What is a Bankerpreneur?—Business Fuel Podcast #87
Lewis & Clark Bank is taking a different approach to small business banking and we should be paying attention
Listen to our interview with Jeff Sumpter of Lewis & Clark Bank
If you don’t know what a Bankerpreneur is, you’ll want to check out this podcast and what Lewis & Clark bank are doing to encourage their bankers to think like the small business owners they serve. I really like the simple five step approach they take to small business lending. Check it out…
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Patrick Wiscombe: It is Tuesday, time for another edition of The Business Fuel Podcast. Good morning, I’m Patrick Wiscombe. Thank you for tuning us in and taking us along wherever and however you’re accessing the podcast this morning. Let me bring in the co-host and producer of the podcast, and just good friend, Ty Kiisel. How are you this morning?
Ty Kiisel: I’m doing really well.
Patrick Wiscombe: We were talking to Dick Cross a couple of weeks ago about “bankerpreneurs.” We touched on the subject.
Ty Kiisel: I wrote about it in Forbes. I was introduced to Lewis and Clark Bank and I had to find out what “bankerpreneurs” are. So I reached out and became acquainted with Jeff Sumpter, one of the co-founders or co-presidents of the bank. These guys are putting their money where their mouth is. They are walking the walk. So I’m excited to talk to him today.
Patrick: Well let’s bring him in right now. Jeff Sumpter, co-founder of Lewis and Clark Bank. He’s the Chief Lending Officer and he comes to us all the way from Oregon City, Oregon. How are you sir?
Jeff Sumpter: Very good, good morning.
Patrick: I am fascinated with the concept of bankerpreneur. How did you come up with that title?
Jeff Sumpter: When we were getting the bank started and a couple of years in, we started thinking about what we wanted the outward facing bank to look like. So we spent quite a bit of time talking about what we do and how we’re different. The bankerpreneur name kind of came out of that. Banking becomes kind of institutionalized and we spend a lot of time internally trying to avoid that. We’re like any other business; our product just happens to be banking.
Ty Kiisel: Do you think giving your bankers the name bankerpreneur has made a difference in the way they treat their customers?
Jeff: That’s a really good question. Is it just a marketing piece or is it something we really work on internally in our culture every day? It’s really the latter. The culture piece came first and the word bankerpreneur really put a name on it. We strive to have everyone work on one specific goal which is, we’re here to help clients. We do that from a perspective that we’re a small business. We worry about the same things everyone else does when they get started. The employees approach their job from more of a position of ownership. It changes the mindset as you deal with clients.
Ty: You focus on business banking. Do your customers see a difference? Has it been a positive thing?
Jeff: I think it has. Most of our business comes from referrals. I think that proves the clients we work with have a good feeling about the bank. We try to be very specific with the clients we work with. We don’t pretend to be the right fit for everybody. I think knowing who you are makes the client experience better. If we know it won’t be a good fit, we can pass them on to someone who will be able to help them better than we can.
Ty: You don’t have bank branches, you have offices. It kind of throws the notion of a bank on it’s head, doesn’t it?
Jeff: A little bit. It goes back to know who you are as a company. For us, we’re not a retail bank. So having a branch every 3 miles in a specific geographic location doesn’t make sense. We look at ourselves as more of a trusted advisor. It doesn’t matter that we might be a few more miles away.
Ty: Do you feel like your business customers are younger because of this? Or does it not matter?
Jeff: That’s a great question. The age on our lending side of the business is pretty much all over the board. On the deposit side, it tends to be a bit older. Actually our deposits went up quite a bit during the recession.
Ty: Looking at your website, it doesn’t look like you have professional models. It looks like you have real life customers who are willing to be on there. Is that the case?
Jeff: Yes. When putting together the website, we had a couple of requirements. First, we weren’t going to work with a marketing firm that has worked with any other bank. We do not view ourselves like anybody else and that has to be the starting point. We don’t want to look like every other bank. And number two, we will not use stock photos of people. That’s not what our customers look like. We have customers all over the board with different businesses. Each customer is an individual and we wanted to get that across. They are called partner stories. I’m glad you picked up on that because it’s intentional and that’s certainly a focus.
Ty: I’m looking at the website and it really doesn’t look like every other bank to me. It really feels different, and I really quite like it. I particularly like the guy in front of a big press. It looks like a diversified customer base. So you’re not particularly focused on any one industry as much as a particular business size?
Jeff: I would say more than that, a type of customer. That doesn’t mean what they do and what their size is. For us, it’s really how they want to work with their bank. Do they like that trusted advisor type of role? If you want to shop every bank in town and get the lowest rate, that’s not us.
Patrick: What was your motivation for building this type of bank? Did you have a bad experience with another bank?
Jeff: Most of us here have worked for one of the large banks in the state. My business partner and co-president Trey and I were talking about how you need your best talent taking care of your clients. Instead of having 5 mediocre people in a department, we would rather have 3 outstanding individuals. That costs you a little bit more, but that’s what it takes to take care of your customers. For a bank our size, you would probably see 30 employees. But we run at about 21. That’s intentional because we have much more capable employees.
Ty: I really like your 5 step program to making loans simple. The first one is look forward. Can you explain that to us?
Jeff: We started with, how do we view things? How does it makes us different? We really thought about our profits, especially on the lending side. One of the things we heard from our clients is that they apply for a business loan and then they don’t know where it’s at. They know they gave you a bunch of paperwork, but they’re not really sure what happens. A lot of the time they find out they weren’t approved, but they’re not sure why. So we really tried to think about what we wanted to do every time. How do we make sure it works the best every time. So the idea of looking forward is really getting to know the client upfront. Right from the beginning we want to know the client’s business. Not just the financials, but what do they do and why do they do it? We want clients that are a good fit for us and this is where it starts.
Ty: The next step is the business 360. Can you describe that?
Jeff: This is where the paperwork starts to come in. You explain how the process is going to work and who else is going to be involved. We like to have multiple people make contact with the client. That way, the client has multiple resources within the company.
Ty: Is this where you get into the nuts and bolts of the credit score and that kind of stuff?
Jeff: That’s probably more of number 3. By now we’ve looked at the financials and have an idea of what the client wants. Then we get into the details. You mentioned credit score. That’s probably the last things we look at. It’s really everything else that is much more important. We don’t have some matrix that says what credit score is good and what one is bad. It’s just a number and it’s too arbitrary. Step 3 is really much more understanding the financials. We have really great analysts that will go through all the information. We then go back to the clients just once to ask questions. Then we can move into step 4 which is bringing everything together.
Ty: I imagine there are some borrowers that are a slam dunk, easy decision. Then there are others that might not qualify, for whatever reason, today. What do you do with those borrowers?
Jeff: When we started this whole process, we tried to look for something we did really well. One of the things we discovered is that if we can’t do x for a customer, we would go back to them and explain that we can’t do x, but we can do y and this is how we can set it up. That’s something we do a lot. Or if we just absolutely can’t help them, we refer them to other lenders we are aware of.
Ty: How do customers react to that?
Jeff: I think most appreciate it. Even if they don’t understand banking, they understand their own financials. They can see how it might be difficult to get exactly what they want. Most people appreciate options. When you show them in black and white, it’s easier to understand. Showing them their situation and telling them what they have to do to get where they want, then it becomes a little more real instead of just a “no” from a black hole.
Ty: Step 5 is the green light, the loan gets funded. What do you do different after that takes place?
Jeff: Depending on what kind of loan it is, they will get a call from someone in the bank. An introduction with a direct phone number. Or we’ll have them come in for a meeting with the staff. If there’s any other resources we can bring to the table, we will do it then as well. For example, if they need an attorney, we can definitely get them in touch with people we know. The best way to describe this is they’re in the family at that point.
Ty: If you’re a small business owner, how do you engage with you guys?
Jeff: We have our main office in the Portland metro, kind of southwest Washington area. We have an office and experienced banker in Bend, Oregon. And we just recently hired a very experienced banker in southern Oregon.
Patrick: We’ll go ahead and wrap up today’s edition of the podcast. Our thanks to Jeff Sumpter, co-founder of Lewis and Clark Bank. You can check them out online at lewisandclarkbank.com. Remember you can pick up a fresh edition of The Business Fuel Podcast every Tuesday at 9 am, Mountain time on Lendio.com/blog. If you want to have the podcast automatically arrive in your iDevice, head over to the iTunes store. Do a search for Lendio. So for Jeff Sumpter, Ty Kiisel, I’m Patrick Wiscombe. Thank you for listening. We will talk to you again next Tuesday.
Bringing you interviews with top business professionals and business financing tips to help fuel your American dream. This has been the Business Fuel podcast, with your hosts, Ty Kiisel and Patrick Wiscombe, heard exclusively on Lendio.com