We have seen a pick-up in activity during the past 2 months.
First of all, success continues with extensions for our existing consultants. With the exception of two consultants, all other eligible consultants have been extended over the past several months. In the case of the two individuals, the bank they supported appears to be taking substantial cost-cutting measures which includes a material cutback in third party resources. While unfortunate, as you will read below, we are seeing an increasing desire for Augment Analytics support!
The State of Engagements
One of our existing fintech clients has added compliance and project management support resources from Augment in the past 30 days. We are helping them transition to a new loan origination and servicing system. There is a lot to do and it wouldn’t surprise me if they ask for more support in the short-term as their program progresses.
Another existing client has engaged one of our credit policy experts to help them enhance their pricing strategy governance and transition away from committee-based decisioning to the accountable executive model. The bank client has other needs and I hope they will soon make a formal request to engage us in other parts of their organization.
On Monday, we signed a mortgage finance company that is owned by one of the largest global investment firms in the world. One of our recruiters will help them staff critical talent for their growing business, with IT being priority #1. And the good news is that Charles, our recruiter, knows who is on the Augment platform. Therefore, where our resources can be helpful to them as an alternative to hiring, or temporarily while they hire, we’ll get a great opportunity to provide support.
Just today, we signed another subsidiary of the same investment firm. One of Augment’s data scientists will help the client build a new probability-of-default and loss-given-default model for their lending business. The project will likely take a few months. As we get to know the client better, I hope that we’ll identify other ways to help them. And a shout-out to one of our consulting partners for the referral!
We are in the final step of signing a PE-backed small business lender. Our FP&A analyst will be the first analyst on the CFO’s team, helping build out their cash flow models. With their growth plans, I believe we will quickly become their go-to resource for talent as they scale.
Next, we are in the procurement stage with a global hospitality company. Once finalized, our first resource will join their analytics team in support of marketing and loyalty analytics. We are already working with two other teams inside the organization to provide additional resources.
In the insurance space, I am awaiting the go-ahead from an InsurTech insurance broker to onboard one or two marketing strategy resources who will help them craft and implement a strategy to expand their business into several new verticals. I will learn more details about the resources that the larger insurance provider needs when I meet with them again on Monday.
Finally, I have met several times with a profitable mid-sized technology company. They are committed to embarking on the analytics journey. I believe they will leverage Augment to provide them with their first resources to help them understand the opportunities, improve the data/analytics environment, and ultimately perform analysis across Marketing, Operations, Finance, Technology, Customer Success, and Product that drive value. Imagine how many companies are out there just like this one? So much untapped potential.
Business Development Takes Time
As you can see, we made much more progress in the past 2 months than we did in the first two months of the year. I feel like we are gaining momentum. The painful truth is that business development takes time. Our pipeline is growing as we add new opportunities to the top of the funnel every day. Our name is becoming more recognized and the excellence in the work we do will enable us to land-and-expand with new clients. Plus, the trend toward part-time resources feels like it is picking up pace.
The Economy
Two months ago, I spoke about economic concerns in the market. Today, mixed signals remain. In the past 30 days, expectations of rate cuts by the Fed in 2024 went from 3 to zero to 2 (current outlook). One of our partner consultancies just released a great report on the state of consumer credit. They also see inconsistency in consumer health although the impact of tightening lender credit policies might be part of the driver. It is worth a read!
From my perspective, the economy needs to slow down in order to get inflation to 2% and the Fed will keep at it until they achieve it. That means companies will need to slow FTE hiring and begin investing in more collection/credit risk expertise; all areas of strength for Augment. The bottom line is that we are well positioned to grow.
