Why Most Digital Transformation in Banking Fails | ICBA’s Justin Dunmyer

What actually drives digital transformation in banking?

In this episode of the Propagate Fintech Podcast, Roland Howard sits down with Justin Dunmyer of ICBA to unpack what community banks, fintech founders, and banking leaders often get wrong about innovation, automation, and data strategy.

Justin previously spent over a decade inside a community bank working his way from teller to Chief Digital Officer, leading digital strategy, analytics, partnerships, and marketing. Today he works with the ICBA ThinkTECH Accelerator, helping fintech companies connect with community banks across the United States.

This conversation cuts through the buzzwords around AI, fintech, and banking innovation to focus on what actually works.

If you’re a fintech founder, banking executive, or fintech operator, this episode explains:

• Why most digital transformation initiatives stall

• How banks should start with automation and data

• What fintech founders must understand before selling to banks

• How the ICBA fintech accelerator works

• Why community banks may be uniquely positioned for the AI era

What You’ll Learn

• Why digital transformation is more about culture than technology
• The most common mistakes banks make when adopting fintech
• How automation should start inside community banks
• Simple ways banks can use data without hiring data scientists
• Why fintech founders struggle to sell into banks
• What makes a fintech truly bank-ready
• How the ICBA ThinkTECH Accelerator connects fintechs with banks
• Why AI may strengthen community banking relationships rather than replace them

Timestamps

0:00 From Community Banking to Fintech Innovation

0:48 Community Bank Career Journey: Teller → Chief Digital Officer

2:16 What Digital Transformation in Banking Really Means

3:20 Why Digital Transformation Often Fails

4:34 Building a Culture of Innovation in Banks

5:54 Quick Wins for Banking Transformation

7:03 Customer Onboarding and Digital Banking Adoption

7:31 Why Innovation Projects Stall in Banks

9:00 Change Management in Financial Institutions

9:51 Avoiding Death by Committee in Tech Decisions

10:29 Chief Digital Officer vs CIO vs CTO

12:16 Building the Business Case for Technology

13:36 Where Community Banks Should Start with Automation

15:02 Why Data Is a Bank’s Most Valuable Asset

17:17 Practical Data Use Cases in Banking

18:09 Avoiding Analysis Paralysis with Data

20:40 Mentorship and Career Growth in Banking

21:37 What ICBA Does for Community Banks

22:32 Inside the ICBA ThinkTECH Accelerator

24:13 How Fintechs Get Real Feedback from Bankers

25:35 Why the Accelerator Matters for Fintech Distribution

26:06 How ICBA Selects Fintech Companies

27:55 What Makes a Fintech “Bank Ready”

32:27 Why Selling to Banks Is So Hard

34:48 Biggest Mistakes Fintech Founders Make

37:03 How Banks Actually Evaluate Vendors

37:38 Partnerships and Fintech Distribution Strategy

39:37 AI in Banking: The Next 3–5 Years

42:42 Why Community Banks May Win the AI Era

44:21 Advice for Community Bank CEOs

45:11 Advice for Fintech Founders

46:32 ICBA Innovation Programs and Accelerator

47:58 Closing

Want to work with Propagate Fintech? Fill out a contact form at www.propagatefintech.com

Transcript

SPEAKER_00 0:04

Hey Justin, thanks so much for being here on the show. I'm I'm looking forward to this conversation with you today. And I always love to have people on the show who worked in the community banks and then have made the transition to the dark side and have come to work in the fintech space. And I think you fall squarely in the in that uh scenario.

SPEAKER_01 0:23

Well, yeah. Well, thanks. Thanks for having me, Roland. I I wouldn't say I went fully to the dark side, or still do serve community banks, uh, but but also have the privilege of working with a lot of fintechs and founders.

SPEAKER_00 0:34

That's awesome. And I'm sure is is a super fun, super fun role. So, you know, I want to we'll unpack a little bit about you know where you came from before where you're at now, which is which is ICBA. Uh, but I think it's so cool that you earned your stripes as uh a leader in a community institution. Could you just talk us through, you know, what what your role was like before?

SPEAKER_01 0:55

Yeah, absolutely. So as you mentioned, I just recently joined uh ICBA uh here about three months ago. Prior to that, I spent a little over a decade inside community banks. Uh so most of my career was spent at a community bank in the Midwest that was a little over 800 million in assets. Uh there I had the privilege of really holding uh quite a few different roles. So starting quite honestly as a personal banker. So opening accounts on the teller line, like learning the business from the ground up. But pretty quickly, though, I started doing a lot of the data analytics, business analytics, uh, and that kind of naturally dovetailed into ultimately leading all digital strategy. Um, so I spent the bulk of my career uh as our chief digital officer, uh meaning I really oversaw all digital delivery and support, uh, including partnerships, integrations, you know, negotiations, all those things. I also had the privilege of overseeing our business analytics team and our marketing team too. So, you know, those kind of three pillars really uh allowed me to craft the digital delivery that we did. Awesome.

SPEAKER_00 2:02

That's I love hearing those kind of classic started at the teller line, worked your way up type of backgrounds because you really get to see the way the sausage is made across the organization. Absolutely. Yeah, that's so important.

SPEAKER_01 2:16

I mean, just again, understanding the business from the from the very ground level, essentially.

SPEAKER_00 2:20

Yeah, you know, I think there's value in leaders coming in from, let's say, telecom or uh, you know, biotech. I'm just making up industries, but outsiders coming in and then looking at the way that we do things, which, you know, for somebody like you, and and I actually had a kind of a similar back background to you and starting more operational and then you know, making my way up, you really just kind of grow up seeing the way things are done, which is great for understanding things at an intimate level, but can also be a hindrance when you're trying to think outside of the box and you're trying to, you know, maybe take it to basic principles on how the institution operates can be kind of hard when you're when your lens has been defined by you know being in it for so long.

SPEAKER_01 3:04

Yeah, yeah, absolutely. I, you know, there's I think there's a healthy medium there. Like it's it's good to again understand how things are done currently. You can't get so entrenched in that to think that, well, that's the only way to do things. There's lots of other ways to to execute on on the strategic initiatives and and operational elements of the of the bank.

SPEAKER_00 3:24

You know, one thing I've always thought when I hear digital transformation is well, first of all, it's such a buzzword. It's been around for 20 years now. And yeah, I there's no end in sight to transformation, right? It's an ongoing exercise. What would you say is the hardest part of digital transformation that you know people who weren't in the role that you were in at the institution just like don't understand?

SPEAKER_01 3:49

Yeah, I think that uh I totally agree that it's kind of a buzzword, whether it's digital transformation or innovation. Like I want to demystify those things. These things don't have to be complex or or mystical. For for me, in my experience, definitely the hardest part is not the technology, it's the culture and alignment to you know the goals. So building a culture of curiosity, building a culture that's comfortable experimenting a little bit with technology and more you know modern or or unique business approaches, uh, that takes time. You can't just you can't just say we're gonna be a culture of curiosity and digital transformation. Like that doesn't work, right? You have to get people to buy into it. You have to kind of lead with those same principles. Um, and it's just it takes time and effort.

SPEAKER_00 4:39

So, how do you build that trust to then go and explore and try things and see, you know, throw it against the wall and see if it sticks?

SPEAKER_01 4:48

Yeah, it's uh I would say it's very much a crawl, walk, run uh approach, right? So as I kind of came into that role uh at the institution I was at, you know, I did not start with ginormous, huge projects, right? I didn't come in and saying, you know what, we're going to an AI native blockchain digital banking system. Like, no, you start with the small, tangible, quick ROI type things. And you get your hands dirty, you get down in the trenches, you do the work, right? You don't just dictate to a team, hey, build this and that's what we need to do. Like you show up and you do it yourself, too. Um, so in my experience, one of the first things we did in our digital transformation journey was do some very lightweight marketing automation, right? Like it was a low risk, easy win, is what I'd say, right? We knew we wanted to communicate with our clients and and our customers. Um, we weren't necessarily executing on that in a automated or repeatable fashion, right? And so you just take some simple concepts and do some simple outreach, right? Uh with that, you can start seeing some quick wins, right? And then you just you continue to uh leverage that, right?

SPEAKER_00 5:58

And when you say you you reach out, are you talking about to like the vendor ecosystem? Like you're reaching out to fintech, uh you know, marketing tech players or oh, I'm sorry.

SPEAKER_01 6:08

I I was talking more about at when I spent time in the bank, reaching out to our clients, right? So again, you just start a relationship with us. Well, there's things we want to educate you about. And you know, it doesn't even have to be salesy, right? It's telling you who we are, what are our values, right? Making sure that you were able to sign into online banking successfully and you know, checking in to make sure you're having a great experience, right? Things that are not just pushing product right off the bat or anything like that. Um, again, these are things that contribute to the overall customer experience or hard to deliver on if it's just an individual banker doing it differently each time, right? You need systems in place to do these things. Um, and there's just one, there's just one example of like a really easy initial use case.

SPEAKER_00 6:52

It's like there's so many little things that you need to be doing that contribute to that digital transformation narrative. That's one of them. It's interesting what you said also actually dovetails with one thing that one of our other guests, Harai Khalsa, mentioned one thing that every institution should make sure that they're nailing is ensuring that every new customer, you know, walks out the proverbial branch door, right? A lot of these accounts are being opened online, but that people know really well how to get into online banking and get set up there is just a great way to reduce abandonment and inactive accounts, you know, so on and so forth. So I think that makes sense. Where do you see most of these digital transformation initiatives stall out?

SPEAKER_01 7:35

They stall out if the kind of goals and objectives are not clear in the beginning. So if an institution just kind of chases a shiny object, right? Maybe they saw a demo from a vendor and they're like, wow, this is so cool. We want to do X, whatever that is. And they say, okay, we got to do it, right? And they implement it. Well, then what? Right. They weren't approaching that with uh a kind of an end state in mind, right? Instead, I think that a more appropriate approach is, well, you as the bank, right, you define, well, what is the problem we're trying to solve or the experience we're trying to improve, right? And then you go and find a vendor to implement and solve that problem, right? Um, I think another another thing that can call cause things to stall out is quite honestly making decisions in a silo, right? So if you have a, again, whether it's digital transformation or or innovation, what whatever you brand it as or call it, if you have that happening in a silo and you haven't involved the other stakeholders, you run the risk of that initiative stalling out once it goes live, right? So maybe it's, you know, maybe you're rolling out a new lending system, right? LOS or something. Well, if you haven't engaged the key stakeholders throughout the entire kind of journey of that project, and instead you say, Nope, we're going with, again, I'm not gonna say a specific vendor, but some modern vendor. And then you you're like, okay, we're live, let's do it. It's just really hard to get by and kind of post the decision being made.

SPEAKER_00 9:04

Change management. Like people are gonna, if they're not involved in the beginning, and I've seen this happen before, where they are trying to use the new solution, the thing that's gonna drive the transformation in the old way. And that obviously doesn't work.

SPEAKER_01 9:19

Yeah, it just degrades like it degrades the whole experience, then, right? And then six months after implementation, you're sitting there scratching your head thinking, well, did we really solve the problem after all?

SPEAKER_00 9:29

No, I think that and that makes sense. Um, I I would imagine a lot of leaders struggle with okay, if I open up the aperture on, you know, who's gonna be involved in kind of charting a new course for us from a transformation perspective, it's gonna be death by committee, and we're not gonna actually get anything done. So there's there's gotta be a balance there between involving the right stakeholders and getting it over the finish line.

SPEAKER_01 9:55

Yeah. I mean, I think you point out a really relevant thing here. If you involve, you know, small teams generally perform better, right? Uh in implementing some of these changes. So, yeah, certainly you don't want the entire bank involved in some minor change. And so I think some of that just comes with time spent in an organization, right? Understanding the culture of the organization, understanding how decisions are made, and understanding who are the appropriate people to pull in and who can be your champion. You know, sometimes there's you know departments where maybe you have like an internal champion in that department and you don't need to involve everyone, but you need to involve the folks they'll listen to. Yeah.

SPEAKER_00 10:34

I'm hoping you can you can share some insight from a culture perspective. How does a chief digital officer synergize with a CIO and a CTO? Like where where does everyone's kind of kingdom begin and end, if you will, in terms of like where they have say in the organization and and what how they're contributing to these types of endeavors?

SPEAKER_01 10:58

Yeah, I I I think that in my case, I was really filling a CTO type role uh with that title, right? So we we had a traditional CIO, we did not have a CTO role. That was kind of me more or less. Got it. Um in that setup, you know, I was bringing more of the, you know, what do we need to do to stay competitive? How can we improve customer experience? How can we improve efficiency? How can we improve, you know, accuracy, internal client experience? Those were my objectives, right? I partnered very closely with our CEO, or I'm sorry, CIO uh for guidance from them on, you know, how can we do this with data security in mind? How can we do this uh under the necessary like vendor management and regulatory framework? And so certainly I think that's a I think that's a nice uh balance of powers, if you will, right? Kind of the yin and the yang, you know, in in my ideal world, I would be bringing things that would make him or make them slightly uncomfortable, and they would be pushing back on things that I think should be easy, right? And so through that and just through mutual respect, right? Like I would never uh push something through that, you know, this the CIO wasn't uh wasn't on board with, right? Now sometimes it took some convincing, right? Uh and and I do think too developing the business case is super important, right? Explaining why you need, again, maybe a certain piece of technology, or maybe you need to take a different approach to something. You need to be able to clearly define the business case, right? And the ROI.

SPEAKER_00 12:33

And I guess that ties into talking to the team, talking to stakeholders, getting to, you know, the bottom of what the business issues are, and and then getting their buy-in and collaborating on on these. That's cool. I think that that makes sense. Uh, and I think it was probably wise of your team to not have a CTO, a CDO, and a CIO. It feels redundant and would probably give rise to some conflict. So basically, you just you had a good working relationship with the CIO, kind of the visionary, if you will. And the CIO basically keeps you from getting in trouble. Absolutely.

SPEAKER_01 13:10

Absolutely. And again, that's there's some natural and intentional friction in that relationship. And I think that's a good thing, right? It's great to disagree with people you work with sometimes, right? As long as you can do it respectfully. Absolutely. And we all wanted the same thing, right? We wanted the bank to succeed, we wanted to provide great experiences for our clients. We were bought into the mission, I guess is what I'd say. And so it's just how do you get there?

SPEAKER_00 13:32

Yeah, that makes sense. It's a partnership. And what do they say about partnerships? If you don't argue a little bit, then you don't need each other. So that's that's cool. I get that. Okay. So, Justin, let me draw you out on automation. This is obviously a huge piece. It ties into agentic AI, it ties in, you know, so much of the current narrative around dig digital transformation. Walk me through your thoughts on where should community institutions start with automation.

SPEAKER_01 13:59

Well, yeah, thank you. I I community banks should start with the simple things, right? Automate the things that you know a human shouldn't be doing, right? So examples that come to my mind would be things like booking an account to your core, right? That shouldn't take manually typing into the computer or moving documentation into your cold storage system, right? Those are things that for many banks, they likely have the necessary software and technology already to automate, right, to some degree. Um, sometimes they just haven't yet, right? And that's, you know, maybe that's just how new products have rolled out. You know, there's lots of reasons for that. But if you automate those kind of simple tier one things, it allows you to build a foundation to automate the next, the next thing and the next thing, and the next thing. And I think even more importantly, is it frees up the humans, right? It allows the humans to work on much higher impact items. You know, I don't know too many folks that just thrive on manual data entry, right? Like there may be out there. I know I'm not one of them. Yeah. I don't know too many folks like that, right? Um, so get rid of it, right? Let the systems do what systems are good at, free up the people to do high impact, high gain functions.

SPEAKER_00 15:12

I love that. No, I think that uh I think that makes sense. So, Justin, let's talk a little bit about data. I know that this is something you've experimented with and had some success with during your time at the community institution. And data I keep hearing is critical. It's the new, you know, it's the new oil. Where do you see data showing up within the community banks today? And how is it being used or or underused?

SPEAKER_01 15:36

Yeah, I you know, I always used to say that data is kind of the, you know, the largest asset a bank has, which is not on the balance sheet, right? So basically every community bank is is sitting on a tremendous amount of of information, data, right? And the reality is, is I've never talked to a bank that has the staffing or knowledge or expertise to use all of it to uh effectively, right? And you shouldn't have to, right? I mean, these are complex systems, some of these. I think when it comes to data, you should focus first on what is absolutely required. Like, okay, regulatory and financial reporting type things. Most banks have that figured out, right? You're doing your KYC, you're accurately booking interest, you're accurately posting transactions. I mean, these are the kind of table stakes, right? As you look to say, well, what else can I do with data, right? I always like to focus on things that are actionable and that drive revenue, either directly or indirectly, right? And so a couple, I guess, really easy examples or or base examples would be, okay, any data that prevents fraud, yeah, you should look at that, right? Now, you don't have to get analysis paralysis. You don't have to build the next model that's going to eliminate all fraud, but there are things you can do with data to mitigate fraud, right? You know, one example that I think you know many banks would do is okay, well, look at the logs and sign-in activity that's happening in your digital banking experience, right? And look for obviously suspicious activity, right? Brand new devices accessing through a VPN and then immediately trying to do extreme volumes of money movement, right? Okay, there's a data point that you can look at and you can action. You can say, okay, I'm gonna partner with my digital banking provider or internal teams and say, when a new device accesses online banking, let's review it, or let's minimize their like lower their limits on what they can transfer, or you know, whatever that looks like. You know, one other kind of simple or actionable piece of data would be, and something I spend a lot of time is, is look at your card portfolios, right? Your debit and credit card portfolios. And don't get buried in the weeds. Don't try to look at every single data point and predict when somebody's gonna buy, you know, whatever. But you can say, well, who's stopped using their card and why? And can I either message appropriately or re-engage them to start using it, right? Like those are the types of things that the banks should be doing is the simple base level things. Now, once you accomplish that, absolutely start iterating on your models, start iterating on um how how you're using data. But I think sometimes it's easy to get just analysis paralysis, right? You sit there and you say, Oh my gosh, I could I I could perfectly predict everything, right? Because I know my entire customer relationship based on data. Well, just start with the simple stuff, you know, keep keep it simple. I don't know, maybe I'm too too basic here, but uh, you don't need a data scientist, I guess is what I'm saying, right? You can use like very basic um triggers and insights to really drive and expect action or at least drive messaging or drive uh certain automations.

SPEAKER_00 18:45

Okay. No, I I there's a trend here, and it's basically to keep things simple. And I love I love that mantra. Honestly, I feel like we have four kids, we have a big family, and just keeping it simple with our crew keeps everybody happier.

SPEAKER_01 19:02

Yeah, I I had in my notes here, I said this, you know, kiss, keep it simple, stupid. And I was like, oh, maybe I shouldn't say stupid, but you know, here we are.

SPEAKER_00 19:10

Yeah, yeah. No, I think that I think that makes sense. You know, keeping things simple within the community institution realm, but even where you came from, you guys were sub a billion. You know, there aren't there really aren't data scientists who are trying to play in that job market, right? Like there, you really don't have a deep bench of people generally who can help you do all sorts of cool and fun, sexy stuff with data. And you're you know, you're really heavily leaning on the fintech ecosystem that you've built for yourself and and your partners and your your in-house team. And so I think keeping things simple allows you to, you know, build and compile skill set when it comes to, in this case, data.

SPEAKER_01 19:52

And I'll just just if I could add on to that. While, yeah, most sub 1 billion institutions aren't going to have some, you know, PhD data scientist type person, they probably have somebody that's hungry to learn, hungry to grow, and kind of understands data, right? Like that probably exists somewhere in those four walls or within the institution. And so I do think it's super important to create internal opportunities for folks, folks that are curious and driven, like let them explore, let them explore safely, right? I'm not saying just open up everything and say, have at it, but there are safe and measurable ways that you can like build up internal team members, give them exposure to things, and you might be surprised at what they what they deliver.

SPEAKER_00 20:35

Did you, in your career, which again is is a pretty cool work your way from the ground up type of story, did you have people along the way who mentored you? Oh, uh absolutely.

SPEAKER_01 20:45

I mean, I, you know, both both within the organization and outside of the organization, I had great, great mentors, and that's I've been lucky to have that. And so if you're somebody that's you know coming up in the banking or financial institution space, I would really encourage you to just ask. Again, just be uh contagiously curious in internally, right? Ask people, well, why do we do things this way? Will you show me what your a day in the life of you looks like, right? And um, I I've found that people are generally pretty open to being a mentor, right? And I I I still have mentors I have yeah, yeah, exactly. Most people would be uh excited if you asked them, hey, tell me what you know.

SPEAKER_00 21:28

So, Justin, you obviously earned your stripes in the community banking space. Now you've made the transition to working with the ICBA. So you went from you know bank operator to ecosystem builder. Why don't you give us a little what the ICBA is?

SPEAKER_01 21:42

Well, yeah, absolutely. So the ICBA or independent community bankers of America, uh, we're an organization that represents a large number of community banks within the United States. I had the opportunity when I was a banker to interact with this organization really from the banker's lens, right? So what that looked like for me was. Was I actually served on the selection committee for the accelerator for a couple of years. And so at the time as a banker, that gave me exposure to getting to see a lot of fintechs, getting to have a vote on whether or not they made it into the accelerator program. And really opened, opened my eyes to a much wider, uh, much wider audience of fintechs and bank tech solutions that I had never come across outside of outside of this.

SPEAKER_00 22:28

And so now you're managing the ICBA FinTech Accelerator. What ex what is that? Can you break it down for us?

SPEAKER_01 22:37

Yeah, good question. So it's the the ICBA Think Tech Accelerator. Uh, this is an accelerator program that's laser focused on bringing relevant bank technology solutions to community banks. You know, we serve our member banks, period, right? That's why we exist. We exist to help them, right, find technology, help with innovation, help with other pillars too, right? So the ICBA uh has a has a big voice in advocacy for community bank issues, has a big uh big role to play in education in the community banking space. And then the area I uh have the privilege of working in is really in the innovation area, right? So that can be technology, that can be helping with innovative culture, all sorts of things. The accelerator is a it's uh again geared towards what I would call growth stage companies, right? So generally we like to see companies that uh likely have at least a handful of bank clients. Uh, they certainly have a live product or products out in the marketplace, uh, but but maybe they're looking for that next step in their journey, right? And so what we do in the accelerator program for the the fintechs or bank tech companies is a few things. Number one, we we provide, I would call it education, right? So there's in-person opportunities to speak with bankers, speak with core providers, speak with regulators. Um, we bring in all sorts of subject matter experts, right? Whether that's, you know, how do you approach VC folks, how do you build culture, you know, sales strategies. But they're doing bank visits. So those are structured visits. And do you guys facilitate those? Yes, we do. So these are, yeah, we facilitate really two flavors of bank visits, right? So we offer group bank visits where banks can just sign up and and join to kind of see who's coming through the accelerator. But then what's sometimes even more impactful is what we would call one-on-one bank visits. And these are structured calls virtually with the bank. Uh, generally, it's a whole team of people at the at the bank, and they get to spend three and a half hours with us and see all six of the companies that come through the accelerator. And we keep it very um, very scheduled, right? So essentially a uh fintech gets 15 to 20 minutes to present their solution, but then almost the most important part is there's 10 minutes at the end for feedback, right? So this is not a sales environment. Uh the reality is a banker could sit in their office and their phone and email will ring all day with people trying to sell them stuff, right? Like we know that exists. What this is all about is about you know product market fit and kind of the opportunity to engage with your potential clients, right? So um we view it as very collaborative, I guess is what I'm getting at here, right? For the banks, they get exposure to fintech solutions that are serious, that have kind of gone through some level of education, they've really dedicated themselves to serving the community bank market. And then for the fintechs and the founders, they get the opportunity to talk to a lot of banks, right? Over the past 10 weeks, the fintechs in our program spoke with over 200 bankers to give you an idea of the scale here. Wow, right? That's really hard for them to do if they're just you know dialing for dollars and the email and what we're doing.

SPEAKER_00 26:02

That's an unbelievable distribution framework for a fintech to plug into. It's like a dream, it's like a dream come true, basically.

SPEAKER_01 26:10

Absolutely. And uh I'll share, it's a it's a competitive process here, right? We get a lot of applications. Uh, and what's what I think is really special about our accelerator is that really we the people making the decisions on who gets in is a team of bankers, right? So we we have a structure we follow, right? We take applications, we do kind of an initial scrub through those applications for you know relevancy and just basic things. But then the real value is we have a team of about 20 or so bankers that, you know, they don't work for the ICBA. They're bankers out there living their daily life, doing their work in their community banks. But then they get to see all these, all these companies that are finalists, let's call it, and then they get a vote on who makes it in. And why that's so important is because we are committed to bringing relevant and meaningful solutions to banks. Again, we are not, we are not a sales arm for these fintechs. Very clear from the beginning. We're not here to sell your product. What we are here to do is to connect you with knowledgeable, dedicated community bank community bankers that are at least interested in how do I, how do I modernize? How do I keep meeting my clients' expectations? How do I, you know, approach technology, right? And then we just, you know, we just match, match those folks up, kind of help the conversation.

SPEAKER_00 27:27

I love that. I think that's I think that's so cool. It's such the idea of what you guys do, it's kind of an abstract concept of nurturing these these fintechs and then finding bankers who are interested in taking part and presenting to them the option of helping to kind of cultivate the the the industry. I think that's uh I think that's that's very cool. I mean, any fintech would be lucky to be a part of what you guys are doing. How do you how do you vet them?

SPEAKER_01 27:59

Yeah, so there's um, you know, again, we we have a standardized application process, and I I should say applications for our 11th cohort are open right now. So we are currently accepting applications for when does that close? Uh applications close March 31st. Uh so yeah, well, let's let's get those applications in. But so once an application is submitted, there's some what I would call initial vetting. And this is just basic, like, okay, is this a real company? Did you submit what we asked you to submit, right? Those types of things. Uh we also then look for, I mean, we are while we accept solutions, any solution that's that serves community banks, there are certain themes that are really important for us, right? And so in 2026, really, there's five kind of thematic areas that we are really focused on. And this is based on feedback from bankers, right? We are kind of aggregating the voice of all sorts of bankers that we talk to saying, hey, these are what we're focused on. And those five areas are AI, right? That that has to be there fraud, data, payments, and stable coin, and then customer experience, right? And so as you can see, that's a pretty broad set of themes, right? I mean, uh almost every solution anymore has some element of AI today, it seems. So anyway, so you know, we kind of do an initial scrub, an initial review, and then where I would say where the magic happens is we then get those solutions that kind of make it through that initial cut in front of our selection committee. And again, these are real live bankers, right? Representing community banks across the nation. Um, and that's where really again the magic happens, right? These bankers dedicate their time to this cause, essentially, and they provide very direct feedback. We aggregate that feedback in a in a structured way. Think about it as like a scoring matrix, essentially. And that's really how we end up with the finalists, right? The folks that make it in. Now, certainly there's also the you know, there's the due diligence side of it too, the the legal, the background checks, all those things, which obviously our team handles and there's you know certain criteria there. But at the end of the day, the bankers are are really driving um much of the much of the decision here.

SPEAKER_00 30:07

Okay, got it. And so what would you say makes a fintech bank ready?

SPEAKER_01 30:12

Yeah, that's uh that's a good a good call out. So I think a few things. Attitude is important. If they come at this with a willingness to learn, a willingness to listen, a willingness to, you know, just make the most out of the opportunity to talk to so many folks, um, that goes a long way. Now, there is when we talk about being bank ready, right? We do expect that they understand like the traditional kind of community bank tech stack. Selling into community banks or building solutions for community banks is a lot different than building solutions for a software company or for uh Neobank or for you know a different industry, right? And so I think a baseline understanding of, hey, yeah, they're gonna have a core, right? It's probably gonna be from you know a handful of these large providers. Um, you know, they're gonna be a regular uh they're regulated, right? And there's certain regulatory requirements. Um, you know, those are things that are important. Uh we do then look for, again the kind of vendor due diligence type things too, right? So if they're handling PII, right, like are you at a point where you have the documentation to support that you're doing that correctly, right? So you have your SOC 2 type 2, do you have your insurance certs? Do you have your access controls? And you know, I could go through the list. Uh, I do have to be very clear, you know, we are not stating that these are 100% vetted and uh approved or anything like that, but we are doing a an initial review of, hey, do you have and understand these things, right? And so what that plays out as is if you're a smart person that has an idea and wants to build a solution, that's great. We support you, we want you to succeed in the community banking space, but you need a little more than just an idea to get into the accelerator, right? You need some adoption, some product, some like true understanding, right? And so there's other ways we can work with those folks. And you know, we want to support the whole ecosystem where where appropriate. Um, but there's definitely a you know, you need to fit kind of what it is we're looking for. Same if you're the other way. If you have you know 500 uh financial institutions live on your product and you have a team of 300 people and you're you know a series C, you know, you're probably maybe a little too mature for for the program. Okay, got it.

SPEAKER_00 32:32

Yeah. So like you should at least have, I don't know, a Figma design. You need to have maybe already be talking to some some institutions, you need to have a story on on your financing and you know what your runway looks like in order to be taken seriously.

SPEAKER_01 32:49

Yeah, and I'd say you probably need even a little more than a Figma design generally, right? Like you need a a product, right, that's out there being used. Um there are and why that's important. I do want to kind of circle back to that. That is important because again, you have to think about what what is our role in this ecosystem, right? And our role is to serve our member banks, right, and provide them, you know, access to technologies that are gonna be relevant, that are gonna stick around, that are going to be, you know, that they're going to implement and they're gonna get good results from, right? Now, obviously, we don't guarantee results, right? That's still, you know, there's still a contractual process between the fintech and the bank if they choose to partner. But we don't want to just sell dreams, right? We want to sell like real, tangible meaning.

SPEAKER_00 33:39

This is coming very soon or this is available now.

SPEAKER_01 33:42

Right. And what we generally see is that throughout the program, right, we'll have a a uh company enter the program, you know, find there's relevancy. And we see that that product they offer get tweaked and change a little bit, right? And the hope is that it's you know changing in a way that is just more and more relevant for community banks.

SPEAKER_00 34:02

Mm-hmm. Mm-hmm. Okay. Okay. Awesome. No, that this is great. This is great clarity. And anybody who's trying to get something going, this is a great avenue to go down to try to get the ball rolling. Because it's hard. Oh my gosh, it's so hard to get in front of people. I mean, that's gotta be the hardest piece of this because the buyers in the banking fintech ecosystem are getting blown away in every single channel with advertisements and vaporware and you know, AI, AI, AI. So let me ask you this. If I'm a founder right now, you know, what what are some mistakes I'm probably making when as I'm trying to get in front of bankers?

SPEAKER_01 34:45

Interesting. So if I'm a founder, what are some mistakes I'm making trying to get in front of bankers?

SPEAKER_00 34:52

Like, like is email like is email a dead channel, do you think? And is it just all you got to get in in person or um I I I wouldn't say email's dead.

SPEAKER_01 35:02

It's challenging, right? Like all these channels are challenging. I would say that when if you're a fintech founder and you're wanting to get in front of banks, you really need to understand the problem you are solving, right? Sometimes it's not just about having the cleanest UI or having the fastest decision or the cheapest pricing, right? Like you have to really understand what problem you are solving for a community bank. And to do that, you have to spend a lot of time talking with bankers, right? Somehow you have to understand what are they living day to day? What are they getting challenged on? Where could they use efficiency improvements? Um, I would also say founders should approach these relationships as partnerships, right? So I had a um someone that's just incredibly intelligent and uh well-versed in this industry one time explained to me. He's like, hey, you know, vendors, right? Well, we're not a vending machine, right? You don't want to stick a quarter in and get a solution. Like you want a partnership, kind of making the vending machine analogy, if you will. Uh, and I think that understanding a couple things. Number one, yeah, approach things as a partnership. Add some value to the banker's life somehow, even if that's not that you get a sale right away. Be a connector in the ecosystem. Like this is a small world. And the reality is that everyone knows everybody. When I was in the buyer's chair, let's say, uh yeah, when I worked inside a financial institution, my email would blow up, my LinkedIn would blow up, my phone would blow up, everybody wanted to sell me stuff, right? And yeah, I did not carefully review everything, every message I got to see, well, should I buy this AI solution? What I did do though is if I had a problem I was trying to solve, I did call my peers in the industry and say, hey, what are you guys doing about fraud monitoring? Who are you working with? What's working well? I I did do that. And so every connection you have with a banker, like just maximize it, right? Be a be a good person, be reasonable, keep it simple, right? Back to back to the theme here. Like just follow the golden rule. Um I don't go.

SPEAKER_00 37:10

No, that's no, I think that makes sense. And you're making me think about um kind of what we spoke about earlier, which is and what you're saying now, which is you're calling your peers, you're talking to like it which kind of pre-qualifies whoever they're gonna tell you about because they know about them. Let me ask you about partnerships. Like, are we in a space now where if you are an up-and-coming fintech, you should almost be looking for that force multiplier of a partnership, somebody that's interested in reselling, white labeling, referring what you do?

SPEAKER_01 37:42

Um, you know, I think this is gonna be highly dependent on what it is you're selling or what your solution does. Um, I do think that that's one very valid distribution strategy, right? It's not gonna work for everybody. Um, and it's something that in the in the community bank space, there's more opportunities than ever with that, right? When you look at things like digital banking marketplaces, right? With kind of, I guess I'd say plug and play integrations, right? Or you look at um other kind of ecosystem channels or players, if you will, there are ways to get distribution that are not, you know, send a thousand cold emails and hope for the best, right? Now, whether or not you should enter into an official reseller partnership, I mean, it's hard to answer that question, like in broad strokes, right? That's that's very specific to each each solution.

SPEAKER_00 38:31

That's fair. And and uh it's as somebody who worked in a partnership capacity, it's that is a challenging thing to stand up and and manage. And it's probably you know, it gets a lot of fintechs over the resquis pretty pretty quickly.

SPEAKER_01 38:46

Let me uh go if I could just add real quickly on that, like choose your partners carefully. Just because somebody has what they might state as mass distribution or uh, you know, oh, I'll get you in front of 500 banks, a thousand banks, just consider your options. Like be conscientious that once you enter into those relationships, you sometimes lose control of what it is you're selling to some degree. And if you can't control the product, sometimes the results aren't what you want.

SPEAKER_00 39:15

Totally fair. Yeah, I think it's probably good to temper your expectations when you hear claims about how connected somebody is and their willingness to get you in front of X number of prospective buyers because it's it's kind of like the fishing story, right? The fish is oh yeah, exactly. I can you can talk to get you Jamie Diamond on the phone. And so let me let me let's bring it home here with uh a little conversation on AI. I mean, what what's there to say about AI? Ever it is absolutely everywhere, it is dominating, it's like the one constant in the news cycle, I feel like, right now, maybe even outpacing Trump, which is which is hard to do. Where do you see this impacting community institutions over the next three to five years?

SPEAKER_01 40:10

Yeah. So, you know, this one, this one's a little tough, particularly as you look at the three to five year time horizon. You know, if you asked me two and a half, three years ago where I would where AI would be, it's like, I don't think I would have been able to predict where we are even today. What I do think is going to happen, and this is I'd say my personal opinion, right? And I I don't have a crystal ball. I think a few things are we're seeing already. Number one, I think that the bank technology providers are seeing agentic AI having just tremendous, like tremendous real world impacts, right? How they build engineering teams, how quickly they can develop new iterations on their product, right? Like I think that's in general a good thing, right? I can iterate quicker, I can deploy quicker, I can do so at you know a lower cost potentially. I think those are good things. I do think that banks should be um banks should be open to experimenting responsibly with AI, right? And so, you know, this ties back too to some of all the all the things we talked about before, like your data, right? Like, okay, if you want to use AI, well, your data's got to be in order to do that effectively, right? Um, so I think banks should be experimenting. They should be doing so responsibly, right? They should be doing so with, you know, specific use cases in mind, right? This is not just, hey, turn on Copilot and let just open it up to everything and let's go, right? Like, yeah, you need some experimentation. Um, so I think that again, service providers will be able to iterate faster. They'll probably be able to drive costs lower, would be my estimation, right? And folks should be able to deploy solutions faster. All this to say, though, is I actually tend to believe that community banks in particular are uniquely well positioned for this kind of AI wave. And here's why. I think that AI will allow banks to grow and scale without adding without adding headcount as rapidly, right? Like basically the same number of employees will be able to do more work. That's a positive. However, I also think that you are going to see essentially AI only banks out there, right? Whether those are neo banks or or whoever, right? You're gonna see scary. Yeah, I mean, I say AI only, it'll probably be a person or two, right? And I think what's unique about community banks is we have a few things that as an industry that you know, sometimes the larger players or the online only banks struggle with, right? Like we have trust, we have real relationships, and we have like a community presence, right? And those are those are real meaningful things. And so I tend to think that that there will actually be come a point where there's a premium on like actual relationships, right? And so certainly, yeah, use AI to make things more efficient, use AI to deliver uh exceptional customer experience, right? Use AI to improve fraud mitigation, right? And improve um, you know, all of that. That's that's good, right? But I'm a little bit bearish on AI ever fully replacing a human relationship, right? Like I agree. I think that there is something here. There's a reason you and I are talking here on a video, right? I could just have my AI agent talk to your AI agent and share notes, right? Like, okay, well, that's not I don't nobody nobody wants to watch that. Right.

SPEAKER_00 43:32

I don't want to do that. I don't like that future.

SPEAKER_01 43:34

No, exactly. And I think that as people kind of, you know, people are nervous and anxious about their financial lives, right? Like it is confusing, right? And sure, you can plug it into a PFM solution that's AI enabled and they can spit out, oh well, you know, Johnny, you should save more money. You know, don't buy a cup of coffee, don't buy your avocado toast, like whatever. There is a place for real relationships. Relationships with people, right? And I think that community banks like just are in the right place at the right time for that. So I would say AI is a partner. AI is a is a enabler. It's a force multiplier, but it just allows us to do more of what we're already doing great. And that's building relationships, you know, being a trusted financial partner and impacting our communities.

SPEAKER_00 44:20

Love it. All right, man. We're at the end here. Let me uh let me run you through some rapid fire questions. You ready? Yes. Okay. Number one, community bank CEOs. What should these guys be paying attention to right now?

SPEAKER_01 44:31

Listen to your customers. Your customers are broadcasting their preferences with how they interact with you. Look at your transactional activity, right? Look at how your customers are interacting. Talk to your customers, right? There's a qualitative and quantitative side of this, and both are important. Um the other one I would say, if I can, is consider your culture, right? Technology is easy. There's always somebody that will build technology. Culture is hard, and it takes like a leader to build a culture that can excel.

SPEAKER_00 45:01

Totally agree. And if you want people thinking creatively, they need to feel safe to do so. And that's, I think, the kind of main ingredient of innovation. Uh okay. FinTech founders, what should they be preparing for right now?

SPEAKER_01 45:14

I would say, is your solution solving a real problem? Have you talked to a bunch of bankers about what that problem is? And have you have you vetted that it's actually a problem? Right. Sometimes we see folks that may think they're solving a problem, only to realize, like, well, there's intentional friction in a process, right? There's a reason for the friction, those types of things. The other thing, if if I'm a vendor that I'd be really paying attention to is what's my moat, right? Like AI is it's making it more challenging to build a solution that has a moat around it. You know what I'm saying? I tend to think the best way to do that is understand the business of banking. Like I just can't overstate that, right? Don't just be the greatest software developer or greatest engineer. Like understand banks and then build software for them.

SPEAKER_00 46:02

I love the uh the notion to talk to them and get your idea in front of them. You know, I recently had Elizabeth McCluskey, who runs a venture fund at TrueStage. And she was talking about how talking to your buyers is so important because these ideas in the beginning early stages almost always change quite a bit before it's generally available. And so getting that feedback early and establishing those relationships with those bankers, I think is super important.

SPEAKER_01 46:35

Absolutely.

SPEAKER_00 46:35

Well, Justin, this has been great. Really appreciate you coming on. Where can people follow uh what is going on with the ICBA? And is there anything coming up with the ICBA that you want to mention?

SPEAKER_01 46:46

Absolutely. So uh www.icba.org, that will have all the information on it. Uh you can find the innovation uh area on the site and all of our innovation programming. Uh as I mentioned before, we are currently accepting applications for our uh 11th cohort of this accelerator, which kicks off in May, middle of May. So if you are a founder or know a great founder that's serving the community bank space, please submit an application. Feel free to reach out to me directly as well. Find me on LinkedIn. Um, find me uh, you know, my my emails listed on the on the ICBA website. Uh the last thing I'll mention is we we do, you know, outside of the accelerator, we have all sorts of programming that we do for community banks. So most notably, we have an innovation workshop coming up on uh in the middle of April. Uh, and in that innovation workshop, we'll be just helping provide sources and education around well, how do we build a culture of innovation? What are the, you know, we've spent a lot of time talking about the why should banks innovate. Now it's time to tackle the what and how are we going to innovate? What do I need to be doing? So that's a great, it's a two-day session virtually where we'll bring in a bunch of experts, a bunch of other bankers, and it's just like collaborative and productive, quite honestly.

SPEAKER_00 48:02

Awesome. Well, thanks for being here, Justin. Thank you, Roland. It's been a pleasure. See ya, buddy. See ya. Hey, thanks for being here. If you or someone else you know would like to explore coming on the show, fill out a contact form at propagatefintech.com and we can explore some content ideas with you. Also, we are an end-to-end marketing and PR firm only supporting the bank industry. So if you would like to explore going deeper with Propagate, again, feel free to reach out to us and we can explore whatever that you're working on. See you on the next one.