(upbeat music) - [Narrator] This is Carolina Business Review.

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- Recently, like many of us, I was scrolling through some smiling photos of friends on social media who were vacationing in exotic locales.

They had the earmarks of a trip of a lifetime, a thousand-watts smile, exceptional views, great food.

The only problem was, and there's certainly no judgment, but that scene stood completely in contrast in my mind, given the epic discomfort and suffering of people in the western part of North and South Carolina.

Welcome again to the most widely watched and the longest running program on Carolina business, policy and public affairs.

I'm Chris William.

We're here every week to observe, discuss, unpack issues at hand in our region.

And as business and communities in general soldier on, mostly across the Carolinas, our friends in the upstate of South Carolina, and certainly in Western North Carolina, struggled to redefine just what basic life from day-to-day looks like.

We will not delve too far into that on this program right now, but we will keep it as part of our dialogue in discussions for quite a while.

In a moment, we start with a new dialogue again this week and later on, Pierre Naude', Chief Executive Officer of FinTech Star Performer NCINO.

- [Narrator] Major funding also by Truliant Federal Credit Union, proudly serving the Carolinas since 1952 by focusing on what truly matters, our members financial success.

Welcome to Brighter Banking.

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And Martin Marietta, a leading provider of natural resource-based building materials, providing the foundation on which our communities improve and grow.

(exciting music) On this edition of Carolina Business Review, J. Brannen Edge III of Flagship Healthcare Properties, LLC, Carl Blackstone of the Greater Columbia Chamber of Commerce.

And special guest, Pierre Naude', CEO of NCINO.

(exciting music) - Welcome again to our program.

Not to be too flippant, and I'm not going to be flippant about this, but Carl, Brannen, welcome to the program.

The gravitational pull of not just the scenes coming out of Western North Carolina, but upstate South Carolina are, amazing is an understatement.

In general, we all have anecdotal evidence and the stories and friends and the videos that we see and our mouths drop, but in general, what's the sense of the impact morally but also economically that you hear about?

- I mean, the short term is we got a lot of rebuilding to do, right?

I mean, just getting the infrastructure back to where people can live their daily lives, electricity and the water going back to places, it's just gonna take some time.

Fortunately, South Carolina was spared compared to what North Carolina had to deal with, but we've still got a lot of folks, especially in the rural parts of the state, it's still without power after 10, 12 days, so it's gonna take a little bit longer, unfortunately.

Well, the good news is we've got people there and the resources are committed to get those folks back, their lives back to, close to back to normal as they can.

It just takes a little bit of time.

- Yeah, and you've got interests in Western North Carolina, right?

- We do.

We've got staff there and we've got patients there and we've got properties there.

And it's hard to believe that even after two weeks, the toll of that has not even been calculated yet.

- Right.

- And the loss of life is significantly understated right now.

And that's gonna come to light over the coming weeks, sadly.

- We've got roadmaps and there are a lot of references to other storms that have happened.

Katrina obviously comes to mind and people said, this is the Katrina for the Western Mount or for Western North Carolinas and the mountains of the Carolinas.

We also have a roadmap in that Hugo came roaring on through Charleston, I mean, took out every palm tree in sight among homes and businesses and residences.

But you made an observation before we started taping around the rebuild of a place like Charleston, that's historic.

And there is hope, there is optimism?

- Absolutely.

I mean, you think about, I don't think Charleston would be Charleston today if it was not for Hugo in the sense it gave the city planners the ability to start thinking proactively of what they want Charleston to look like post-Hugo.

And you have this mindset, it's just devastating what you're having to deal with and you're thinking about how to just do the mundane task of a day.

But you've gotta have the city leadership and the local leadership to start thinking, all right, we know we're gonna get through this, but what do we wanna look like?

How do we want to grow?

How do we want our downtown to look?

How do we want this region to look?

And I think the folks in Aiken and Greenville and Spartanburg, all the way up into Asheville are gonna have those same conversations.

And the good news is there is a path in other places that have done phenomenal work after devastating storms.

- Carl, and not to be insensitive, and I'm not saying you are, but it's hard to imagine Chimney Rock.

- Yeah.

- That is all but gone.

And the mayor has said, "We're not gone, we're gonna rebuild."

But it's hard to see that now when you've got people that are still stunned.

- Right.

And it's going to have to take, it may not be today, and it may not be tomorrow, but you've gotta start rebuilding.

And once you start getting that mindset of rebuilding, it's not, "Can we rebuild what we had?"

It's, "What do we wanna look like?"

And that is a great opportunity for them to say, "We're gonna be better and stronger than we were before.

Obviously, we're gonna respect what we had in the past.

We want to continue to do something similar, but we're gonna build it back better."

- Well, and the beat of business does go on and we don't wanna be insensitive to that.

But I wanna unpack a couple of things, especially with you, Brannen.

You've got of, course, healthcare and real estate and commercial real estate and healthcare in both Columbia and Raleigh, in the State House and the General Assembly in both states, they have been back and forth with what is called the certificate of need for hospitals, getting the approval from lawmakers to build hospitals.

South Carolina's gotten further along.

North Carolina's still getting to that point.

Does that factor in to healthcare sites that are outside of hospitals?

- Absolutely.

So, CON, the certificate of need, is state-by-state and 50 years ago it was in all 50 states.

And then slowly over the last few decades, it's kind of retraced how prevalent it is.

It governs not just hospitals, but also high dollar medical equipment, so large imaging type equipment, scanning equipment, surgery centers.

So you can't just, in a certificate of need state, you can't just put up a surgery center, on any corner without approval from the state.

That's starting to lessen and will lessen even further next year in North Carolina and all but the smallest counties in the state, so absolutely.

- Let's go a little bit deeper, especially in healthcare.

It seems like healthcare is bulletproof or is certainly recession-proof because just 'cause of the spending on healthcare for Americans and in the Carolinas with all the retirees moving in.

Is there something though that you watch, that you say, "Yeah, but that thing could undo or at least sideline growth."

Is it whistling past the graveyard for you on any issue out there?

- Yeah, great question.

And I don't think anything is recession-proof.

I think healthcare and healthcare real estate's recession resistant and you mentioned retirees.

We track the growth of the senior population and all the markets that we're invested into because disproportionately, they're using healthcare exponentially more than the average American.

I think some things that could derail that are just runaway spending in healthcare.

I mean, costs have to be constrained at some point and there's not been a great way to figure that out.

And insurance, we talked about with the hurricane and the impact of insurance, well, we're heavily invested in not just the Carolinas, but also Florida.

Runaway insurance costs are gonna impact things.

- Okay, all right, I'm gonna come back to you on something else, but I want to ask you this question around politics.

- Yeah.

- Whatever happens in a presidential outcome in November and again, this is a blanket statement.

It'll sound ignorant, which I am in many ways, but does an outcome even matter to a state like South Carolina?

- I think it's a foregone conclusion what's gonna happen in South Carolina?

What happens on the national level could impact South Carolina.

We've punched above our weight in so many years on political stature, political influence.

If Trump does win, does that mean we have a vacant Senate seat or does he pull people?

Do we reshuffle the deck in South Carolina based upon who gets elected?

That's where the interesting thing comes in South Carolina.

I think it's a foregone conclusion who wins here, but if there's a Republican winning, do we reshuffle and grab some people from the federal level?

- So it's really more about influence on the federal level.

- Correct.

- For South Carolina.

It's not gonna change the DNA of the state?

- No.

- In any major way?

- No.

- And then back to your, the question with you, if there is a Trump administration, does this change the calculus around healthcare funding that flows down to States?

- We're agnostic in terms of who is controlling Congress and who is in the White House.

Healthcare is now viewed as a right for most Americans.

And so access to care is not gonna be rolled back.

Even if you get rid of Obamacare, it is not gonna diminish access to healthcare, I don't think.

- Okay.

All right, gentlemen, stay with us.

We're gonna bring our special guest in just a moment as we talk about the effect of Helene, the effect of storms, past storms.

There is no other company more on the point of that spear than utility companies.

And it certainly means Duke Energy, but also Dominion in South Carolina, Santee Cooper, et cetera, et cetera.

Coming up on this program is the newly named president of Duke that is a breath away from the CEO job, but his name is Harry Sideris.

Harry will be sitting out here on our set and you can bet that he will be talking about how Duke has met this challenge.

But how they fund it, it's not any small replacing a few broken lines.

This is a major effort.

And Harry Sideris from Duke Energy will be here to talk about that.

And also the secretaries of transportation in North and South Carolina both are on the point of the spear, as well.

What does DOT do around infrastructure following storms like we just experienced.

Both Joey Hopkins from South Carolina, DOT, as well as Justin Powell from North Carolina, DOT, will be guests on this program, as well.

Wilmington, North Carolina has emerged in the last decade or so with quite the critical mass around innovation in tech organizations for sure.

Our guest runs a global FinTech company with the headquarters in Wilmington, but also has operations in Spain and South Africa, in Australia and Japan and a few other countries, as well.

Virtually joining us now from his office in Wilmington is nCino chairman and Chief Executive Officer, Pierre Naude' Mr. Chairman, welcome to the program.

I hope you have a view from Wrightsville Beach, or certainly the beach from your office.

Do you?

I hope?

- No, I don't.

We have to work here.

We can play afterwards.

(both laughing) - Yeah, but it's probably not far from your office, but Pierre, welcome to the program.

Pierre, let's start with this idea of FinTech.

10 or 15 years ago, FinTech was seen as quite the, I'm gonna say the dark disruptor of traditional banking, that many were worried that it was gonna undermine regulatory oversight, that it was going to increase instability around platforms, around banking.

And here we are 10 or 15 years later, and it seems like you're becoming part of the fabric and certainly in the DNA of banking as you grow in joining partners around banking.

How would you characterize what it was like then and what it's like now?

- Yeah, thank you for having me.

The first thing you have to realize is when FinTech came up, it was seen as an alternative to banking and I think it's morphed into more of a compliment to banking as opposed to an alternative.

The second thing is that these independent companies like us could move at a pace that banks cannot because of our innovation, mindset, our DNA, et cetera.

And then the third big technology shift was the cloud.

Bankers are conservative, it's highly regulated, and so we could innovate on the cloud at a pace much faster than the banks.

And then we started applying the technology we have to the banking industry to actually make them more efficient, more customer friendly.

And the banks that embraced that early see tremendous returns and efficiency because of that cloud transformation, the flexibility they have and the more consumer-friendly products they can offer.

- Pierre, how do you answer regulators about the safety of cloud banking and not just given day-after-day thousands of attacks by bad players that are trying to break into banking and we certainly can provide statistics, but I'm sure you know 'em better than we do.

So how do you answer US regulators to say, "No, we're just as safe.

No, we're just as secure, and maybe even we can add another level of safety to what you're doing in your back office."

- Yeah, that was a massive challenge in the early days to convince people we could be as secure and safe.

It starts with a platform you select.

We run on a combination of AWS, as well as the salesforce.com platform.

And what you have to realize is that these platforms can spend 10 to a hundred times more on security and safety than what a single bank can do.

So actually, the resources we have on that platform around security, customer data protection and data residency is much higher than what any single bank can do.

So I would tell you, it's actually a more safe and secure environment than what banks can do individually.

- [Chris] Okay.

All right.

Carl, question?

- Pierre, nice to meet you.

You're a global company based in Wilmington.

What are the benefits of being a large employer, a large tech company in a mid-market, East Coast city?

- It's a fantastic place to do business.

When I asked to do this and started making the business plan, the first thing I realized is there's a lot of underutilized people in markets like this.

And so it was a tremendous opportunity to attract people from the local market that I would say were slightly under-compensated and had all the potential as long as you let them lose.

The second thing is people think you have to be in Silicon Valley or Austin, Texas or Atlanta.

The problem there is there's a few people chasing a lot of jobs.

So in tech you have a 20 to 25% turnover of staff, which is tremendously disruptive.

- [Carl] Wow.

- If you look at Wilmington, our staff turnover is between six and 10% because it's a high quality of life, cost of living is better than those big cities I mentioned.

And then you've got a stable employer with a global opportunity is very attractive and we've been very lucky to pull people from UNCW, from Charlotte, from ECU, et cetera, and just build a tremendous group of people here to innovate.

- [Chris] Brannen?

- Pierre, nice to meet you, and couldn't agree more about Wilmington.

We just bought our largest asset ever in Wilmington last month, so certainly agree with that.

Henry Ford is famously, the quote was, "If I were to ask the customer what they wanted, they'd say faster horses."

Banks are not normally on the cutting edge of technology.

How do you balance giving them what they're asking for versus kind of taking them to the next level and kind of bringing them into the future?

- Congratulations with your investment in Wilmington.

You'll be pleasantly surprised by this city.

It is a balancing act.

And so since we were the early adopters of the cloud and we actually have that memory muscle and that execution muscle to get banks over the line with new tech, it is a push and pull.

You show them and you earn your reputation through execution and innovation and safety and security.

And then once you build that trusted relationship, you drag 'em along into new tech and there's always early adopters in any market.

And then there's the slow followers and the fast followers and you just have to identify by the character of the business which banks are leading, and you go there first.

I will add something about AI and data analytics that's coming now fast down the path, which of course people frown upon, how it's gonna work in banking.

As long as you understand your marketplace and do understand the need for transparency, the ability to audit and trace every decision and how you deal with automation, then people understand that they feel safe, it comes from a trusted vendor and then they embrace the technology.

So I think the most exciting part of this business is ahead of us.

- I'm thinking and not be too inside baseball here, Mr. Chairman, but thinking about Natalie English, the head of the Wilmington Chamber down there probably loves the fact that you love Wilmington as much as you do.

You clearly like the Port City.

- Oh, I love it.

I mean, I moved here 12 and a half years ago and today we've got close to a thousand people in Wilmington.

I can tell you, we embrace the city.

We are involved in some of the civic elements.

We sponsor the sports park here.

We sponsor the Hunger Center for Food distribution.

And the presence of a company like this and then how the employees embrace this place is phenomenal.

We move people here from all over the world.

I've got employees from Australia.

I moved here.

I've got people from Utah.

We moved here because we've got 400 people in Utah.

Tremendous quality of life.

- Let me touch on something that you referred to.

12 and a half years ago, nCino was spun out from Live Oak Bank, which is not surprising you were spun out from a bank and you're a FinTech company, but that was your oxygen.

As we know, small business needs financing.

And that was the way that you did it.

Is there another opportunity for FinTech companies?

Do FinTechs by and large find enough financing that they need and how do they get financing?

- There's a tremendous amount of money around for companies that's good focus in a marketplace that's large enough and that's the total addressable market that they can address.

And then in the end, it comes down to execution and the management team.

I give a tremendous amount of credit to my management team that supported me passed through the two or 12 and a half years.

Because what is the biggest, there's a startup cost and funding upfront and there's a whole VC community doing different stages of this.

But then following on this first phase, it gets to scaling and execution.

The most difficult thing for startup companies to scale beyond that initial phase, maybe 30, 40, $50 million of revenue.

And what we've done successfully is starting to scale the revenue and the client base, but also scale from the smallest bank in the US to the largest banks like Bank of America, Wells Fargo, Lloyds of London, some big banks in Japan now.

So if you combine that recipe, funding will follow you and you'll be surprised how much money is available to innovators.

- [Chris] Carl?

- With a successful company, with wind in your sails, what challenges are ahead of you or what, I don't wanna say what causes you to lose sleep at night, but what are the issues that you feel or what are future headwinds that you've gotta deal with?

- Growth is probably your biggest challenge, as you can realize.

The markets have changed on us.

A few years ago, it was pure growth.

They didn't care how much money you lose, you could find funding, et cetera.

And then the market sentiment changed a few years ago and we have to be a profitable growth company.

So you have to actually outgrow the pace of your cost increases to become profitable.

We've done that successfully and now that balancing act of where do you invest, what markets do you attack and how do you deal with new regulations coming down the pike as well as the (indistinct) of the banking sector to new technology.

If you look at banking over the past four years, we've had two years of the Covid pandemic.

Then right as we came out of that, we had the liquidity crisis and the Silicon Valley Bank went under and three others, First Republic, et cetera, and Signature.

So those shocks to the system will hold you back temporarily, but then you get the strategic mindset, come back in the industry and then people thrive again.

So I'm excited about the growth opportunities on a global basis, but it takes a lot of execution discipline to be a profitable growth company.

- [Chris] Brannen?

- Pierre, I was surprised to to hear Chris say that you've got operations in so many countries in Japan and Australia.

What sort of challenges does that present to nCino?

Do you have to manage and market your company and your services differently in those markets or is it really a kind of a centralized product offering that is just available globally?

- It depends on the portfolio element.

If you're in the commercial lending space where we are, significantly, it's less regulated and that product can go across the globe.

As you move down to small business and consumer, you'll find that there's more regulations you have to adhere to.

And then on the onboarding front, which is on the commercial onboarding, it is heavily not regulated as much but regulated from a KYC and a KYB or money laundering perspective.

So it depends on your portfolio element.

The second thing is to carry the culture of the company on a global basis.

We put a significant effort in to make sure that the culture and drive for innovation and our reputation centricity carries across the globe.

- Mr. Chairman, let me come back to something that would be, well, would seem like a natural and this whole idea about work from home and having some hybrid, but I wanna quote something first, so forgive me for looking down for a second, but in Raleigh alone, economic development officials say there are 4,000 companies supplying 60,000 jobs that fall under the umbrella of FinTech in the triangle alone.

So as you sit in Eastern North Carolina, specifically in New Hanover County in Wilmington, how do you balance the idea of working from home but still having maximum productivity that you would need to have some of the intellectual capital sitting around the same table?

How do you do that?

What does work from home in FinTech look like for you?

- Yeah, the first thing is our people did a fantastic job throughout the pandemic to work from home and stay productive.

At the end of that, we did an assessment and 18 months ago, we gave them a three-month grace period and then brought everybody back to the office in Wilmington five days a week.

We have lots of young people that needs mentoring, needs learning to be in-person and so we just made that decision and bit the bullet.

I think if you send a mixed message, you get trouble from your employees, not sure what's gonna happen.

And we were just very definitive.

Now different cities vary.

In Salt Lake City, we go Monday through Thursday in the office and Fridays from home because of traffic conditions.

In London, we're Thursday, we're Tuesday, Wednesdays, Thursday in the office, Monday, Friday purely because the commute.

Some people, it takes one hour one way to get to the office.

So we are very pragmatic about it.

But where your innovation hub is, which is mainly Salt Lake City and Wilmington, we have lots of young people, needs the mentorship, needs the communication, need the in-person interaction and we are fully back in the office.

- Yeah, Mr. Chairman- - And I can add one factor for you- - Yeah, please, about 20 seconds, please.

- We measured our productivity from the programmers and last year after doing that, one main factor was working in the office again, our productivity increased by 81%.

- Okay, well, it's substantial and that's an understatement.

Chairman, thank you for being on our program.

Thanks for taking the time and we hope you'll come back.

- Thank you for having me and have a good day.

- Thank you, sir.

Take care.

Always nice to see you, gentlemen.

- Likewise.

- Please come back, as well.

- Thanks for having me.

- Until next week, I'm Chris Williams.

Goodnight.

(pensive music) - [Narrator] Gratefully acknowledging support by Martin Marietta, Blue Cross Blue Shield of South Carolina, Truliant Federal Credit Union, Sonoco, Colonial Life, High Point University, and by viewers like you.

Thank you.

(pensive music) (exciting music) (exciting music continues) (exciting music continues)