MPA caught up with serial entrepreneur and founder of Hero Broker, Clint Howen to find out more about what his digital platform means for brokers and consumers.
MPA caught up with serial entrepreneur and founder of Hero Broker, Clint Howen to find out more about what his digital platform means brokers and consumers.
What led you to start Hero Broker?
Well, like most people I've seen, it started with me going through the loan process myself when I was buying an investment property with my family some five years ago. It struck me (even back then) how outdated I felt the system was. At that time I was working on a mine site in remote Western Australia. The thing that struck me was I was out there working 80+ hours a week, trying to get ahead while having to jump through hoops, drive into town and fax things, so this broker can do my loan? He’s making a huge clip because he has access to a computer screen that I don’t. That didn't sit well with be because, I felt, I was more than capable of doing it myself and I understood finance. So I thought this needed to change.
With property prices the way they are I think our generation needs every edge in the market to try and get ahead and to get the best finance we can. So I wanted to try and fix that problem and build something that gave the same access the broker had and use some technology to be able to give good answers and access to everyone. In saying all this though, there wasn’t a single ‘light bulb’ moment - more something that simmered away over years and then the timing became right to build Hero Broker.
I understand this is your fourth start-up? What have you gained through those experiences that are strengthening Hero Broker now?
I’ve learnt heaps! What not to do is a big one (laughs). I’m still making mistakes but if I could sum it down to a couple of things it would be keep your head up in times of defeat and your head down in times of success. Always listen to others that have walked the path in front of you and surround yourself with good people.
How robust is the online questionnaire? How does it compare against a broker's expertise and face-to-face hours spent with their clients?
The way we designed the platform was to simply ask the right questions when users are on the platform; explain what the features are; and to make it intuitive to the point that someone can easily see how different scenarios change the loans and rates they are meeting the criteria for.
How does this compare to an expert mortgage broker who knows the client better then they know themselves? Well it doesn’t, a machine is not a person and it can’t beat a broker that is on point, who has a good relationship with their client and is also powered by tech. The realty is however, that these elite brokers are few and far between. Many brokers don't offer that level of service and good brokers are hard to find. I think many people within the industry would agree with this.
What are the incentives for consumers applying for a loan via the platform?
It goes from nothing to thousands of dollars in rewards. It depends on how much the consumer does. The more they do the more they get rewarded for it, so if they go through the process and just put down their phone number for a lender to contact them, then great - but they don't receive an incentive for that. If they do the full application they are given a much larger amount to spend at over 60 retailers in Australia.
This makes it good on both ends. The consumer doesn't have to do all the work online if they don't feel like it and the lender only pays depending on the quality of the lead and amount of information sent across.
I believe that the borrower already does the hard work for the broker. They have the job, assets, deposit and they take the responsibility of repaying the loan every month. They have all the data that the banks needs to lend against. So if we can make it so that the person at the center of this whole process actually gets something out of it, then I think that’s a huge bonus.
How long does applying online take?
Once they have compared loans and selected the one they want to apply for it can take a couple of seconds to minutes. It depends on how much they want to do. They can submit their details to the lender at any time.
What we have done is to make it so they have the ability to do everything online, including collecting banks statements and online verification; it just depends on how much they want to do.
How does Hero Broker ensure its loan recommendations are tailored to best suit the individual?
What Hero Broker does is give the tools and answers to the consumer to help them find the solution themselves. The big thing with our platform is it is completely unbiased. We don't rank loans above others because they paid for advertising space and we don't have loans unrelated to the query show up in the search.
We only show the loans that match the serviceability criteria and for the features the borrower is looking for and then the consumer can compare.
Sometimes it may not be the rate that is a determining factor, it may be the brand of the lender, its values or its service record that makes the consumer choose them. We give unbiased answers so they can make that decision more clearly.
This platform essentially replaces the broker’s role through technology. Did you consider utilizing the broking industry or tapping into brokers’ skills and working with them in some way when developing Hero Broker?
Well for starters, I never built Hero Broker to try and put brokers out of business. I simply wanted to tackle a problem that I had seen in the industry - some take it as me trying to replace brokers, where as I see it as me just trying to make good, unbiased access to loan products.
On the second note, yes, we plan to work with brokers. What happens when someone can’t find what they are looking for or needs a broker’s personal touch to get them across the line? In that instance we push it to a broker network. We have already been talking with such groups that I look forward to working with and have helped me with Hero Broker.
Are you expecting a backlash again from the broking community at the relaunch?
Yes I am but I feel for the brokers. My beef isn't with the individual brokers. It’s more to do with the industry as a whole and the aggregators that I see as the problem.
Where would you like to see Hero Broker be in 12 months’ time?
Working! (laughs) We look to be in a position that has us gaining traction in Australia and taking steps and doing the ground work to launch into other international markets.
What led you to start Hero Broker?
Well, like most people I've seen, it started with me going through the loan process myself when I was buying an investment property with my family some five years ago. It struck me (even back then) how outdated I felt the system was. At that time I was working on a mine site in remote Western Australia. The thing that struck me was I was out there working 80+ hours a week, trying to get ahead while having to jump through hoops, drive into town and fax things, so this broker can do my loan? He’s making a huge clip because he has access to a computer screen that I don’t. That didn't sit well with be because, I felt, I was more than capable of doing it myself and I understood finance. So I thought this needed to change.
With property prices the way they are I think our generation needs every edge in the market to try and get ahead and to get the best finance we can. So I wanted to try and fix that problem and build something that gave the same access the broker had and use some technology to be able to give good answers and access to everyone. In saying all this though, there wasn’t a single ‘light bulb’ moment - more something that simmered away over years and then the timing became right to build Hero Broker.
I understand this is your fourth start-up? What have you gained through those experiences that are strengthening Hero Broker now?
I’ve learnt heaps! What not to do is a big one (laughs). I’m still making mistakes but if I could sum it down to a couple of things it would be keep your head up in times of defeat and your head down in times of success. Always listen to others that have walked the path in front of you and surround yourself with good people.
How robust is the online questionnaire? How does it compare against a broker's expertise and face-to-face hours spent with their clients?
The way we designed the platform was to simply ask the right questions when users are on the platform; explain what the features are; and to make it intuitive to the point that someone can easily see how different scenarios change the loans and rates they are meeting the criteria for.
How does this compare to an expert mortgage broker who knows the client better then they know themselves? Well it doesn’t, a machine is not a person and it can’t beat a broker that is on point, who has a good relationship with their client and is also powered by tech. The realty is however, that these elite brokers are few and far between. Many brokers don't offer that level of service and good brokers are hard to find. I think many people within the industry would agree with this.
What are the incentives for consumers applying for a loan via the platform?
It goes from nothing to thousands of dollars in rewards. It depends on how much the consumer does. The more they do the more they get rewarded for it, so if they go through the process and just put down their phone number for a lender to contact them, then great - but they don't receive an incentive for that. If they do the full application they are given a much larger amount to spend at over 60 retailers in Australia.
This makes it good on both ends. The consumer doesn't have to do all the work online if they don't feel like it and the lender only pays depending on the quality of the lead and amount of information sent across.
I believe that the borrower already does the hard work for the broker. They have the job, assets, deposit and they take the responsibility of repaying the loan every month. They have all the data that the banks needs to lend against. So if we can make it so that the person at the center of this whole process actually gets something out of it, then I think that’s a huge bonus.
How long does applying online take?
Once they have compared loans and selected the one they want to apply for it can take a couple of seconds to minutes. It depends on how much they want to do. They can submit their details to the lender at any time.
What we have done is to make it so they have the ability to do everything online, including collecting banks statements and online verification; it just depends on how much they want to do.
How does Hero Broker ensure its loan recommendations are tailored to best suit the individual?
What Hero Broker does is give the tools and answers to the consumer to help them find the solution themselves. The big thing with our platform is it is completely unbiased. We don't rank loans above others because they paid for advertising space and we don't have loans unrelated to the query show up in the search.
We only show the loans that match the serviceability criteria and for the features the borrower is looking for and then the consumer can compare.
Sometimes it may not be the rate that is a determining factor, it may be the brand of the lender, its values or its service record that makes the consumer choose them. We give unbiased answers so they can make that decision more clearly.
This platform essentially replaces the broker’s role through technology. Did you consider utilizing the broking industry or tapping into brokers’ skills and working with them in some way when developing Hero Broker?
Well for starters, I never built Hero Broker to try and put brokers out of business. I simply wanted to tackle a problem that I had seen in the industry - some take it as me trying to replace brokers, where as I see it as me just trying to make good, unbiased access to loan products.
On the second note, yes, we plan to work with brokers. What happens when someone can’t find what they are looking for or needs a broker’s personal touch to get them across the line? In that instance we push it to a broker network. We have already been talking with such groups that I look forward to working with and have helped me with Hero Broker.
Are you expecting a backlash again from the broking community at the relaunch?
Yes I am but I feel for the brokers. My beef isn't with the individual brokers. It’s more to do with the industry as a whole and the aggregators that I see as the problem.
Where would you like to see Hero Broker be in 12 months’ time?
Working! (laughs) We look to be in a position that has us gaining traction in Australia and taking steps and doing the ground work to launch into other international markets.
