This episode features a conversation with Joe Beard ‘96, Co-Founder & CEO of CollateralEdge. Joe talks about how he had to adapt and use what he learned at West Point to succeed in business. He also discusses his successful investment strategies, the importance of problem solving, and what it’s like to be an entrepreneur.
This episode features a conversation with Joe Beard ‘96, Co-Founder & CEO of CollateralEdge, a Dallas-based fintech platform that provides banks with a flexible, automated sales enablement solution to efficiently increase lending capacity without compromising credit quality.
Joe has had a diverse career spread across the military, technology, investment banking, and venture capital. As a former Partner at Perot Jain, a Dallas-based venture capital firm, he led 40+ investments in 5 years. He's a Founder and Board Member of Venture Dallas, the premier venture capital conference in the DFW region, and a recipient of the Tech Titans Investment Catalyst Award. He spent 8 years as an investment banker in New York and Dallas and has executed approximately $10 billion in transactions across M&A, debt, and equity.
In this episode of On Point, Joe talks about how he had to adapt and use what he learned at West Point to succeed in business. He discusses the investment strategies that helped him make fifty investments in under five years, the importance of remaining clear headed when problem solving, and why having work experience before attending business school is extremely beneficial. He also talks about finding balance when moving between different segments of finance, business, and entrepreneurship.
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“The biggest challenge initially was just making sure that you're balanced, and really kind of being intentional about how you spend your time. And, there's never enough hours in the day, right? You know, no matter what work ethic you're bringing to the table, no matter how you're being creative about resources, there's never enough hours in the day to do all the things that you want to do. So you have to ruthlessly prioritize your time. You have to be ruthless about prioritization. Not chasing the next shiny ball, but really kind of focusing your effort and energy and doing the things that you know are gonna move the needle for your business.” - Joe Beard
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(02:08) Segment: AAR
(03:45) Experience at West Point
(10:04) Journey in the Army
(11:33) Segment: Sit Rep
(15:17) Attending business school
(17:06) Starting in investing banking
(20:07) Investment strategies
(25:10) About CollateralEdge
(33:27) Quick fire questions
(39:39) Segment: SOP
(43:45) Mentorship
(45:20) Segment: Giving Back
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West Point Association of Graduates
Narrator: Hello and welcome to On Point. This episode features a conversation with Joe Beard, class of 1996, Co-founder and CEO of collateral edge, a Dallas based FinTech platform that provides banks with a flexible, automated sales enablement solution to efficiently increase lending capacity without compromising credit quality.
Joe has had a diverse career spread across the military, technology, investment banking, and venture capital. As a former Partner at Perot Jain, a Dallas based venture capital firm, he led more than 40 investments in five years. He's a founder and board member of venture Dallas, the premier venture capital conference in the DFW region and a recipient of the Tech Titans Investment Catalyst Award.
He spent eight years as an investment banker in New York and Dallas, and has executed approximately 10 billion in transactions across M&A, debt, and equity. In this episode of On Point, Joe talks about how he had to adapt and use what he learned at West Point to succeed in business. He discusses the investment strategies that helped him make 50 investments in under five years, the importance of remaining clear headed when problem solving, and why having work experience before attending business school is extremely beneficial.
He also talks about finding balance when moving between different segments of finance, business, and entrepreneurship. Now, please enjoy this interview between Joe Beard and your host, Tim Hsia and Lance Dietz.
[00:01:50] Tim Hsia: Welcome to On Point started by Eddie Kang, class of 2008. I'm Tim Hsia class of 2004,
[00:01:56] Lance Dietz: and I'm Lance Dietz class of 2008.
[00:01:58] Tim Hsia: And today we're joined by Joe Beard, West Point class of 1996. Joe, how are you?
[00:02:04] Joe Beard: Doing fantastic. Thanks for having me guys.
[00:02:06] Tim Hsia: Awesome. Thanks for making time for us. Let's get into our first segment AR or for our non-military listeners after action review.
In this segment, we'd like to touch on specifically what other veterans can learn from you, your process and your journey first and foremost. Joe, could you please tell us about your journey to West Point? Sure.
[00:02:24] Joe Beard: Well, I was, uh, I was an army bra growing up, so I was always around the military. I was born at Fort Bragg.
My dad was special forces for almost 20 years SAR major in the army. And so I always grew up around that culture. And so I, I think without me even knowing it, it kind of just fostered on me in terms of the environment I grew up in and just kind of led me to thinking that the military was a, a noble cause.
And I think even just as important, I wanted to surround myself with the best and brightest. And so I, I thought west point would be a great opportunity to do that. I was raised in Southern California for high [00:03:00] school and always thought that I'd go to UCLA or Stanford or, you know, all my buddies stayed in California, but for me, the opportunity just to take a different path and do something that I thought would be extraordinary.
What I was up for. And so literally didn't look back, flew to west point, never visited and, uh, never turned around given
[00:03:22] Tim Hsia: you hadn't visited. How was R day? How was beast? Barrack's cadet, basic training,
[00:03:28] Joe Beard: you know, it's, it's funny when I think back now, there's nothing that west point could put me through that my dad had not put me through.
Right. And my dad was the guy that 6:00 AM would walk in the room, pull your covers off and be like, I'm up. And I'd be mowing grass at 7:00 AM in the morning. And so, you know, beast wasn't that bad. I actually gained weight during beast, which was funny. So beast barracks wasn't that bad for me. It's it's same thing I kind of grew up with.
What was your west point experience like you guys know? I mean, it was, it was tough right. Day to day. West point [00:04:00] is, uh, grind academically. I thought it was very difficult for me my first year. I didn't know how to. I think I made it through high school. Just memorizing information. As you guys know, west point gives you more information than you can possibly memorize.
So struggled academically my first year, you know, above a 3.0, kind of the rest of the three years, but the friends, the camaraderie, the time you spent away from, you know, the academy on the weekends with your buddies, like that's what makes. All worth, it makes the grind all worth. It makes the place bearable.
The four years was long, but when I look back, it was a, it was a pretty great experience. Looking back now,
[00:04:36] Lance Dietz: what do you think, like after that first year allowed you to kind of, I guess, reset and get acclimated to west point and the academics to then be above a three oh, further remaining years. Like I'm a product of AI.
I spent too much time doing that, but I'm just curious. What
[00:04:51] Joe Beard: worked for you? For me, it was, I've always wanted to be amongst the best. Like I've always wanted to compete. I've always had high expectations. And [00:05:00] so for me, when I, when I had like a 2.3, my PLE year, I was like, dude, this is unacceptable. Like you've gotta step it up.
And so I just learned how to study. Like I had to learn how to study and how to allocate my time. And it just took me a year to do that. The other thing is I've always had a healthy fear of my dad. And so my dad was like, boy, you need to get your stuff together. And so I, I think just a combination of those two things, I was just like, man, I, I gotta focus and really lock in.
And, and that's kind of what I did. And not only that, but once you start getting into your curriculum for your major, which for me was discrete. It was just much more in my wheelhouse. Right. So I started taking more math classes, which kind of worked for me. So that was kind of it.
[00:05:43] Tim Hsia: Were there any classes, mentors, classmates that have really resonated or you've touched back in and touched back on and really helped you in the past few years to
[00:05:55] Joe Beard: decades?
Yeah, there there's a lot, you know, one class I would say stands out was [00:06:00] abstract. I think there was literally four civilian professor, four people in my class. So I just thought given four people we're all gonna get A's. We took our first exam and it was like a C, two D's and a F for the four students.
Like this guy was ruthless. And so what I took from that is just not to take things for granted. Like you still gotta bust your button. You know, do the work like nothing's gonna come easy. And then thinking about individuals that I think were impactful. My plea year, English professor, a guy named Colonel Les knots, great guy ended up being a mentor through this day.
He actually reviewed my essays for business school for me. Reviewed the essays of all my buddies. He's been to my house in the last couple of years to see my kids, but just a phenomenal guy that's been helpful. And then another person I'd mentioned is John Hampton, which is one of my classmates. He's actually the reason I went to business school at Columbia.
I was in Silicon valley at applied [00:07:00] materials. He called me and he is like, Joe, you gotta go to business school. And so literally he probably led 3, 4, 5 guys from our. To go back to B school, which was awesome. So super thankful for him, for guiding me in that direction.
[00:07:14] Tim Hsia: Oftentimes we talk about what we learn from west point, but what did you have to unlearn
[00:07:18] Joe Beard: from west point?
You know, that that's really interesting. You guys know it at west point, what you learn in terms of work ethic in loyalty and doing things the right way and having high expectations of the people around. that's what that place is all about. And what I found is when you get into business, not that those same characteristics, aren't important for you to hold within yourself, but having those expectations of other people, I think a lot of times you'll find that people fall short.
And so I think one of the things that I learned was that, that same sense of loyalty, that same sense of work ethic, that same sense of even going back to our four response. [00:08:00] Right where it's like, no, excuse, why didn't you get it done? No excuse that doesn't exist in the business world. And so I, I think for me, just kind of recalibrating my expectations of the people around me and understanding that people have different motivations, different ways of thinking different approaches to how they think about interacting with individuals and character.
That realistic approach to seeing people for who they are. It's a different thing than you learn at west point, right? It's just people aren't like that west point is an ideal place. And I think business is just less than ideal.
[00:08:38] Tim Hsia: Fascinating. You shared that. It actually reminds me. Of some feedback. Chris garner provided, uh, west pointer, um, also in the venture space and startups, who's worked at many of the largest big bracket firms.
He talked about how one thing west pointer's transitioned to civilian sector might have some shock on is not everyone has the same work ethic, [00:09:00] not everyone's as driven, not everyone has the same approach to the honor code and how they carry themselves. And he said that a lot of times he has to. Council veterans about how to think about the civilian operating, I guess, environment versus the military and west point.
And
[00:09:19] Joe Beard: it's not that it's necessarily bad or that people are, are bad people. It's just, you have to understand that people are bringing a different set of values, a different set of ways of thinking than you might have a and that's all right, but you just gotta understand that everybody doesn't think the same.
And so, as long as you come with that approach and you treat people the way that you think they ought to be treated and you're doing the right things, just understand that it may not come back the same way. That's all. And I think as long as you see things for what they are, you'll be fine and you'll adjust and you'll adapt.
[00:09:56] Tim Hsia: Fascinating. Could you share with us about your army journey? [00:10:00] So after graduating west point, what did you do? Did you go to Fort Bragg and return back to hometown, et C.
[00:10:06] Joe Beard: It's funny, you mentioned Fort Bragg. So I, I ended up going to 25th ID in Hawaii. So I was an air defense officer. Did my platoon leader exo time out in Hawaii.
Loved that Hawaii was phenomenal, great place to be. And then I went to OAC, um, skipped cast cubed. I literally started changing command inventories. The day that I graduated from OAC. Took command. It was a Patriot battery command, not what I was wanting to do. My, my goal was to go to Fort Bragg and go to ranger school.
Those were the two things that were kind of on my bucket list. And again, I wanted to almost go going back home. Right. My dad was at Fort Bragg. I was born at Fort Bragg. My uncles were at Fort Bragg. So for me, it was kind of this full circle idea, but I talked to one of my mentors and he is like, Hey, you have an opportunity to take command.
You are hand selected, you gotta do it. So I did my [00:11:00] command and ended up getting out after that Patriot wasn't for me, I got married, had my first child didn't really want to be at the whim of the army in terms of just sending me forever, wherever they wanted me to go. So I decided to get out after five years.
Probably still miss it to this day, regret not going to Fort Bragg and not going to ranger school, but I still look back on that time. Very fondly.
[00:11:23] Lance Dietz: I think that's a great transition into our next segment, which is what we call the sit rep or the situation report. And this is where we dive into what you're doing post army career and what you're doing now.
And. It's a really incredible experience in finance at various different banks, then working at investment firms and now part of a startup company with collateral edge. And it touches on a lot of things we've talked about in this podcast, but would you mind just giving us a quick overview of your career since the military, and then we'll dive into a few things.
[00:11:53] Joe Beard: Yeah. So my, my first job outta the military was out in Silicon valley at applied materials and kind of business development. I worked for a [00:12:00] former army captain, which was awesome. Just someone who really understood my DNA, but I was fortunate to learn about, you know, R and D and sales and marketing and operations, all those good business, you know, areas left there, went to business school, straight into, um, investment banking in New York, doing M and a in media telecom.
So I spent time at bear Stearns Merrill Lynch, B of a, some boutique shops for about eight years, did a lot of deals in terms of financing's M and a IPO, et cetera. And then I spent five years at per Jane, a venture capital farm started by Ross Perro Jr. In honor, rock Jane, where I led investing activities there managed the portfolio.
So probably. Led about 50 investments over five years early stage tech enabled companies across four countries and then managed that portfolio, which was fantastic. And then I left Proja in late 2020 going [00:13:00] into 2021 to launch collateral ledge. You know, I'll tell you, it was just really the culmination of all that experience.
And then I think a lot of the things that were happening in terms of civil unrest in the country at the time, COVID I just felt like if I didn't take all of the education and opportunities and mentorship and learnings that I've been given over my career and put that towards building something that could really changed the world then was I really deserving of everything I've been given.
And so that just led me down a path of, of entrepre. awesome.
[00:13:34] Lance Dietz: I'd love to dive into a few things. Nowadays. There seemed to be a ton of opportunities for veterans as they're transitioning from the military. A lot goes straight to business school at the time when you were leaving the army, did you think about going to business school immediately or was that even on your radar?
[00:13:50] Joe Beard: I, I actually didn't. And I will tell you that anytime I've mentored west pointers in particular about going to business school, I've [00:14:00] always suggested that. Getting a little bit of business experience before business school is actually very helpful because it gives you context because there's so many things you learn about in the classroom that you have no context for, because you've never been in a business environment.
But for me, having spent two years in kind of business development and learning business and interacting with people, all those things in terms of sales and marketing and strategy and finance and accounting, all those things kind of made sense because I had some previous experience that I could lean on or bring to the classroom.
And so not that you know, going to get your MBA. You know, doing something in the civilian sector, a lot of people do it and you're gonna be successful and you're gonna figure it out. But understanding the language, having shared experiences that you can bring to the classroom and, and basically benefiting from those things and sharing those things in the classroom, I thought were beneficial for me not to mention I had a wife and kid, [00:15:00] right.
So I wasn't leaving the military to go straight to school. I was like, I gotta get a job and, you know, support my family.
[00:15:06] Lance Dietz: And then you mentioned John Hampton. Classmate is the one who drew you to business school. Had you looked at any other schools or was Columbia the place to be, and naturally it's the center of finance, uh, or a center of finance.
So curious kind of, if there was anything beyond John Hampton there,
[00:15:21] Joe Beard: you'll find this pretty funny. I actually didn't apply anywhere else. I loved what I did at applied materials. I loved living in San Jose. My parents were in LA, so they were close by my wife's family's in Hawaii. So San Jose was a great situation and a great job for me.
And when he, you know, started pulling on me to apply to business school, he was like, you gotta go to Columbia, our other best friend, Thad Underwood applied to my class as well. And so I was like, you know what, if I get into Columbia, great, I'll go. I'll be there with all my buddies. And if I don't, I'm gonna stay in Silicon valley.
And so I only applied to Columbia. I got in and, you know, packed the [00:16:00] family up, moved to Harlem. Straight into investment banking. So, you know, thankful for him for the nudge, because I, I think Columbia really changed the trajectory for me in terms of what I could do with my career and even just opening my eyes to other opportunities.
But if he hadn't been pushing me so hard, I'd. Who knows where I'd be today.
[00:16:20] Lance Dietz: I think that's a meaningful thing about the long gray line, quick riff on Thaddius Underwood. So bad Thad is what EV became known as he was a professor of mine. And then we went to South Africa on an a I D with him. He actually was like the guy that got me thinking more about investing in real estate and, and all that stuff.
So a small world, I'm gonna have to ping him and get him on the podcast as.
[00:16:44] Joe Beard: That is a phenomenal guy. Literally met him the day I reported to R the night before at the hotel. I met fad and John Hampton been best friends ever since.
[00:16:54] Lance Dietz: That's awesome. So you did finance for a bit. Did you think about consulting at all?
I know that's a [00:17:00] common option for vets coming out of business school, but was it always banking from the start?
[00:17:06] Joe Beard: You know, for me, it was always investment banking. I thought that, um, investment banking was gonna give me the broadest you view and the strategy and finance at the highest levels. And I just knew that investment bankers were unbelievably sharp people.
And I was like, man, what a great way to start my civilian career outside of business school, by doing something like. Um, so I never thought about consulting. I'll tell you that I did do a little bit of consulting after investment banking for about a year or two with some of my former clients. And I hated it.
Absolutely hated it. And I'll tell you why. For me, I love the flexibility of not having to be in an office every day, being able to work on strategic things, but, um, that one foot in and one foot out not being on a team that really didn't work for me. So I found. Kind of questioning decisions, [00:18:00] questioning why things were done.
And it was just difficult to be kind of half in the boat and half out that just didn't suit my, my personality very well.
[00:18:09] Lance Dietz: Makes a lot of sense. I feel like there are at least nowadays a lot of academy grads and a lot of military veterans that have carved a path in investment banking that made it easier for guys like me when we were coming outta grad.
Had you always thought about getting into venture? I mean, transitioning a little bit to pro Jane, cuz that it seems to be like more and more veterans are getting into that now. But at that time, do you have anyone that was leaning you towards that? Or what was that experience like? You know,
[00:18:36] Joe Beard: honestly, I was at a boutique shop doing investment banking and I was co-head of their corporate investment banking group.
Just kind of starting out their group, building their practice. And I got a call from one of my mentors, Darcy Anderson, who's uh, the vice chairman at Hillwood and pro companies. And I, I believe Darcy's class of. 78. I believe don't quote me on [00:19:00] that. He called me and he is like, Hey, Ross has, you know, a handful of portfolio companies.
They want to build out a firm around it. Are you interested? Right. And so I don't think it was so much that I wanted to be venture, but the way I looked at it was it was gonna be very entrepreneurial because I was gonna have to build it from scratch. It was gonna allow me to leverage a lot of the experiences I had around organizational leader.
Financing companies, advising CEOs, which is something I had been doing for years in investment banking. And so I just felt like it was a natural transition for me to apply everything I had learned on large corporations and apply that to early stage companies, right. Apply the organizational leadership to early stage founders that maybe didn't have a lot of leadership experience.
And so I just saw it as a challenge and an opportunity for me to go do something slightly different, but. Apply all the skills I've learned. That's
[00:19:55] Lance Dietz: amazing. The 50 companies or investments in five years is [00:20:00] an incredible cadence and pace. And it sounds like it's a relatively small team. I'm curious what you learned over those five years as it relates to what's most important when you're looking at building a business in the venture space, how you ed companies, and then where you spent a lot of your time working with the C.
[00:20:18] Joe Beard: It's interesting because everybody has a slightly different lens in terms of how they look at early stage companies. Right? So for us at per Jane, I was fortunate to have. Two partners. I call 'em partners, but really my bosses, Ross Perro, Jr. And ARA Jane, who both had their own operating companies per has a lot of companies underneath our umbrella honor.
I had a company called access healthcare. And so part of my investment strategy was investing in companies where we understood the business could add value, but where I could leverage. All of my partner's assets to help accelerate the growth of those companies. And I felt like that gave me a competitive advantage in early stage companies.
That was the lens. I kind of looked at companies [00:21:00] through, but I really focused a lot more on the jockey than the horse. Right. I, I focused on the entrepreneur, their character, their work ethic, how they dealt with stress and ambiguity of people around them, how they empowered their team, like all. All those kind of intangibles is what I spend a lot of time trying to understand.
And my takeaway from, you know, those 50 companies and looking at really a thousand companies a year was that there's two things that stood out to me that are very difficult for early stage companies. And we only did B2B by the way, enterprise sales and organizational leadership. Right. Those two things, I don't care the background of the founder.
I don't care if they were technical, if they were leaders, if they were sales people, those two things, organizational leadership and enterprise sales consistently, those are the two challenges I saw in literally every single company it's just [00:22:00] hard. Right? B2B sales is really, really hard when you're selling the large corporations that are getting pitched all the time in organizational leadership.
As you can imagine for early stage C. It's one thing to lead an organization when there's 60 people in layers of management and mid-level managers, et cetera. But when you're dealing with five people and there's 10 people worth of work, and you're trying to manage the business, be an operator and build a team just really hard.
I think it's just a really difficult thing. And so I think a lot of people struggle with. And so those are the things I tried to focus on was how can I help my companies with enterprise sales and how could I help my companies with organizational leadership and just solving basic things. And so the ideas was if you could eliminate those obstacles and just allow people to go execute, that's what I tried to solve for, with our portfolio.
[00:22:58] Lance Dietz: I think the experience from the [00:23:00] military does, especially at the platoon level and at the company level, Does resonate a lot with early stage startups in that you're still dealing with limited resources, kind of too many todos on the, to do list, having to motivate and encourage and assess, which is what I found.
I'm curious, kind of how the founders that you ended up working with, how they like appreciated or didn't really care about your military back.
[00:23:27] Joe Beard: I think a lot of people appreciate it. And, and I think that, um, every founder needs something a little bit different, right? It's not, it's not cookie cutter. You can't just give the same piece of advice to, you know, all 50 CEOs.
Like it doesn't work. And so what I tried to do was look and identify the needs. And then try to see what I could do to fill some of those needs. And so I think from a military perspective, what I brought was the fact that I never got too high or too low. Right. And what I meant by that is kind of like your, your [00:24:00] demeanor, your overall excitement level.
I never got too high on the highs and I never got too lows. I just tried to stay even keel. And so even interacting, you know, with my portfolio C. And, you know, a lot of times a founder would call with the problem and they would be anxious about it, right? Whether it's fundraising, whether it's challenges with people, whether it's a customer issue.
But I always found that if you could just be even keel and be like, Hey, let's just take a step back. Let's break this down into pieces. Let's see what we can solve for and chip away at the problem. You know, getting over excited and getting anxious about the problem. It's not gonna help you. It's not gonna help your team.
I think people did appreciate the calm. And they did appreciate the fact that I had the ability to kind of just take a step back and, you know, pull them out of the fire a little bit and just help them think critically about how to approach the problem that they were trying to tackle. I'd love to now
[00:24:56] Lance Dietz: hop into more about collateral edge, what you're doing now, your [00:25:00] experiences from the finance world and the venture world leads.
Like into this. Great. So like, could you just give a quick overview of collateral ledge, your role there now and kind of
[00:25:10] Joe Beard: what the mission is? Yeah. So I'm the, the CEO and co-founder of collateral ledge with my partner, Joel raki and collateral ledge. What we're doing is really kind of reenvisioning, um, capital delivery in the middle market.
And what I mean by that is. You know, through our financing experience. And my partner grew up in private equity and investment banking, kind of similar DNA. We always noticed in the middle market, that lending is very inefficient. And what I mean by that is you have a 5% piece of paper from a bank. And all of a sudden, the marginal dollar beyond the bank turns into a 14% piece of paper plus warrants.
Right. And it's not that that marginal dollar is so much more risky. It's just structurally there's friction because you have a second lender with a [00:26:00] different cost of capital, uh, with different priorities, different operating expenses. And, and that's not great for the borrower. And it's really ultimately not great for community banks and regional banks either.
And so we basically developed a platform that allows banks, community, and regional banks to compete on structure. Not price. And so we kind of flip the paradigm of middle market lending upside down because banks aren't in the business of taking risk. Typically what they do, they'll bring in a customer, the bank will solve for what works for the bank first, and then pitch that to the borrower, right.
Where a lot of times you're pitching to lose, right. You're pitching something that, you know, does not work for the borrower. And what we've done is we flipped that upside down and said, Hey, let's solve the problem structurally for the borrower. And then let's use the collateral ledge platform to back into how to keep the bank [00:27:00] within their underwriting standards.
And so simply what we do, we basically use our platform. To put collateral behind the bank to augment any underwriting on a term loan or revolver that helps them solve for short term problems in the underwriting process. So very simple took us probably seven years to really develop the platform we passed on funding probably seven years ago, but over hundreds of conversations with bankers, we finally developed at a platform that fits in within the bank's underwriting.
Doesn't change the bank's workflow. Doesn't change how they do workout, but allows them to augment the collateral stack that a borrower is bringing to the table and allows the bank to stay within their underwriting framework without adding bodies, without, you know, increasing operating costs. The bank was able to leverage their core competencies, solve problems for a customer [00:28:00] and win new business.
[00:28:01] Lance Dietz: What was the hardest piece about going from the investing side back to the business side or the operating side. And in this case, being the CEO,
[00:28:10] Joe Beard: the biggest challenge I think for me is as an operator, you're forced to think strategically. And, you know, tactically on a daily basis and you gotta go back and forth all the time, right?
Between conversations throughout the day, you're constantly going back and forth and you can really never focus on one or the other. And so I, I think for me, that was probably the, the biggest challenge initially was just making sure that you're balanced. and really kind of being intentional about how you spend your time and there's never enough hours in the day.
Right. You know, no matter what work ethic you're bringing to the table, no matter, you know, how you're being creative about resources. There's never enough hours in the day that do all the things that you want to do. [00:29:00] So you have to ruthlessly prioritize your time. You have to be ruthless about prioritization, not chasing the next shiny ball, but really kind of focusing your effort and energy and doing the things that you know are gonna move the needle for your business
[00:29:17] Lance Dietz: in the FinTech world.
What you're doing seems incredibly novel. It feels. Finance in general is being, you know, disrupted as we speak over the past few years. What do you think is the hardest aspect or the easiest aspect as it relates to getting more financial institutions on board with this type of offering with collateral ledge?
[00:29:37] Joe Beard: You know, the, the challenge honestly, is that banks have been doing business the same way for a really long time and no different than healthcare banks are slow to. Right. They're slow to embrace new technology and new ways of thinking. But I, I think where we found success is that we've really aligned our incentives with the bank.
A lot of [00:30:00] FinTech opportunities are going around the bank, right? They're looking for arbitrage opportunities. We are partnering with the bank. Our goal is to make the banker the hero of the story. Right. And so everything in our structure is designed around that we don't interact with the borrower. I have no idea who the borrower is and that's intentional because we want it to be the bank's relationship.
We want the bank to be the one that's solving the problem for their borrower. We're behind the scenes, helping the bank to do that. Right. We're empowering the bank. And so I, I think the, the biggest challenge that I, I see kind of going forward in the market in terms of banking is just helping bankers understand that there's a different way of doing.
Helping them understand that if you are solving a problem for your borrower using innovation and technology, it can give you a competitive advantage in the market. And we find that once we sit down with the CEO, once we sit down with a credit officer or a market president, and we walk them through our platform and [00:31:00] help them understand that we're creating a better experience for the borrower.
But also helping the bank to be able to use this sales enablement tool in a proactive way to adjust problems and underwriting. Once they understand that they're on board and they get it. So for us, it's just chipping away, right? It, it it's chipping away at these community banks and regional banks that are our
[00:31:23] Tim Hsia: customers.
I have a number of, I think, quick fire questions. First is, would you still recommend MBA for veterans or not?
[00:31:31] Joe Beard: I would. And I'm not saying that that's the only way. Right. But I do think the MBA, at least for me, helped me to be much more well rounded. Right. So it just gives you so many tools to put in your bag in terms of a little bit of marketing, a little bit of sales, a little bit of finance, a little bit of accounting, a little bit of strategy.
It, it just makes you more well rounded. And I think that's super helpful for someone who's coming from the military who doesn't have a broad [00:32:00] kind of business experience
[00:32:02] Tim Hsia: next. Did you ever meet Ross pro senior?
[00:32:05] Joe Beard: Yes. I was fortunate to meet him several times when I was president in the west point society in north Texas, we actually hosted.
Him and his wife for a dinner, which was phenomenal. One of the funniest people and one of the best storytellers, I think I've ever come across, but I will tell you even up until the time before he passed, anytime I went down to Hillwood, he was walking around every day, suited up Polish shoes, walking the hallways at Hillwood.
I thought it was just an incredible thing that he was present even, you know, late in age when his health was declining, he was always present. And so for me, it makes you think about habits, right? It makes you think about routine. And I think he just had really solid habits and really good routines. And he just stuck to that.
There's no reason that man had to be suited [00:33:00] up walking around the halls, interacting with people at that point in his life. But he, he did. and I think that had a huge impact and it's something that I saw and had a huge impact on me. Cause it's like, if he's showing up, right, why am I not showing up? So my shoes better be shined my tie better.
Be straight. My shirt better be starched. I need to be ready for business. If that man can do it, his legacy is just unbelievable.
[00:33:27] Tim Hsia: This is impressive coming from three west pointers. Right? So this is a pretty special Naval academy grad. Did he ever share the story of him? And I heard this when I was a kid at like, he came to west point and rang the church bells.
[00:33:38] Joe Beard: Yeah. He actually, uh, he told part of that story, funny enough at our founder's day dinner, which was where he was the host and we honored him. And so at that time, I think it was general Lennington. Who was the comment on, at the time was telling this story about Ross Perro. Being up at west point. And so you'll love this Ross Perros sitting [00:34:00] there at the table says you're not telling the story.
Takes a piece of bread, throws it at the calm and the calm was like, sir, it's your story to tell, gives the microphone to Ross per senior. And he proceeds to tell this story about being at west point, getting arrested, being secured by the MPS. It, it was, it was unbelievable. The
[00:34:21] Tim Hsia: Ross Perro, Fred Smith of FedEx, George Schultz, Hank Marie Greenberg, all of them worked way into their seventies, eighties, and nineties.
And that point you made about habits and just showing up is super impressive. Next is pros and cons of being a VC versus an entre.
[00:34:38] Joe Beard: I think being a VC is hard, man. I think that is a really, really hard, hard business to win one because starting out with a 20 million fund 50 million fund, there's no great economics in that.
Right. It's difficult to make money in that you're not making money until two, three funds in where you're stacking management fees and you've [00:35:00] had some success, you know, a lot of people look at that. And they're like, wow, it's novel. It's sexy, but it's hard. I tip my hat to anybody who started from the bottom in that business and become successful.
I think it's really difficult. And then as an entrepreneur, you know, everybody's not built to be an entrepreneur. Having a great idea does not make you an entrepreneur. It's a lonely place. And that's one of the things that I think, you know, you don't hear at business school, you don't hear from people that have been wildly successful.
Being an entrepreneur is lonely. When it's you or you and a founder, and you're making every decision, right? Every call is important. Every meeting is important every day that things to do list is extremely important, but I'll tell you there's nothing more reward. In my opinion is building your building, something yourself, putting your touch on it, putting your hands around it, guiding the ship in a direction you think is best based on your [00:36:00] experience and your knowledge and all the things that you've learned.
There's nothing more rewarding than that. So I'll tell you out of all the jobs I've had, this is not the easiest, but it's absolutely the.
[00:36:11] Tim Hsia: Amazing. We can tell that from your energy and vibe, uh, I mean a real triple threat, right? Soldier, investor, entrepreneur, and many other things. How are things at collateral edged right
[00:36:21] Joe Beard: now?
Things are good. You know, you're, you're never far enough along than where you want to be. We have solved some big obstacles in our business on the regulatory side, just making sure that we are aligned with regulators. We have a former chairman of the F D I C. Bill Isaac, that's been an advisor, which is huge, really locking down our value proposition for the banks.
We have seven banks under contract right now ranging from 600 million in assets, up to 60 billion in assets, which is phenomenal. And then locking in our backend structure in terms of how we provide collateral to our banks. UMB bank is our partner, and [00:37:00] that was no small task of getting that deal done with a, a great partner like, um, B.
So we're in a great spot. Now we're into deal execution. We have multiple deals in our pipeline that we're executing on right now. We're building out the team from just me and my partner to now seven people, which is fantastic. So we're in a, we're in a really good place. I'm excited about the future and kind of where we're going, but just staying diligent.
Um, staying in our purpose, making sure that we're really listening to the customer and solving a problem for the customer, but I'm excited. I can't ask for anything more team is doing unbelievably well surrounding myself with really good people. So I'm definitely blessed to be where I'm at.
[00:37:44] Tim Hsia: And then how can this community of veterans, not just west pointers, but Naval academy, folks who are listening to this podcast be helpful to you.
So is it, you're trying to get in front of more banks, you're trying to raise money or, um, hiring, like what areas might this community of veterans be helpful [00:38:00] to you? I
[00:38:00] Joe Beard: think there's a, a couple of ways. One it's a microphone. Anybody that's promoting and supporting your business is unbelievably helpful when you're an early stage company.
So whether that's following us on social media, Following me on social media. I think all of those things are super helpful. But then on the banking side, you know, our customers that we focus on are banks with kind of 2 billion to 20 billion in assets are our core marketplace. And, you know, anybody focused on CNI, anybody that's trying to increase their lending without taking on additional risk or operating expenses.
Those are great banks for us. So any referrals in that area? And then I'd say not so much investment, but really advice and mentorship is more important. What I've learned is that when you go seeking advice, a lot of times dollars come, I think anytime I can be introduced to just really good, thoughtful, smart people that might want to engage with me on what we're doing or how [00:39:00] they can be helpful.
I think those are relationships and intros that I would welcome at any. Let's
[00:39:05] Tim Hsia: get into our third segment. Yes. O P or standard operating procedure in this segment, we're going to talk about the personal routines, habits and words live by that have been instrumental to your success. What routines or habits do you have in the military at west point that you still adhere to?
[00:39:19] Joe Beard: Ah, man, there's, there's so many still I'm up every morning at 5 45. I try to make use of the time. I really value my time. And you guys know at west point, like you are taught to value every free moment that you have. And I still do that. Second thing. I work out every day. So I try to get in the gym seven days a week, first thing in the morning, um, really clear my head just allows me to kind of focus my day and put out that energy and effort in the morning.
and then I think the last thing is I, I'm still really disciplined about how I spend my time about how I allocate my time during the day. And I think you just have to be as an entrepreneur and you guys know in the military [00:40:00] and at west point it's the same thing, right? You're, you're super disciplined about how you allocate your time and how you prioritize.
I mentioned earlier about ruthlessly prioritizing your time. That's something I try to implement every single day in terms of who I spend my time with, what things I spend my time on. and also what things I don't do and who I don't spend my time with. You really gotta be purposeful, Joe, real
[00:40:24] Lance Dietz: quick on that in the venture world, in the startup operator world, there are also a lot of things that probably come your way ad hoc during the day balance between routine and flexibility.
Planning is everything, but the plan is nothing
[00:40:41] Joe Beard: type thing. It's amazing. I've had so many fortunate things that have happened in my business just by chance. Right? Like, I, I, I do think that luck plays a, a part in it and. You know, I, I think all you can do is be open to the opportunity, being prepared for [00:41:00] things that come up.
And so you can seize those opportunities when they do come, I think is, is really important. The other thing is that I still try to allocate time to other people where they're not giving me something in return. They're not doing something for my business. They're not doing something for me personally.
You still gotta put that good out into the world. I, I firmly believe. You get what you put out. I still try to spend time doing those things, even though it's very difficult. So whether it's helping somebody with a resume, making intros, talking to somebody about their business, even people that still come to me, looking for investments, even though I'm not actively investing, I'll listen to, you know, what they're talking about in their pitch and see if I can redirect them to people I know within the investment community, I still try to do those things and kind of give.
To other folks, because I, I, I do think it comes full circle
[00:41:51] Tim Hsia: in terms of your normal work week and day. Like how do you structure it now,
[00:41:55] Joe Beard: man, it's really hectic. I'd say on any given day. [00:42:00] I am always having conversations with investors, whether that's potential investors or existing investors all the time, there's always something tactical, right?
Something tactical in the business that we're solving for. I'm probably engaging with customers every single day. And again, whether that's existing customers or new customers that's happening on a daily. And then I'd say the last thing is really allocating my time to my team. You know, one of the things that I realized is that you can hire really, really smart, capable people.
But if you're not vested as a leader, if you're not putting your time into them, you're not helping them to optimize their productivity, right. You're not helping them to help you. And so really making sure I take the time to help the team to be successful. I is something that I do. So I think those four things, no matter what the day is, those things are happening.
Every single. You
[00:42:53] Tim Hsia: mentioned 5 45 wake up, which I think is attributed a bit to your father. And then you mentioned, I think a bit more than four things. [00:43:00] Raising, leading the team, selling organizational management, mentorship, I think for juggling all those areas, it's a bit like a cadet juggling all of your different requirements.
The last question I have is are there any particular people who have served as mentors for you throughout your civilian career? So you mentioned a few in your military and west point career. How about your civilian?
[00:43:21] Joe Beard: Less knots. I, I, I think I mentioned earlier has always been a, a great mentor, really helping me with how I spend my personal time as it relates to my family and time by myself, he has been super helpful in helping me think through that.
Darcy Anderson has been a, a great mentor and just an all around great guy to have in my corner. Joe de Pento who's currently the CEO of seven 11 has been a, a great mentor. And someone that's always rooted for me, which is fantastic. You know, having somebody that doesn't need anything from you, but is always there kind of cheering you on pushing [00:44:00] you to be a better version of yourself.
Those are the type of guys that have been great. And then I have to mention my best buddies from west point, right. I, I probably have a group text with like my 10 best friends from west point that I'm on every single day. And those are the, the guys that are constantly pushing you constantly challenging the way that you think constantly figuring out how to support you in your endeavors and what it, whatever it is you're doing.
A lot of them are investors in my company, probably a third of my cap table are west pointers. So very fortunate to have really, really good people around me and supporting my business and giving me advice on a, on a daily basis.
[00:44:44] Lance Dietz: Joe, speaking of support and a mentorship in giving back. That's our last segment.
We have a lot of grads and non grads that listen to this that are transitioning. You've done a lot with AOG. You mentioned you served as the president of the society [00:45:00] in your local society. I think, I think you've also done stuff with a ag volunteers group. Like what's driven you to do that. Given how busy
[00:45:07] Joe Beard: you are for me.
I just, I think about what west point gave to me. West point opened so many doors for me professionally. I know it was west point that got me into Columbia business school. I know that it was west point that helped me get into investment banking. It was west point that led me to, you know, doing venture through Darcy Anderson.
Like I'm fortunate for west point what west point does for me. So I, I think I've always thought about how can I give back? How can I show an appreciation for what I've been given? And so anytime I can add value to west point as an institution, anytime I can mentor young west point grads, anytime I can mentor, you know, young people that are thinking about going to west point in terms of where I put my dollars in terms of nonprofits and where I donate [00:46:00] west point is at the top of that list.
I try to make sure that I am west point centric. Kind of in my life in terms of where I put my time, where I put my money, because I, I know that I've benefited from, you know, west point in the same way. So that's kind of how I try to spend my time. And it's not so much how much time, right. Because I know for a lot of grads, especially early in your career, You're trying to build, you're trying to learn.
You're trying to be a sponge on the job. You can't go allocate hours a week to go do something, you know, but it could be something as simple as. Connecting with a young west point grad, that's going to west point and sit down with that young man or gal and having coffee and talking through your experience, talking through how you benefited from west point, or it could be just, you know, donating a little bit of your time for a west point grad, that's getting outta the army and trying to think through that first job.
Right. Which we all know is very, very difficult. What's that first step after the [00:47:00] army. So there's a lot of things that you can do that don't require money, that don't require a lot of time where you can have an impact on an individual's life. So I, I think we all have something that we can give
[00:47:12] Lance Dietz: Joe amazing ending to the podcast.
Um, it's been absolutely awesome to have you. This is one of my favorite episodes. Really appreciate you making time for this. I'm sure a lot of people will enjoy it and. Would love to have you back at some point to do around two if time permits, of course. But thanks again.
[00:47:28] Joe Beard: No, I appreciate you guys. This has been fantastic.
I appreciate what you guys are doing for the west point community. I think it's a great thing.
Thanks, Joe.
[00:47:39] Narrator: This has been a production of the WPAOG broadcast network. Please take a moment to rate and review the show and join us each week for a new episode. Thank you for listening.