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hello everyone uh this is tony lawson ceo and co-founder of shop black today i'm joined by mr wale coaxland the ceo and founder of mokafi wale how are you i'm great thank you how about yourself today great great can't complain thanks thanks for joining us today it's my pleasure absolute pleasure it's it's this is important uh and we're all trying to strengthen our communities so whatever we can do to uh to be uh supportive of each other i'm happy to be a part of that yes indeed yes indeed so getting right into it tell us um about your company mokify what is it and how what inspired you to start it it's a great question so um you know my background is one where i spent the first part of my career in financial services um i was really fortunate actually to learn uh how responsible banking can have positive impacts on communities i started my career at citigroup i then went to um willis which is an insurance broker which really gave me a chance to manage large numbers of people and understand how risk works and then i went to jp morgan as one of the most senior black people there um managing uh some treasury services products and commercial card and finally i ran the sales for the business bank uh at jpmorgan so i had all the bankers 12 000 bankers responsible for the 65 or 5600 branches and i think the number was 2.3 million customers and one of the things that i was tasked with was how do you drive digital into the bank the business banking or small business customer and so i was beginning to really understand the power that mobile can have on distributing products and services to as individuals quite efficiently and then you know my george floyd moment happened with the death of michael brown and so in 2014 and as we all watched those images that were just heartbreaking after his murder yeah i thought to myself you know i get impact on my community and being uh at jpmorgan doing what i'm doing and so i at that time sort of thought that well i know how digital works i'm seeing how you can distribute um a large numbers of peopleography my community is struggling we need a financial or an economic agenda um let me be a part of that and so i left and um went on my own personal journey to figure out how to be a part of the conversation i thought about buying a bank i thought about raising a fund that could invest in companies and i'm one of my mentors and it's a real testament to the power of mentors one of my mentors came to me and said hey you know you should start a company um he isn't he is an investor in financial services companies and he said well they i think i've invested a lot of people who don't have nearly the experience that you've got and the sense of mission and this purpose is something that i think can build a great company i'm supportive of what you're trying to do and so with that i said well geez let me give this some thought and uh that led me to start the company in 2016 and you know in the typical entrepreneur journey um started with a bootstrap uh in terms of financing started uh with my own personal investment as well as investments from friends and family and i like to joke that we ask for money for investors from friends and family enough to keep the company going but not enough to ruin a friendship and so um uh we were able to raise three million dollars that way and that allowed us to really build our initial app and build the the uh what i'll call the the mvp the minimum viable product uh and to sort of see if we uh had a product that people wanted and at our core our product is we believe in three things we want people to bank smart we want people to build their credit and we want to help people create wealth particularly black and brown people sure and um the three million dollars got us to the point where we could have an app and sort of put that framework into play and then we realized that we were onto something um and we were able to go out and raise another three and a half million dollars from the investor community so between 2016 to 2019 we did the friends and family essentially and then in 2019 in october we raised our seed round of three and a half million dollars and that was led by an investor in california radical impact that's focused on social impact projects and initiatives and so they allowed us to upgrade our infrastructure to what we have now which is a completely free product that's a dda account for individuals where we have transformed the retail stores the dollar generals the family dollars the walmart and the places where people can put money into their account instantaneously for free they can withdraw cash out of their account for one of our free atm machines for free they can take a picture of the check and that can be deposited into their account instantaneously for free so our philosophy is give a high quality product to a market that has been relegated to the check cashers and the pawn shops and we got a business and as we do as black people we over index in terms of the utilization of check cashers and we over index in terms of the utilization of the pawn shops and we're trying to change the game with that with our product and the other thing i'm really excited about is you have the ability in our product if you do direct deposit with us to get your direct deposit into your account two days early so if you get paid on the 15th the money will show up on the 13th if you use our platform and you do it through direct deposit so we think that by being so intentional in terms of our messaging our marketing our target audience we believe in the wakanda effect right black panther exactly black panther which makes a lot of sense in the time of cobit then it's it's a great way of respect um while uh well well social distancing but um we believe that you know black panther didn't become a billion dollar movie because only black people saw it but it became a billion dollar movie because it was authentic to its brand and messaging and it was a high quality product right so we think we can become a billion dollar company taking the same kind of approach uh that uh that black panther did and we're really excited about that so speaking about the product it is a mobile banking app yes that is serving the unbanked or the underbanked correct so i guess clarify or yeah so the reality is that it really serves everybody quite frankly um i would argue that you know the statistics would suggest that 55 of african americans are unbanked or underbanked unbanked means you don't have a bank account under blank means you have a bank account but you rely on the check cash or the pawn shop the payday lenders as your primary source of banking so we're essentially saying and our product by the way is equivalent to any other products in the market wells products cities product chime product you know but but we're saying you get a when you enroll with us you can do it all online we asked a couple of key questions who are you when were you born what's your social security number if you don't have a social security number we can take an itin if you don't have an itin we're going to roll out the ability that we can use any foreign issued government id to open up a bank account importantly we don't check the check system so there is a system that exists that if you have had a bad experience with a banking product a deposit or checking account in the past that bank will put a little note in your file yeah and when you go to any when you go to many banks not all but many banks they'll check the check system before they open up a bank account for you we don't do that because we want it to be inclusive and so when once you go through the onboarding process in our app which is at mokafi you can find it wherever you get your apps you know google play store uh apple store or whatever um with the span of two minutes you can get your account set up and as soon as you're done we will give you your account number your routing number your 16 digit account number your uh cvc code of the three digit pin on the back of the card and the expiration date so you can immediately start to utilize the the platform it's all free there's no minimum cost there's no cost to open up the account there's no monthly cost we have free atms we got 55 000 free atm machines we got 80 000 stores where you can put money into your account for free any bank that is matt that has mastercard you can take your card in and take cash out of your account for free so it's all free um and within three to five business days your plastic shows up at your your in your doorstep right at your house and you can start to transact with that so this is basically a bank account without a bank so you're a black owned bank but you're a digital black owned bank basically that's exactly right and so we have uh our bank partner is a bank called sunrise banks it's out of minnesota so whenever you do business with us you're getting fdic insured accounts you're getting mastercard branded uh cards and so it's it's all digital uh focused on our community um so we think that that's a game changer because there aren't very many we've got a lot of great black owned banks in various communities across the country and we're 100 supportive of them and over time want to help them grow but in the meantime there isn't a national platform that can reach all of our community wherever we are in the country and that's the place that we want to play so speaking about the unique characteristics of this um of your platform of your app what are some things that separate you from the other mobile banking apps that exist already yeah a couple of things so we think of it as three premises right we wanted people to to to to to bank smart um and that's we just described second we want people to build their credit uh and in the same way that there's been redlining in this country as it relates to access to bank accounts eighty percent of the bank branches that have closed this country but in poor communities uh black people spend fifty percent more than white people for bank account hispanics spend 100 more a month for banking services so we think our first step is get people banked save people real money over time second step how do we get people to build their credit scores because there's credit red line credit score red line that happens in this country what we've done is we've made it really easy for people to take their rent and report it to the credit bureaus 60 of african americans we are renters compared to the broader population for that number 60 our owners and 40 are renters if you are one of those renters there's a low probability that your biggest expense every month which is your rent which you pay religiously does not help you build your credit right and that is a problem right and if you live in public housing 100 of people don't have the ability to uh build their credit right so why should we be limited in terms of our ability to build our credit based on our zip code as opposed to having tools that allow us to do that and so we're committed to that and we allow individuals we enable individuals to take their rent payments if they pay it on our platform and we report it to two out of the three credit bureaus and this the power of that is is compelling so what we see is 80 to 85 percent of people who do this see some sort of improvement in their credit score and at the same time we can actually do two things one we can take your historical credit excuse me your historical rent payments for the last two years and report those all to the clip bureaus as if you had a trade line for the last two years or we can take starting in august for example and take that payment and just capture it going forward now people need to continue to pay their rent they can't just i'm going to do it one and done so you're putting you're putting yourself on the hook but yeah it's it's a very powerful way and and what really hit us to this was some analysis that had been done in new york city by the the controller uh and he did an analysis that was a test in new york city public housing said if you had they took a subset like 2 000 people or something and said what would happen if rent was reported to the credit bureaus they found in that sample of the individuals who were thin to no credit file 30 of those people once you added rent it became 700 credit scores or better what so okay so let's back up so these people who historically underserved by financial institutions they now have 700 credit scores based off of this product that you have created and introduced to them they can now take this 700 credit score and now do a myriad of things that are not going to put them on the path to creating wealth you just made the commercial [Laughter] they me but happy too but that's what it is and so it's so we have a system in place in this country that has marginalized large numbers of people right again 60 of us are renters right and those score those payments aren't being reported to the bureaus and it's a game changer and so what we do is on our platform is we give you a mechanism to report to pay your rent and report it we also let you see your vantage score so you can see the impact that you're having in terms of improving your credit score and what's really important is many of us hear those commercials oh you want 30 points 40 points on your credit score pay some credit fix a company and we'll take care of it for you right i'm not going to judge but all i am going to say is on our platform you can see those same kinds of results for free right and so if we got you banking properly and saved your money the average black person spends forty thousand dollars a in their lifetime on access banking fees right if we could bring that what'd you say no just saying that basically insufficient fund fees monthly fees okay right because we tend for better or worse to be transactors money comes in money goes out and if you have a overdraft fee if you're five dollars over on your account and you get hit with a 30 fee yeah that you know and then oh by the way oh by the way then you if you don't clear out that overdraft fee then they might close your account and know if they close your account they're going to report it to the check system and if they report to the check system then you become you you go from under bank to unbanked right all right so so let's address that first porch portion right of let's get your bank save your money check the box yes second to your point let's get your credit score to reflect who you are not where you live and we'll give you tools to do that and we want to increase that we want to bring in utility payments we want to bring in other payments that you make and help those inform your credit score because that's another form of redlining yeah i was about to ask about that like what other um what other payments that are being made can also be reflected on the um on the platform as well other than rent so you just mentioned utility payments and some others that you're working on as well yes so right now it's rent so if you want to to get our app right now you can do the rent payments we are working we have a great partnership with equifax and we're working with equifax to expand it to include uh utility payments uh insurance premiums potentially and other things that happen on a recurring basis uh and so keep an eye out for that at 2021. um and then the third piece that we are focused on is how do you create wealth from our communities right and so the two areas that we're focused on is around uh home ownership again maybe not everyone should own a home i gotta believe that more than 40 of us should have the privilege of owning a home and so we create access to hud certified counselors that can provide people with a pathway to knowing what the resources are that they can become a first-time home buyer or if they've been a home buyer in the past but have come out of that and want to do it again we've got a lot of resources that are free or very much low cost to the individual at the same time we're working with the banks so we can find low-cost mortgages for people we don't lend money at the moment but we want to find partners if you're you know help you qualify so you can do that so the home ownership is an importa t aspect of what we're trying to do and we're trying to drive that and at the same time we're also trying to drive entrepreneurship in our community and um we're trying to create tools that people can use to start businesses we we we have a whole course one thing i didn't mention is our whole platform is built on information financial literacy financial coaching blog posts videos we just feel that if we can educate folks and give them a high quality product we're we're positioning people for success so anyway we have a lot of uh great content around so you want to be an entrepreneur and how do you do lean startup and you got start a business and you got a 50 dollar budget or something but all these sort of ideas and we're beginning to think about how we can get capital to people so they can begin to find the dollars to invest in their companies as well so so those are two areas that we're focused on home ownership and entrepreneurship uh as the part of our platform to move our community forward no that's great that's great um another question i had around the entrepreneurship piece was like give a i guess a scenario where an entrepreneur is under banked or unbanked doesn't have a bank account or is in a situation where they're collecting all types of fees because they have a low balance and money's coming in it's going out going and they're getting charge fees for that how can they utilize your app to create a successful business or financially stable business that's a great question so i unfortunately have half the answer for you and we're working on the other half the the the reality is depending on the business uh whether it's online or a physical business most thirty percent of physical businesses if you're black and i've been given a number up to forty five percent of mobile businesses or online businesses people are using their personal bank account to run those businesses um i don't think that's the right way to do it quite frankly um you really need an appropriate business account we are thinking about and exploring developing business accounts but we don't have that yet um so if somebody wants to start the business using their personal account we're a great place to start uh if they would like ideas about where to get a proper business account while we're in the process of sort of building that on our roadmap they should feel free to give me a call or send me an email will they dot coke some w-o-l-e dot c-o-a-x-u-m mokify.com or info mokify.com and i'll to give me a little information about where they are i'll find a good product for them in the meantime people should from a small business perspective start a small business account and this becomes really important both on the consumer side having a good quality individual account and having a good quality business account when you when things like ppp the payment the paycheck protection program came about who were the folks that needed the money most that didn't get it our community right why was that because they didn't have a proper business account to be able to demonstrate that they had a payroll that fulfilled the obligations that or the requirements set by the ppp program terrible right and then at the same time when when we had the karazak dollars the six hundred dollars or the sorry the twelve hundred dollars per individual and the i think it was five hundred dollars per kid who were the last people to get those dollars our community why because we had to wait for a gift card that had the money on it right or we had to wait for a check to be issued and because we didn't necessarily have a check account checking account we had to go the check cashier to pay them a fee to get access to our money so there's a real need for both the consumer side and the small business side to have a banking relationship we can check the box in a big way on the consumer side and we're thinking a lot about how to check the box on the on the small business side we're just not there yet sure another thing that i noticed was that you have a few partnerships with some black home businesses already and you offer some incentives yes oh man this is this is the part of our business that i'm really most excited about that's so excited when i saw it also actually we're going to have many conversations about how to partner so what we are going to what we have in our in our capability what i what i'm so excited about is we have the ability to market use our platform as a way to market to consumers who want to spend money with black businesses and many black businesses i'm sure many that you work with have um affiliate programs or referral programs and what we can do with our platform is if there's a company that's willing to pay a uh referral for business that comes from our platform or comes from one of our uh customers we can actually share that with the consumer and create a rewards program so imagine a rewards program for black owned businesses across the country every time you swipe with your mokify card you get cash back everybody wins we're driving consumers to the businesses we're getting cash back to the consumer and we can do it on a instantaneous basis so then when you hear the the jingle what's in your wallet the answer should be you know you're helping your community grow because i think this whole you know i've grown up like as you did and many of people who are who are looking at this today in homes where we celebrated the idea of creating community we celebrated the idea and challenged ourselves how can we keep the dollar inside the black community how can we strengthen each other and the world has gone digital even more so now than ever but it doesn't mean we have to lose those values and our ability to keep dollars in our communities because oh by the way kovid is an extinction level event for black businesses so we need as many tools as possible to make sure that we're keeping our dollars circulating in our community but i think we have a redefine the frame of community to reflect the digital component and not necessarily the store that's right down the street the store that's right down the street is really important so let we got to continue to support that but we can support a broader system like the ones that you're creating uh with your with your platform no that sounds great that um that sounds amazing um are there any type of particular businesses that fit and are there some criteria for businesses that you want to work with not really i mean i think i mean we're it's it's it's it's one where um for us selfishly having as many businesses on the platform is fabulous because it just gives more uh opportunities for people to just to be supportive and um we just we have to just work out the arrangement so we can make it all work but the nice thing is the technology does makes it uh on an automated so once we have the the arrangement have the conversation then if the company can provide us with their own materials or their marketing information we would happily use our platform to drive the activity to all of our users so it becomes a very virtuous cycle so to answer your question no we don't put any uh restrictions on but i think businesses that have established a terrific uh online presence are well suited to take advantage of what we're doing sure sure so in wrapping up shortly what are your what are your future goals for mocha phi let's say five five years from now that's a great question i think that there is a big lane in this country for financial services that serves our community and so if i were to fast forward the clock i would love to be able to say we've got millions of people on our platform who we who are both individuals and small businesses i would love to be able to say that we are strengthening our communities which include some of the black banks where we're able to use our platform to drive assets and depositors and customers to the black banks and make them stronger i would love to be able to say that the check cashing business and the payday lenders and the pawn shops they're a shrinking business as opposed to a growth business because individuals are using our platform to uh properly uh take care of their financial needs and not and take advantage of something that's that's inclusive and adds value as opposed to them being a part of something that's extractive and taking away value and that we have demonstrated an ability to get appropriately priced products on the financial services side to people so they can take care of their families they can create economic security they can buy homes and start businesses and we're changing the narrative around black economic mobility in this country so if we can do that in five years i will be energized for the next five years no that's awesome that's great thank you so much for spending some time with us and sharing you know your insights and information about your company and hopefully you know you and i can talk soon about getting these black business black businesses empowered i'm all i'm all about it so i look forward to that conversation thanks for the time and inviting me to your important show i appreciate it now it's my pleasure you have a great rest of the day thanks you do the same thank you