Artificially Intelligent with Sam Maule and Maia Bittner

Crafting a Modern Community Bank: Insights from Corey LeBlanc

• Sam Maule, Maia Bittner, Rachel Morrissey

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Ever wondered what it takes to build a bank from the ground up in less than a year? Join us as we sit down with Corey LeBlanc, co-founder of Locality Bank, who managed this incredible feat in Miami for under a million dollars. Corey shares his remarkable journey, from overcoming regulatory obstacles to raising capital, and how his background in the Air Force surprisingly prepared him for the structured world of banking. This conversation is packed with insights that anyone in the fintech and banking sectors will find invaluable, especially those passionate about community banking.

Relationships are the backbone of the banking industry, and this episode underscores their critical importance. We discuss with Corey and other industry leaders how seasoned executives and strong networks can navigate the complexities of obtaining a banking charter. Learn how reputation and relationships can fast-track progress and foster innovation, even amidst post-2009 regulatory challenges. Discover our mission to revive community banking by blending local decision-making power with modern technological advancements.

The decline of community banks in America is a pressing issue, and we explore its impact on local markets like Broward County in South Florida. Corey sheds light on the challenges these banks face and the potential for modernization through innovative tech solutions. From strategic decisions in building a tech stack to managing partnerships and contracts, we delve into the intricacies of launching a banking startup. This episode is a goldmine of practical advice on balancing development costs, maintaining customer trust, and successfully navigating the fintech landscape. Don’t miss out on these invaluable lessons.

Hosts: Sam Maule & Maia Bittner


Maia Bittner:

Hey, hey. Welcome back to yet another episode of Artificially Intelligent brought to you by Money 2020. I am your perpetual fintech intern, Maia Bittner.

Sam Maule:

I love that terminology. I'm that other perpetual fintech intern, Sam Maule. Maia, how are you today? It looks beautiful wherever you're at.

Maia Bittner:

Beautiful sunny day. Sam. I got to admit I'm operating on low sleep today. Babies will do that, um, that's the thing about those newborns. So apologies if, uh, you know if I seem a little out of it, but I'm super excited um to be chatting today, of course.

Sam Maule:

Well, once we get into this topic, everyone uh, Maia's energy level will go through the roof, because this is what you call teeing up something or a softball lob, because today we're going to talk about how you build a bank. So for those of you that don't know, for some reason, Maia, how long have you been at Chime? How many years now?

Maia Bittner:

I have been at Chime since 2018.

Sam Maule:

Okay.

Maia Bittner:

So six years.

Sam Maule:

So for those of you who don't know roughly how large is Chime now. Give us that ballpark stat. How big are you now?

Maia Bittner:

In terms of employees, customers how much money we're making.

Sam Maule:

Oh, customers, let's go.

Maia Bittner:

Customers, let's do whatever everybody's favorite ego um statistic, but let's go with that how many customers chime has is the number one thing I could never talk about to anyone ever in any definition, any sense. I got like, got no idea Like seven or eight million.

Sam Maule:

She's not going to admit it. It's a lot. Yeah, they do really flipping well, everybody, they aren't New Bank down in Brazil, google that, but in the US killing it.

Maia Bittner:

You know we sponsor the Dallas Mavericks. We got our logo all over that stadium.

Sam Maule:

Mr Cuban, there you go. Well, we are going to talk to a friend of ours who's working on getting the logo down in Miami. I'm sure that's well on the list of things for Corey to get done. One of my favorite people in the world, Corey LeBlanc. Corey, how are you doing?

Corey LeBlanc:

I'm doing, beautiful brother. How are you? I'm good, mia, we're coming after you. We got about 1,500 clients.

Maia Bittner:

Hey.

Corey LeBlanc:

Growing Come on.

Maia Bittner:

I look over my shoulder.

Sam Maule:

That's it. Bring it, bring it, yep. The logo for Miami Heat will be Locality Bank. That's what we're going to talk about on this episode today how to build a bank from scratch, how to build a bank from absolutely nothing. And, Corey, you cracked me up as you were getting ready.

Corey LeBlanc:

You said I don't know if I'm going to tell you how to build a bank. I'm going to tell you how we built the bank. Yeah, yeah, that's the only experience I have. I've talked to a lot of other people that have started to Novos over the past couple of years. We've kind of created like a I don't know a group of people that you know share all of our common complaints, do you?

Maia Bittner:

guys have a group chat.

Corey LeBlanc:

We do. You know, we randomly will ping each other especially the ones that were coming out right about the same time we were. It was kind of a hey, are you getting the same question? Are you having the same problem? How are you raising capital and all these things. But yeah, I can't tell you exactly how to build the perfect bank, but I can tell you how we did it in 10 months for under a million bucks we could do that.

Sam Maule:

Well, see, that's going to be fun, because we're going to talk about the bank charter side of the house, the regulatory side, just an immense number of meetings, and that's the Sam Mall trivia question of the day, because I am desperately trying to catch Maia on one of these. Maia or Corey, when was the first banking charter granted in the US? If you can get within 20 years, I high-five you.

Maia Bittner:

I'm going to go like 1862.

Corey LeBlanc:

Corey. I'm going to say late 1700s, early 1800s. I'm going to say 17. I almost swear. I've looked this up recently just reading. I want to say like 1780.

Sam Maule:

All right, oh, my God, Corey, 1791. Ooh.

Maia Bittner:

The bank in the.

Sam Maule:

United States Congress gave a 20-year charter. That is considered the first bank charter. Good job, man. Within 10 years, that's that military screaming out of core, even though it's the Air Force, or it isn't kind of military, it's an army. Maybe that we won't go there anymore. But let's start with what is wrong with you. Why would you want to start a bank in Miami?

Corey LeBlanc:

Yeah, I'm a former military guy, and if that don't tell you anything, sam, I don't know what will. I am a sucker for punishment and heavy regulation. I like rules, man. And no for me. I had left the Air Force, thought I was going to go into banking temporarily, just as a stepping stone job to get closer to family. Got in there, realized I really had a passion for, specifically for me community banking. And after about 15 years at a larger regional bank that was growing very, very fast and went public, I said, well, this is not a challenge anymore, so let's, let's go do something different. And uh, weirdly enough, man, I have to thank you for this. Uh, I would have not started this bank without you, sam All.

Corey LeBlanc:

Uh, if you recall, right at the beginning of the pandemic, you call me and you tell me I'm going to do a podcast every single morning. It's going to be 30 minutes, it's going to be great. And I said, sam, you're insane, you can't do a podcast every. That's a lot of work, dude. And you said, no, no, no, it's fine, you just got to participate. And then in the mornings you just got to log in and talk to people, like in the chat, and I said, cool, I could do that. Uh, cause we've never been more disconnected, right? So I was like this is great.

Corey LeBlanc:

I kind of have those conversations again and, serpantipitously, my co-founder and our CEO, keith Costello, heard that podcast and knew he was going to be coming out of a non-compete, reached out to me on LinkedIn, as anyone would. When someone messages you on LinkedIn to say they want to start a bank with you, you ignore them and you think they're spamming the hell out of you. And so my wife finally did the research and said no, you really need to talk to this guy. So without Sam, I don't think we get here.

Maia Bittner:

Well, Corey, you and I have that in common, because Rachel actually cold reached out to me on LinkedIn and said do you want to have a podcast? To have a podcast.

Sam Maule:

And that's how that happened, and so that's why.

Maia Bittner:

Sam and I are here today, so hold LinkedIn reach outs. Hey, working hard, building big things.

Sam Maule:

You know. If you don't ask, you know. You got to ask everybody. There's lesson number one in how to build a bank Just go on LinkedIn, send a message. You never know what will happen. It was rather funny when Rachel asked me about doing this podcast. She said really need a co-host and I, like screamed through the phone. I said Maia Bittner, Maia Bittner, she would be. I will never get her, but she would be awesome. So, Corey man, I just the task to go and push to start a new bank, to get the charter and everything else. I have no clue. I left banking in 2004. My first job was with Northern Trust, way back when, as a SAS 70 auditor there's a bit of trivia for everybody Was there for about 10 years. Then I left banking. I've never worked for banks since. I just can't imagine what it's like now, especially post urban, post the crash, the regulatory environment, the lack of charters that are issued anymore. What that experience is like. Where do you even start?

Corey LeBlanc:

You start with a business plan, right, you got to come up with a really good business plan and you got to make sure that you can go out and get the capital to even get going right. So that was, first and foremost is let's figure out what it is that we want to do and why. What we were wanting to do would be different enough to get investors to give us money, but traditional enough that the regulators wouldn't make it difficult and costly. And so the good thing is is we had a really great team and we still have a great team that was at from the beginning, that understood how to do this.

Corey LeBlanc:

You know Keith, our CEO and my co -founder. He had started a few banks before, and so he kind of had some familiarity with the DeNovo process, although it had changed quite a bit since he sold his last bank, which would have been, I think, around like 2011, 2012. And we launched in 2022. But no, oddly, it was way easier than I thought it was going to be. And so, you know, like two good French and Irish guys, we decided to submit our charter application on St Patrick's Day for good luck in 2021. And we had our conditional approvals by November of that year and we launched in January the following, so 10 months.

Maia Bittner:

Well, yeah, I mean it's good to know about your co-founder. That kind of makes sense, because one of the things I was going to ask about is that relationship with the regulators. I think tech people kind of think of bank charters as like an API doc or like you either have it or you don't, and it's programming and it's like hard and fast and it lets you do X, y and Z definitively and doesn't let you do one, two and three when really that's not how it works. So much of bank charters is about the relationship with the regulators and so I was going to ask if you were starting from behind with this new bank charter. But it sounds like your team does kind of have that established relationship that they can lean on and that would let you like move faster and have more trust. Is that right?

Corey LeBlanc:

Absolutely yeah, no. So like you got to think about it. So we're chartered out of the state of Florida with the Office of Financial Regulations, the OFR, here in Florida. We have deep relationships with them from you know Keith's previous institutions. He's been down here for 30 years so he's worked with them, he's created confidence with these regulators and they understand that Keith is not trying to come in here and make fast money. He's trying to be a good banker and a good steward of the banking concept and do it ethically, and so that alleviates a lot of problems.

Corey LeBlanc:

The other thing in some of the other de novos that I talked to, they were having issues getting that charter and getting it through. One of the first questions I would ask them is do you have anyone in your C-suite, at your senior executive level that have ran banks at a senior executive level? And then, if they said yes to that, have you had one that started a bank? And so that was the next question. I was so surprised how many did not have anyone that had worked in that senior executive level of a bank before that thought that they could just go through the charter process Like it was nothing. That sounds like how tech people approach things, but I get it, we had so.

Maia Bittner:

I started a small fintech company. We had six people on our team, right, so it was me and my co-founder, we had two engineers, we had one ops person and we had a chief compliance officer who had that pedigree and that history and that resume and those relationships. And that's how we made everything happen is by kind of leaning on that and just what you're saying right. People trusted him. They knew that he wasn't going to approve things or get on board with something that was going to be against consumers or screw people over, and that we're trying to do things the right way. And that gave us a little bit more leeway, a little bit longer leash to then try some new, innovative things.

Sam Maule:

Yeah, you think about Chime, about Chime, right With.

Maia Bittner:

Chris.

Sam Maule:

Britton, everybody found her at. Chime right. I mean Chris came out of Green Dot and Visa, if I remember right and Visa. Yeah. So I mean again isn't it fascinating that in 2024, people and relationships still matter. If you're young and listening to this, please note that very early on. If you want a career in financing and banking and in tech for that matter, your network, your the people you know and, by the way, your character and reputation. This is the old man talking it matters absolutely.

Corey LeBlanc:

And look, I will tell you, if you're not in banking and you're in another industry, your relationships with bankers and attorneys and all these other people are going to matter if you really want to grow to something substantial. And so, man, you know we talk about, you know digitization, all this stuff all the time, and sometimes I get a little frustrated, you know, with some of the things I read, because I'm like you're missing a key component of this, and it absolutely comes down to the people around it and what they're willing to put out to get something done. But it's also that ecosystem of people that you know, right? I mean, how many times do I text you, sam, just to say, hey, do you know anyone in this space? Because I just want a connection real quick and vice versa.

Maia Bittner:

Those things save time, which saves money, which makes things work. Be somebody in the C-suite at Experian. And that's how we made that happen, right, because we weren't making progress through the front door. And she was like these guys are awesome, these guys are great. And sort of fast-tracked us through the whole problem, and anytime we ran into a roadblock, we'd reach out to her again and she'd push us forward.

Sam Maule:

I can't stress enough for those of you. I mean, this is a FinTech podcast, so you know our assumption going in, as you know a lot about payments and banking and all that, but you know, sometimes it's not good to assume prior to 2009. So, prior to the market crash, on average, about 150 banking charters are granted a year. Roughly right After that, it just went to zero for several years. In the year I think, Corey, that you did this in 2022, there was only 14 charters granted I mean, this isn't like a factory people and 14, by the way, is the highest number since 2009 of banking charters granted in the US, so there is not a ton.

Corey LeBlanc:

So during the time we filed, there was about five other institutions I was talking with pretty regularly about what they were doing. Of those other five institutions, only two of them got out the gate. As of today I don't know that the other ones ever I know they tried to pivot. They looked at just going FinTech route, they tried a number of different ideas and it didn't work. And when it came down to another thing that we had to do was we had those good relationships, we had that confidence, but we had to be flexible. Like our business plan changed based off of the feedback of the regulators. We we had to concede on a few things. You know, at first we said we were not even going to carry cash and you know, today we have a traditional you know cash recycler and things like that in our facility. So we serve much more as a branch in the physical location than we intended originally. And that was because of the conversation we had with the regulators and we realized it was going to be easier and maybe the right thing to do.

Maia Bittner:

Well, and Corey, can we back up a little bit? I don't actually know what you're building, what you're doing. Give me the pitch on what is so special that you needed a whole new banking charter to provide it write it.

Corey LeBlanc:

Yeah, so we're a bunch of lifelong community bankers that was seeing the existence of community banks kind of being diminished, right In the sense that most community banks are getting gobbled up in around 200 million assets 500 million assets by larger regional banks, really creating a gap in local markets where that relationship, that local decisioning power and those things are happening. The thing that we loved about banking was changing and the shift that we were seeing was really creating not just a gap, but almost an impossible gap to cover by the other institutions, because the part of the business that was becoming difficult by the other institutions, because the part of the business that was becoming difficult, they had zero control to go get back right. They didn't have the technology, they didn't have the business structure, they didn't have the planning in place to go get that business. And so when we decided to start a bank, the first thing we did is when we started sitting down with investors, they asked us the same question. They said why the hell do we need another bank?

Corey LeBlanc:

Did you not just drive down Los Alas here in Fort Lauderdale and pass by 15, 20 other financial institutions or banks?

Corey LeBlanc:

What makes you think you need to be here? And so then we started asking the question of when was the last time you were able to take your business into those locations, have a conversation and have them understand what your business needs are, but then, whenever you left the building, also have that financial institution be able to allow you to self-serve with the digital tools you need, so that we're not bothering you when it's not relevant. And obviously there was much more in the pitch deck than that, but that's really what kind of drove home the point. And so what we're trying to do here in South Florida is we've built a digital native community bank with a traditional relationship focus, powered by an infrastructure that supports modern innovation and growth and change, so that we can be sustainable growth and change. So that we can be sustainable, we can keep growing right alongside of our customers but be agile enough to be, I guess, responsive to the changes they're going to see in the future as well.

Sam Maule:

I just want to let this number strike home for everybody. So, according to FDIC, the number of US community banks dropped by 46% over the last two decades, 46% over the last two decades 46%, from about 7,500 to around 4,000 in 2023.

Corey LeBlanc:

That's so I want to say. I want to say, when Keith brought this to me and we started talking, the first thing he told me was when he sold his last bank, there were like 12, I want to say 11 or 12 community banks headquartered here in Broward County, here in South Florida, and at the time we were having that conversation there were three, and one was in the process of being sold, and so that struck me because to me this is a big market, there's a lot of opportunity here. And then when I started looking at the competition, I realized that it really wasn't the face of community banking.

Sam Maule:

The part I like, Maia is Corey. Where were you living before you moved to South Florida?

Corey LeBlanc:

I was living in North Central Louisiana.

Sam Maule:

Just like Miami and Fort Lauderdale, Maia, they look so much alike. The same kind of you know businesses, you know.

Corey LeBlanc:

Exactly the same.

Sam Maule:

Cuban food. Yeah, so I mean you went from Ruston, louisiana, to basically you're in Fort Lauderdale now from Everett right In Broward County.

Corey LeBlanc:

I am North of Miami. Yes, sir, yeah.

Sam Maule:

One of the fastest growing places in the country, Incredible amount of money, incredible amount of businesses that are there. So there's probably I'm doing this off the top of my head, but I'm guessing the growth and the number of businesses as compared to maybe the entire state of Louisiana, just in the couple of counties you're in, is mind boggling.

Corey LeBlanc:

Well, that was part of the hypothesis as well. Right, if we were going to prove that a modern version of the community bank could exist and actually make value for local communities, there's not a better market necessarily than South Florida to prove it. Because if it can't work here, sure as hell isn't going to work in Ruston, louisiana. Right, it's not going to work in small town Mississippi, it's not going to work in rural Missouri. But if it can work here, then we can talk about. What does that look like at scale? What does that look like as a blueprint for everyone else to understand what works and what doesn't work?

Maia Bittner:

I've done a lot of research on banking deserts, which is more on the consumer side, but places that aren't served by bank branches, that are hardly served by ATMs and they don't have those resources. It's really interesting. Louisiana, I think, is a big home of banking deserts and people who don't have the financial resources. But that begs the question to me, right? Okay, so all these community banks are dying? Very sad. They're dying because they're not good enough businesses to keep going, right? So how are you thinking about that piece? Or tell me yeah, or do I have it wrong? Are they dying for a different reason?

Corey LeBlanc:

So I don't think that it's necessarily a bad business plan to be a community bank. I think they don't have the appropriate plan in place for their institutions to grow in the future. I think what they've done is they've kicked the appropriate plan in place for their institutions to grow in the future. I think what they've done is they've kicked the can down the road for so long that they find themselves in a position where they really don't have an ability to climb out of the hole they've created. And so, therefore, if you can't grow, how do you continue to capitalize the bank? So either A you're privately owned by a small group of people and you keep your assets at a certain level, you maintain your deposits and you write the same amount of loans every single year and everyone keeps making money, and you're okay.

Corey LeBlanc:

But that's not typically a model you see too often, right, but that is one that you see in community banking. The other side of that is, you just have community banks that can't grow anymore. And when you hit that plateau as investors, as stakeholders in that institution, what do you do? Like if you have no plan to grow out of it, you've got to figure out something else, and so that's where you start to look at the acquisition opportunities. And in your large regional institutions there's good assets there, there's good customers. It's just the institution doesn't have the management team or the plan in place to take advantage of that.

Sam Maule:

How do you approach this from a tech stack? So let's get into the technology side of this, right? So, Maia at Chime, right, you got the ability to say cool, we're starting from scratch. Here we go, and the same thing with you, corey, right, it wasn't like you inherited a I'll make fun of Hogan you haven't inherited a core. That dates back to when I was three years old and you know watching TV black and white. You start from scratch. So how do you go about that decision tree of how you're going to build out?

Corey LeBlanc:

Yeah, you know, as a IT guy by trade right, I've been a builder of infrastructures and architectures and the air force and the banking for a long time my initial thought was let's go build everything we can for ourselves and let's own the tech stack, right. And then when the investors and my executive team said 10 months and under a million dollars, I said well, I was thinking more three to five years and eight to $10 million. When the investors in my executive team said 10 months and under a million dollars, I said, well, I was thinking more three to five years and eight to $10 million. But okay, let's try it your way as well. But collectively, as we sat down and we thought about it, the way we approached it was let's keep our technical debt really low. Let's create a nice path for profitability as a bank in the first three years so that when we get to that point we have opportunities to go get additional capital to keep growing this thing. But in doing so, what we didn't want to do which which is weird, because I see all these other de novo banks that are coming out they're doing it the exact same way they go sign up with the traditional core, you know, one of the top three or four cores that are out there and they take and they just replicate the same tech stack, the same application experience, everything that all other banks have, and they think that's their plan for the future. Maybe they have an idea of changing that later, but they have zero control to do that and they're just right back into the same binding contracts and hurdles that they probably left at their previous institutions For us. We said, okay, well, let's keep the technical debt low, but let's work with a provider and partners that allow us to iteratively take and gain more control over the tech stack over time as we see fit right, so we're not having to build it all for ourselves. Maybe we're dependent on our partners in years one through two, three, you know 90, then you know maybe 75% and 60%, but over time we'll have ownership of the things that matter to us and then we'll let everyone else kind of keep building and shaping the things that we don't really care to spend as much time with. And that's been super helpful for us because we're seeing that now.

Corey LeBlanc:

The difficult part of that is because we kept the tech that low. We didn't have full ownership is in the first two years. It's a lot of collaboration and working to try to get the thing to where you really want it to be. But where we are today is so exciting for me because we're starting to see all of the hard work we've put in the first years come to fruition. We're starting to create partnerships and opportunities to do things that I couldn't do at my seven and a half billion dollar institution before without moving mountains, and I can do it with a phone call and 30,000 bucks right. It's insane to me that we could do some of these things. So that's kind of the way we did it. I know, Maia, you did it a little bit differently and I love the way that you guys did it, because there's not one right answer right to this.

Maia Bittner:

Right, I know, and that's what I think you know, my standard advice for startups is really invest in building out the things that are your competitive differentiators and everything else. Buy it off the shelf and maybe look at you know, implementing it in a modular way so that you can rip and replace things and build it on your own as you grow over time. Particularly, I think that can help on the unit economic side and really reduce expenses. Buying software for everything gets pretty expensive once you get to scale. But I think that and that all sounds good and I saw it like Sam's nodding.

Maia Bittner:

Everyone's like yep, cool, invest in your competitive differentiators, but the devil's in the details there, right, and just as you're saying, it's like well, okay, you work with partners and then you realize, like the product you can bring to market is not exactly what you want it to look like. Then what right? Like? Do you just compromise? Do you just ship something where you're like this is 90% of what I love, but like at least it's done, at least it's in people's hands and we can change it later? Do you hold a hard lot Like? I think that nuance level of negotiation is where a lot of people get stuck and there's probably no scientific formula for it. There's probably like a little bit of magic in nailing that right balance.

Sam Maule:

And I think part of that is not staying stuck. That that's something we see way too much. Right Is that you can't overcome inertia because, oh my God, everything I'm facing and you're going to have to make a decision one way or the other, and so which path are you going to go down? And I don't care if you're a company with 10 employees or you're a company with 200,000 employees, that inertia will kill you.

Corey LeBlanc:

Absolutely. You come from a development background, right yeah my background is engineering.

Maia Bittner:

Yeah, so from that engineering background, right. Yeah, my background is engineering.

Corey LeBlanc:

Yeah, so from that engineering background, I know, we both know, and, sam, you've seen this right From the amount of time you spend in this space, on this side.

Sam Maule:

Dude, I was a Lotus Notes programmer. I know Come on.

Corey LeBlanc:

I remember, okay, but on the banking side, the vast majority of things we're going to spend time and money trying to build and develop are not going to work right, at least the first time around. There's going to be a lot of things we have to scrap and there's going to be a lot of money we burn. It's just how do you reduce the cost of that burn and keep moving right To your point, sam? Is that inertia, or you know, don't stay stock and all these things, but the reality is is there's nothing going to be perfect, and so why? Why stop Right? And so, yeah, there are definitely some things that we probably rolled out in on day one that we probably would have imagined would be different Right when we first started. But I can tell you those things are very different today than they were when we launched, and we're going to continue to shape that.

Corey LeBlanc:

And you know, if we have partners that are working with us on software, I'm working really hard to be creative on how we structure that. And you know, if we have partners that are, you know, working with us on software, I'm working really hard to be creative on how we structure that contract with them, because there's not a single thing I'm going to sign a contract with that. I'm not going to be willing to scrap completely and eat that contract and do something else if my business or my customers need it. And that's how we've. We've structured the way we do business.

Maia Bittner:

I like that. I think also when dealing with, like money, banking, all this important stuff, we've talked about trust a lot, that trust is really important and often people trust things that are really refined, you know, that work really well and that you could take a naive perspective and say like, oh, it doesn't matter, you know the way that's looks or this tiny little interaction, but I think all of those things add up and makes your customers trust you, and so sometimes you do have to invest in that little bit of polish before launching something new.

Corey LeBlanc:

Absolutely. You know we have. We have two vendors right now that I would say are part of the top three major core providers. When we signed the contracts they were not part of those companies. They were acquired either during implementation or after implementation. Those are the two products. I'm trying to get rid of ASAP, because I have the most problems supporting my customers with it. It's not super easy to forklift those things and get them out of there, but that's why we're doing a lot more due diligence now on looking at the roadmap and putting some very clear things in the contracts to do that Because, to your point, we are built on trust, but our customers trust us, not the third parties we work with right. So at the end of the day, it comes down to compliance, same all this other stuff. We're responsible for the product, service and everything that we do, and so when a third party like that is an affecting factor, you got to get rid of that 100%.

Maia Bittner:

Yeah, I mean, the buck stops with you. I used to rant at people. I worked at an e-commerce company, you know, and our top complaint, of course, was when things took too long to arrive in the mail, and sometimes people on our team would say, well, like, that's not our fault, like that's the USPS. And I was like, no, no, that is our fault. Right, we're the only ones that chose to work with the USPS. We could send everything overnight through FedEx, but we don't, because our business model doesn't support it and some other. Right, but that's on us. Like we're the ones that are choosing those vendors, we're the only ones that have a say in how that works and we need to take 100% responsibility for the experience that our customers have with it. So, as you can tell, I'm passionate about this and I'm heartened to hear that you share the same perspective.

Sam Maule:

So we need to come up with a sound, a noise, a gong or something when we come up with ideas for future shows, because we've already come up with two during this conversation. So Banking Deserts, Maia, I got excited when you said it. Oh yeah, let's talk about to scale, right. I'm not pointing fingers, but go read about JP Morgan and maybe an investment they did at Chase in a tech. But due diligence can go both ways, right. It's due diligence with your partners. You got to do due diligence on banks too, right? I mean, in this day and age, there's a show, Maia some of the horror stories and lessons learned around due diligence when you're working with companies.

Maia Bittner:

Well, that's like, Corey, do you have any advice? I mean you kind of hinted at. You're like, okay, like now we've learned there's some things we need to include in our contracts, there's some things that we need you're going to do differently going forward. Now, it's really hard to get that stuff right from the start because you don't know what you don't know. Do you have any advice for people as they like get started on a new project right, how can they structure contracts? What type of stuff should they be thinking about when, yeah, you don't know what you don't know? You don't know how it's all going to play out?

Corey LeBlanc:

Yeah, One keep contracts short, right, that's pretty simple. That's an easy one. Everyone should already know that but we always like to try to take the deal and we take the longer ones, which invests our companies into something we don't know. The other thing I necessitate when we're talking to anyone of any kind of significant contract anything that's going to actually go to my customer experience or drive the way that we deliver service to our customers. The first thing we do is we sit down and we define a clear objective for Locality Bank. Here's the one thing we must have, and this needs to be in the contract that this will be received and in this way. And then what we ask our partners to do is we ask them to define one clear objective for their side that they want in the contract as well, because we want them to know we're going to give much skin in the game of delivering something back to them, as they are going to be delivering back to us, and that's been super helpful in us making sure that when we get into the projects, we don't forget what's important. We have to be able to define those things, so that's super helpful.

Corey LeBlanc:

The other thing is is one I don't care how small the contract or how easy you think this is. I don't care if you've signed 50 billion addendums with the same vendor. Do you think that this is going to be fine? Have legal review, Make sure that you're protected whenever the mess hits the fan right, so that you can back out or get out of those things. That's super important because it reduced the cost of forklifting something after three years and you never really wanted it since day one, right? And that saves the cost for the other things that you need to be able to do. So when we start to have budget conversations, it makes it entirely different.

Maia Bittner:

Yeah, yeah, it puts you in a better position to negotiate.

Corey LeBlanc:

I don't know if there's golden nuggets, but it's really simple, right, but that's what's been working for us.

Maia Bittner:

Well, and I think people get carried away Like it's easy to, or you know, you see the discounts on the 10 year contract and it's like oh yeah let's do that. We're getting such a good deal and you end up putting yourself in a bad position.

Sam Maule:

The thing that I love, Corey, is you know you talk about biting off more than you can chew or just going all in the thing with having a community bank. Um, you can't hide. They know where you're at all right, they know where that. I think you have one branch. They, they know where you're at. You're gonna you're gonna come face to face with your customers.

Corey LeBlanc:

So we know these people for the most part, too, like a lot of these, these people who are customers of our, there are neighbors, you know. These are people who have invested in the bank or invested in some of the companies that have invested in our bank or that we've given loans to, and so these are people we're going to see, you know, at the restaurant. We're going to see these people downtown, we're going to interact with them. So, yeah, we better put our best foot forward.

Maia Bittner:

All I'm hearing is like data points for underwriting advantages. I'm like Ooh like. Well, what restaurant do you see them at, and where downtown?

Corey LeBlanc:

And what time of day are they down?

Maia Bittner:

That's what I'm thinking.

Corey LeBlanc:

Oh, absolutely, I'm with you, 100% there. That's the thing that I'm trying to figure out how do we continue to replicate? I love the in-person thing, but how do? We take and we create the right information to be very strategic, very direct and accurate, with the next thing that we're going to do so.

Sam Maule:

folks, for our listeners, here you go. You want to learn how to build a bank. Two people to talk to, Corey and Maia, and we're going to make sure you get their information. Corey, where's the best place for people one to find out about Locality Bank and then to reach out to you?

Corey LeBlanc:

Yeah, you can go to localitybankcom. Uh, we're actually getting going through a web refresh already just to make sure that we're highlighting more customers and providing more tools for people to use. Uh, or hit us up on LinkedIn. Uh, really busy there. Uh, and, fun note, my daughter is the one who runs our, our social media platform. So if you see anything on my social media platform, that's my daughter, charisma, charisma and, by the way, probably of my wife's recommendations, who's really good at marketing as well. We also have a great marketing director, ryan, who helps us drive these things home, but his on LinkedIn, and you can always message me on Twitter, at Inked Banker, or on LinkedIn. Just Corey LeBlanc, look for Locality Bank. And I actually look like a banker in that picture, unlike the way I look most days.

Sam Maule:

And if we don't give a shout out to his wife, Cassie, I will never hear the end of it. So also Cassie LeBlanc at Nimbus, who is one of the best marketers I know. You're welcome, Cassie. Maia, how about you? How to build a bank?

Maia Bittner:

I'm, I'm no, no, no, no, please do. Please do not talk to me about building a bank. This is not an interest of mine. It is not a specialty. I do not want any DMs inviting me to build a bank with people, just to put that out there. No cold LinkedIn messages. But if you want to chat about anything else, I'm on Twitter at maiab.

Sam Maule:

And if you want to talk about anything else, please don't talk to me about building a bank, Sam. Find me on LinkedIn. Find me on Twitter. Hey everybody, Thanks for listening. This is way too much fun. It's always good when we know that we're learning something. So, hey, join us next week.