Tuum Talks Episode 1: Routes to Renovation in Banking

Welcome to Tuum Talks Episode #1: Routes to Renovation in Banking

Recorded Live: Tuesday, October 24, 2023
Co-hosts: Myles Bertrand & Dharmesh Mistry

In our inaugural episode, Myles Bertrand, CEO of Tuum, engages in a captivating conversation with Dharmesh Mistry, Fintech Expert & Visionary, exploring the evolving landscape of banking technology.

Dharmesh shares his journey into banking tech, highlighting his early fascination with technology and his unexpected entry into the banking sector. The discussion delves into the challenges and opportunities in banking, the role of challenger banks, and the impact of technological advancements such as AI on the industry.

Myles and Dharmesh also touch upon the importance of modernizing core banking systems and the potential of banking as a service (BaaS) in creating a more integrated and efficient banking ecosystem.

Join us for this insightful dialogue as we unravel the complexities of banking technology and envision the future of the financial industry. Enjoy!

Routes to renovation in banking

[Full Transcript]

Myles: Morning, good afternoon, good evening, wherever you may be, and thanks for joining the first Tuum Talks session that we’ve ever conducted: Routes to Renovation in Banking. I’m Myles Bertrand. I’m the CEO of Tuum, and thanks for joining us. I’m joined today by Dharmesh Mistry. Dharmesh, great pleasure to have you. Thanks for joining.

Dharmesh: Thank you so much for inviting me, and I feel really honored to be your first guest. What a privilege.

Myles: Wow, it’s great, but also, you’re either going to set the bar very high or set the bar very low. Let’s hope it’s the higher end of the spectrum anyway. And also, this is very unusual for me. Normally, I’m getting interviewed on these sorts of things, and you’re the interviewer, so it’s actually quite nice to have the tables turn this time and actually have, we’re sitting on opposite sides of the podcast.

Dharmesh: Yeah. We’re coming up to about, I think the hundreth episode soon of Dave and Dharm Demystify, and I’ve done less than a handful on the opposite side where I’m answering questions. So yeah, it’s quite different for me as well.

Myles: Oh, good. It’ll be a test for both of us, actually, but looking forward to it. Hey, so look, let’s just cut straight to this. There’s a lot of really interesting questions I want to ask you. Why did you decide to work in banking tech, because you know, it’s not everyone’s go to?

Dharmesh: The honest answer is I didn’t decide to work in banking necessarily, but from about the age of 12, I absolutely knew I was going to work in technology. So, I was writing code on the first kind of microcomputers, and I just thought it was fun, right? And even when I joined my first or had my first job, I didn’t go to university, because I got this job with Lloyds Bank as a trainee programmer. And for the first three months, I’m literally going to university, learning mainframe programming like… Hold on, I’m getting paid for this. This is too good. Like unreal. I’m getting paid and I’m learning.

That’s how it all started. It wasn’t really because I wanted to join a bank. But, if you think about it, back in those days, and I know I’m fairly old now, right? But it was all about the mainframe. There was no client server, there was no PC, there was no internet, etc. And so, banks were some of the first to invest in technology. So, it makes sense that the opportunities to be in kind of technology were most prevalent in banks at that time.

Myles: Would you make the same decision now?

Dharmesh: What to join a bank? I’d join a different bank. Not that I didn’t like Lloyds. Lloyds was fantastic, and I would absolutely not do that again, but it was a great place to learn, and had a mentality where, you know, you either work hard to stay up with everything else, or you were just exceptionally talented. So, it was a great environment, but I’d probably join somewhere where they pay better. Yeah, I think I need an investment bank.

Myles: Yeah, it’s a very different environment, I think working for the bank in the 80s or the 90s or 2,000s to where, what it is now and what the industry is like, and I think It’s always interesting that you ask kids these days when they’re growing up what do you want to be when you grow up? And they don’t know I didn’t know what I wanted to be, and I’m still, I turned 40 and I still didn’t know what I wanted to be. I’m still working on it Dharmesh, eventually I’ll find out what I’m supposed to be in life.

And your podcast it’s a great achievement, it’s fantastic what would you, what would be some of the highlight, highlights of coming out of having a podcast like yourselves, and like you do and what do you enjoy about doing that?

Dharmesh: Look, we none of the podcast is sponsored or driven by any kind of finance as such. We did it really to understand the medium and also to get to talk to interesting people and we’ve had the good and the great, as I would say, on our show. Everything from the top FinTech influencers to banks doing really interesting stuff, but I guess the area that I’ve enjoyed the most is speaking to other entrepreneurs and FinTech startups, how they started the journey, why they do what they do, how they’re progressing. It’s just a fascinating insight and it gives us access to, to things or finding out things that we wouldn’t know otherwise. Not everything gets printed in the press. It’s been a great learning journey, I would say.

Myles: Yeah. And lots of topics that you cover off, but I want to draw on one in particular. I read your last article, which was really interesting. You basically make the case that the challenger banks have failed to disrupt the incumbent banks. And obviously this is a space where my business, and I’m very passionate about as well. Like, why do you think that’s happened? Why do you think the challengers have failed to really penetrate the market and disrupt the way they expected to?

Dharmesh: I think what generally happens with tech is that something happens, an innovation occurs, the mainframe, we build something. These banks or businesses get market share, et cetera. It’s hard to dislodge that. A new innovation comes along. Adoption of that technology tends to be a lot slower from a customer perspective. I was involved with the internet in ‘97 when some of the very first banks online, and at that point, I was like, oh my gosh, this is going to revolutionize banking. And I was saying the same thing that people are saying today about fintech, which is it’s all over for the banks unless they get onto the internet, unless they spend big and do this properly. And banks were spending big, right? Lloyds Bank spent over a billion dollars doing the Evolve Bank, right? I know others that did partnerships, we talk about these kind of partnerships in the fintech space. RBS, I was on a project with Southern Electric trying to do SME banking in a different way, right?

None of these exist today. What’s interesting is that the banks are still here, but the new players have gone away. Now, where are we today? What are the facts about the incumbents? Monzo and Starling are the two that have scaled. They’ve got millions of customers, which is great.

Monzo is about to get to full year profitability we are told. Starling’s already been there, right? I’m not going to pull any punches, right? When we look, when I look at the facts, Starling got most of its revenue and its loans from government bank assured loans, right? Which meant that they could lend. They went from about a hundred million in lending to a couple of billion, right?

You don’t do that if you’re underwriting that risk yourself. Have they succeeded in disrupting the banks? No. Another telling thing, a CEO of a large tier one bank said to me, when I said, look, TransferWise is going to eat up your 4x revenue.

And they said, basically, look, when we look at the customer base, there’s 10% of our clients that are kind of rate chasers. We know their profiles. They’re getting the best deal wherever they go. 90% of our customers just stick with us because we’re always there. They come into the branch, they call the call center, etc. It doesn’t matter. We’ve got the next tech that they got coming, right? But we’re not going to be commoditizing our revenue because of this 10%. And these are the facts, right? Where is the margin that these new incumbents, the new players, have created? They haven’t, they’re on paper-thin margins.

Most of them started with interchange fees, which has been eroded steadily over the years. And with open banking and 808 payments pretty much disappears. So, if they don’t get into lending or other more higher margin products.

Myles: Profitable products. Yeah. That’s exactly right. Most of these digital banks or challenger banks started with like deposit or accounts or wallets and things like that. Yeah. We know that it’s very hard for them to make, be profitable, make money off that. You have to basically get loans out the door.

Just circling back on your point though. But do you also think you’re going to start seeing a demographic change from the customers? Because you talk a lot about customers where, now I remember the days when I was 12 years old and my parents took me to the bank for the first time, and I got my passport, and they deposited my first $5 into the account for me and they’re, here you are Myles, this will be your first savings account.

And I remember those days when people would just stick with that bank for the rest of their lives because that’s just what they were hardwired to do. Do you sense a change in the end consumer happening now, where those that are much more digital happy, a lot more digital savvy, and I look at myself, I’ve got a mortgage with one bank, I’ve got a credit card with someone else, then I’ve got a wallet with another bank, because I’ve got comfortable with the ability for, where am I going to get the best experience? Do you think that demographic change is going to start driving different behavior from the incumbent banks?

Dharmesh: Yes, but not for a long time yet. I still think. And again, this may be a contentious view. I’ve had this kind of interaction on LinkedIn and Twitter that the fintechs, neobanks are going to disrupt, et cetera.

But the simple fact is my kids grew up with the internet. They don’t really know a world without the internet. So, by the time they’re 17, 18, and now have some income or expenses, you know where they need an account, guess where they went first to say which bank should I bank with? The bank of mom and dad, right?

Yep, and that’s the case actually for the millennials, right? Typically, they’ll go back to their parents or friends and family to really understand where to bank and get where are they banking? Yes, they may also have other accounts, but the main bank is with one of the incumbents typically, right?

So, when do I think this will change is when I think like a Gen X which is the next gen maybe in about 10 to 15 years, you start to see people choosing companies based on their value set. And so, they’re a lot more independent in their views. They’re not biased by the brand necessarily unless the brand pool is backed up by their actions.

So, incumbents, if they are really investing in bad companies and it’s well known, then I don’t see that Gen X where he’s going to bank with them, right? But that’s quite a way down.

Myles: And the other sort of hot topic is BaaS, or banking as a service, really seems to be a way that a lot of organizations are trying to be a lot stickier with their customer bases and providing financial services as part of their capability. Is anyone doing banking as a service well at the moment? Do you see it really giving traction on the market?

Dharmesh: Yeah, that’s a good question. So, I see lots of people doing it. Quite a few players starting to get some clients, et cetera. But who’s scaling, who’s signing up bank after bank. Really, where does this landscape lie?

How many players can a market sustain? If we look in the UK, how many BaaS providers can there be? I think most countries will have one or two in the long-term, players that provide for that local market, really address the regulations well, provide the breadth of services. One or two players can do this at scale, because they’ll provide for that local market.

There’ll be other players that provide it as a multi country basis. For organizations that need to span geographies, and they need the same services running across different countries. I don’t think today’s model where we’ve got twenty odd potential technology and banking partnerships arising in a single country like the UK.

Who do I see is doing it well? On paper, and I don’t know the detailed facts quite yet. On paper, Green Dot in the US because they’ve got Apple pay. They’ve got Uber, they’ve got Walmart. Once we start to see big names being addressed, I think that’s the beginning of somebody getting scale, right? Because what they’re really saying is, I don’t need my client base. I need your client base, and I’m willing to work with you in a partnership model that says your success drives my success. It’s not like what we’ve seen in the marketplace strategies or API marketplaces where, you know, just sign them up, get as many on board as possible.

If they fail, we don’t care. We’ve got a few hundred other people in the marketplace. They’re failing as you’re failing. So, I think the model has shifted from trying to sell to really pawn and make sure that there’s the revenue stream between the two parties so that both are successful.

Myles: Yeah. It’s got to be, it needs to be a one-to-one outcome. I agree with that 100%. All right, so moving on to something which is probably a little more closer to home for me: core banking. So, people ask me, how do you define core banking? I want to hear if your elevator pitch is as good as my one.

Dharmesh: Core banking. Okay, my view on core banking is that, it’s actually a story of two halves. And it’s really the vendors that basically said, look the two halves are managing the customer life cycle and managing the product life cycle, right? The product life cycle is: I create an account, I give it some features, et cetera, I onboard customers, et cetera, et cetera.

The customer life cycle is: I profile my client base, et cetera. I target them, I onboard them. Two separate things. One you really want to get a single view of the customer and manage that life cycle. Separately to I’m a product manager and I’m gold on selling my products.

So, the core really for me is about the product life cycle. Now, my evolution in my thinking also is does everything need to be in the core when it comes to defining products, because actually, isn’t the core just the ledger part, the debit and the credit. It’s actually a small part of the functionality, because if other people’s definition could be everything to do with the product, so it’s not only defining the product, onboarding the product, and then operating the product, but things like credit scoring and KYC and AML, et cetera.

Now in the past, players were able to provide everything in one box. But really what we’re seeing is a bit like the electronics world, right? One player can’t be the best at everything. Phillips was selling its screens to lots of other tv manufacturers. The same thing is happening in car manufacturing. Somebody’s producing the clutch mechanism, somebody’s producing the engine etc., you know for other providers, right? And then the manufacturers are bringing these parts together. I think the same thing happens in banking where we’re actually seeing specialist in KYC or specialist in credit scoring, right? And if you want the very best, you have to do a mix and match. But the core is fairly narrow now. And even to the point where I think that banks, especially the smaller banks, have undervalued the idea of a single kind of product catalog or way of defining products. Because we all understand the single customer view. But no bank has a single core. They all have multiple cores, because that’s the way that legacy was brought up. In the future, we may get to a single core for all of one product, but we’re not there yet. And I think having a single product catalog is part of the journey towards a new way of defining the core.

Myles: Some of us are working on it. But I do agree with you. I think very much it’s gone away from the single monolithic tech stack to solve the problem. People are moving very much to this ecosystem mentality, obviously, which we buy into and support as part of our fundamental value proposition. But what’s happened, I think, and am particularly interested to get your view is the banks have really focused on those periphery systems. So, they’ve spent a lot of money on their UX and their apps and their customer experience and their AML, KYC. So, they’ve separated out those functions, but in a lot of cases, they’ve left the core alone. It’s the black box. It just sits in the corner and does what it does.

What are your views, though? I mean, with the demands of the consumer and the speed that the market’s operating, can banks continue to not modernize their cores? What’s your perspective? They’ve got to bite the bullet soon and they have to make that investment.

Dharmesh: Yeah. Interesting. You know what I would love to say is that definitely the cost profile of the new players of running modern tech, customer demand, all of this means that they have to do it. But do they really, right?

If you can launch a new product quickly, right? And I’m not saying it has to be done in the core. If it can be done outside of the core, then doesn’t that mean you don’t need to change the core, core? In effect what’s actually happening is that you’re renovating around it, right? You’re modernizing the core and or another terminology that’s widely used is you’re hollowing out the core, so you’re getting the core to do less and less and supplementing it with better functionality on the outside.

Now in Europe, we’ve been much more aggressive about replacing cores. We’ve seen some huge failures, some career changing moves. In the US, we’ve seen a lot less of that, and we’ve seen a lot more renovation or organization of the core, and it seems to be a less risky approach. Yes, from a cost profile. But remember the mainframe and these old cores are sunk costs. So, it may be more expensive, but the larger banks certainly can afford to do it. The smaller banks, I don’t know. I think they’re still surviving.

Myles: I think you’re right. We know all those carnage on the streets. Isn’t the joke, a core replacement can be the CEO killer, basically? It could be a career limiting move to a certain degree. You used two terms there, which I think were really interesting, modernization and replacement. If you were a bank CEO, how would you decide between the two?

What are the two things that you’d need to think about?

Dharmesh: For me, I tend to look at the future and part of my biggest weakness, is that I see things further down the line and then I expect them to happen sooner. And for me, what’s gonna happen further down the line, inevitably at some point, but I maybe have forecasted that a lot sooner before, is that bank business models will change, fundamentally change. Because we are in a tech business and those tech life cycles do matter, right? Because we’ve seen this in the tech industry, right? So, if we think about who are the big database providers early on the mainframe? IBM, DB2, etc. Along came client server and now we’ve got some new providers or that’s how Oracle got its life, et cetera. Microsoft big in the database space. And then we’ve come to the internet era and then we we’ve got some other database. Same thing happened in the CRM space, et cetera, et cetera.

The kind of history shows us a pile that when it becomes about technology and banking now is becoming far more about technology than we’d like it to be. It really, I think it will matter in the longer term. And I think what really will change is somebody comes up with new business models or products that couldn’t be facilitated in the old way on the old systems, then I think it changes the game fundamentally.

It’s a bit like if Uber didn’t have the GPS access on the phone, then the customer experience would have been what, an app rather than a phone call. No big shakes, right? But everyone loved to see where the car was. The fact that you didn’t have to work out the tip and whatever else, right?

Myles: I love watching when my food’s going to arrive.

Dharmesh: Yes, exactly. But we haven’t got that with all of this innovation about the digital players and everything, and I’m a big digital advocate, right? But we haven’t seen the game changing experience in financial services yet. I’m a revolute. Not for me a game changer.

Myles: So this opens the perfect question. Everyone’s hot topic, AI. Everyone loves AI. How’s AI going to impact financial services? And what do you think? Personally, I do think it’s going to have a significant impact. I do think it’s quite real and certain aspects will help this support personalization, decisioning, things like that.

Is AI potentially one of these game changers that’s going to really potentially revolutionize the financial services industry? What’s your perspective on that?

Dharmesh: 100%. If it hasn’t done so already, right? But the thing I’d like to make clear because, and it sounds a bit, I’m not teaching people to suck eggs, but there’s a lot of confusion about generative AI and AI. We’ve been doing lots of in the past, but that stuff was about analyzing data and making predictions etc. not generating content. So, when it comes to the generative ai side of things it’s a lot more difficult in financial services because this is unsupervised learning and output and everything that we know in financial services is supervised output. Compliance would be shutting you down before you publish something about a product or a piece of advice or could be deemed as advice.

So, I think we have to separate the two things but fundamentally, AI is the new database. It’s you can’t imagine a business system without a database. In the future, fundamentally, we’ll be driving the business, and I’ve talked about my vision of the future of a bank is basically one person and a computer, right?

And you sit there and you define what the purpose of your bank is, etc. It creates it for you, right? But there’s a lot more to that in that every aspect of banking needs to have this intelligence built in. Whether it’s your credit risk, credit scoring, whether it’s AML for detection, even advising the customer support people, every aspect of it is driven by AI.

So, what we need to be thinking about is not the individual problems, but how we embed AI almost into the fabric of our business and what decisions do we want it to take versus the ones that we have to supervise?

Myles: Interesting your perspective on AI again, but going back to the example, we talk about cores where a lot of these banks have spent a lot of money on the periphery, but they’re still sitting on 25, 30-year-old core platforms. Is AI one of the catalysts that means they have to take advantage of next gen core tech? It’s one of the drivers of potentially a core replacement.

Dharmesh: It could be right. And I think the bit that matters the most is how much of the bank can I orchestrate automatically. Like some of it, you don’t need human decisions to make, right?

Let me explain this in a better way. So, if I wanted, if I couldn’t create a product or I imagine a world where you know, the product manager is assisted by AI to say, look I’ve looked at the data, I’ve looked at the way that customers behave, and I think you know, a product of this shape, this capability, these features, would attract this audience and would create this margin. Now it’s fine understanding that, but the next thing also has to be driven by AI, which is, and here I’ve built it and I’ve mimicked what the client base is, so this is what you should be earning, right? So, it’s an end-to-end life cycle of AI driving pretty much everything with somebody just validating and making sure it aligns with the bank’s flashy, et cetera.

Myles: I know I tend to agree. And then I think this is where as the expectation moves forward and you’re moving into this real time world, having a core system that goes to sleep for four hours every day to basically do its batch processing and move X to Y to Z. Is that sustainable? How much orchestration can solve for that?

Dharmesh: The bit that’s difficult, if you’ve got a monolith, firstly, every deployment means a retest of the entire package. And that package is huge, which means that it’s a long life cycle, right? So, banks that can’t deploy You know, it doesn’t have to be on a daily basis, 15 times a day, but if you can’t deploy something in less than three months, right? And that’s being kind, there’s banks out there that can’t deploy in less than nine.

Myles: I was gonna say 18. I think you’ve been really kind on that.

Dharmesh: I’m trying to be kind, but yeah. And add significant costs. I’m literally seeing banks with seven figure kind of change cost for things like a rate change, which is. It sounds a bit scary, right? But if we look at what happened over the last year, how many of the incumbent banks have launched new term deposit accounts taking advantage of the rate hike? I can tell you that Monzo and Starling had them out very quickly. Which kind of tells you that for competitiveness, you do need to be able to respond to a market or a change in circumstances quickly.

Myles: I’d agree with that a hundred percent. Those that have gone, got onto sort of the next gen core stacks do have the ability to punch stuff out a lot quicker, but back to your earlier point, are they getting the traction they expect in the market from the consumer?

So, you’ve got all these different sort of parallel universes going on about technology, but I do believe sometime in the future we’re going to see some conversion with things like AI, customer expectations, and I saw a stat where they interviewed a thousand bank CEOs and 57% of them said that if they didn’t evolve, they would become extinct. Now they didn’t put a timeframe on it, but it shows that people are thinking about what it needs to be.

I’ll leave a few minutes for questions at the end, cause we do have a few. One last sort of generic question to you though, fintechs had a really tough time over the last 18 months has been pretty brutal and there’s blood on the streets, particularly from a funding perspective. How do you feel about 2024? What’s your outlook and how are you feeling about the fintech space in the market for the next sort of 12 to 18 months?

Dharmesh: I think there’s enough happening from a tech perspective that will continue the investment. I think the lull that we’ve seen apart from the economy has also been a natural cycle of investment in that some of the early fintech have been through several rounds, haven’t scaled end of funding. And we’ve seen huge funding pots go in, but we haven’t seen the output from the fintech in terms of their scalability and real revenue. Scaling and profitability, right?

Yeah, do I think this is Revolut? Again, I hate to pick on Revolut, but I mean is it a success story? Probably not yet. Not until it starts to get you know real levels of profitability per customer. The margins are too thin, and its foray as being a kind of financial souffle, which is all great, right? But banks have been offering a wide range of products for many years, but their penetration tends to be about two and a half products per customer. I can’t imagine Revolut doing better than that right now.

Myles: I do love when we talk to banks, and they say I’ve got a thousand products and they’re so proud of their thousand products but really 90% of the customers only use about a hundred of them, and they’ve got these 900 things that they’ve built and almost no one used them so it’s always interesting out that perspective but I think you’re right. Starting to really look at those success stories what does it really mean? And I think stickability, right? Cause penetration with each of the customers they’re really important things.

All right. So, we’ve got a bunch of questions, which we’re going to flip through Dharmesh, if you’re okay? They’re to both of us, which is good. And their probably a bit all over cause we’ve covered a lot of topics. So, we’ll probably have to be a bit adaptable. We’ll see how we go.

“Hi Dharmesh and Myles, what’s the future of BaaS, especially given the regulatory pushback?”

Dharmesh: So, the regulatory pushback says look, if you’re the licensed provider and you’ve partnered with somebody or you’ve sold your service to somebody, you’ll still take accountability for the customer. That’s natural and that’s why it needs to be a partnership, right? It’s one of the reasons why it needs to be a partnership and not me selling just to anybody.

Myles: This is a good question and probably a good point.

“You didn’t really talk about much about embedded finance. Isn’t the real threat to banks losing distribution rather than seeding ground to fintechs?”

Myles: Good question.

Dharmesh: What do you think?

Myles: I think embedded finance is absolutely something that’s going to get some traction. I really do. I think you’re starting to see some of the big brands really putting the horsepower into it, and they’ve got such great strong relationships with their customers that it’s going to value that. So, I’m a big supporter, and I’m a big believer actually that I think we’re going to continue to see quite an uplift in embedded finance.

Dharmesh: Yeah, I 100% agree. I think there’s some really interesting stuff that is happening outside of banking that as the rest of the industry starts to catch up, they’re just going to copy, and it’s going to happen you know on a broad basis. It’s a bit like, you know when Uber first came out, and you could track the cab etc. Now every cab company has the capability to do that. Every delivery company has the ability to track where your delivery person is on route, right?

Now if you’re a retailer and you can understand where your customers are spending their money outside of your own stores, then that’s a great thing to do. With embedded finance, you can start to do that, especially if you can incentivize them to spend more on your card than the bank card itself. I think there’s some fantastic plays to be had. There’ll be more coming downstream, I think. Web3 starts to offer some interesting propositions. And I’m starting to see some early movement in the tokenization space. Things like property that really actually address a need. I don’t want to invest in a single property, but if I could spread my bet over 10 properties through fractional ownership, then yeah, I would want that.

Myles: Very good. Maybe I’ll have a crack at this one first.

“For a scaling fintech, what is more scarce today talent or capital?”

Myles: Great question. I’ll go first. I think capital raising is tough. I can tell you it’s certainly much harder than it was two years ago, being in the midst of that process right now. And I think talent, there’s talent around, but then the expectations of the talent, I think is quite interesting.

They’ve all been in a very interesting spot over the past couple of years. So, finding good talent continues to be a challenge. For someone like us, which is our locations aren’t the best at the moment. But we are expanding into more fintech hubs. So, when we’re starting to have a better talent pool to attract, but yeah, it’s, I’d say it’s actually both of them are quite difficult at the moment from our perspective.

Dharmesh: Yeah. For me, I think look, if the proposition is right, and you’ve got the right talent, you’re going to get the money, and if you can prove that. But I think the issue is I’d put all my chips on talent, right? Because what I’ve seen with some of the fintechs is they have got a strong proposition, they understand their market, they’ve proven the product, but scaling, they haven’t managed to crack and scaling cost effectively. It’s easy to launch a deposit account and give an extra two points if that’s what you want in millions of customers, then you’re going to get them. Everyone that wants the extra rate is gonna do it. But that’s not a business model. So how do I get to these customers? How do I hack my growth so I’m not spending hundreds of pounds to acquire a customer? I’m doing it profitably and that is only by good digital marketing talent. And I think that’s the real scarcity. It’s not, I think you can find lots of people to write you good systems. I’m sorry. I’m techie, but I think it’s really difficult to scale the growth without good people.

Myles: I’d agree. I personally, my philosophy is if you get the culture right and you get the people right, the rest takes care of itself. And that’s a mantra that we try and abide to in the business. All right. So look, time for one more question. And I’m going to ask, I think this is the most important question that I’ve seen in the list here.

“Is Dharmesh planning to keep his beard?”

Dharmesh: Hahahaha. This is your first podcast, right? This is actually the first time in 56 years that I’ve grown a beard. Yeah. I’ve had a goatee before, but not on a full-on beard.

Myles: You’ve got the full two tone going on as well.

Dharmesh: I know, my wife hates it and it’s actually, I’m actually doing a run in Nepal. And I just figured that if I’m going to do that, I might fit in better if I’ve got a beard.

Myles: Really good. Hey, look, Dharmesh, it’s been an absolute pleasure. And thank you very much for being the inaugural member on our Tuum Talks. I’ve really enjoyed the discussion and your perspective on what’s going on. And it’s always great to have these conversations with industry heavyweights like yourself. So, thank you so much for your time and joining, and I look forward to the next one.

Dharmesh: I really appreciate being invited, and you’re a fantastic, you should do more of these. You’re a natural, you’re a natural. And I also appreciate, although I’m not a rugby fan, you’re not mentioning the rugby.

Myles: Hey, I don’t want to jinx myself for the weekend when hopefully the All Blacks will bring it home, but that’s a different topic.

Dharmesh: Awesome. Good luck.

Myles: Very good. Thanks, Dharmesh. See you later.

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