to apply to Y Combinator.
• 4:53
  SPEAKER_01: We, you know, were about to go into adult life.
• 4:56
  SPEAKER_01: You know, we were ready to be software engineers or co-founders and I.
• 5:00
  SPEAKER_01: But we said, hey, why don't we apply to YC?
• 5:02
  SPEAKER_01: We've always wanted to go, and we've, you know, try with a few ideas, and we are really passionate about this.
• 5:08
  SPEAKER_01: Like we are solving a problem for ourselves, and we were set to keep building this even, you know, past graduation, even if we didn't get into YC.
• 5:16
  SPEAKER_01: So, you know, I think you can see where this is going.
• 5:19
  SPEAKER_01: We ended up applying in the summer of 2019.
• 5:23
  SPEAKER_01: We ended up getting an interview.
• 5:24
  SPEAKER_01: We flew out to the Bay Area back when you know it was pre-COVID.
• 5:27
  SPEAKER_01: You still had to go in person and do that quick interview.
• 5:30
  SPEAKER_01: And then we ended up flying back that same day to Austin and they called us saying, hey, like we'll love to have you as part of the you know summer 19 covert.
• 5:38
  SPEAKER_01: So we we immediately said yes, turned down our jobs and just you know, moved uh after graduation.
• 5:44
  SPEAKER_01: We drove, we literally drove from Austin to Mountain View that summer, and we started building what will become gradjoy.
• 5:52
  SPEAKER_01: Long story short, here on how this leads into method, as we're building grad joy, we kept running into a common issue, which was folks didn't know how to find their debt.
• 6:03
  SPEAKER_01: Right?
• 6:03
  SPEAKER_01: The same way I got that letter, millions of people get that letter from their school, from their financial aid office, but they don't know who owns that debt.
• 6:11
  SPEAKER_01: They don't know the credentials, they don't know how to log in.
• 6:14
  SPEAKER_01: So, you know, we were using incumbent technologies which require the users to put their username and password.
• 6:20
  SPEAKER_01: But every user was like, hey, I don't, I don't know what my username and password is.
• 6:24
  SPEAKER_01: I never set one up.
• 6:25
  SPEAKER_01: Or we had folks who did have their username and password, but said, hey, I have loans with seven different servicers.
• 6:31
  SPEAKER_01: Do am I supposed to like log into each one every time?
• 6:34
  SPEAKER_01: And then you know it's brittle and it breaks.
• 6:37
  SPEAKER_01: So it was just a lot of connectivity issues on the on the financial connectivity side of things.
• 6:43
  SPEAKER_01: And for us, we saw it as table stakes to make this app work.
• 6:46
  SPEAKER_01: So that's when we decided to say, hey, how what is it gonna take to actually build a new way of financial connectivity that really fits into this app, right?
• 6:57
  SPEAKER_01: So that's when we started this side project, if you will, of financial connectivity, still within gradually, if you will, and then eventually will turn to be method, right?
• 7:06
  SPEAKER_01: I'll pause there because you know the story then kicks out into the method side.
• 7:10
  SPEAKER_01: But that's how how we ended up here and kind of the professional journey into what is now method.
• 7:15
  SPEAKER_02: Okay.
• 7:15
  SPEAKER_02: No, that that's a perfect segue because the next question is to tell our audience what method does.
• 7:20
  SPEAKER_01: Yeah, no, perfect segue.
• 7:21
  SPEAKER_01: But no, you know, method, uh, as you can probably get a sense of from from the conversation, right?
• 7:26
  SPEAKER_01: Method is a financial connectivity API.
• 7:29
  SPEAKER_01: So we saw the problem firsthand when building graduate.
• 7:33
  SPEAKER_01: There was, you know, no easy way for someone to locate all their student loans, all their liabilities, right?
• 7:38
  SPEAKER_01: Not only figure out the data for those liabilities, but also the money movement, right?
• 7:43
  SPEAKER_01: How do we actually pay off a student loan, make an extra payment?
• 7:46
  SPEAKER_01: We found that, and this was back in 2019, 2020, that there was no APIs to do this.
• 7:51
  SPEAKER_01: You know, there were some incumbent connectivity technologies that relied on using them in password and screen scraping.
• 7:58
  SPEAKER_01: But as we talked about, those are just difficult to scale.
• 8:01
  SPEAKER_01: And when you think of you know, the liability sign of someone's balance sheet, there's just so many different types of loans and credit cards that people have.
• 8:09
  SPEAKER_01: So to provide that holistic advice, it was very difficult to scale.
• 8:13
  SPEAKER_01: So we found that we really had to build from scratch, and that's what method ended up becoming, which was this financial connectivity API, where using someone's identity as opposed to their credential, so using someone's name, phone number, and SSN, we can locate all the liabilities they have under their name.
• 8:30
  SPEAKER_01: So not just student loans, but credit cards, mortgages, auto, personal loans, and enable that connectivity layer.
• 8:37
  SPEAKER_01: So enable, you know, a consumer to consent and say, hey, I would like to get my personal loan and I would like to share that with graduate.
• 8:44
  SPEAKER_01: I would like to get my student loan, I would like to share that with graduate, right?
• 8:47
  SPEAKER_01: So enabling that connectivity layer, and on top of it, we took it a step further and enabled money movement.
• 8:53
  SPEAKER_01: So it wasn't just read and write.
• 8:55
  SPEAKER_01: Sorry, it's not just read, but also read and write, and enabling that two-way communication that was never seen before, never seen before in personal finance.
• 9:04
  SPEAKER_01: And we took that, enabled, you know, the personal finance component of it, and then took it beyond and started working with lenders, debt consolidation, underwriting, and whatnot, which feeds into the broader method story.
• 9:17
  SPEAKER_01: But that's kind of how we ended up here and what ended up really becoming method after that discovery within graduate.
• 9:23
  SPEAKER_02: Okay.
• 9:24
  SPEAKER_02: Well, what's the biggest challenge that your company's solving for your customers right now?
• 9:29
  SPEAKER_01: You know, one of the things that we found when we did this pivot, right?
• 9:31
  SPEAKER_01: So we pivoted from Gradu and became method.
• 9:34
  SPEAKER_01: We went out to market and started talking to folks, not just in the personal finance space, but you know, across the board, anywhere where credit is being touched or being used, we went and talked to them.
• 9:45
  SPEAKER_01: So that was that meant us talking to folks like SoFi, Credit Karma, Upstart, Upgrade, Figure, right?
• 9:52
  SPEAKER_01: All these name household names that you that you know and trust.
• 9:55
  SPEAKER_01: And they kept saying the same thing.
• 9:57
  SPEAKER_01: They said, hey, we don't know when someone comes in to get a personal loan, we don't know what other debts they have under their name.
• 10:05
  SPEAKER_01: So we can't really help them, right?
• 10:07
  SPEAKER_01: We don't know if someone has a 29% average cost of capital or a 5% average cost of capital.
• 10:13
  SPEAKER_01: So we can't really target our offers.
• 10:15
  SPEAKER_01: We can make our messaging personalized, we can't help them understand what a 29% APR is when someone goes to sofite.com, for example.
• 10:24
  SPEAKER_01: So we saw a very similar challenge that we were facing when we were doing graduate, right?
• 10:29
  SPEAKER_01: And then on top of it, on the payment side, they said, you know, we have folks that come in and you know, mostly everybody that gets a personal loan is doing it for the purpose of consolidating their debt, right?
• 10:40
  SPEAKER_01: They're saying, hey, I have all this debt at high interest rates and I'm looking to get it at a lower interest rate and you know, access a better financial opportunity.
• 10:47
  SPEAKER_01: But again, because that brittle connectivity and that one-way nature of that connectivity, customers will become eventually customers, right?
• 10:56
  SPEAKER_01: But folks like SoFi said, hey, we have some data, we know this customer wants to pay off all this other debt, but we have no way of actually paying those creditors.
• 11:06
  SPEAKER_01: So what we have to do is either mail a check.
• 11:10
  SPEAKER_01: So mail a check to all these other creditors.
• 11:13
  SPEAKER_01: So that means you know you're sending$60,000,$70,000 worth of checks in the mail and you know, hoping that they get there, or give the check made out to the creditor to the customer.
• 11:24
  SPEAKER_01: So then the customer has to go to the branch.
• 11:26
  SPEAKER_01: So it has to go to like a JP Morgan branch and say, hey, I would like to pay off my credit card.
• 11:31
  SPEAKER_01: I mean, that was just a terrible experience, right?
• 11:33
  SPEAKER_01: As you can imagine, I saw you nodding because you know, you know, sending all these checks is it's crazy.
• 11:38
  SPEAKER_01: But those were the challenges that we kept hearing, which was just the lack of connectivity ends up falling back into these subpar experiences that in a way hurt the consumer.
• 11:47
  SPEAKER_01: We heard stories from consumers who said, I forgot that I had to mail the check, or I forgot that I had to call Chase and get a tri-party call with Sell Fight to authorize this payment.
• 11:59
  SPEAKER_01: And as a result, I missed my payment.
• 12:01
  SPEAKER_01: And now I'm getting charged late fees, and now I'm getting more in debt, right?
• 12:04
  SPEAKER_01: So it was just this cycle of debt, and I and you know, it was just so hard for people to escape kind of the cycle.
• 12:11
  SPEAKER_01: And that's what we found that our customers wanted to solve for, and that's where the technology came paired really well.
• 12:17
  SPEAKER_01: And we could say, hey, here's the solution where now with an API call, you can say, here's all the you know, credit items that Jose has open at other creditors.
• 12:28
  SPEAKER_01: And here's an API call to say, great, let's send the SOFI personal loan proceeds into this other credit card.
• 12:34
  SPEAKER_01: Let's pay off the student loan with this credit card, all you know, with the click of a button electronically and kind of in a way magically, if you will.
• 12:42
  SPEAKER_01: I can talk more about that, but that was really the problem that we felt and saw when talking to folks.
• 12:47
  SPEAKER_01: And what is so interesting, it just resonated with us.
• 12:50
  SPEAKER_01: It was the same exact issue we were facing when we were, you know, coming out of college, just taken at a you know 200, 100x size, right?
• 12:59
  SPEAKER_01: We know at first it was just this app for us, and now we're seeing the same problems with you know billion-dollar companies like SoFi.
• 13:06
  SPEAKER_01: So it was just really energizing for us to go and attack and solve that problem for them.
• 13:11
  SPEAKER_02: Okay.
• 13:12
  SPEAKER_02: And so maybe talk about the customer set.
• 13:14
  SPEAKER_02: I mean, you've mentioned kind of fintechs and so-fi, but who else you know uses your products and services?
• 13:20
  SPEAKER_01: Yeah, that's a that's a great question.
• 13:21
  SPEAKER_01: And you know, we've been thankful and have a great opportunity in front of us, and we've been able to take the technology and put it in front of some of the largest fintechs and financial services companies out there.
• 13:31
  SPEAKER_01: So some of the names include like, you know, SoFi, Figure, some of the bigger ones, like folks like Credit Karma and Intuit, where they're saying, hey, you know, we have a big swath of America, right?
• 13:43
  SPEAKER_01: If you think of Credit Karma, they have almost every American I mean has a Credit Karma account.
• 13:49
  SPEAKER_01: So now they're saying, how can method and the method data and the method productivity enable a better financial opportunity for all these Americans, right?
• 13:57
  SPEAKER_01: And I think that's where where it gets really exciting.
• 13:59
  SPEAKER_01: Recently we started to move beyond just lenders, right?
• 14:03
  SPEAKER_01: Uh, and the lending lifecycle and actually moving into the commerce lifecycle.
• 14:08
  SPEAKER_01: So if you can think about buying something or or paying your rent, right?
• 14:13
  SPEAKER_01: Those are the life cycles where credit is still in the mix and we can go and support those credit payments with our same two-way data connectivity.
• 14:22
  SPEAKER_01: So started working with folks like Built, where you know, when you go and pay off your rent, I learned rewards on that on that payment, methods in the in the in the loop, making sure that your credit card isn't rolled and making sure that your credit card is valid and that you are seeing all the cards in your wallet in one checkout experience, right?
• 14:40
  SPEAKER_01: So that's where we've been able to go most recently, but again, all in the same credit landscape and credit opportunity.
• 14:47
  SPEAKER_02: Well, what would you say differentiates method from your competitors?
• 14:51
  SPEAKER_01: Yeah, that's it's a really good question.
• 14:53
  SPEAKER_01: You know, by and large, we think about competitors, we are thinking about it in two ways.
• 14:58
  SPEAKER_01: One is the current actions that are happening, right?
• 15:01
  SPEAKER_01: And then two is like what the future state could look like, right?
• 15:04
  SPEAKER_01: And that SOFI example earlier of mailing checks, for example, that was kind of one of the one of the competitions that we were facing, which was like, hey, we've been doing this for years, right?
• 15:13
  SPEAKER_01: And we have a payment operations team that's able to handle this really well, right?
• 15:18
  SPEAKER_01: Like we don't need to do anything, right?
• 15:20
  SPEAKER_01: So that's one of those of like not needing to do anything.
• 15:24
  SPEAKER_01: But once they start to see the ROI and they see the value of this whole integrative life cycle, then it's kind of like a light bulb moment, right?
• 15:31
  SPEAKER_01: It's like, oh yeah, that makes perfect sense.
• 15:33
  SPEAKER_01: On the other side, there's a lot of solutions that do enable you to make payments to credit cards, right?
• 15:38
  SPEAKER_01: Like I'm not, I'm not gonna tell you that we invented, you know, payouts to credit cards or payouts to debit cards, right?
• 15:44
  SPEAKER_01: A lot of them have a lot of steps that you know are required for you to enable that.
• 15:48
  SPEAKER_01: Primarily the one that we've seen the most is entering a 16-digit PAN, right?
• 15:53
  SPEAKER_01: So if you want to go and pay off a credit card, you have to go in and type your credit card in.
• 15:57
  SPEAKER_01: What we found from some of our other customers who use that technology is that it was like a you know, opening or an aperture for everything from just typos where people would type the wrong account number all the way to fraud, right?
• 16:12
  SPEAKER_01: People were you know getting a loan using a stolen identity and then putting the real credit card so the money would flow into the real credit card underwritten by a stolen identity, right?
• 16:22
  SPEAKER_01: So it was just this vector for fraud, and we were able to take it, and I think this is really where it all starts to shine.
• 16:29
  SPEAKER_01: It's because of that two-way communication with the creditor that we have, we're able to not need to have that 16-digit entry where we can just say, here's all the cards that we found for Jose, which one would you like to pay?
• 16:43
  SPEAKER_01: And then the user doesn't have to input anything.
• 16:45
  SPEAKER_01: It is a secure end-to-end communication closed loop within the creditor, obviously the user who's consenting to it, and you know, on the other side, the application or the company who's utilizing this data, allowing for no fraud to occur, allowing for no time posts to occur, and enabling a true seamless payment experience in the workflow, right?
• 17:07
  SPEAKER_01: So that end-to-end connectivity is really what makes method shine, and it makes method, I mean, as we talked about, the solution that some of the largest fintechs and finserves out there uh utilize in these in these workflows.
• 17:20
  SPEAKER_02: Okay.
• 17:20
  SPEAKER_02: So are you taking a transaction fee or is it SaaS-based?
• 17:24
  SPEAKER_02: How's the business model work?
• 17:25
  SPEAKER_01: Yeah, we like to tie our success to our company's success as well, right?
• 17:30
  SPEAKER_01: So we make it a transactional basis, right?
• 17:32
  SPEAKER_01: Where we say, hey, if we're able to submit this payment for you, you know, we want to we want to split the win, if you will, and we wanna, at that point, we take a transaction fee.
• 17:41
  SPEAKER_01: And we have that model across all of our use cases, right?
• 17:45
  SPEAKER_01: If it's a lending underwriting use case or a lending payout or paying your rent, you know, with build, as I said, that's where we want to tie into that success.
• 17:53
  SPEAKER_01: So by and large, we we aim on the kind of more traditional success model on a transaction basis.
• 18:00
  SPEAKER_02: Well, let's talk about the future a little bit.
• 18:02
  SPEAKER_02: Where do you see the biggest growth opportunity in your segment?
• 18:06
  SPEAKER_01: I mean, I there's two two things that come to mind.
• 18:08
  SPEAKER_01: I'm sure you get a lot of this of AI, right?
• 18:11
  SPEAKER_01: Uh, and then and what AI is gonna do for payments and financial services in general.
• 18:18
  SPEAKER_01: And I think that's, you know, I'm gonna double down and say AI as well, because what we're seeing from our side, if you think about where we came from in 2019, we're building this app to help people manage their debt, right?
• 18:30
  SPEAKER_01: Now in the age of AI, that app is not needed, right?
• 18:34
  SPEAKER_01: As long as we feed the data securely to an AI agent with the consent of the customer, then we're able to enable a lot of these read and write actions, right?
• 18:43
  SPEAKER_01: So you can imagine someone going to something like ChatGPT or Claude and saying, hey, I don't know what to make of my finances.
• 18:51
  SPEAKER_01: I am struggling in debt in the debt cycle, help, right?
• 18:55
  SPEAKER_01: You can imagine ChatGPT or Claude saying, Hey, let me go do the work for you, right?
• 19:01
  SPEAKER_01: That's where our integrations come to come to fruition and are excellent for this use case because now you can think of an AI agent who's gonna go out there and say, great, I captured all your debt information from method.
• 19:12
  SPEAKER_01: I know who your creditors are and I know how to pay them.
• 19:16
  SPEAKER_01: Let me go see how I can optimize this debt.
• 19:19
  SPEAKER_01: And in the future, this part doesn't exist just yet.
• 19:22
  SPEAKER_01: You can imagine AI agents that go on your behalf and essentially are bidding, right?
• 19:27
  SPEAKER_01: Are bidding with other financial companies saying, hey, I have you know Jose here at an average cost of 29%.
• 19:34
  SPEAKER_01: Who would like to take his debt, right?
• 19:36
  SPEAKER_01: Who will like to help him out, right?
• 19:38
  SPEAKER_01: And you can think of all these companies that I mentioned now participating in that lifecycle and it's fully automated and it's uh maybe continuously on, right?
• 19:46
  SPEAKER_01: And customers don't even have to think about it.
• 19:48
  SPEAKER_01: So I think this agentic payments world is really exciting, but for us, it's taking it a step further, maybe a step deeper, if you will, and focusing more on the outcomes and saying how can agent payments and agentec lending, if you will, drive those outcomes for customers.
• 20:04
  SPEAKER_01: So that's something that I'm we're really excited about.
• 20:06
  SPEAKER_01: And we've been working uh under the hood with some of our companies and some of uh some of our customers as well on thinking about how do we enable that consent sharing and securely allow an agent to perform actions on your behalf, right?
• 20:19
  SPEAKER_01: And read your data on your behalf while keeping the trust and security that is at the core of method.
• 20:25
  SPEAKER_02: Well, what does success look like for method over, say, the next three to five years?
• 20:30
  SPEAKER_01: You're kind of hearing what I'm what I'm talking about here and there.
• 20:32
  SPEAKER_01: I think a lot of it comes from where we started, right?
• 20:36
  SPEAKER_01: When we started method, it came from a source and a place of like, hey, why don't we help other people achieve a better financial outcome?
• 20:43
  SPEAKER_01: And I think that's been at the core of method, right?
• 20:46
  SPEAKER_01: Because we find that the way method works as a as a network, right?
• 20:49
  SPEAKER_01: We think of method as a as a data and payment network, which is kind of what it is, right?
• 20:53
  SPEAKER_01: On one side, we have consumers, like your, you know, your actual average American.
• 20:58
  SPEAKER_01: And then you have on the middle layer, you have one of the financial services or platforms who interfaces with method.
• 21:04
  SPEAKER_01: And on the other side, we have you know the creditors for folks own that debt.
• 21:09
  SPEAKER_01: We have found that when we have use cases, and this is you know true for basically all of our use cases, if they are win-win-win as in every part of the stack is winning, that just makes the network a lot stronger.
• 21:22
  SPEAKER_01: And it makes every part of the stack win, right?
• 21:25
  SPEAKER_01: You have consumers on the other side who are saying, hey, I'm getting a better financial opportunity, right?
• 21:30
  SPEAKER_01: I was able to take my cost of capital from 20% down to 7%.
• 21:34
  SPEAKER_01: This is huge, right?
• 21:34
  SPEAKER_01: I didn't know this was possible.
• 21:36
  SPEAKER_01: You have in the middle our partners who say, Hey, I'm able to capture a new customer and I would have build loyalty with this customer, right?
• 21:43
  SPEAKER_01: And build a trusted partnership in the long term.
• 21:47
  SPEAKER_01: And on the other side, you have creditors who say, Great, this is a way to for consumers to get access to financial data in a secure way that we can get behind, right?
• 21:55
  SPEAKER_01: And we can enable that data sharing in a secure way.
• 21:58
  SPEAKER_01: So everybody in the staff.
• 22:00
  SPEAKER_01: is winning.
• 22:00
  SPEAKER_01: And I have, and we've what we found is that if we keep doing this over and over again in different verticals, right now moving into the commerce and checkout space is what success looks like for us in the really long term.
• 22:11
  SPEAKER_01: It's like keeping that keeping that trust and enabling consumers to access a better financial opportunity.
• 22:16
  SPEAKER_01: And we found that if that is at its core, then everything else will happen.
• 22:21
  SPEAKER_01: Even if it's AI driven or not AI driven, or if it's, you know, we help companies increase their costs of, you know, or decrease their their risk or whatnot.
• 22:31
  SPEAKER_01: As long as it's all centered in that consumer focus and centered around that financial outcome, everything else kind of works out for itself.
• 22:38
  SPEAKER_01: So that's really how we think about success in North Star for method.
• 22:43
  SPEAKER_02: Okay.
• 22:44
  SPEAKER_02: Well you've mentioned agentic commerce, which always comes up when I ask the question about the biggest trends.
• 22:50
  SPEAKER_02: But what other trends do you see when you kind of step back and look at payments?
• 22:53
  SPEAKER_02: What other trends are really reshaping the industry?
• 22:56
  SPEAKER_01: Totally.
• 22:56
  SPEAKER_01: I mean I think besides agentic payments because I think agentic payments is still very much in like in our bubble right like folks who listen to to this podcast I was into us today most likely are thinking about agentic payments, right?
• 23:09
  SPEAKER_01: But when I when I talk to like the average consumer and you know I won't go I won't go that far when I when I talk to my mom, she's not thinking about agentic payments, right?
• 23:17
  SPEAKER_01: What she's thinking about is like how can I get my money faster?
• 23:21
  SPEAKER_01: Right?
• 23:22
  SPEAKER_01: She's thinking like how can I get my paycheck twice as fast or why is it that today there's still a two day lag when I want to send money to someone right so what we have found is that there is this concept of immediateness that is happening and growing in the average consumer.
• 23:39
  SPEAKER_01: That's one of the trends that we've been following really closely which is like how do we enable that kind of time to value and how do we decrease that as much as possible because consumers have not necessarily grown impatient I don't think that's the correct word but they've uh they've come to be accustomed or used to an immediacy when it comes to these payment life cycles and payment flows.
• 24:00
  SPEAKER_01: Unfortunately the average consumer doesn't know that you know we are still working on top of ACH, right?
• 24:06
  SPEAKER_01: And we're subject to their limitations, right?
• 24:09
  SPEAKER_01: So that's one of the things that we're that we're kind of keeping a close eye on of like you know what are the advances that are coming up you know RTP with Fed and then you have Fed now as well.
• 24:18
  SPEAKER_01: It's like how all those can be layered into to some of our use cases.
• 24:22
  SPEAKER_01: Obviously agentec payments is it's in the background but but that's one of the things that we've been seeing just that the immediacy and speed speed to value uh it's really active and alive for our customers.
• 24:32
  SPEAKER_02: Well a couple of final questions if you could go back and give yourself advice at the start of your career what would that advice be?
• 24:39
  SPEAKER_01: It's a great question.
• 24:40
  SPEAKER_01: There's almost like two there's like the AI and non-AI world right uh you know it's crazy to think about when I started my career not too long ago that you know the pre and post AI like we joke in the office like oh like do you guys remember when we used to write code?
• 24:57
  SPEAKER_01: Crazy how that time has changed right but I think you know one piece of advice that that I that I would give myself and you've probably have been hearing it throughout this conversation it's really the the customer obsession or the customer focus.
• 25:10
  SPEAKER_01: I think a lot of folks maybe optimize for you know engineering outcomes or optimize for brand outcomes right and what we have found ultimately is is the most successful at least for us is optimizing for the end customer and optimizing for our customers right and having that customer obsession.
• 25:28
  SPEAKER_01: So that's really the feedback that that I would give myself if I were to look back it's just like hey focus on on a segment on a vertical of an underserved population, right?
• 25:37
  SPEAKER_01: Folks where MPS is slow, right?
• 25:40
  SPEAKER_01: People just don't really like the incumbents or people don't really subscribe to the way things happen or the way things operate.
• 25:46
  SPEAKER_01: And if you can go in there and elevate that MPS and say hey we're going to help you either get a better financial opportunity or make your payments faster then everything else kind of figures itself out.
• 25:57
  SPEAKER_01: So that's you know one feedback that I've gotten throughout the years and the more we're out here doing it, the more I believe that that is one of the key kind of factors for success.
• 26:07
  SPEAKER_02: Yeah you can never go wrong with being truly customer focused and obsessed.
• 26:11
  SPEAKER_02: I mean that's that's a strategy that has worked forever and will work forever.
• 26:15
  SPEAKER_02: So sounds like that's definitely what you guys are are focused on.
• 26:18
  SPEAKER_02: So one final question what's the one thing that payments leaders that might be listening today, what should they be thinking about right now?
• 26:26
  SPEAKER_01: You know leaders in payments right now obviously we're at the forefront of on what's next, right?
• 26:32
  SPEAKER_01: I think that is my push for for every leader listening to this podcast.
• 26:36
  SPEAKER_01: It's you know figuring out and start start playing and thinking about you know what uh you know AI will kind of come in and how the the future will look like in the next one or two years.
• 26:47
  SPEAKER_01: Right.
• 26:47
  SPEAKER_01: And I think it's really focusing on like what do you want the future to look like in the age of AI?
• 26:52
  SPEAKER_01: Because I think a lot of folks are maybe more resistive and saying like hey well AI won't change payments and but I think it will right and and defining what what that looks like I think it's up to us as leaders and and I think this is a time to experiment, try new things, right?
• 27:09
  SPEAKER_01: You know, have those conversations and most likely nine times out of 10, those ideas will not go anywhere.
• 27:15
  SPEAKER_01: They will not pan out but the journey and the testing and the opportunity of doing that evaluation talking to customers is what's going to get us to to that you know final success right so that's something that we've been focusing internally on of like how do we get more reps?
• 27:32
  SPEAKER_01: How do we start to test?
• 27:33
  SPEAKER_01: How do we start to ideate more and I told my team you know in the age of AI things are changing every every day right like we see new protocols, new payment protocols coming out, new ways of uh using AI.
• 27:46
  SPEAKER_01: And as long as we stay nimble and we kind of stay excited and keep pushing along we'll eventually find our way and figure out what this future of payments and AI will look like.
• 27:56
  SPEAKER_01: But I think the key thing is just being in the conversation and being open to ideating, trying things and throwing away nine times out of 10 some of some of the some of the ideas or projects that we were working on.
• 28:09
  SPEAKER_02: Okay.
• 28:09
  SPEAKER_02: Well great Jose thank you so much for being on the show today.
• 28:12
  SPEAKER_02: I think that's a great way to wrap it up.
• 28:14
  SPEAKER_02: So I know your time's very valuable so I really appreciate you being on the show.
• 28:17
  SPEAKER_02: Thank you Greg really appreciated having me on and to all your listeners out there I thank you for your time as well until the next story.
• 28:24
  SPEAKER_00: Thank you for joining us this week on the Leaders in Payments Podcast make sure you visit our website at leadersinpayments.com where you can subscribe to the show and where you'll find our show notes.
• 28:35
  SPEAKER_00: If you enjoyed listening please share on your social channels as well.