Bringing Heterodox Thinking to the Credit and Finance Space

Adam Torres and Colin Frost discuss the credit and finance space. 

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Show Notes: 

Why has the credit world been largely unchanged for so many years? In this episode, Adam Torres and Colin Frost, CEO of Impact Analytics, explore the credit and fintech space. 

About Impact Analytics Inc

Impact Analytics is re-imagining risk assessments and making financial services more accessible, bringing intelligent risk management to the nucleus of everything that matters most to enterprises.

They are designing technology to reimagine traditional risk assessment models. Their mission is to empower intelligent decisions across the credit surveillance, underwriting, loan origination, and bundling verticals. They’re working to leverage our developing wedge products and a robust intellectual property portfolio in order to empower your business.

 Full Unedited Transcript

 Hey, I’d like to welcome you to another episode of Mission Matters. My name is Adam Torres, and if you’d like to apply to be a guest in the show, just head on over to missionmatters. com and click on be our guest to apply. All right. So today’s guest is Colin Frost and he’s CEO over at Impact Analytics.

Colin, welcome to the show. Thank you very much for having me on. I’m excited to be here. I’ve been a, I’ve been a listener for a while. Oh man. Well, we, we got some fun today. We’re going to be talking about bringing heterodox thinking to the credit and finance space. And I guess just to get us kicked off here, how’d you start out in the credit and finance space?

Where’d all that begin for you? My life started , as a product designer, just bringing digital products to life, starting from a blank sheet of paper and making things work. And that journey found me over in the finance space. I worked for Experian for quite a few years and launched their, their most innovative product over there called Experian Boosts, which Fast Company called the world changing idea in 2022.

I was pretty proud of that. And , I’ve always looked at things a little bit differently than everyone else. I came to realize a little later in life, and it’s been a, it’s been a gift to be able to bring that to creating products. I’m always, I’m always so interested when I’m talking to product people because I feel like they think a little bit differently.

Like what draws you to making products? , I think it’s, it’s always been a way of seeing how things could be done better. And, , there, there’s nothing worse than old cable boxes and how terrible they made watching TV. Hold on, there’s nothing worse for you because you’re a product guy.

That’s awesome, go ahead. , you’re the one that gets under your skin. Me, I just throw it to the side. I don’t, I’m like, ah. But for you, continue. But that’s the thing, you’re plagued with seeing all these inefficiencies in the world and better ways to do them and, , that’s how Apple came and did their innovative products that they had.

And so when I started working in the finance space, gosh, I saw this world of opportunity and working for a, , 47 billion organization really let me make some big impact there. What I really got to do is, is learn how building that kind of business works and bring that over to impact analytics where I could have a little bit more of a clear playing field to say, okay, let’s really dig in and make some changes on, on how people look at finance and credit.

So the, the credit and finance space, I mean I’ll use the word maybe it’s considered many times like stodgy or old fashioned or still are like, kind of like lagging compared to maybe some other things that are taking place. Do you see it that way? Do you see like an open playing field of like, wow, plenty of, plenty of improvements that can be made or how do you see the field in general?

Adam, you used some of my favorite words to describe an industry to design new products for. It is stodgy and it’s old and I use the term dinosaur often when describing a lot of these companies that, that make these products. And, and usually, , , what, what really happened in this industry is, The Giants became Giants in the 70s.

Legacy, right? Their legacy, and they’re largely uncontested and, , that air quotes of the way we’ve always done things is, , pervasive in those types of industries. So I see them as ripe for disruption, and it does take a lot of critical thought and , very Calculated approach to how you do things.

But that’s, I mean, that’s why we’re here. I think, I think stodgy is a word that I’ll strive to never describe anything that me and my team create. And that, that just to me feels like massive opportunity. Yeah. And I guess if I was to make a parallel here. And I was to say which ones in front at the moment FinTech and finance versus the credit side, which one would you say is kind of lagging the most at this point?

If I had to, and if you’re not a FinTech expert, it’s all good. I’m not asking you to give your professional opinion. I’m just giving your, your hunch or your assessment because everybody’s been talking about FinTech at least for the last decade, but I don’t hear too, too much about credit. So I’m curious on your end.

Yeah. , I’m very comfortable with robo advisors and all that stuff. After a long time, like FinTech, a lot of people have been looking at it, but I don’t know how often, how many people are like, or how much, at least in media, I mean, at least what I’m saying for my opinion are looking at the credit side.

Yeah. , I think it all plays together and that’s, that’s a part of this puzzle that hasn’t been cracked yet by most, I think you do have to look at all the pieces , robo investing. I think there’s been some great businesses there, but I don’t think it impacts the vast majority of people.

I think a lot of people today are living paycheck to paycheck and things like budget are massively important and things like navigating the credit play field are massively important for getting ahead in life. And where a lot of people would look at this, at the landscape of this thing, how does this really hard?

How do I do this? Everything’s more tempting these days. There’s less dollars to go around. So I think that having a thoughtful approach. Around how you look at budget is really important right now. And that’s part of what we’re doing is we’re looking at it in real terms. One of the things I’ve been saying about this is that we’re living in, , the TikTok era.

And everything is 12 second tidbits and short versions. I mean, if you were to look at how many Instagram Reels are watched last year versus how many books were read, numbers would be staggering, but it’s a, it’s a reality that everything’s vying for our attention these days. So, if we were to throw giant spreadsheets and graphs at people instead of one or two quick bites of what they can do to improve their life we’d be failing.

So we’re flipping it on its head. We’re saying, what are the little things you can do? Let’s lean into AI to figure out how to make the best decisions. And then when we figure that out let’s just serve one at a time. Let’s lean into what we’ve learned about human behavior change from, , let’s say the health and diet world and apply that to finance.

It’s, it’s, it’s something I haven’t seen done very well yet. I’m excited to be a first mover in space. Why do you think the credit world has been so large and changes it just because of the legacy side of things and things were so big or like, well, is there any other reasons? I’d say that’s, that’s probably a fair blanket assessment.

I mean, that’s, that’s pretty true. , the first, Big mover in the space was Credit Karma, and they came in and added some simplicity to it. But it’s still, there’s this quantum leap that hasn’t been taken yet, where you can truly simplify it down to, hey, here’s one thing you need to do, and maybe give me a swipe of a couple options of what I can do.

But even the best in the space, I think they’re still 10 years back in what they need to do, as far as making positive change for end users. Yeah. So in terms of financial applications in general maybe sometimes , they come out and like, then last in short bursts and was like, kind of like fads and they come and go, like, what do you think it takes to make something that’s long lasting?

I think that so there’s this, this researcher at Stanford named BJ Fogg is a guy I’m a really big fan of his. He wrote this book called Tiny Habits and he’s got this whole practice around how to make, , changes stick. And a lot of times, like I mentioned, that’s, that’s applied in the health and diet world.

And, I mean, I don’t, I don’t know about you, I’ve done this before, like, I’m not, I’m not eating anything bad again, let’s throw away all the chips, , , we’re not going to go out to eat, I’m going to make everything and it lasts a week. And, , what his research taught me is that it’s really about finding the little wins and celebrating those.

And then continuing that momentum to build up slowly. So that’s, that’s where I’ve seen this strategic mistake on the human side of creating products in the finance space is that it’s all been very fad diet. Like I mentioned it’s, it’s, , here’s, here’s a ton of information. Good luck, , reading it and understanding what to do, but really what people need is, is a coach in their pocket.

That’s going to give them little things that thinks about them as a human at the same time, not just. What’s best on the finance side? Most people aren’t are, , if you go research, , what do I do with my money? You’re gonna get all this antiquated advice around, 30 percent of your your finance is gonna be your rent and you’re gonna invest this and most people will today will look at that They go how the hell do I do that?

So we plan to bridge that gap between the how the hell do I do that? Getting them to a really safe financial space Like getting them in a way that it’ll stick and that’s, that’s the mistake I think that they make is they’re, they’re asking too much too soon. You really got to keep it small so you can celebrate the wins and create real time lasting habits.

Yeah, I definitely see that. I want to talk more about what you’re doing over at Impact Analytics as well with some of the time we have here. So maybe tell us a little bit more about the company and what you’re up to as well. Yeah, so , our flagship product is called Credessential. And it’s, it’s a holistic look at finance for the real world.

We, we use a lot of AI in the product. My opinion on the AI thing, a lot of companies are saying, hey, we’re just AI this or AI that. I see it in, in the product world as a really strong tool to have in your belt. But it’s not the only thing to hang your hat on. , try to think what, what five years from now looks like in, in build in that way.

So we’re looking at how to optimize what your assets are. , that might be things like you have a car loan that , our AI model could take a look at and say, hey, you could be saving a few bucks a month. If you switch over to this or that we, we look at the budgeting, like I mentioned, I mean, you can, you can draw the lines there , we’re really, really leaning into the, the habit forming side of it and giving people understanding a good example would be if, , there’s a couple at home in their thirties and they door dash a lot, it eats up a lot of their budget.

The, the model will take a look at that. And this is what we’re building right now. Is take a look at that and say, , we’re not going to say don’t do that ever again. It’s not realistic maybe you do it eight times Let’s start doing it six times this month And give a lot of interaction around where they are in that process and options of what to do.

Otherwise That’s how we’re looking at budgets. And then the the last two pieces are credit and identity So a credit is one that we’ll be building out a bit more in early 2025 but a similar model, , here’s one or two quick things you can do and then identity It’s one I’m also passionate about.

I think it’s important to think about identity in terms of how you use it responsibly. Right now, people have copies of their identity sitting at car dealerships and at the doctor’s office and all over the place. And there’s scenarios where you don’t necessarily have to leave a copy of that wherever you go.

So we’ve created a lockbox that’s very safe for identity to use homomorphic encryption. And we’ve built a burn after reading feature. So if you were to go to a car dealership and say, Hey, I want to. Give you some of my identity to take a look at financing this, , new Jeep after a certain period of time that gets pulled, the access for them gets pulled, and that comes back into our lockbox so that they’re not able to lose that.

So yeah, we’re trying to take a really fresh look at all these pieces that I think look at the holistic credit and finance self and taking fresh approaches we’re going down to first principles and saying what’s really important and then we’re building it. , who’s your target market for this product?

Your target user base? I should say. Our target user base is probably mid twenties to mid forties. Again, like I mentioned, there’s this just enormous base of people who live paycheck to paycheck and it’s increasing as time goes on and rents get more expensive and houses get less easy to buy where you need this, This assistant that can help get you to where your goals are as it gets convoluted as time goes on So we’re not skewing way too old or too young.

We’re kind of playing in the middle folks that’ll have full time jobs probably double income houses that’s that’s generally who it is If the reason why we’re going so wide with it is there’s such a wide need that’s what the demo is. But but when I look at creating a product I look at , where’s the, the friction, what’s, who has this friction?

And it’s a pretty wide group that has the friction. So that’s what we’re really going after. Our target market is, is who’s feeling this burn. Yeah. And I mean, the, the end goal would be to help them if you had to kind of sum it up in terms of the different pillars of debt, data security is one of them.

You mentioned finance and habits. Like how would you describe it? If we had to kind of like, like give the pillars of, of , what you’ll be helping them with. It’s really credit, finance and identity. Those are the big pieces. The reason why we went after those is , they all interplay together.

Yeah. You need your identity to, , take the best advantage of credit. You need to have good budgeting to make sure your credit doesn’t get impacted. , your credit will impact how much you spend on your budget. They all interlink together. And so we didn’t want to just take one and, and, And say, Hey, good luck with everything else.

And the only way to really do that without getting complicated is just keep it very, very, very simple. And that’s, and that’s what we’re doing for each. Talk a little bit about the user experience and like what, and what you’re planning. I know some of the stuff you mentioned that you’re that it’s still being built and you gave us some timelines earlier, but talk about the, the user experience and kind of what you envision.

Let’s go, let’s go there. Yeah, so I, I’m a believer, and this is from somebody who’s spent many years in a UX seat. That you’re not trying to reinvent the, yeah, you don’t want to reinvent the wheel with user experience. You want to lean into patterns that people are familiar with. So, I think, it’s kind of weird, , this doesn’t feel creepy ever seen, , a baby reach down and start, , doing a pinch motion on a book, , where they want to zoom in, which is weird and magical at the same time.

So we’re, think about that and then scale it up so everybody knows how to, how to function Instagram, you double tap to like something, you swipe to keep going. We’re just looking at the very base models for design and we’re bringing them in. So the UX is kept simple. High level information. If you want to go deep, you can.

But the idea is, let’s just take a couple seconds and make this an enjoyable and simple experience that gives you just the information you need at the high level. As users will engage my theory here, and we’ll test this out, there’s no better tell in the market when we see our data. Of course. But, but as people engage with it, I’m sure we’ll find that they’ll want to go deeper on the data and we’ll give that ability to do that.

But our UX, it’s simple. It’s clean. We’re just trying to keep it as as easy and quick as possible to get the information into your head. That’s most important. I like it. Easy, quick, get that information in my head, Collin. I don’t need it. I like the way you say it. , so many things asking for our attention.

I don’t need anything else, man. I’m done. Why doesn’t everybody think that way? I’m in. Well, , it’s funny that the, so many things are important, , and you, you go to approach a problem and this is part of what happens at the legacy organizations is they go, but this is all important. You go well to you.

Yeah, but to most people, just this top 10 percent is really it. And we can tuck the rest away. It’s a nice, it’s a nice way to function. Oh, well said, well said. Well, Collin, man, this has been a lot of fun. Fun having you on today and learning more about what you’re doing over Impact Analytics.

. That being said, if somebody wants to follow up, follow the journey, continue to follow the progress of the company how do people connect and learn more about the products?

So , our best way to connect is through our website, impactrisk. ai that’s, that’s the best way to find us. You can find our stock on the OTC with IPTNF, or if you’re in Canada, you Which is where our company is based. You can look P A C T is our ticker. If you want to check and see what’s going on, you can always find news about us and new products releases there.

So, yeah, check out the website impact risk dot A I. We always got something cooking and we got a killer team that’s putting together a cool product. So we’d love to have anybody interested and come follow along with the story. Amazing. And everybody listening, just so , you know, we’ll definitely put the links , in the show notes.

So you can just click on the link and head right on over and speaking to the audience. If this is your first time with mission matters and you haven’t done it yet, hit that subscribe or follow button. This is a daily show each and every day. We’re releasing new episodes, new content, and bring you new stories that are hopefully.

Help you along the way in your journey as well. So make sure you hit that subscribe or follow button and Colin, again, thank you so much for coming on. It’s been a lot of fun. It’s been a hoot. Thank you for having me. And Hey, one little message for your audience, hit the subscribe button. Cause this is one of the best shows out there.