0:00:01 – (Matt Widdoes): Welcome to another episode of Growth@Scale. I’m your host, Matt Widdoes. And today we are joined by a very special guest and dear friend, Brad Stroh. Brad is the co-CEO and co-founder of Achieve, a digital personal finance platform that helps people build financial stability. Brad and his co-founder, Andrew Hauser, started the company over 20 years ago and since then have served over 1.5 million people and resolved over $18 billion in debt.

0:00:24 – (Matt Widdoes): In addition, the company has funded over $10 billion in loans to Achieve members. Brad, so excited to talk today. Welcome.

0:00:30 – (Brad Stroh): Great to be with you, Matt.

0:00:31 – (Matt Widdoes): Yeah. So Brad and I go back. It’s kind of hard to say this out loud, but maybe 15 years or so, and we were working on a gaming startup separate from what him and Andrew have been doing with Achieve, which was formerly called Bills. But, Brad, tell us, maybe let’s start with yourself, and then let’s talk a little bit about Achieve. So where did you get started? Where are you from? What have you done? This has been the majority of your adult life, but let’s talk through the early days of your career.

0:01:01 – (Brad Stroh): By the way, a good transition. Matt, that was such a fun era to work with you. Just growth hacking and trying to get something entrepreneurial up and going around, a shared passion of gaming and kind of social betting. Maybe that weaves in a little bit. But my personal story is I’ve lived all over, was born in New York, lived in Montreal, Chicago, St. Louis, Boston. Moved a lot, which means kind of just personally felt pretty comfortable moving into new cities, new schools, new environments, making friends, appreciating difference of, you know, everywhere we went. And, you know, my family was always really tight knit as we moved around.

0:01:35 – (Brad Stroh): Something that is core in my DNA as well, in addition to kind of the family and the. Which weaves into the way I run my company today, to be honest, is I played sports all my life growing up. So football, basketball, lacrosse, soccer. But if you rolled a ball out and it was a team sport, I jumped on the field doing anything. And sometimes that was. I was the worst player on the field and just trying to figure out how to play hockey in Montreal and could barely skate, you know, and trying to just make, like, the C team. And sometimes that was, you know, being one of the better players playing lacrosse, where I ended up playing in college at Amherst College.

0:02:06 – (Brad Stroh): But that being in a locker room with a diverse group of individuals all kind of striving towards a shared goal, to me, is one of the most fun, one of the most fulfilling things that I’ve ever done. And I continue to do. That’s my family. That’s coaching, that’s being a CEO, that’s playing sports. That just weaves very deeply into my DNA and a culture of competing, getting better every day, sacrificing, doing the short term tough things for long term success.

0:02:32 – (Brad Stroh): I think a lot of those themes kind of weave through my leadership style and some of the things that attracted me to being a CEO and wanting to run a company. And then career wise, it’s a very long, serendipitous, meandering story, but I went and interviewed and got offers at all the investment banks coming out of Amherst. I had good grades, was an athlete, and decided after coming back for one last site visit to one of the top banks that I said, I actually want to see what the analysts do.

0:03:01 – (Brad Stroh): And I realized that’s no judgment on investment banking. It’s an incredibly great way to get analytical rigor and learn skills. But I said, it’s just not right for me. That’s not what I want to do. So I turned all my job offers down. My parents had a brief heart attack, but said, trust me, I’ll land on my feet, trekked around and backpacked around Africa and Kenya for a couple months, and then came back and just started interviewing and backstories. I was more of an introverted kid in high school and college and coming out, it was hard for me to put a cheap suit on and ask a 40 or a 50 year old partner to venture firm or private equity firm or EVP of marketing in a company.

0:03:38 – (Brad Stroh): Hey, what do you do? What do you like? What’s great about your job? What would you do differently? But after about 20 of those conversations, I did pick up some themes of things that resonated with me and themes that didn’t resonate with me. And I landed. I was very lucky to land right out of my first job in private equity and venture capital, did three private equity jobs, and then went to Stanford Business School.

0:03:59 – (Brad Stroh): And I did love private equity, by the way, and I’m old enough to know the late nineties when it was a weird era and everything worked. And the .com boom, for most of your listeners, probably won’t even know what that is, but it was really exciting and it got me hooked on growth, growth hacking, value creation, a bunch of people that just loved being in the room together, growing companies and technologies and systems and SaaS software early in those days, but then came out of Stanford business school, co-founded what now is Achieve with Andrew Hauser. And, you know, we’ve been fighting this fight for 20 plus years with. With, you know, amazing teammates. And our core business today is helping consumers struggling and striving American families deal with debt problems across a bunch of products. Debt resolution, home loans, personal loans, some budgeting apps, tools, resources to help people make better financial decisions.

0:04:52 – (Brad Stroh): And we are creeping up on a billion dollars in revenue, but bootstrapped it and been growing it for 20 plus years. That’s a little of my story, Matt.

0:05:01 – (Matt Widdoes): Yeah, no, that’s great. And I was going to say, if I remember correctly, you guys had bootstrapped it, and so you guys never took funding.

0:05:08 – (Brad Stroh): We did. We did. Which is such an interesting journey coming from private equity and obviously having the opportunity to raise capital. But we really did have the conviction and the idea early on. This will lean into a bunch of the phases of our journey which will probably be most relevant to you and your listeners. But we really consciously didn’t want to be forced into an exit in two to five years, which is typically kind of the hold period for a venture. Private equity.

0:05:33 – (Matt Widdoes): When you had seen that, you had seen that firsthand in private equity, right? So you knew the risks of taking money.

0:05:38 – (Brad Stroh): I saw it firsthand. I also wanted to run the business consistent culturally with the way that I wanted to run the business. And sometimes sacrificing short or near term profitability for long term benefit, including culture, team, community benefit, a bunch of things that we think about. There’s a larger purpose of capitalism, and I’d say capitalism with the heart, or enlightened capitalism that doesn’t always align.

0:06:00 – (Brad Stroh): No criticism of anybody, any business that’s raised venture capital, and you do have to in many different business models in ours, if I looked at Capital One or I looked at some businesses and consumer finance that I aspired to and I really respected, these were multi decade journeys of value creation. And there’s no way that we could have done that in a two to five year window of time, you know, pros and cons of that that we can get into here. But we did bootstrap it.

0:06:25 – (Brad Stroh): Knowing all the ins and outs of private equity was very hard. Kind of went through all the phases of entrepreneurs of, you know, opportunity identification, finding our market and our product can get into that with you getting into taking an idea from zero to one and just trying to figure out a way to get something that is going to be alive and has product market fit. And then through the scaling era, and now for us, we’ve got 2800 great employees, and, you know, now running a business at scale, really, really different CEO hats and founder roles across those phases. But yeah, going back, I’d say bootstrapping is still part of our narrative and my personal story as a CEO, well.

0:07:06 – (Matt Widdoes): And as many early companies do, but you guys kind of did a lot of this. I’d love to hear more about how you guys landed on this market, on this product. I know that you guys looked at a lot of different things and there was many iterations, and then I’m sure even post starting Achieve, you guys have seen many different iterations and pivots of sorts. Can you talk to us a little bit about that early kind of founding period, pre getting your business entity set up and some of the work that went into those early days?

0:07:36 – (Brad Stroh): Yeah, I think it’s relevant to probably some of your listeners that want to found a company. So I will go in there and the real answer is, we did the work just very directly and it’s hard work. We were smart enough to know that you’re going in to launch a business. First of all, Andrew and I, he’s the smartest person I’ve ever worked with. We were both successful at Stanford Business School. We both had the entrepreneur.

0:07:58 – (Brad Stroh): We really want to start a company, but we didn’t know what that idea was going to be. We mapped a bunch of industries, and I just say we did the work and doing the work as market analysis TAM. And if I break that down, maybe for all my business, just as a case study, we teach this at Stanford, now in the business school. But consumer finance is a $17 trillion industry. There’s $17 trillion of consumer debt, the banks.

0:08:24 – (Brad Stroh): So first of all, TAM size. And then we tried to break that TAM down into discrete segments, secured, unsecured auto student, and then we even broke those down into marketing, acquisition, servicing. And we rolled up and we tried to identify a very big market that’s growing. At the time, consumer debt was growing unsustainably, but which turned into the ’08 great financial crisis that we could have predicted. But a big TAM that was growing, those are like checkboxes, okay? So it’s not going to be a niche market that if we’re good at, we can’t scale into.

0:08:56 – (Brad Stroh): And then we really tried to find inefficiencies inside of that big TAM. And we identified credit cards as the most profitable line of revenue for banks. 2% interchange fee, 5% interchange fee on for an American Express card. And you add in, you know, 22% APR interest, you add an annual fees. These are on a return on equity measure. These are the most profitable products for the banks. And we just started doing interviews, trying to map out what was going to be our product offering. How do we play with people that worked in all aspects of credit card issuers, banks, servicers?

0:09:33 – (Brad Stroh): This is way before fintech apps and fintech even existed. And I would say a couple of things came to light to us. Big growing, huge inefficiencies in the value chain consumers, before I even get into understanding the customer, really taken advantage of at multiple points in that cycle and many places to play where you can increase value in that ecosystem. And then the next thing we did from looking at just sort of market analysis and tam analysis and inefficiency and value creation opportunities, we went and talked to customers, what everybody does, gift cards and Starbucks coffees and friends and neighbors, and consistent problems kept coming up to us, which was someone who was FiCo or credit impaired, couldn’t get a loan.

0:10:18 – (Brad Stroh): They got kicked out of the financial system. When we sized that, we realized that is a massive market that nobody’s paying attention to. And the people that are back then were either predatory or highly inefficient. And I think the light bulb started going off. And then when you’re looking at a market and you’re really deeply in the weeds on it and you’ve done the work, serendipitous moments will come to you. So my co founder went out with a guy who was an Olympic gold medalist in the ’96 Olympics in beach volleyball, and he negotiated himself out of his Bloomberg terminal debt. And we realized, oh, banks have models internally around where they will take settlements and reduce balance outcomes for consumers that are struggling to get kicked out of the system.

0:11:05 – (Brad Stroh): And the model, just like The Matrix, froze for us of, oh, huge growing, inefficient, lot of value creation for the bank, the issuer and the consumer. And we’re just going to build these portfolios for consumers to educate them transparently. Here is your best path to deal with your portfolio of debts. And you would kind of, we’re 20 years into building this business, which is, there’s a lot of efficiency in asset management.

0:11:31 – (Brad Stroh): No one has really built, built a liability management platform and that’s what we continue to build on. And that’s understanding how the credit issuers view those consumers at an individual trade line level. You’re going to get into AI and machine learning and data science and building a data platform with returns to scale. And I’d say those just, it froze for us of this is it.

0:11:53 – (Matt Widdoes): Got it, go ahead.

0:11:55 – (Brad Stroh): Now, that light bulb moment though, got married with, okay, now we’re going to launch. This is before lean startup had been written as a book, a bootstrap business. Now we just start building a tiny POC, Matt, you know, stuff you and I did together in a totally different, different vertical, and just start putting it in front of consumers for free and seeing, is there value to them? What would they pay? What are price points, price elasticity, interest?

0:12:19 – (Brad Stroh): We’re doing A/B test and just lander tests to measure level of engagement and interest to consumers, giving everything away for free. And the first hundred people that we went in front of, it was like, we got it. They all really deeply valued it. And then at the time, by the way, we thought it was going to be more of a day to play and effectively all of those people said, we will pay you nearly anything to manage this process for us. And we realized, okay, we’re going to productize this into a consumer finance before fintech was a term, but a fintech business.

0:12:50 – (Brad Stroh): And we will become the leader in that space. And that’s what we’ve been doing for 20 plus years. So that’s market identification. Then it’s a co-founder and I just sitting with two broken tables and no money and trying to deal with a couple hundred customers. And then we get into zero to one of, can you actually turn an idea into a business? And then you get into, how do you scale a business? And then running something to scale. But that was really our founding story.

0:13:16 – (Brad Stroh): I’d say we did the work and we were very rigorous and disciplined around it, recognizing if we chose the wrong market, if we chose the wrong product, if we chose the wrong consumer segment, if we chose the wrong economic model. We’re in this thing for three to seven years. The opportunity cost of our time is very high. So we got to have a lot of conviction that we believe in what we’re doing. We like the value.

0:13:39 – (Brad Stroh): We think it can be a valuable business. And for us, I’d say the stars aligned. We kind of made them align that it’s like we made sure it was the right product, the right economic opportunity for us, and we’re blessed that it’s been a good market for us.

0:13:55 – (Matt Widdoes): Well, this is one of the many values of having an idea of where you want to go. So whatever those checkboxes might be that need to meet your criteria, things that you need to see in validation phases, if you know, like specifically what you’re looking for and you’re not seeing it, you know, you need to look somewhere else versus kind of flying by the seat of your pants. So I think, for me, that’s been really important throughout my career of, like, calling your shot and you fail sometimes, but it’s really, you know, lots of people.

0:14:20 – (Matt Widdoes): You know, I was thinking of a thread I’m on with a bunch of people who were, it was all around investing, and I’d see all the time guys being like, oh, I just made all this money on such and such or this. And I’m like, where were you I six months ago when you made the investment? Like, that’s way more impressive to say I’m putting 20% of my net worth into this thing in advance. And then when it fails, everybody can see you failed or didn’t. So I think that conviction and vision is really important for context during that.

0:14:45 – (Brad Stroh): Some people get lucky. I mean, just clearly, many entrepreneurs get lucky. And serendipity is a thing. I’m just trying to engineer luck as best I can and continue to this day versus just walk a bunch of cow pastures and hope it lands in the. Promise me. No, that’s not the way my brain works, is I want to derisk things and I want to be very disciplined in all of our approaches.

0:15:06 – (Matt Widdoes): Yeah. And deliberate about kind of where you’re taking yourself and the business more generally. For context, in that early kind of POC phase, you’re running A/B tests. You’re talking with early customers, you’re giving everything away for free. You’re just trying to discover if there’s a there there. How long was that process? Was that a year? Was that a couple months? Like, how quickly were you guys able to reach that kind of conclusion that this is a real thing, that we can productize and start to put the groundwork in place, to scale that and go to that zero to one.

0:15:34 – (Brad Stroh): Yeah. To break those apart. I’d say the market exploration, probably maybe a nine month process of deep exploration. The beauty was, coming out of business school, you got a window of time where you can do that deep dive. And then in terms of going to. Now we’ve jumped, this is our market, and we’re trying to build something that, and trying to then build up a financial model that will work. That’s probably for us, was two quarters of refinement around.

0:16:02 – (Brad Stroh): Okay, what will the revenue model be? Let’s test different revenue models. Let’s test different value props and go-to-market strategies. Let’s say that was like two quarters of getting out of the gates, and then you flip to, now I’m just in every single day problem statement, definition, problem solving, and trying to identify works, what doesn’t, and I’d say the things there that were really critical and we were intentional and disciplined around, again, is the speed of learnings became the core determinant of success.

0:16:30 – (Brad Stroh): How short can we make the iteration cycles for each one of those tests and never get wedded or lose objectivity around? Is it working or is it not? And how quickly you can kill something and then pivot back to what else could work? What else could be tested? To me, that increases, but sort of maximizes the surface area of luck, but it’s pretty disciplined around speed of iteration cycles. A beauty if you’re working with a really, really high IQ person.

0:16:56 – (Brad Stroh): That’s super hard charging is the bullshit. Time is very low, the tax of bureaucracy is very low, by the way, transition 20 years later, different. You get the scale that the inflection point flips. But back then you can be very disciplined, lean, and test many different go to market strategies, messages, product price points, value props, service models, digital experiences, all those. I mean, just really short, quick iteration cycles in a couple. At that point, let’s say we’re, you know, six to twelve people in a room, and you’re just every day iterating as quick as you possibly can, including same day iteration cycles. You know, sometimes were beautiful back then.

0:17:35 – (Matt Widdoes): Yeah, well, and I think that kind of speed from insight to action and not marrying some, some idea that you feel like your intuition tells you it’s really good and then all of the data is telling you otherwise, and being able to like to kind of not let ego get in the way of what the data is showing you, and being willing to kind of listen and pivot and kind of flow with what you’re observing and retail, it’s hard. It’s hard.

0:17:56 – (Brad Stroh): Yeah, yeah, it’s hard. And honestly, it’s a muscle that I’m still training to this day. It’s something that is one of my biggest gaps, because I do fall in love. I fall in love with an idea, a person concept, and trying to maintain that objectivity and kind of data driven approach. I’d also say you have to marry it with judgment, intuition, real leadership at times too, where if you’re waiting for 100% perfect data, you’re going to get lapped.

0:18:20 – (Brad Stroh): You’ve got to get to the point where you say, I have enough data to make the judgment call. And a lot of this is sort of risk/return. In the early days of running a business, the cost of being wrong is very low. The cost of being right and iteration cycles is high. You get later stage in a company in particular I’m sure we’ll get into. In fintech, you’ve got regulations, you’ve got credit, you’ve got balance sheet risk, you’ve got lending risk, cost of failure very high.

0:18:43 – (Brad Stroh): At that point you need to increase your level of precision around judgment. But in the early days, you also have to balance getting great transparent data and objectivity with when’s it enough to make a judgment call and move forward?

0:18:55 – (Matt Widdoes): Great. Well, and so speaking of fintech, as you mentioned, you guys were doing fintech before that had a label and you know, 20 years, a long time in the Valley. I’m curious where you sit today with all of the things that you’ve seen and where you guys are heading. Are there any kind of emerging trends in fintech that startups and growth marketers should focus on to kind of stay ahead and any insights you see or predictions you have for fintech specifically,

0:19:21 – (Brad Stroh): I would say we’ve been through so many waves of PFMs, that’s ‘personal financial management’ tools and budgeting tools. And Mint was hot for a while into it, just shut it down, then kind of unbundling what a bank does. And you had lending club and prosper and marketplace lending and that was white hot and then not, and now sort of stabilizing as a personal lending business. The things that we see, I’d say just continue to be opportunities that we see over the 20 years, two decades of running this business, which is financial services, fundamentally is inefficient fundamentally. There’s a huge volume of opportunities in the space. And they’re almost even more emerging now, driven by changing consumer preferences, regulatory constraints on banks and all of the amazing availability of data and technology.

0:20:12 – (Brad Stroh): Clearly, I mean, just to kind of go through those, consumers want to have more personalized solutions than ever before. They don’t want a cookie cutter product that a banks goes down their, they don’t really want a one size fits all bank model where they walk in and it’s a shopping mall for them. They want personalized solutions delivered to them how they want it, when they want it, on the device they want, with what digital experience they want.

0:20:36 – (Brad Stroh): Increasingly digital is clearly continuing to be emerging trend in terms of banks. Banks just continue to exit very profitable lines of business and consolidate into the things that make them money or low risk. So all the big banks, all the Wall Street banks, Morgan Stanley, Goldman, huge into wealth management, competitive space, hard to play in, very fragmented. They continue to be, I would say, lots of inefficiency around many other lines of consumer finance and then emerging technology. I mean, it’d be impossible not to leave this conversation with talking about AI, machine learning, data models, and the ability to now, without massive teams of data scientists, which is how we built it up in the early days, is to actually have true, personalized, predictive models for every single consumer that path them through what is the best message, the best product, via what device, with the right time, with the best message. And then every interaction for them is totally personalized to that consumer is, to me, just like, remarkably, it’s almost breathtaking for us of how it transforms our business, how it’ll transform every business, and how it’ll transform how every consumer interacts in the future around personal finance. You’re going to get to the point where it’s just zero. Click, Matt. Meaning you’re just going to get pushed.

0:21:56 – (Brad Stroh): Matt, great news. Your rate just got lowered 25 basis points. You didn’t do anything. Great news. We just consolidated your credit card debt and swept it into a HELOC line. At 7% interest versus 24%, you now have $400 more a month of cash flow. And that’s combining data science models, credit models, consumer prefs, LLMs, AI interaction. To us, it’s just like back to almost the Wild West, which was the early days of innovation for us, which is really exciting.

0:22:24 – (Matt Widdoes): Well, I was going to say, in some ways, it’s like, if you think about, and maybe you guys are thinking about this internally of, like, given what we have today and what’s ahead of us, particularly in AI and ML, how would we build this differently in, you know, in 2024 or 2030, for that matter? Right. And it does offer a ton of opportunity, not just internally, from a business process and efficiency standpoint, but from a consumer experience and benefit to the consumer, and just that ability to kind of. I could picture some of the things that you mentioned. It’s almost like a minor minority report of, like, pop, do you want to make an extra $600 a month?

0:23:01 – (Matt Widdoes): This is how you would do it. Here are the downsides. Here are the upsides. This is our recommendation making that.

0:23:06 – (Brad Stroh): If you opt in to sharing your data, that you will have an infinite array. I mean, you’re just an n of one. Every us consumer becomes an n of one, and you’re gonna have an infinite array of options that get presented to you. I think that is the case. The one thing that gets very tricky in consumer finance, in lending in particular, or any underwritten product, though, is you’re not allowed to have AI and machine learning models.

0:23:29 – (Brad Stroh): In credit money you get into some very specific regulations which are built with the right intent. Sometimes they have complex consequences, but concepts like redlining or adverse selection or you wouldn’t want to have any treatment where a model builds in a group of consumers are excluded from getting access to a product that others aren’t. So you’re always going to have regulatory driven constraints driven around fair lending regulations that will preclude credit modeling to go as sophisticated as it could, because you’re going to have to have a single univariate ability to knock out a consumer and convey that to the consumer why they failed a credit model. So then how do you build consumer experience in an infinitely personalized way on top of highly regulated underwriting credit decisioning models?

0:24:21 – (Brad Stroh): That’s interesting. The other one is you’re just having less separation between your world’s, I’m sure, fintechy, but you do just have this very inefficient world that still exists of we offer a loan to a consumer and that loan then gets packaged into a pool of loans sold to an investor. The investor then pool a bunch of loans back into a securitization to turn them into strips and its security. And it just basically means you can now have risk and return differentiation for different investors.

0:24:49 – (Brad Stroh): Those things then frequently end up in the private credit market, which has now exploded into a $2 trillion market. Is I think we’re going to have less inefficiency in that value chain and I will be able to just connect risk return of individual consumers and pathing that consumer through their financial journey of financial health to private credit markets. And what return hurdles different investors are looking to get by what assets they want to back, it gets. It’s just like infinite array of opportunities, I’d say driven by technology, consumer prep, banks, leaving regulatory lots of things that to us are just really interesting.

0:25:23 – (Matt Widdoes): Matt. Well, and let’s unpack the regulatory challenges in finitech because I’m sure there are many, and there are many well funded people in DC fighting for different things. How do you guys kind of approach navigating that? And are there things that newer startups can do to kind of get ahead of those challenges where they don’t maybe have the same people in DC fighting for their specific desires and needs?

0:25:49 – (Brad Stroh): Yeah, it’s a good question. And it’s hard, I mean, honestly, it is a hard problem statement that is a major investment that you just have to make. Whether it’s licensing, regulatory compliance, credit modeling, lobbying, it’s a real function inside of our GC’s you know, office that we were late to develop. You want to be in the room writing and defining the rules of the game that you’re going to play by.

0:26:12 – (Brad Stroh): And the big banks always have been, you know, smaller startups, they’re frequently kept out of those rooms. So that is a problem. I’d say build. If you’re building a board of advisors or a board, have someone who has a real competence in the rules of the game you’re playing. And whether that’s a lobbyist or a GC or someone that’s played at that level, or partner with a bank, a lot of fintechs will do banking as a service where they, you’ll be the front end, the credit model, the origination model, and a partner bank can help navigate some of those licensing and regulatory models. It’s still a huge heavy lift and burden. And just to be honest, it does end up building barriers to entry in a moat because it’s expensive to navigate and it’s hard. And getting it wrong is a one of the few things in these businesses that just totally put you out of business.

0:27:03 – (Brad Stroh): Consumer finance, it kind of boils down to if you got product market fit and it’s working now, you’re just in scale and optimization and efficiency, with two exceptions, credit risk and credit modeling. If you get it wrong, it can blow you up. And regulatory, if for any reason you hit a third rail or you trigger something that you’re in violation of, it can knock you out of business. So cost of failure gets very high at scale in consumer finance.

0:27:27 – (Brad Stroh): Again, it just creates opportunity, though, if you look at it from the other side.

0:27:30 – (Matt Widdoes): Matt. Yeah, well, and I would imagine too, in finance specifically, it’s probably up there with things like healthcare, pharmaceuticals, others where it’s highly contentious and lots of differing interests, which we’ve seen play out in many ways over the last, well, many years. I’m curious.

0:27:48 – (Brad Stroh): I think it’s a good analogy, but I’d say highly regulated industries typically correlate with lots of inefficiency, frequently correlate with bad consumer experience. Banks and hospitals and healthcare service providers are typically one of the lowest raters rated on NP’s scores. Opportunity, that’s what I see as an opportunity. You just see opportunity inside of that.

0:28:10 – (Matt Widdoes): Well, so let’s talk about Achieve a little bit. And what are some ways that you guys kind of differentiate yourself in the space? And can you talk us through some of the problems that you’re helping your customers kind of solve on their end?

0:28:22 – (Brad Stroh): Yeah, so, I mean, very specific to us, just around what Achieve does. But we do identify our kind of core TAM now is the 17 trillion in consumer debt and specifically the struggling striving consumer that isn’t super well-served by Goldman, Morgan Stanley, Chase, Citi, of an 800 FICO with very high net worth. That’s well served. That market for us, driven by inflation, driven by record amounts of consumer debt, driven by record interest rates charges, our TAM has really grown that consumer segment that now needs help.

0:29:01 – (Brad Stroh): So we start with budgeting tools, tips, advice. We get into home equity loans and consolidation products for lending to help people reduce the cost of repayment their debt if they don’t own a home. We’ve got personal loans, the original kind of fintech personal loan, kind of peer to peer marketplace type of products. That’s Achieve Home Loans. By the way, our apps achieve good, which is good at debt, achieve molo, which helps you with your, your money left over and your cash flow. Achieve home loans or the HELOC products, achieve APL, achieve personal loans, or that peer-to-peer lending kind of unsecured personal loan product.

0:29:37 – (Brad Stroh): We’ve got a proprietary lending product called Achieve acceleration loan. And then if you fail the underwriting criteria and you’re struggling with a lot of debt, we’ve got achieved resolution that resolves debt, which is negotiating people out for a discount on their heavily, a high burden of debt. We’re a multi, just right there. I’m laying out Matt, a differentiating factor. We’re a branded company.

0:29:57 – (Brad Stroh): A lot of these companies aren’t branded when you get outside of big banks. They’re just point solutions that doesn’t have brand awareness. So trying to build the branded leader, we’re multi product. So to us that’s really important that we’re solution and consumer oriented. I’m not trying to shove a product down a consumer’s throat, I’m trying to help a consumer solve their problem across a suite of products.

0:30:16 – (Brad Stroh): And then we’re able to path consumers through those journeys, which is as your FiCO and your financial health improves, we can continue to kind of uplevel you in your gamification world as you unlock the next level. We’re going to give you a lower cost of debt, lower payments, and help you get on a faster track to paying off your debt. And then underlying that kind of branded leader in this category that we think we’ve defined, which is liability optimization and liability management, really the inverse of asset management is it’s just built on shit tons of data and data models and technology which makes the consumer experience feel seamless. Easy, personalized. And what it is is just tons and tons of ML and AI models, whether those are chatbots or agent assist models that help us serve those consumers better.

0:31:04 – (Brad Stroh): And then we are, we have this human touch thing that comes back to our early days of Andrew and I, my co-founder, we took calls to us, to this day,. If they want to call in, we pick up the phone in under 30 seconds and just answer their questions. You want to talk about customer service, you want to talk about a challenge you’re having, you know, with your kid’s cancer or your divorce, and you need forbearance or you need deferral or you need flexibility.

0:31:31 – (Brad Stroh): We think that’s a real differentiator for us, is being kind of human-centric, and I personalized around then how we can re underwrite that consumer using the call center on top of a bunch of data and data models to help reevaluate and figure out what’s the best solution for that consumer. Basically not be a bank, I’d say, but stitch together products around liability management with the human touch.

0:31:52 – (Matt Widdoes): I was gonna say that’s a huge differentiator in finance specifically because even me calling my bank, I can’t get somebody on the phone in 30 seconds yet alone to actually solution anything. Yeah, go ahead.

0:32:02 – (Brad Stroh): And then, Matt, it’s not uncommon and, you know, no fault of theirs, but a lot of times it’s regulatory driven or just scale and bureaucracy. And acquisition driven is you talk to a rep if you get a good one, and they say, I’m sorry, Matt, I can’t. My system doesn’t interact with the home loan system, personal loan system, or I can’t see your record. You have to go online to this thing and then tell me what you see. And you just think at this day and age, it’s just crazy that we don’t have better tools and services to meet the needs of the consumer.

0:32:32 – (Brad Stroh): It’s hard to do right as anybody that knows how to run a business at scale. But I think getting it right in a massive market is the solution. That’s the game we’re playing.

0:32:43 – (Matt Widdoes): And you mentioned leveraging. You’re sitting on a bunch of data in ML to drive this seamless, personalized customer experience, and of course, the differentiator of great customer service. But you have these kind of very differentiated products that solve different things. So for somebody coming in new as a consumer to Achieve, are there strategies that you guys employ that we could talk about on top of all of that data to kind of quickly orient people, get them into the right products, find opportunities to upsell them the next thing that they need, because you can’t just kind of give them seven things at once, like any kind of strategies on top of that, through product or through marketing or through other means that leverage that data.

0:33:23 – (Brad Stroh): Yeah, I mean, you know me well enough to say, I think I’m a CEO, you know, by title, I’m a product person by heart. Is we’re just constantly trying to push on the edges of digital enrollment and digital evaluation and then tools for a consumer, you can go and achieve and play around. And we’ve got incredible cool amortization tools that doesn’t sound like a fun thing, but sliders that just say across all of our products based on you just slide unpersonalized, just, you can play around payment cost, time to pay off your debt in all these different products, credit score simulators. If you do this, here’s what you’re going to look like in the future.

0:33:58 – (Brad Stroh): Not simple to do, built and now really empowers the consumer to make the right decision now, once they get to the point where they want to be evaluated for product. Yeah, we integrate via API with a whole bunch of great fintech platform partners, Mxdev, which is like plaid for account aggregation and cash flow and bank account statement, spin wheel, Experian, Equifax. We work with all so we can get visibility and then reveal to the consumer, here’s what you look like.

0:34:27 – (Brad Stroh): You may not even know how much you owe, who you owe, what your interest rates are, what your monthly payments are. Let’s create a digital picture of what you look like. And we’re going to tell you where you’re kind of red, green, yellow, and where you could go. And then if you chose a product, here’s what it looks like you could qualify for. Let’s make sure you get into the right product for your right fit.

0:34:46 – (Brad Stroh): And by the way, every single time, there’s an escape hatch, which is want to talk to somebody? And we have screen mirroring where our agents can sit on the phone. And just like we’re doing right here. Hey, Matt, let’s go through right now your balance sheet for free. I’ll just walk you through who you owe, what your interest rates are, what your payments are. By the way, did you know with your FICO score, you’re paying, you know, 50% above the average APR of what a consumer who looks like you paying, even if you don’t use our products, just, hey, make a better financial decision for yourself to lower your cost of debt repayment.

0:35:16 – (Brad Stroh): Here’s where your FICO could be, here’s where your wealth could be. Here’s where your cash flow could be three to five years from now if you made these decisions. Banks don’t do that. That’s hard to do.

0:35:26 – (Matt Widdoes): They’re not incentivized to do that.

0:35:28 – (Brad Stroh): Well, they’re not incentivized to do it. I just think that. I think it’s hard to be consumer centric at a big bank where you’re just trying to survive the, the day and your boss and your end of month enrollment goals and open account goals. I think we have the luxury of always being kind of heart and dollar sign balance bootstrap, consumer centric of founders who talk to every consumer and heard that person at the dinner table crying about the stress they’re feeling. And for us, then how do we just continue to push the envelope of digital experience combined with the personal human touch to improve their lives? That’s what we do, by the way. I think you can do that in a lot of verticals, Matt, but the beauty of being around for 20 years is we stored data, not always knowing how we would use it in a data mark, in a data schema that we were very smart from our CDO and our CTO and our president of technology and our data engineering team and our data science teams of this is going to be valuable someday. And now that this just LLMs emerge and AI models emerge, oh, the value of this first party data, married with third party data, credit reports and cash flow and all that becomes really unlocks value to the consumer. And that’s what we’re in right now.

0:36:37 – (Matt Widdoes): Well, we see that a lot too, in early stage, how important it is. I mean, everybody knows this, I think, in a general sense, but they don’t ascribe to it. It’s like, you know, you’re supposed to floss your teeth a couple times a day, but still, people do it once a week or never, or they don’t do it enough. But it’s. No, that’s budgeting.

0:36:54 – (Brad Stroh): In our world, I mean, we have budgeting apps, you know, just budgeting people, it’s hard to get to change habits and behaviors, and especially a financially stressed consumer. Budgeting is not fun. So you gotta make it, you gotta make it easy, and you gotta show value, benefit to them, really, you know, really tangible every time.

0:37:09 – (Matt Widdoes): Well, and as you were talking about that and talking through the, just that process of going through the sliders, if you wanna talk to somebody, we’ll just do a screen share and review these things. Not to come off as salesy, but my knee jerk reaction internally is like, why wouldn’t somebody do this? Because it sounds, I’m really not selling here. I’m just, it sounds. The value prop is really impressive.

0:37:30 – (Matt Widdoes): And so I wondered, though, I’m like, trying to answer that question for myself internally is like, is it? Have you found that it’s a challenge where half the battle is just getting somebody willing to look at it? Because you see this sometimes in weight loss, there’s a number of vast majority, maybe, of people who are like, I don’t step on scales because I don’t want to know the number. And if I don’t look at it, it’s not real and I don’t have to, like, deal with it. I can compartmentalize it outside of something I have to solve. Have you guys seen that, like, one of, you know, a hurdle being somebody saying, I know it’s a mess, I know I should be looking at it, but the idea of looking at it is so stressful, I don’t want to do it. And then I would imagine, well, so I’ll maybe take that as a first part of the question. And then if so, do you find or observe that once people do finally look at it and find that there is a way out that that creates not only hope but motivation to dig out and really bring more financial kind of literacy and kind of intention to how people are spending and saving their money?

0:38:29 – (Brad Stroh): By the way, good observation. The quick answer is yes and yes unequivocally. But if you go through, it’s not. So. It’s behaviorally irrational not to budget, not to get on the scale, not to floss, but it’s not. I mean, spending so much time with this cohort, it’s very intuitive, which is, we don’t teach financial literacy in high school. People feel that there’s asymmetric information, meaning the bank or the person they’re going to get on the phone with knows more than they do, which is true. Yes, they’ll transact three times in their life on a mortgage.

0:39:01 – (Brad Stroh): They’ll consolidate their debt twice in their life, if ever. And so therefore, there’s a sense of insecurity. And so if we can bring empathy and compassion and softness with digital tools and with that human touch, it invites them back in to help them say, okay, I’m not judged. I don’t feel like I’m being taken advantage of. I just feel educated and talked to on my terms and I’m starting to understand this, but I would guess, I mean I put back to you, I think noom cool innovation primarily run ui and pricing models and just experience versus Weight Watchers.

0:39:33 – (Brad Stroh): I think same with healthcare. I would guess if you can start to remove the hurdles around the emotional component, the friction of going to the doctor or going to the bank. I mean, I don’t want to sit in the waiting room for an hour. I’m busy and then I don’t want to sit there and waste my time. I think product can bring a lot to this around, destigmatizing the emotional component and definitely consumer finance has all of that in spades.

0:40:04 – (Brad Stroh): Yes, people don’t do it enough. Yes, if they come to us, they do understand. And yes, that does help them make better decisions. No question.

0:40:12 – (Matt Widdoes): Now that you guys have grown, you started off two guys, two broken tables, you grew to a dozen or so. And now I think you’re at 2800 and probably growing. How do you continue to foster a culture of innovation and specifically agility within the and I any learnings there that others in fintech or outside of fintech that could take lessons there?

0:40:34 – (Brad Stroh): Yeah, I’d say one is storytelling. I know you’re great at this, but I’m a big fan of storytelling is just tell the stories over and over of the breakthroughs that we’ve had in the business. Try to incent the right behavior, rewards, put in people’s okrs, you know, innovation time, innovation budget. I do think there’s a critical thing when you get to scale though. I’d say on the other side of this, Matt, is you can’t have 2800 people every day breaking everything and trying to solve little tiny problems because it’ll turn into chaos.

0:41:06 – (Brad Stroh): And just anarchy is you do have to control a little bit, which is deeply understand with clear thinking and system design, where the key leverage points in the business. How do you align your best and the brightest around the key leverage points in the places where you need creative thinking and problem solving and innovation at the same time really trying desperately to keep the front lines of the business, which is where the magic in our business is made.

0:41:31 – (Brad Stroh): Deeply connected to the people that make the business decisions, resource allocation, product decisions. And I think that’s cultural, that’s system design, that’s process, that’s incentives, storytelling. And honestly, I’m a tinkerer at heart, as anybody in my company knows is just continuing to me doing it, just constantly trying to talk to consumers identify places we can get better, sit with agents doing assist sessions and just talking about, we’re going to fix these three things tomorrow and just go into your CISO, your CIO, your CTO and say, just for visibility, we’re going to fix this guy’s UI problem with his communicator right now because he’s going to tell 100 people and they’re going to tell 100 people and then that we’re a culture of saying yes, not no. I think think to me that becomes pervasive, but a lot of layers to it.

0:42:19 – (Brad Stroh): I would also say, though, really being intentional and knowing what to say no to is an important part of innovation at scale versus innovation. When you’re really small and the cost of failure is very low.

0:42:29 – (Matt Widdoes): Well, and you mentioned kind of keeping people abreast across different orgs of kind of rapid changes or things that you’re doing and the reasons why, and making sure that people kind of understand the rationale behind kind of fast iterations that have to go live quickly. We believe deeply that unlocking scalable growth requires working holistically and teams understanding. It sounds so simple, but you see a lot of times where the lifecycle teams don’t talk to the product teams don’t talk to the marketing teams, don’t talk to the sales teams, don’t talk to the service teams.

0:42:59 – (Matt Widdoes): And in some cases, the most kind of observable demonstration of this is you have sales teams or you have saying the marketing team is not bringing us good leads, that’s why we’re not selling. And the marketing team says, well, the product teams aren’t giving us future parity or pricing or any number of other things like our competitors.

0:43:16 – (Brad Stroh): I’ve never heard any.

0:43:17 – (Matt Widdoes): Yeah, and so we can’t, this is.

0:43:19 – (Brad Stroh): Called like my morning meeting this morning, but it happens at scale and it’s just, it’s natural, you know, entropy, bureaucracy, siloing. It happens. And the larger you get, the more it happens. Staying super, super customer centric, listening to sales calls and making your senior leaders listen to sales calls really core and just try as hard as you can to build those collaboration bridges, scrum teams across functional areas, across product lines, and I just say deemed very, very, very customer centric, always not process centric or kind of silo-centric. But the poll is strong for any large company. And so you just gotta constantly fight it, like very intentionally fight it and have a massive amount of impatience from the top of – go faster, do more.

0:44:11 – (Brad Stroh): Every time you start seeing patterns of inefficiency is just call it out and then say, let’s celebrate. Agility, speed, quick decision making, collaboration, and I mean, Erica, who introduced us here, you know, our Head of Comms, it’s just celebrate the hell out of the great stories of where you did change a consumer’s, you know, life as a result of these breakthroughs.

0:44:32 – (Matt Widdoes): Yeah, I think the point of, like, bringing it back to the customer or what we sometimes call the baby, like everything should be in pursuit of making the healthiest baby we can. And it doesn’t matter who gives it the milk. It doesn’t matter if somebody has a better idea of how we can feed it or clean it or dress it or help it sleep, whatever that that might be. We should all be open to it. And it’s very easy, I think, in that perspective, thinking about of a baby, most people be like, well, yeah, of course you have to take care of the baby, but sometimes that gets lost inside the company where you, you maybe lose sight of the customer themselves. You may be lose sight of, like, the business goals and the needs of the business. And I think a line we definitely.

0:45:08 – (Brad Stroh): Do, I mean, I gotta be really direct. You know, we’re far from perfect at it. It’s just a constant struggle in a fight to maintain that, that, that focus and that lens while it’s life, man. I mean, you know, it’s like, okay, you’re trying to deal with your, you know, you got a sewage issue and you’re, you gotta, you know, have date night with your spouse and your kids, have stuff and then works busy and then somebody quit.

0:45:33 – (Brad Stroh): So much of life is just surviving day to day. You gotta not get into the grind of where circumstances drive your behavior. You just gotta force intentionality, direction, and kind of ground your principle constantly back into your life and back and whatever those are, and back into the business as well. At scale, a lot of the role of the CEO is doing that. Well, thanks for that discussion, Matt. I’m curious to turn it back to you, is what are the patterns or systems or habits that you’ve seen that help other companies and other leaders break some of those habits and stay focused on the baby, focused on the customer, focused on the main thing. What do you see? What’s your.

0:46:09 – (Matt Widdoes): Yeah, so I think is there’s a number of things. One is finding a way to, this is the biggest, I think, which is you have to kind of find ways to align the incentives amongst teams so that what you’re rewarding is part of what you’re rewarding is how well people collaborate, how well they communicate. Right. And how well they receive communication. Right. So if I come to you with some idea and your immediate approach is always no whatever, or like, we have no, no way to even discuss a. A concept that is in your camp versus my camp.

0:46:40 – (Matt Widdoes): And my intention bringing that to you is, I think it can help the baby, then we have to have ways that we reward and exit people who aren’t meeting that level of expectations. So that’s one piece, and it’s hard to maintain at scale. We could give some examples, like in a specific product line as an example for certain revenue targets or whatever that might be, and certain other components, like collaboration, how well they’re working within a team, because it’s not good enough to just be amazing at your job. You have to also have people around you that want to work with you. Otherwise all those people are going to leave.

0:47:10 – (Matt Widdoes): So some of it is setting those frameworks to where you have actual cash incentive based on the performance of the business that are set by leadership, et cetera. And some of this sounds very simple and in some ways it is. But it’s about cross collaborating to solve a common issue. So if in that example of marketing says it’s this product, says it’s this sale, says it’s this, it’s like, okay, well, one, let’s use the data to decide that, but let’s come up with a plan that we can test one or multiple of these hypotheses to understand how do we crack that and put this to rest. So if we test it like marketing says, we need lower pricing. And if we had lower pricing, we’d have better leads. Okay, well, let’s do a discrete test on pricing.

0:47:47 – (Matt Widdoes): Let’s make sure that’s measurement set up so that marketing or so sales teams then have that. And if sales aren’t closing on that, then let’s just stop talking about the fact that our pricing is too low, right. If we can reach that. So a lot of it is data driven. A lot of it is team driven. I think one of the bigger inputs as well is on the hiring side and having those expectations clearly set in the beginning and having a rigor around that where you value that as much as you value output or revenue or some of these other more traditional things, because it’s the how we get it done. You know, as an athlete, it’s like, would you rather be on a winning team that won the championship that you played a minor role in, or that you hated every. You hated being on the field with that team, or would you rather have a middling result with the team that you loved working with.

0:48:31 – (Matt Widdoes): That was really fun. You weren’t able to compete as high as you were or as others, but you had a great time, you have great memories. You were a major participant in that. Many people would choose the latter. So the success in and of itself isn’t the end state and isn’t fulfilling as individuals either. If we just say, win, win, win, win, but we hate ourselves when we come home or we hate ourselves when we walk in the door, that’s not sustainable either. So I think it’s a balance.

0:48:56 – (Matt Widdoes): It is hard to maintain. It’s much easier to do in an earlier stage where everybody’s talking to each other all the time. But how that shapes up in larger organizations is having that play out at every level of management so that can bubble up and that you have systems in place by which those learnings get leveled up and that things from the top get pushed down when deemed necessary by those teams. So it’s a challenge. It’s like if anybody can solve that forever, and as you hire as much as you can, politics emerge.

0:49:22 – (Matt Widdoes): You know, different groups form and segment, and so you’re kind of constantly trying to break through that scar tissue and set it as an expectation for the early and hold on to that. And if people start seeing that a really high performer who was hard to work with, who wasn’t super collaborative and wasn’t always thinking about what was best for the baby, what was best for their, or their outcome, and they got let go, it’s like, okay, well, we really value that. So. And that’s hard to do, to let go of a top performer just because they don’t have these other elements. But those other elements are really important and harder to capture in data.

0:49:53 – (Matt Widdoes): So hopefully that’s helpful. Very helpful.

0:49:57 – (Brad Stroh): All stuff, by the way, we struggle with. But, you know, some of the themes I did here is get the right people on the bus, get the wrong people off the bus, have the right incentives, create the right problem statement. That’s data-driven in a culture of ego-less problem solving, in a teamwork, in a team-based environment, and celebrate success and have a culture of kind of team orientation and fight as hard as you can.

0:50:21 – (Brad Stroh): Bureaucracy and tribalism which, which it just naturally will emerge in a large organization. All those are things that I definitely, I heard you say that, that we, we think about a lot.

0:50:31 – (Matt Widdoes): Well, in celebrating how we got it done is really important.

0:50:34 – (Brad Stroh): Yeah, like that.

0:50:35 – (Matt Widdoes): That’s not always captured because it can be. And then you get everyone focused on the metrics and then they’re like, I don’t care. I have to hit this metric. And what you need doesn’t matter. It’s like, well, the house still does.

0:50:43 – (Brad Stroh): Yeah. I’d say that’s leadership, Matt, by the way, before, before dropping is, I gotta say I want to be on the team where I love everybody I work with, I love the mission that I’m working on, and I win the championship. That’s what we’re doing here at.

0:50:53 – (Matt Widdoes): Yeah. Yes. And I think that those are interconnected. Right. When you have teams that are playing really well together, great things happen as well. So, Brad, thank you so much for the time. I really appreciate it. Look forward to next time and always a pleasure.

0:51:06 – (Brad Stroh): Great time, Matt. Thanks.

0:51:07 – (Matt Widdoes): Okay, take care. Bye.