@Ben Tuszynski from @Judo Bank, shares his insights on the importance of banking relationships for small business owners.
Ben is currently the Managing Director of Judo Bank in Victoria and Tasmania. He has over a decade of experience in the banking and finance sector. Joining Judo in 2017 as one of the pioneering employees, Ben has played a pivotal role in the bank's substantial growth over the years.
His primary focus lies in supporting small and medium-sized enterprises, aligning with Judo's commitment to providing tailored financial solutions to businesses, in an age of #industrialisedbanking.
Our conversation covers;
- Judo's nimble and responsive approach to #smebanking
- The four C's of credit
- Ben's tips for business owners, such as the value of having open discussions with banking professionals
- What to do if you're feeling frustrated by the lack of support and opportunities from your current bank
- Trusted advisors for small businesses
- Vendor finance in #businesstransitions
- Explore better banking relationships through skilled finance brokers
"No one business is the same from the other, so how do you industrialize that whole process? We really want to have a look at what's their management experience, what's their skill set, how have they gone through the ups and downs of the economy and weathered those storms?" Ben Tuszynski
Timestamped summary of this episode:
00:00:14 - Introduction and Technical Difficulties
Michael and Julie from Judo talk about technical issues regarding Ben's recording for the podcast.
00:03:13 - Catching Up and Personal Background
Ben and Michael catch up on their personal backgrounds, discussing Ben's move back from Perth and his role at Judo.
00:07:02 - Judo's Mission and Target Audience
Ben explains Judo's mission and target audience, focusing on small and medium-sized enterprises (SMEs) with turnover up to $100 million.
00:13:07 - Judo's Approach and Importance of Personalized Banking
Ben elaborates on Judo's approach, highlighting the importance of personalized banking relationships for SMEs and the industrialization of the banking market.
00:17:21 - The Importance of Reviewing Banking Relationships
Michael and Ben emphasize the importance of reviewing banking relationships and the role of a trusted banker in supporting the growth and success of SMEs.
00:20:02 - Importance of Collaborating with Accountants and Business Coaches
Ben emphasizes the importance of engaging with accountants and business coaches to navigate complex business situations and provide added value to customers.
00:21:48 - Judo's Customer Base and Industry Focus
Ben discusses Judo's industry-agnostic approach, catering to SMEs across various sectors such as accommodation, manufacturing, financial services, and property investment.
00:25:17 - The Four C's of Credit
Ben explains Judo's credit assessment framework based on character, capacity, capital, and collateral, with a focus on character and the ability to walk the factory floor for a deeper understanding of the business.
00:29:39 - Importance of Credible Cash Flow Forecasts
Ben emphasizes the significance of credible cash flow forecasts and the business owner's ability to endorse and explain the assumptions, fostering trust and communication in the lending relationship.
00:33:29 - Funding Opportunities for Growing Businesses
Ben highlights Judo's approach to lending against trading businesses, supporting growth plans beyond traditional equity in property and enabling businesses to access funding based on their strong balance sheet and income generation.
00:35:25 - Understanding Debt Servicing Capability
Ben explains the importance of understanding a client's capability to service debt on a case-by-case basis. He emphasizes the need for deeper conversations and not missing out on growth opportunities.
00:36:43 - Business Growth and Financing
Ben discusses the dynamics between business owners and potential buyers when it comes to taking on debt for growth. He highlights the role of trusted relationships and the importance of considering alternative financing options.
00:40:54 - Vendor Finance and Business Sales
Ben and Michael explore the concept of vendor finance and its potential in facilitating business sales. They emphasize the need for effective structuring and collaboration between the buyer, seller, and banker.
00:43:32 - Loyalty Tax and Customer Relationships
Ben delves into the concept of "loyalty tax" and emphasizes the importance of delivering strong relationships and support to existing customers. He also discusses the role of finance brokers as an effective channel for improving banking relationships.
00:47:34 - Economic Outlook and SME Support
Ben shares his views on the economic outlook for small and medium-sized enterprises (SMEs), highlighting factors such as labor market conditions, property market trends, and sector-specific considerations. He reaffirms Judo's dedication to supporting SMEs.
00:53:09 - Building Trust and Long-Term Relationships
Ben discusses the importance of building long-term relationships with customers and becoming Australia's most trusted SME bank. The focus is on delivering quick and confident solutions to customers for their business needs.
00:53:46 - The Value of Banking Relationships
Ben emphasizes the importance of evaluating the effectiveness of banking relationships and suggests reaching out to judo or a finance broker for a better understanding. The conversation highlights the mission of fintechs like judo in providing special opportunities to clients.
00:54:19 - Experienced Business Bankers at Judo
Ben reinforces the fact that judo, as a new bank, is staffed with experienced business bankers. He encourages businesses to start chipping away at any loyalty tax they may be paying and acknowledges the efforts of other fintechs in the industry.
00:55:11 - Access to Opportunities and Different Ways of Financing
The conversation touches on how judo and other fintechs have enabled clients to tap into opportunities that may not have been accessible before. The focus is on freeing up capital and exploring different ways of financing for businesses.
00:55:33 - Ways to Reach Out to Judo
Ben shares the various ways to reach out to judo, either through their website, phone, or LinkedIn. He emphasizes their willingness to help and collaborate with businesses, concluding the conversation with a message of appreciation for the opportunity to share insights about judo.
Thanks for listening. Visit the Owner To Owner Podcast website to subscribe, listen back, or check out any resources or information mentioned on the show.
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Reach out to Michael Kerr via the website if you need personal assistance or advice for your small business.
michael.kerr@kerrcapital.com.au
www.ownertoownerpodcast.com.au
[00:00:00] Welcome to the Small Business Banta Podcast. I'm Michael Kerr, I'm your host and I'm also
[00:00:11] the founder of Kerr Capital where I work day to day with business owners. The Small Business
[00:00:17] Banta Podcast is built for business owners and their trusted advisors at what I see
[00:00:22] is three different key stages of ownership in, Ben. Thanks, Michael. Thanks for having me on the show. Look, you manage a team of 60 bankers. I was pretty representative of the growth of Judo
[00:01:41] over the last few years. We're just chatting about our first meeting about what Judo does and why it's different to the big banks. We're going to talk about just why effective funding of small and medium businesses is Judo has been incredible from 2017 coming in is that first bank are riding our first transaction, which we're really proud of is actually still a customer of ours today.
[00:04:21] All those years later and has grown considerably
[00:04:23] over that time.
[00:04:24] But I've had the fortune of the backing of Judo at the time but moved over there and started up in a little tiny shared office and started recruiting and getting out there into the market and by the time I left after just quick responsive and it's a play on us being the small player in the market being able to respond quicker to our competitors and really be there to support our customers I suppose at the end of the day and I think there's a few things that really
[00:07:02] form our foundation. One is the four C's of credit you get to see so many varieties of customers out there. There are hundreds of thousands of businesses
[00:08:22] that might potentially fit into that size range, right?
[00:08:25] Absolutely.
[00:08:26] Well, we know that majority of our economy It was kind of the detriment of SME customers who really want that personalized relationship experience banker who that can talk to about their business and what they're looking to do. And I suppose what we found, and one of the reasons why I suppose our co-founders started the business was because no one business is the same from the other.
[00:09:40] So how do you industrialize that whole process?
[00:09:42] Yes, you can extract information out of financials
[00:09:45] or an industry code or whatever it might be. accounts, trading accounts, but also, you know, I'm no doubt that there are ways and means to, you know, to minimize the pain from that. But at the end of the day, if your business is growing, if it's, and you're missing out on opportunities by not having a, you know,
[00:11:02] a good banking relationship, well, you've just, you've got a banker and a bank on the other side, that firstly picks up the phone when you call. So it's not going through to a call centre, but actually picks up a call and knows you and your business can really help the customer grow their business and succeed. Look, I agree wholeheartedly because
[00:12:22] there's a deal with in potentially in the same way as with accountants. You're going to do your annual tax return and you get it done, you do all your compliance stuff, you feel good, but you've missed an opportunity to if you've got a really engaged accountant and there are some excellent accountants
[00:13:41] who can actually be a part of that team that you need.
[00:13:44] And that's not a formal team, experienced in finance, it may be a really good at running your business. You have an expert come in and tell you if there's some potential to take on some more borrowings or restructure it because it could help the bottom line but also help better position the business for whatever the opportunities are. That comes as a banker or as an advisor.
[00:15:01]
