Key takeaways:
- Customer experience elements and lender economics of one-stop shop playbooks
- Biggest wins and challenges executing one-stop shop models in today's unforgiving market cycle
- Top operational and compliance considerations when going beyond mortgage only
- Tech stack differences between monoline lenders and multi-product/service shops
Julian Hebron (
How's everybody doing? Good to see everybody this morning trying to see past the lights here, but thank you all for coming and I just wanna make some quick remarks. I'm gonna do some big intros for very big panelists this morning in a sec, but I wanna make a couple quick notes about the flow of this morning, because as Heidi said it's a very rapid fire morning. So what's gonna happen is we're gonna do this panel and then I will stay here and give you guys a briefing. You're gonna see to your left that this stage over here is gonna light up. And the Lending Tree sponsored demo contest that takes place here on this live stage on these two podiums will then kick off. So when I close out this morning here, I'll give you guys a briefing on the format, how that works, the timelines, but that starts immediately after this panel.
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So I'll make some remarks on that in a minute, but I just want to kind of start with this topic is one stop shop, home ownership on hold, or better than ever. And when we think about being confined to our homes, it's one thing, but home, as we know, is everything. And when I come to events like this and I see friends and colleagues and you can't walk two feet without saying anything, that's also home. This industry is facing a very, very tough moment right now. We know this, that tough moment's gonna probably play out for another two, three quarters. But one thing I know for sure, having been through a few of these, these folks have been through a few of these, A lot of you all have been through a few of these do not ever count out the teams that are sitting here and that are sitting out there, I think we all know this.
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So this is something we don't see in the headlines, but this is the kind of thing, this home, this community is what serves the consumers and will through this cycle and all the other cycles. And that is the theme for this morning. So I just wanted to start with that. So you all are tough as nails, so I do want to give a little round of applause for everybody on that because we have to be fired up here, and that's what we're gonna do today. So, as Eric said, I'm Julian Hebron. I run a sales and strategy consultancy called The Basis Point, but there's some worlds colliding up on stage here today from past lives. But we've got three of these top players that are pioneering this one stop shop model, which is all about zeroing in on the concept of home from the consumer perspective.
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So we're gonna explore a few things. What's a one stop shop? What's included in the consumer experience? What are the economics? Is today's cycle turn changing priorities and how and of course the tech stack. So I have to say a word on each panelist special, just so everyone knows. I think some folks do know. But I'm gonna provide some details. So first we have Zeenat Sidi from, she is the President of all things digital products and services at loanDepot. They were America's number seven lender last year, and the first six months of this year overall she got started Experian in FICO. She set strategy and run scale operations at RBC Capital One, SoFi, and now loanDepot. And she's worked across all key consumer lending and banking categories besides mortgage. So one stop shop, I think Zeenat it is like wired into your dna. so one of the things that folks might not know, she came into SoFi through a company called Galileo, which powers the the any challenger bank of any consequence in this era. So she also knows the tech stack stuff cold too. So please give it up for Zeenat.
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What can I say about Dom? So Dom's, the CTO of Guaranteed Rate, America's number nine lender last year, eighth ranked in the first half of 22. G rate for those who don't know actually did launch the first digital mortgage in July of 2015. This was before the October tri-deadline, and this was before Rocket launched in November of that year. So G Rate was actually the first, but Dom was actually at Loan Depot at the time building the early iterations of the one stop shop, which started with a digital found Digital Mortgage Foundation. And then on his and Zena's, watch has become much more fun fact about Dom in Loan Depot's Innovation Campus down in Southern California. He's the one that physically actually wired that building with green and purple wires, which are the color of the brand. So, needless to say, this stuff's running through his veins too, so please give it up for Dom.
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Last, we've got Rhett Damon who runs broker operations and industry relations at Open Door, which I think it's safe to say, not just pioneered and won the IBU game in America which we're gonna talk about a little bit, but is also a full-fledged brokerage too. And it's just a modernized version of it, which starts with this end to end consumer vision and perspective, and thus was built as a one stop shop from day one. So we're gonna get into a lot of that. But he interestingly did a tour at Guaranteed Rate in their Gateless innovation division. And prior to joining Open Door, he was at realtor.com, where he ran relationships with all the US MLS's, all the associations, the brokerages, and oversaw data licensing and deal making for all of their huge realtor.com is huge product portfolio. So please give it up for Rhett. Heavyweights. So let's do this. We've got two core themes that we're gonna start with. I'm gonna run down the line here. First you guys, what I want to do is start with the question of what is home? And you can define this as you see it as pros that have been around for a long time, or as you define it in your organizations or both. So Zeenat it what is home?
Zeenat Sidi (
All right, thanks Julian. First, thank you for having us in the panel and for the organizers of this conference. Well, Julian, you would know if you go to loan depot.com, the first thing you'll see is our brand positioning, which is home means everything and we truly live that mission. We believe that from a consumer standpoint, a home is not just a means of kind of financial stability, but it's more than that, right? It drives your social wellbeing, your emotional wellbeing and so it becomes really the epicenter around which consumer builds their lives and it has a generational impact. And so from that perspective, this is why Loan Depot's mission is to enable home ownership for Americans and we live that mission every day. But if you kind of zoom out from the consumer standpoint and you look back, the vast amount of wealth creation in this country has been driven by home ownership and 401K investing, and particularly the last few years, as we've seen home values increase, it really speaks to kind of the home being the central driver of all things to enable a consumer to live their lives and to kind of enhance their wellbeing and their families.
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So that's the definition of home that we come from, and that really drives everything we do in terms of our strategies and the consumer offerings that we put forward.
Julian Hebron (
Thank you. Dom, same question, either personally or through your org or both.
Dominick Marchetti (
Sure. Yeah. I'd start by saying, Home is what my wife is trying to get me out of.
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So, I spent it has new meaning today than it did a couple of years ago for me personally. Home was a place obviously family and friends, things like that. Today it's where you spend lion share of all your time. I personally do, so I'm working outta the house for the most part. I work there, I live there, I eat there, and some days I won't drive for two or three days. It's crazy. I think that's true kind of across the us. I think as unit said, in terms of GDP, right? So it represents about 80% in a mortgage debt. It represents about 80% of GDP. So it's central to everything in the economy.
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We have a huge responsibility first to consumers first to allow potential homeowners and homeowners to be in that home, to feel everything that we all feel, right? When you create that home and really to the larger world it's central to how the entire world operates, right? And we have a huge impact on how the economy functions and how everything fits together. The advantage obviously, with what we have with technology is we can make the biggest impact on home ownership than with any other tool or anything that we could do with technology. We have the ability to impact huge numbers of people in a material way. And just to bring it back to what you said, this group here feels like home to me too. I think when you walk around the, the conference halls and you see people, and this is a first time in a very long time that I've got to see everyone face to face. And it just brings it really full circle, . So
Julian Hebron (
That's awesome. Rhett, what is home?
Rhett Damon (
Yeah, thanks, Julian. I love the way you first started, which is like, it's this community. It's one that we've all been in, I've been in it for 20 years. It feels like home every time we get back together. Even where when we were virtual for, those several years at Open Door home is something that we are trying to make accessible to anyone and everyone from their phone with a tap of a button. It's simple, fast, certain and that's what we're committed to doing. So that home ownership is available to everyone. All the services that support that and certainly support our economy and our way of living. It's vitally important. It's a big part of our culture. We're looking forward to continuing to be a part of home ownership.
Julian Hebron (
Thank you. And I'm gonna stay with you, and then we'll come back down the line here. So, second question is, we'll do the quick version of this, the quick answer on this, and then we'll really start getting into the details. But the quick answer it doesn't have to be too quick, but what is one stop shop, Home ownership?
Rhett Damon (
It's gonna be what we're all, what the consumer demands. It started with the opening session, our opening comments and we're all living this world, right? It's I ordered my Starbucks from my hotel room before I left my hotel room this morning. That's where we're going, and that's where the consumers are going. We are the consumers in this room, and we serve all of them. So what's unique for Open Door is we have, evolved as the leader in the I buying space, and that allows us to do lots of things in this, in the context of one stop shopping and ancillary services when the open door is the principal owner of a home that then supports buyers and sellers and serves them in all the things that they need to do in that, in a transaction. So we are always looking at making home ownership in one stop shopping, simple, easy, certain, convenient and that's kind of in a nutshell the way we look at it.
Julian Hebron (
You guys, we are gonna go into the weeds. So Dom, same intro question. What is ones stop shop home ownership?
Dominick Marchetti (
Yeah, so I think, and it was like you mentioned in the opening comments, expectation is clearly a huge driver. Like, how do people expect to interact? What does today look like? I think ultimately at G Rate, we've guaranteed rate, we focus on really enabling originators to strip all the mundane that they're working on and really focus on something that they can materially influence and impact and that is really playing an advisory role. Really solving for the relationship items, it still remains, although it's trite, the largest purchase consumer will ever make, right? And the majority of really everything, all of their assets. So that's a huge responsibility that we all carry. I think a consumer does not want to enter a transaction and wanna make best friends with a title officer, escrow officer.
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They don't want under become best friends with an appraiser, right? They don't wanna necessarily go meet compliance attorneys. They don't care to understand product pricing and eligibility engines and platforms and investors they wanna move into a house. So our responsibility is to simplify that transaction. To smooth out all the friction to not bring them into our world and create a lot of complexity. If we understand it well, we're gonna make it simple and I think that's been a long journey. I think we've made great progress transactionally still a long way to go. It's not just about technology, it's about adoption and to your point, I think the last couple of years have helped in a huge way in terms of driving some of these technologies that have been around for a very long time. But consumers have finally really embraced some of those tools and technologies, and it's forced us as companies providing some of those tools to really drive harder, not just around platforms, but around how to implement those platforms and how we solve for consumer expectation.
Julian Hebron (
Love it, viewing it through the consumer lens. Zeenat!
Zeenat Sidi (
Just staying with that theme from Dom and Rat around the customer experience. I mean, when you think about home ownership, it's not just obviously the mortgage transaction. So the National Association of Realtors, according to them the average consumer spends eight weeks searching for their home. I actually think it might be longer, but the intent to buy a home starts way before in terms of looking for neighborhoods, figuring out where you wanna be. Then you engage in looking for a home, finding a realtor, then you need to get a mortgage. And so when we think about one stop shop home ownership, it really kind of zooms out from the actual mortgage transaction to everything that happens prior to buying a home and nurturing that relationship, helping a consumer qualify for the mortgage, whether it be saving for the down payment, helping them bolster their credit so they can qualify, enabling them to kind of find the home of their dreams, obviously helping them through the mortgage, but then thinking about the needs don't stop there.
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A consumer has needs once they're in their home, renovating their home other financing needs that emanate from that transaction, By the way, servicing needs, right? Maintenance appliances, all sorts of upkeep. And so our view of one stop shop home ownership is how do we enable the entire journey of home ownership and play a role in simplifying that. Just as, Dom and Rat said you'd look at what's happened in, whether it's transportation or food delivery or shopping, the expectations of a consumer have changed, and they're looking for a simple, intuitive experiences. I think we as an industry have a big role to play and can really drive that experience.
Julian Hebron (
Absolutely. So I want to, let's go into the next segment. So the next two segments are the customer experience elements of a one stop shop and then prioritizing for this market cycle. So let's stay with you for a sec, and as we go into the details, but now we can kind of open it up here and get into it. but Zena, let's have you sort of comment on what's included in the one stop shop consumer experience as a complete vision. I'm not zooming in on the companies at the moment. I'm zooming in on it as a complete vision through the consumer's lens, going to Rat's point and Doms, which is what are they thinking? What is in it? And you can rattle them all off and all the types of services. And we can maybe start there, or you can do it however you want.
Zeenat Sidi (
Again, just picking up on what I was saying, when you put yourself into customer's shoes, they start with going online. 75-76% of consumers start their search online, and that's where they find their home. And so really that buying the property or finding the property begins with that. But then there's a whole element of financial kind of education and literacy that comes with that do you qualify? What elements do you need to be able to get your mortgage? We're thinking about that and I think that enables the customer experience so that they're prepared once they're ready to purchase the home. Obviously then enabling a digital mortgage experience that's convenient, it's seamless. It doesn't take weeks or God forbid months. But then once they are a homeowner, as I said, when they're engaging with whoever the servicer is there's a whole lot of information sharing that's happening there, and subject to privacy and compliance.
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I think there's an opportunity for us to then leverage that information, detect customer preferences, and be able to proactively go out and say, Julian, I see that you may have a need for this, or you'd like to do this. And then either providing that or enabling that as part of an ecosystem to help you enjoy your home ownership, to take the stress out of that. But then, proactively anticipate what your needs would be around not just your home ownership journey, but overall life needs, but then take that relationship to be able to assist them with that. And so when we think about all of these elements starting from home search to financial wellness and literacy, to the actual transaction, to then other financing needs, and building a partner ecosystem that helps them enrich that that home ownership journey is how we view home ownership ones stop shop.
Julian Hebron (
I want to take that and Rhett, I want to go to you for a sec, because I think your pla the Open Door platform is one where folks do start with the home, in the core mortgage space. This was Zeenat it's opening remark on her answer is like, they're starting online somewhere and they're often starting with the home. That was the opening thesis for Open Door, correct? Like, we're gonna focus on the home, we're gonna kind of redo this model a little bit, and then the additional one stop shop services grow as you scale. Is that true or not true?
Rhett Damon (
That's very true. Again, with Open Door being the principal owner of the home, I mean the service was Mr. & Miss Seller. Let's strip away all the inconvenience and all the complexities and all the uncertainties of selling your home and sell it to Open Door, fast, simple, certain you even get to select your move out date, we'd like to say. You choose when you want to close. We actually recently have started kind of a concept called late checkout. So you can close and then move out five days later. So the concept of just that is the origination of Open Door, and it scaled to the point where we are today, which is even though I buying transactions represent still a small percentage of the market less than one and a half percent, if you look in total the demand is there in every market that we launch instant demand for folks saying, Hey, yes, I'd like you an offer from Open Door because that has proven to be a valuable service that then allows us as the owner of the home to consider what those one stop shop and multiple facets of transactions looks like what it can be.
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And it's always based on what consumers are are wanting. For us, initially, it's,title, other services, title mortgage, but it can be many other things. Insurance, warranties, remodeling, vendor management an open door own home and a transacted home could result in many other services that have yet to be discovered. And I think we'll see how consumers demand those. So that's kind of the unique position that we are in today is being the leader in that space of of home ownership and in the platform of creating the ecosystem to allow lots of different things to occur.
Julian Hebron (
Thank you for that. And I would put this one to all three of you. I'll rattle off a handful of things and you guys can kind of react to like, is this part of the one stop shop, home ownership vision or not? So mortgage real estate, which is both I buying and brokerage, of course HeLOCK, he loan personal loans, home improvement appraisal title, home services and repair. Zena, you alluded to a few of those. Then I have a question, what else am I missing, including non-mortgage and or banking products, that kind of stuff. So when you all think about this from a long game perspective, and we did want to talk long game coz we've all been working on this through full cycles. Are those all the components? Do you wanna comment on any of the components? What components are missing?
Dominick Marchetti (
So without being overly theoretical, starting with the analytics, right? So going back to GDP, so mortgage represents 80% or so, or consumer lending and mortgage, and of that 80%, about 80% is mortgage. It's clearly one of the highest revenue products, which gives us budget to do some pretty cool stuff. We can go buy a bunch of data, we can use single source validation and then it back to our obligation to a consumer. So how do we present timely, relevant, predictive offers to them? So we're not bugging the heck out of them, we're actually serving them in a way that actually makes sense is kind of where I'm centered and we're guaranteed rate is centered. I think it's really important to say we're anchored as a mortgage lender, right?
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That gives us the ability to be great there first, and then it allows us to continue to expand our, or influence to solve other problems that the consumer may have. I think the easiest answer is, well sure it includes all those things and probably a lot more our customer is a potential homeowner who's everyone, right? So it's easy to get broad really fast. I think it's really important to stay anchored around where you can have the biggest impact, where you can drive budgets. And with budgets we can do some pretty fancy stuff. Two required movies for my team. We make everyone watch Minority Report. Not in a creepy, weird way, but how do we be predictive, timely, relevant, and the great hack, right? How can we do that in a non Cambridge Analytica, go to jail kind of way, but do it in a positive make a positive impact on consumers. And I think, again being anchored with mortgage, driving budgets for mortgage, serving the largest purchase a homeowner has, and then being able to thoughtfully expand so guarantee rate recently has launched HeLOCK, we've launched consumer loans. And all those naturally sort of expand from that first foundation in a real relationship that we're driving with a customer.
Julian Hebron (
When we used to work together at Depot, we used to sit around as a management team and talk about mortgages very much the hardest sandbox to play in. So I still very much appreciate.
Dominick Marchetti (
If you could make it there, you can make it right.
Julian Hebron (
That's right. Zeenat, go ahead.
Zeenat Sidi (
The only thing I would add to what Dom articulated beautifully is the notion of trust, right? And any financial transaction, particularly mortgage, which for many consumers is the most complex, the largest transaction that building that relationship of trust is critical. And so to his point let's solidify the foundation and build that relationship of trust so that we give consumer reasons to come back long after that transaction is complete. And then it's not about throwing everything in the kitchen sink, but because surely all the things that you pointed out are critical, but being very deliberate about where you can truly add value to that relationship, either directly or through other partnerships and be customer driven. In terms of you have the data to be predictive and anticipate, but you wanna be guided by what your customers are expressing as a core need that is not being fulfilled elsewhere.
Julian Hebron (
Yeah.
Zeenat Sidi (
Then really honing in on that.
Julian Hebron (
So on the core need thing, you all teased publicly also a a HeLOCK product that's coming. So are you able to do any teaser on your approach to that? Because it's obviously a very hot topic with record equity. And I would just, before we go interject my own view, I wanna be very clear that this is the basis points view and not any of these organizations, but that too many, again, of the headlines, we're starting to see prices finally turn after home new and existing home sales have slowed for a number of months. But I think we are still gonna arrive at a systemically safe level, even with certain markets turning and coming down a little bit. First you have home sales slow, then you have appreciation slow, then you have certain markets that start to come back off of very sky high levels of the last two years. So I just wanna preface any Helock discussion with, I believe we're still in systemically a safe market looking forward in the few years ahead. So with that said though, do you want to tease any of your approach to Helock?
Zeenat Sidi (
Yeah, absolutely. So let's first talk about the why, as you mentioned and this audience is not foreign to this, but I just recently saw Core Logic's latest data around equity growth. And just to kind of, start with that just in a year we've seen a 28% increase in equity appreciation. Year over year. And we have the average consumer sitting on about $300,000 in equity in their home. So back to my earlier comment about wealth creation sitting in kind of their home and overall we're talking about 2.6 trillion 3.6 trillion in home equity. So the why in terms of you've got the ability, especially you couple that with an inflationary environment and rising interest rates, the consumer need really hasn't changed year over year. There is a need to live their lives and that drives financing needs.
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And here's a smart way and I'm no lawyer, but, every consumer has to do their homework, but a potentially smart way to access that equity to be able to consolidate debt, finance, major purchases, renovate their homes, whatever major project, it is accessible. So then we talk about the how, and this is as you alluded, we mentioned this publicly earlier in the year about building a digital helo product, which we're very much in the process of doing right now and hopefully launching in the near future. And our approach to this was not to start with an existing traditional process that we could just tailor to home equity. We could have done that very easily and been in the market sooner. But we started again with what is the expression of the need from the customer in terms of the experience that they're looking for and where is the real value in this?
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Because there are outlets for home equity today, but what differentiates us and how can we uniquely be in a position to serve those needs in a way that resonates with customer needs? So we started our journey of building an all in digital HeLOCK product end to end and this is really leveraging technology, leveraging data, working with a few partners to be able to build that experience that enables the consumer to, in a very intuitive and simple way, apply for the home equity, get qualified for it, and then actually have access to that cash in a re in record time and so we started by defining that experience and we've been busy now building out and executing on that vision, and hopefully we'll be in market shortly.
Julian Hebron (
Dom, you had mentioned it as well, so is there anything about the G rate HeLOCK product that you maybe wanna underline?
Dominick Marchetti (
Yeah, I think back to expectation and what Zena mentioned in terms of how it ought function, our product that we launched to market again is now a few months ago we've seen a lot of volume, a lot of traction, right? There's a huge consumer demand. There's not much of a backend appetite yet. people are still trying to figure out on the capital market side, what that looks like in the safest way, in the most risk adverse way possible, obviously. But the critical aspect of it is real time. It's done in an a hundred percent digital environment, right? So there's no paperwork, there's no anything that goes, it's a hundred percent digital from the beginning to the end, totally automated.
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And I think that ultimately, some of those new tools and capabilities really help us to figure out how to make some of those, approaches more mainstream as it relates to even the core mortgaproduct. I don't believe in big bites, kind of lots of smaller bites, but, maybe that appl to conventional conforming, things where there's a really solid backstop, as opposed to,further out, kind of jumbo and, not NQ type prots. but yeah, I think there's, it's critical t they're done in the most modern way possibleight? To leverage all the to and capabilities that exist.
Julian Hebron (
I'm gonna just tie off this HeLOCK bit, cuz I think it's really important. And then re I'm gonna go to you on, on a question that's related to the set of services, but,there's so many data sets and as we know, the consumer finance media then sort of reflects whatever data set was shoved in front of a journalist at any given time, and they don't necessarily know how it's all connected. So I will offer that I do like Black Knight's tap of black equity measure because it's an a CTV cap on tapable equity two Q we all know this, but I'm just gonna state it as we tie off this HELOCK bit before we start. All contending with the home is an ATM machine, again, which is nonsense, 11 and a half trillion in equity as of two Q 5.31 in new equity just from pre pandemic to present.
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So if home prices come off a little bit at 80 cltv, we're still in a very good place that's the right approach for consumers. So I just want to offer that because we're all gonna contend with these headlines and they will start coming and as we said over the next couple, two, three quarters, we're gonna be contending with this. And you can't get deflated by the headlines that your consumers are feeling like, oh, everything's gonna crash. And it's just, we're not, we're headed, I believe towards more of it's gonna be bumpy, but it's gonna be as soft of a landing as we could have coming out of a global pandemic. So now Rhett, I want to go to you on which of the services are most important either for lenders or for a business model. So example, are adjacent services in your business model mostly about consumer experience or is it more about full cycle diversity of your business model?
Rhett Damon (
Yeah, I think it's certainly first and foremost consumer experience, right? And we've again proven the given the NPS score for just the acquisition piece of the business, right? Which is like how we started in 2014 serving the seller and saying, Let's make that easy. That's a proven and well and successful product. Then from that, again, it's like, where else can, and back, I was thinking earlier several points. We all have to choose to be good at something. We can't be good at all things. And that think that's where in this one stop shop conversation, it's a combination of the things that companies build and become good at at open door. What we've proven to be good at is valuation the creating the capital market to support the ability to buy homes and then having the operational expertise and knowledge among teams, many people to execute on that.
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So within that ecosystem I think we then determine, okay, where is the next piece? Certainly we operate title, we operate mortgage but as we said before there are many things that consumers will continue to demand as part of home ownership and given the macro that we're in, what we know is that things have certainly changed and adjusted, but people will still buy and sell homes. Transactions are still gonna continue to occur. And we're prepared to support those transactions in an upmarket or a down market based on what's been built. And through that there may be other services that evolve that consumers demand.
Julian Hebron (
And so, just to clarify, cuz now I want to go into prioritization. So just, I'll say this and you guys have to make sure that that you're keeping me correct here. So predominantly I buying and brokerages is core focus predominantly mortgage for both depot and G rate, but with an I toward certain mortgage housing related adjacent services and then potentially expanding there, is that the core of it, the most part? Okay, so, but then let's go into this in terms of how the cycle turn changes priorities. And my question is, and I've spent a lot of time working on this stuff, do the elements of a one stop shop that we just sort of laid out need to live under one ownership roof? Or is it more that the technology is threading it all together for a singular experience? Dom, since I interjected the technology thing, I'm gonna start with you there.
Rhett Damon (
If finally a technology question.
Dominick Marchetti (
So in simple terms I think again, centered on consumer experience, it's a pretty simple problem? So you have someone, a consumer, they're interested in some for some reason. What is that reason? How fast do you want it? How much do you want? Do you happen to own a house? Yes or no? And I think with some of those simple questions we can figure out how to best serve consumers and what product, right? They would basically go down I think about it like the giant Plinko board in the sky, right? So how do we evaluate customer need very quickly. And then how do we route them to the best available sort of product or service? We've demonstrated as an industry, right, generating what about 4.4 trillion last year that we can move some transactions, we can scale up into a market even amidst the pandemic, right?
(
And we can get transactions done. I think as an industry, that's something that we've done really well. Technology aside, it's combination of people, it's process, it's tech, but we figured out a way to do a whole lot of volume in a short amount of time. Ultimately, I don't think those systems necessarily need to be one behemoth, giant monolithic system, right? So if we're able to kind of route where a consumer ought to be and we're able to connect the dots between, is it best to serve them with the HeLOCK, Is it best to serve them with a mortgage? Is it best to serve them with a consumer loan? Is it best to serve them with some new product I'm not thinking about, and then relate them all. I think what I'm seeing as a major problem and something as, sort of a major driver today is transaction again, we've done a decent job, I think this conference, digital mortgage, right?
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Driving consumer experience upfront. I think ICE has done a, a generally a very good job on, on making moves transactionally black night, others companies like Gateless helping automated underwrite, great transactionally moving the ball forward. Where we have this huge gap though, is how to actually serve a consumer. There're very few systems there's total expert I think's done a pretty good job on, on the front end of saying how do you manage and organize and become like a customer operating system for leads, right? For consumers? Where do you put all that data that we're collecting, that we're managing, that we're spending all this money on that transcends a single transaction? And ultimately I think that's kind of the missing piece in enabling kinda like you said, how do we enable one stop shop, not about the transaction, we do that well, but how do we actually transcend that and elevate it so that we again understand what a consumer is doing, how to leverage data in more material way, How do we do a better job, right? of giving consumers choice in terms of where and when they expose that data. Again, right now, very centered on the transaction and there's very few companies I think that are doing that well, that are elevating the consumer to a point where you're looking at things across all transactions.
Julian Hebron (
Zeenat, I saw you nodding, so I'm gonna let you pick up on.
Zeenat Sidi (
Have a lot of thoughts on this topic.
Dominick Marchetti (
I know we're not getting cut off.
Zeenat Sidi (
Time limitations. So look, it's not technology for the sake of technology. I mean, you can build cool DA gadgets and we have, but I think back to my years in FinTech and what I have really learned there, Julian, is they, these, it starts with kind of this unrelenting, unwavering, obsessive focus on the customer experience and the pain point and what is it that we're trying to solve. And a lot of tech companies in this financial services space that in the last few years have really dominated and done well is because they took a problem and they identified a pain point and they went all in and then leverage technology to solve that problem. It wasn't about, Hey, I've got great technology, what do I build? It's starting with that. So that's number one.
(
Number two is my experience, and I'm not an engineer, but just as,someone who leverages technology to build businesses. one of my big learnings having spent the last few years in kind of FinTech space is, again, not to generalize, but I think in this industry broadly, we have started with this desire to like build in house. And there's definitely benefits to that because you get, you control your destiny, right? You own the experience and all of that, but it comes with some trade offs. And over time, what we realized is that you don't necessarily have to own the end to end, like focus on the part that truly is differentiating and additive, which tends to be the customer experience part or the specific pain point, and then partner with others who have built the technology and have the specialization and the commercial capability to add that is not the differentiating aspect.
(
And then the power is in bringing these two together to be able to go to market with something that that lands and resonates with customers. That is it varies, but I mean, again, not to be self critical from an industry standpoint, but, we have generally taken industry solutions and then customized them to such a degree that there was no benefit in actually leveraging an industry solution. So I think we've gotta change our mindset and we've gotta think about how to build a platforms so that you don't hard code everything in, like you've gotta build, just like the auto manufacturers, Like what is that common platform that can be leveraged for different models and car types. So you build that and then you abstract above that to build the things that you kind of need to be more nimble and agile around.
(
And those are some of my learnings, coming out of my past few years in terms of how we're gonna really take bites out of this and be able to advance. And finally I'd say in this environment, and I always say it's to my teams, like never let a crisis go to waste. We're an environment. It's not a matter of it's when we will come back and then we don't wanna be, again, back to kind of throwing all sorts of manual labor at solving high volumes. Let's be smart about taking this time to actually build a technology. We've got majority of this audience representing companies that have built amazing solutions and we're in a unique position to be able to leverage that, take this time to engineer the right solution so that when the cycle comes back again we're ready and we're smarter with how we solve that.
Julian Hebron (
And so re I'm gonna come to you on another question, but Dom, I do want to go back to you for now on this and stay with this for a second because do you also believe that, I mean, you kind of touched on it, but I just want to clarify because I think that both depot and Grate are examples of great brands that are extremely brand forward, but what's going on under the hood isn't necessarily fully proprietary?
Dominick Marchetti (
100%. Yeah, two follow ups to what you said. I don't think this is mine, but I've made it mine sort of by commodities and build differentiation. So I think really staying focused around consumer experience workflow and then how to be really thoughtful around how to leverage a lot of the great great providers in this room as well,whether it's data or capability, but ultimately if you own consumer experience, you own the ability to kind of drive workflow all of those underlying capabilities can help you so much faster and defer a lot of really brilliant people that are focused on a, on a singular kind of function or a series of singular functions,will make all the difference.
(
I wanted just one more quick follow up, and that is again, as I think as an industry, we've done an amazing job in terms of the relationship that originators are, are driving with consumers. Personally, I don't expect to take anything away from that just really enhance it and how to really put a magnifying glass and help them be way more effective and in the same way, right? So how do we strip off the mundane, how do we allow originators to lean on commodities, right? Tools that are best in class many of which are represented in this room, and allow them to do what they do, which is best in class, right? And I think it all kind of fits together that way.
Julian Hebron (
And related note, when we think about extremely brand for and coming at it from what's the consumer doing, I was very intrigued by Open Door this summer signing a deal with Zillow. So can you just comment on that for a second and what it's about and what it does from a customer acquisition standpoint for you?
Rhett Damon (
Powerful partnership really between Zillow and Open Door. And I think we all saw many people were shocked when that was announced because it's two large brands that have disrupted kind of the traditional real estate side of the business who for a while were competing. certainly and certainly that was they were very much on our radar and but yet differently, because the services that Zillow offers and the services that Open Door, Open Door started differently certainly than Zillow. But what I think really to look at it is like what it represents, right? So it represents a change in the business of real estate, in the business of brokerage, certainly because you have these two organizations now that are also brokers, real estate brokers members of MLS's, giving them the ability to do things differently than certainly what Zillow was before, which is more of a portal, an advertising platform a a place where agents could buy leads and things like that.
(
So I think what it most represents and what it says is Zillow exited I buying and yet they partnered with the largest IBU to introduce I buying to more sellers. I mean, that's really the takeaway. Zillow has a very large audience, the largest consumer audience in the real estate space. And now that audience will be introduced to the option of selling their home to open door and educating them on that option and what that looks like and all things kind of around that. So it's definitely was a surprise to a lot of folks. But I think we're working very hard at integrating the two organizations and and delivering on on that partnership.
Julian Hebron (
I just thought that was the best recent example at scale of coopetition, frenemies, whatever you want to call it. It's just in service of the consumer and a singular experience. So to me, it was just like a line in the sand on the long game of one stop shop home ownership at the largest scale. So I thought it was worth underlining. So we're getting a little close on time. There is something that we want to close out with, but before we do that, I also want to do another quick question in very rough terms. It's fine. But how much of your current roadmap, technology wise priorities that you all are working on are focused on consumer facing versus team member facing technologies? We'll just run down the lines starting with Zeenat.
Zeenat Sidi (
In fact, we just spent time this week as a leadership team reviewing our priorities. And I will tell you that outside of things that specifically our related to regulatory compliance, privacy, things that are really important elements of running a quality mortgage business, everything else I would say was geared towards customer experience, everything and you can argue while quality. Well, if we do a good job with quality, it enables actually driving a better experience because there's fewer errors, there's fewer touches on a file, it's a better experience, lower cost, which we can actually pass back to the consumer in terms of value. And so that was the vernacular we were using as we were prioritizing amongst a long list of things that we wanted to do and doubling down on things that we really feel are gonna drive the customer experience.
Julian Hebron (
Yeah, Dom!
Dominick Marchetti (
I would say it has to be said, right? This industry's not for the faint of heart. I don't want to be callous about the amount of people that have exited the industry or, kind of all of our respective companies in terms of the cyclicality in our space. That being said, like you said earlier we're really focused around how to make sure that that we're prepared as a company to really drive efficiencies. Those efficiencies have huge dividends on the front side of a consumer experience as well, right? In terms of price, in terms of reducing friction, all those things. We measure things kind of four ways at guaranteed rate. It's either revenue driver, right, expense reducer, market share, or must be done right, regulatory compliance, that kind of thing. And I'd say we're pretty squarely 25% across all four of those and we make it kind of a mission to stay centered there. That being said, again, there's maximum pressure on, on efficiency and how to be really thoughtful around how to serve our employees too during this downturn and how to make sure they're well situated.
Julian Hebron (
Yeah, I love the term maximum pressure because I know when you say it, how high that pressure really is, but it's all the right pressure's to serve the sales team, so I love it. Rhett?
Rhett Damon (
Yeah, definitely the, this macro and the downward pressure I think is focused on everyone to even become more efficient in the way that we operate. certainly we are consumer focus and kinda lead with consumer given the brand and how it is presented. But as I had said earlier, like our core being able to execute in an upward down market is valuation and efficiencies, and the ability to iterate over and over and over again, right? Acquire and then sell. And so there's a tremendous amount of resources and focus on all of our internal teams and operational teams and the folks that we deploy in a market. We're now in 51 markets large cities in the US and anytime we deploy a market, we deploy people in the in the field going and out of homes, vendors working and supporting on those homes. And so the efficiencies around that is key. The tools that we build in house, most of our tool are built in house to make those teams much more operationally efficient, is critical. So we focus a lot on that. And again, we're constantly retooling and focusing on our evaluation model because that's the core of our business. So it's a good balance between both consumer and internal teams.
Julian Hebron (
Got it. All right, so we're tight on time, so we're gonna do short answers, but it's a simple question and close us out and bring the whole thing home. So we'll just run down the line. We'll start with Zena it and do it like 30 seconds or less on. Do you believe, and this is you, you don't have to rep the org on this one. Do you believe that the American dream of home ownership is permanent or waning?
Zeenat Sidi (
Definitely permanent. I mean, I think we've seen a great example of going through one of the toughest periods that we've been through the pandemic and that has created a perfect storm where people have realized that home and to Dom's point home is now more than just a place you go to after work. you're representing all aspects of your life in the home. And given what we've seen and the freedom to now with many companies be able to work where you want that lifestyle kind of adaptation has in fact, in my point of view, really fostered and strengthened the the home ownership kind of aspect. And the last point I'll make is that as we look at the next generation, which are actually driving a large part of first time home buyer statistics, as we know they are definitely seeing the value and there's different flavors of home ownership in their mind. But to me there's definitely a group that values freedom and not being tied to any asset, but more and more, I think from a wealth creation, from a just the, all the aspects outside of financial wellbeing that come with owning a home, I think we're definitely seeing that increase. And in my point of view, it's only gonna get stronger.
Julian Hebron (
Dom,
Dominick Marchetti (
Yeah, the question's kind of foreign to me. I'm a growth minded optimist, right? Like, I can't see it any other way. I love the industry I love what we do. I I love the opportunities we create for individuals. Like, there's no other answer. Like it's on the rise. It forever will be.
Julian Hebron (
Rhett?
Rhett Damon (
Definitely permanent. I think I would just add to that, the ability to transact and buy and sell with the tap of the button with ease, uncertainty is just the caveat to that. So permanent and multiple.
Dominick Marchetti (
Yeah, we just have to hurry up. That's all.
Julian Hebron (
So, and you guys is one stop shop, home ownership on hold or better than ever. So there's your answer. You just got it. It's better than ever and it's not, and the long game is stays any of the headlines that we all see that your consumers hammer you with. It stays and it's eternal. So don't go anywhere coz I wanna make some announcements and direct your attention over to the other stage here. But I just want to have you all give a big round of applause for our panelists.