Unifin Inc. | Clint Daoud “neo collection agencies” | Receivables Roundtable Ep. 139

Adam:
Hello everybody, Adam Parks here with another episode of Receivables Roundtable. Today I'm here with my new friend, Mr. Clint Daoud, the CEO of Unifin. How you doing today, Clint?

Clint Daoud:
Hey Adam, thanks for having me.

Adam:
Absolutely, look, I think you guys are doing some really interesting things and I've really enjoyed an opportunity to get to know you recently. But for anybody who hasn't been as lucky as me, can you tell everybody a little bit about yourself and how you got to the seat that you're in today?

Clint Daoud:
Yeah, absolutely. Started in the deck collection world back in 2003 with Arrow Financial Services. I was a deck collector there, that's how I started my career there, and went off to, after the whole Arrow thing, which basically sold off to Sallie Mae, ended up at Van Roo Credit Corporation where... My partner now and I and another third partner that we had at the time basically decided that You know, I think we could do that collection a little bit better. So we understood it. We were top collectors I think most collectors actually think that when they're in the seat It's just a whole different world once you actually get over to doing it and running the business but yeah, it was at a Christmas party it sounded like a really good idea and we came up with a plan and Cut our teeth as a subcontractor working defaulted student loan on the federal student aid side. 2015 started servicing some debt buyers and creditors because we had that background from Arrow and understood how to do that. 2019 launched the BPO, which really is customer care and back office. So kind of working that whole full circle and leading up to where we are today. So co-founder, CEO, and I've been in this role 12 years now, so it's cool.

Adam:
Wow, so and Unifin is an interesting organization, right? Like you touched on a couple of those things, the BPO piece that you're doing some debt buyer work, that you have the student loan experience, right? Like that is a pretty well-rounded organization, but give us the quick pitch. Like tell me a little bit about Unifin and what it is that you guys do there.

Clint Daoud:
Yeah, full outsourcing agency. We have dedicated offshore sites. So first we have our US site, which is just outside of Chicago in Niles, Illinois. It's actually the old Aero Financial Building on Toohey. So 5996 West Toohey Avenue. So we have a large facility there. And ended up in 2015 decided we were gonna start doing things offshore too, just having that component. We started in the Philippines. Since then we've launched Guatemala. Egypt which kind of gives us a little bit of everything gives us that bilingual Spanish out of Guatemala. We have some Chinese and Tagalog speakers in the Philippines obviously that's their language and then Egypt gives us that Arab speaking Middle Eastern kind of flair. So that's how we ended up basically just having that full regional presence. But I think what's to lead the digital front in collections. It's been a priority of mine. Back in 2018, we developed our own negotiation platform. Since then, it's really launched into its own little animal, basically communicating with consumers. It's specifically built for post-charge off debt. And just now with the advent of Reg F and giving some more clarity as to communication methods, emails, texts, and just having that digital strategy, consumers to that portal which also has a chat feature and allowing consumers self-service and not just self-service from making payments but also self-service from a debt negotiation and being able to resolve their debt. So that's been an interesting thing and we're seeing that I'd say about 65% a little over 65% of the collections that we have we're driving into some sort of inbound channel whether it's through our you offer our chat or the phone calls that we're driving in which is something that I think 10 years ago years ago or even five years ago just wasn't possible right I mean 80% of what we were doing was outbound so that number continues to drive up and you know continue to go higher so it's interesting

Adam:
It sounds like you guys are creating that two-way communication methodology, right? And I think a lot of organizations have gone down the path of trying to institute the technology or to build their organization around the technology that they've either developed themselves or partnered with. But I think it comes with some... challenges, right? And becoming a, our industry kind of falls in this weird gray area between banking and, you know, and kind of unknown, right? And so you've done a couple of these different pieces with the neo banking and some of the other, you know, facets of your organization. But, you know, what is we were preparing for this call, we kind of threw around the word neo agency, right? And I think a lot of us have seen these neo banks that have been created over years, right? Banks with no really physical infrastructure, they live in a digital world, right? Like they're not brick and mortar.

Clint Daoud:
Yeah.

Adam:
And although I don't think you can ever really do that with a collection agency, right? Like the regulations just ultimately don't allow for that, you still have to maintain a physical presence. Finding that perfect balance between the traditional and those digital or technology driven methods has got to be an interesting challenge that you're continuing to face across the industry. How are you addressing that balance of being kind of like a neo agency with all of this digital and overseas presence, right? But also finding that balance of still maintaining the brick and mortar necessary to meet the requirements of both the clients and the regulators.

Clint Daoud:
definitely has been an interesting journey. So first off, I wanna say that you coined that term, Neo Agency, and I

Adam:
Thanks for watching!

Clint Daoud:
just absolutely love it. That's a fantastic term, I think, for what's happening right now in our industry. I would say from a balance standpoint, You know, with a lot of the technology out there today, and when we talk about balance, we're talking about how do you immerse your individuals culturally, right? How do you allow them to be able to be able, you know, how do you manage them and how do you execute from a regulatory standpoint? And then I think number three, how do you ensure that there's productivity and efficiency that's occurring in the background? And all three of these things, need to be tackled some way or another at the same time. I think in a post-COVID world where a lot of, I mean, mostly everybody pretty much went from a, you know, in center to a work from home or some sort of work from home method, I think quickly realized that trying to get your individuals on board culturally, especially some of the newer hires that came on afterwards has just been somewhat of a nightmare. And I think there's some cool technology out there that some folks are really using to be able to do that. I think there's already legacy technology that's out there that can help do that as well. You know, for us, we've used a multifaceted approach where we use a Teams with an intranet. We have something that we've built internally called U Portal, which allows our back office individuals as well as our collectors to be able to engage with one another, you know, in conjunction with Teams. That kind of helps create a cultural, I would say that it's still really important. We still have what we call rewards and recognitions. We do that monthly with our employees. We also do quarterly get togethers. We try to do that as much as we can. We just had one for one of our divisions actually last week, which was a success and it was pretty cool. Whoever can make it out, they come out and they do that. So from a cultural standpoint, it's really important to be able to tackle that. Number two, regulatory, ensuring that we're doing it all regulatory boundaries of not just federal but also state. I think Nevada right now is kicking around some questions about the work from home setting. And a lot of agencies are looking at that and either chiming in and being able to give their opinion on that with the state. And other states are following suit, right? Because that is a reality now. I mean, a lot of states for the longest wanted to know who your collectors are, where are they sitting, what are they doing, who's your agency manager, where is he sitting or she's sitting, so on and so forth. So that's something that I feel like, regulation and you know always kind of follows what's happening so I think we're getting there and it's impressive because it's only 2023 but we're only two years out from this whole you know three years out call it from the whole COVID work from home and I feel

Adam:
Mm.

Clint Daoud:
like states are really trying to pick up where agencies are today and then the third thing is obviously ensuring productivity and efficiency is being met and staffing, right? I like to throw that in there. I like to do things in three. And that really is for us, the way we manage that is really just understanding what our objectives and key results are, how we're measuring and tracking KPIs, and then having proper reporting to be able to track that. And not just from a macro month to month, which I think a lot of agencies still do. It's really day to day. I mean, we're really looking at individual I mean, to be fair, from a really micro standpoint, we have real-time analysts and supervisors that are managing these things on a minute-by-minute basis, right? So to be able to ensure that productivity is happening, that it's being done efficiently, they're performing properly, and then you're properly staffed to, you know, right-sizing based on the type of debt. And, you know, I know, I remember back in the day, it was always like some kind of ratio that we would use. You know, you have 500 accounts to every agent or something like

Adam:
Mm-hmm.

Clint Daoud:
that. I don't think it really works that way anymore. I think depending on how you're actually managing your shop, what you're doing from a digital standpoint, what you're doing from, you know, how your agencies are, excuse me, how your agents are being managed and how you're managing that productivity, performance, efficiency. I think that kind of all boils down to how your stack is gonna be. So I hope that

Adam:
I

Clint Daoud:
answers

Adam:
think

Clint Daoud:
the

Adam:
you

Clint Daoud:
question.

Adam:
bring up a lot of really good points there. You know, one of the things that I've found to be interesting as you talk a little bit about kind of the work from home and that balance of the traditional versus the digital collection agencies is ultimately kind of this differential in how we manage our businesses globally versus a work from home environment. And I know this let me try and clarify this a little bit. But like when we work in a global. office, right? Like you have a global office, I have a global office, right? Like we have offices around in other countries as well. But I find a lot of that technology and when I'm built to operate cross-border, it's a lot easier to function in a work-from-home environment and provide the same level of support because you're ultimately already going through a lot of these interchangeable pieces or you've migrated key, you know, key tool sets to the cloud, right?

Clint Daoud:
Yeah.

Adam:
Where you're probably not running a physical... phone system anymore, you're running some sort of a digital phone system, the IVR is everything ultimately is in the cloud. And if everything's going to be in the cloud, and if everything's, you know, in that way, connecting between offices and connecting to work from home, ends up being somewhat similar.

Clint Daoud:
Yeah, yeah, that's, that's a great point actually. And it's a, it's an interesting point in the sense that when, when COVID happened, so we were already built for this

Adam:
Mm-hmm.

Clint Daoud:
because of our, um, offshore presence and our dedicated, um, sites that we had, and you're exactly hitting it, um, on the nose here. Um, Technology wise, we were set up for it. There was a few logistical pieces we had to figure out, obviously getting people their computers or their laptops and sending them off to the house and then setting up those VPNs from their home because we weren't doing it from home, we were doing it from the center. But because we had that already set up,

Adam:
and infrastructure.

Clint Daoud:
there was an infrastructure that was already built. We had a foundation and a backbone that was already built. We ended up landing a really large client on the, that's what kind of... The trajectory on the BPO side, that's what helped us grow. There was a large client of ours that we still service today that had a massive need because the big boys weren't prepared for that. They weren't nimble enough. So we ended up getting an at bat where they needed 500 agents to be stood up in like six weeks. Yeah, they needed it right away because

Adam:
yesterday.

Clint Daoud:
if you remember, I mean, you had call wait times, calling queues that were lasting up to a day, 24 hours in some cases. And they were just backed up. name names but it was literally the top three largest BPOs that you could think of were not prepared for this. So all of a sudden this company went from 2,500 full-time customer care back office agents to almost zero because places like in this case the Philippines literally shut down. You couldn't move so people couldn't make it to work anymore. So they had to figure something out quickly and we were able to stand up that solution for them. I kid you not we did it in under four weeks. We hired 500 people, got them trained, got them set up and were able to help them reduce down. After about four weeks, I think their calling queues got reduced down to somewhere in the two hour range. It's an amazing case study that I probably have to write on one day. It's just because the nimbleness and the preparedness of being able to do that. And I think you're, I never really thought of it from that standpoint. A lot of it had to do with the fact that regional we were already set up or geographically we were already set up. So that transition to work from home was much, much easier for us than a lot of other companies were able to set up and stand up.

Adam:
I think we're always prepared for something that's locally, right? Like I'm in South Florida. I expect to have a hurricane once a year, right? Like that's just kind of the. process that I've learned to expect through my time living down here, but I've got people everywhere and Overseas and a hurricane is not gonna hit here Cleveland and India in the same day, right?

Clint Daoud:
Yeah.

Adam:
Like I'm not gonna have that kind of challenge But because we're set up in that remote environment it kind of put us in a unique position to be able to react and respond But that is the level of flexibility in the nimble nature of kind of a neo agency, right? The ability to have that interconnected web of technology that exists not necessarily just on a physical server somewhere, right? Like it's actually a living, breathing part of your global organization.

Clint Daoud:
Yeah.

Adam:
And I think it changes the perspective quite significantly if we kind of look at things from that perspective. So, you know, from my side, like it always... Being global is, you know, it always sounds like fun until you have to take the challenges of running an operation that crosses so many different borders. And what does that ultimately mean? And how do you explain that to the client and how do you engage them? Now, living in this kind of new agency world as you do, what do you think is kind of the biggest challenge that you're seeing across the space as people are trying to deploy a digital strategy, right? For those that lived in that, I mean, we could always talk about those in the technology side and are starting to find their way over traditional collections, but I'm more interested, right, I feel like there's a bigger movement of those traditional organizations that are trying to find ways to deploy digital, but they're tripping over certain things. You know, what are you seeing are kind of some of those tripping points?

Clint Daoud:
Um, so I, I mentioned this on a webinar recently, I think it was last week, if I'm not mistaken, but, um, I think that, and, and I'm just talking from experience, right? I don't, I don't have a tech background. I'm not a developer by any, by any means. I have an idea, I understand the processes really well. I know what I wanted. I think engaging with the right... consultant or hiring the right individual that can come in and navigate and help you navigate through that. You know, what we consider, you know, people that are, I mean, I don't know how technologically savvy you are, but you know, like there's some things that you kind of, depending on how you conceptualize it and what your ideas are, for me it was, I want to do this, this and that. And I just figure. in my mind, it could be done. So I engaged the right people and they were able to kind of put it together. And, you know, the way I visualize it and we're continuously working on it and perfecting it and making better. I think that's where a lot of owners and CEOs and managers in our space might be getting tripped up. I think that they're looking at it as a Mount Kilimanjaro versus it's just a hill and how you're going to actually get over that to be able to get to that digital I don't know what you want to call it, paradise? I don't know what you want to call it, but at the end of the day, that's the goal and that's the objective. And I think if I can give some advice is understanding what the objective is that you're trying to accomplish, whether it's doing something with a back office process, documentation, payments, whatever it is. I think in a world that we live today where we have this advanced RPA that's been around advanced to AI and its regenerative AI today and being able to understand that technology is out there. It's just engaging

Adam:
Yeah.

Clint Daoud:
with the right people and being able to explain right and articulate exactly what it is that you're doing. And I think that's where you know individuals have to sit back and kind of assess what their needs are. Maybe tackling the smaller or the most needed areas first and then engaging with that consultant or hiring that right person and being able to say this is what I want to do and then being it you know able to get that done. I think that's where that's going to be a differentiator I think in the next three to five years is where ownership and some of these organizations are going to be able to pull the trigger or they're not. I don't know, I don't want to make a guess and say that if you're not somewhat digitally set up or capable that you're going to fall off to the wayside. I don't want to aging population and you have more millennials and Gen Zers that are coming to, you know, in a charge off status and they're ending up in debt collection, it might be their first time engaging. If you think about how they actually, that loan or that service was provided was some sort of, you know, it was set up digitally, right? They did it online. They expect it to be taken care of in some sort of, you know, former fashion online. So being what consumers want and how they want it is going to be key. And again, I don't want to say that you're going to be left off to the wayside, but I think it's going to be a little bit more challenging to get the job done three to five years from now if you're not set up. Might even be sooner than that. I'm not sure.

Adam:
I agree with that and I think the ability of rolling those things out if you're looking at developing that tech, put somebody in charge of it, right? Bring somebody in who knows how to translate business to technology

Clint Daoud:
Yep.

Adam:
because that's the area for those that are developing their own tool sets where I see kind of the biggest challenges is as a CEO or as a collection agency owner or whatever the role is, if you're not... If you think that you're going to go in there and document everything that needs to be documented in order to truly help the developers understand what it is that you're building, you're going to find yourself with a pile of work that you didn't expect.

Clint Daoud:
100%.

Adam:
And for me, it's always been like that's and that's my role in technology projects is my role is to understand what the business owner is looking for and be able to translate that to my technology teams. Fortunately, for me, my partner on the technology side also has an MBA. he understands

Clint Daoud:
Hehehe

Adam:
the crazy things that I'm shouting out, right, is get

Clint Daoud:
Yeah.

Adam:
his MIT and his MBA, which makes it a lot easier for

Clint Daoud:
Yeah.

Adam:
me to be able to describe what it is that I need, because he can understand the complexities of the business problems that we face as a collections industry, right? Like, as an industry, our problems are not generally that simple. All right, there's a web of regulations and rules. And now I think as we're starting to look at some of the privacy rules and things, you know, that are going to start coming out from a state level. Now the federal government is kind of at a standstill to do anything related to a privacy statute. or regulation. So, but before I go down that rabbit hole today, Clint, I feel like that's something we're going to have to come back and discuss another day. For those

Clint Daoud:
For sure.

Adam:
of you that are watching, if you have additional questions that you'd like to ask or comments you'd like to make, you can make those in the comments below on LinkedIn and YouTube. And I'm sure Clint and I would be happy to continue to come back and create great content for a great industry. But Clint, I really want to thank you for coming on and chatting with me today. This was great.

Clint Daoud:
No, Adam, thank you so much. I really appreciate it. I love what you're doing, and I look forward to getting with you personally here soon, maybe having a drink and just hanging out and just talking a little bit more, so.

Adam:
Absolutely. I very much look forward to that. For those of you that are watching. Thank you so much for your time today and we'll see you all again soon. Thanks, everybody. Thanks, Clint.

Clint Daoud:
Thank you.