The Intersection of Financial Services and Gen AI with Jonathan Capaldo

welcome to motivation AI matters a podcast designed to help you channel the power of language to inspire action I'm Lisa spyra here to explore the language that drives business outcomes through the lens of what makes that language good because words matter today's guest is John kapalo a vice president at pado overseeing strategic account Sales Management and expansion primarily focused on creating value for large Enterprise clients in financial services John holds a BBA and finance from the George Washington University with a concentration in corporate finance and capital markets his interest in finance predates his work at pado and his interest in communication has only grown during his tenure here I'm excited to share his perspective on the value of language technology for financial services welcome John it's great to be here thank you for having me today it's

great to have you here so I guess we'll just Dive Right In pado has a long track record creating value for financial institutions and you recently returned to pado after some time away what was it that pulled you back I am what is considered in the corporate world as a boomerang as I have gone out and worked elsewhere and I've subsequently come back and along the way my role has been primarily focused on the financial services sector and in seeing what else was out there I stayed in Tech but worked in a couple of different types of product offerings and as you so eloquently put it with the podcast introduction words matter communication is such a huge piece of our lives every single day we spend over 95% of our time communicating and whether that is at work or at home or even what I think people fail to realize internally with ourselves you are always communicating you are always positioning you are always talking and again it can be explicitly implicitly loud or soft doesn't really matter and remembering and realizing the impact that we can create that we can assist with that we are part of here pado I just find that fascinating and I don't think I had that drive that motivation that yearning to learn in some of the other spaces that I was working in they were certainly very exciting very Cutting Edge Forward Thinking and fast moving but at the end of the day the way in which we communicate and the reasons as to why people engage is really powerful and pado had not lost sight of that that's what drew me into bado as well the fact that this is a tool to make communication more effective and I just thought wow there's so much value in communication I want to help build something that does that so when you speak about pado is that what you focus on is that the message or the value proposition that you like to talk about with financial institutions what's been the most impactful way that you communicate what persado is yeah I love that question and when you think about pado and the space that we've been I don't want to say playing in but the space that we are aligned to I'm playing I guess we are all playing in the sandbox right but the space that we are playing in and how it relates to generative AI which is the world's hottest buzzword of our time right now and I'm sure we'll talk more about this later but what I really see though is prado's way of communication and what really I think drives engagement whether it's prospects or current customers is how we are known in the market and positioned as not gen AI but actually Mo Ai and what does that Moe stand for it's motivation Ai and the reason for that and why we have such a massive understanding of what drives our clients customers or prospects to engage is because our models are trained on action oriented outcomes plain and simple we are utilizing whatever engagement metrics we have access to with our customers and clients and those engagement metrics can be opens clicks application starts application submits full conversions doesn't really matter whatever level of information the customer is working off of that's the same level of information that we are working off of and that's real engagement real metrics and so the language that we are building and that we are putting forth to customers is actually the language that they are going to engage with definitely real

metrics just have huge value and when I talk about Brado I also like to talk about how we're measuring Words which I think that so many people in school say oh I'm a words person or I'm a math person and feel like they're going to pick one of those buckets and that's going to be a part of their identity and at P AO we're very much like math informs the words and language informs the numbers and that's one of my favorite things about the solution that we provide I love that it's a perfect encapsulation or marrying of Art and Science and I've always felt in the world in general in life in general it's very challenging to find subjects that are purely black and white maybe physics but even there is a massive black hole of understanding Grays space gray matter for that matter and we've really done I think a fantastic job of mirroring Art and Science together in terms of how our product works how we position with words and phrases how we're working off of content that is sweat over that is built by copywriters by persons who work with brand by agencies by media and we need that starting point we need to understand what is the human connection what is the art behind the message that you're trying to drive and then we'll apply the science to it so I was a

language person who had to find the value in the math but I bet that you come from the other side because your background is in finance which is very much numbers so your interest in finance predates pado how did you get interested in finance walk me through how this numbers guy ended up here man it's quite the backstory so as you mentioned with the intro I was a finance and capital markets major in college and that took me to working for private Equity right out of school and the year I graduated was 2008 so for those of you in my age class uh you might remember that 2009 was not the best year for the world for I also graduated in 2008 good so I'm talking to a like-minded individual who can remember those tough times I feel you right signed my offer letter and received my starting bonus in November and come February 2009 when Capital markets completely dried up nobody was lending there was no need for working on rolling up Trucking and transportation companies with leverage buyouts because you couldn't have any money to fund it and the entire organization that I worked with was let go and I realized I needed to reinvent myself and think about some of the other skills and tool sets that I had and I'll never forget having a conversation with my father and his comment to me it was actually surrounding communication he was like you have this ability to communicate with people and I don't think you really capitalized on that during your time in school I think you were very focused on math and particularly statistics in your world which you excelled at and you got this job but John you are a communicator and you can connect with people and then I thought about one of the aspects of my job in this private Equity company was to actually call these small mom and pop Trucking and transportation companies and talk to them and hear their stories and hear about their business model and again I was realizing wow I'm really good at this because I'm connecting with these people and they're providing information and I talk about this a lot because I think it relates a lot to what pado is trying to do pado as a company tries to communicate and connect with the customers and that kind of ties back to why I came back here but it was at that time my father ask me what about Consulting I think it's a great place to talk about Art and Science the art of communication and interacting and engaging with clients and the science of applying models and valuations and understanding what can we do to help this particular company or this client out so I applied for the entrylevel analyst class at Accenture Federal Services worked my way up into Accenture strategy and was doing financial consulting and again just a lot of relationship building a lot of what we called stakeholder interviews and out of the blue one year a head hunter reached out to me on LinkedIn and said hey there is this fast growing startup that is looking for a consultative approach to its post sales organization and that's how I found myself at P the first time around and what a great place because I came in when we were really just getting our feet under us we were a much smaller company when I first joined as a director of customer success and I ran my first campaign with a co-brand company who is now our largest financial institution client and this was a pilot campaign that we ran with them and I got to be involved in everything in planning and resource allocation and the mathematics of it and work together with data science and with the customers and the clients understanding what their goals were and what metrics were available and we really got to build this from the ground floor up and I just I thought it was so cool and again taking something that I really had grown to love through my strategy career of communicating interacting and engaging with clients and applying that to the product that I was now going to be working on I thought was super duper cool so at the time that you got here as

you said the product was newer we didn't have all of the generative AI technology we have today but a lot of the problems were the same what challenges did that financial institution customer that you were piloting with what challenges did they face when trying to create language for all their marketing needs which I'm sure you've seen in other companies too but what are these challenges for financial institutions yeah it's a great question Lisa because to this day those challenges have not changed the largest one being how do we scale right I think back to the singular campaign that we ran with this bank as I mentioned it was a C- brand credit card it was a display campaign So Paid display is an area where you purchase ad space on affiliate websites and it puts your ad there and you want people to click and to drive to your landing page and ultimately through the application process to get the credit card to apply for and to become a new card holder and this was a true 16 variant experiment for those of you unfamiliar prado's models for our specific customers are driven off of experimentation the more we learn and understand about who you're engaging with the smarter our models become the better we can predict what language might work and might not and this is the starting place with a lot of clients or it was back then and we saw the results and I want to say it was 98% conversion lift off of a single test with statistical significance which was absolutely unheard of people were falling out of their chairs screaming at the rooftops I'm I'm being a bit factious but the excitement was really there and these results really are what supercharge does in terms of growing into an Enterprise wide agreement but during that time the question kept coming up we don't have the resources to implement putting 16 different variations in place in every single piece of marketing content that goes to the world because we have millions of placements per year that we're working on so scale became a really big deal and especially you think about these large complex financial institutions there's a lot of legal and compliance you need to jump through in order to get content to Market there's also executional constraints right typically they're running shared services organizations that are responsible for getting content to market for multiple different business units it's built very different than retailers and they don't work with the same speed verocity that retailers do and again because the implications of having an incorrect offer are far greater for a financial services organization than for a retailer so there needs to be more scrutiny around that but getting back to the issue of how do we scale we would apply something called Leverage and leverage was simply a way to not have to experiment on every single campaign but utilize the learnings and the insights that we had from exploration and apply it to particular campaigns and just give them one or two different variations well we kind of took that idea and just blew it out a little bit and we said hey we are actually going to build and create different product offerings within the tool Suite of pado and when we scope campaigns or projects to work on we are actually going to be prescriptive about what type of a should be provided and so we created this engine where we had full Explorations and we had four variant tests we would typically call them and we would do ab and then we would do predictive swaps where we wouldn't actually test we would just give supercharged content right we would look at the control and provide one piece of content and I think this really set the stage for how we scaled with almost all of our clients and how we've subsequently grown with a lot of the financial services customers that we have today because knowing full well that you cannot experiment on every single campaign that you run but that being said you do need to experiment on some I think that's the important part too is that the only way that we get smarter or your prospects or your customers get smarter is by experimentation it's very important it's a very important foundation to have but with Dynamic motivation essential motivation right these tools that we're coming to Market with now that show prediction scores how well is this predicted to perform in market and brand alignment scores how aligned is this to your brand voice and now we've got options such as compliance scoring and how aligned is it to legal and compliance how much faster are you getting content out really started from this idea of how do we scale what can we do with pado to really change the game and make sure that we can really use it everywhere so Financial instit tions

their biggest problem is scale they are so huge and so they can't test the way pado originally conceived of testing every individual bit about language but over time at this company we've scaled by testing so much with so many different companies and across different Industries but with a lot of financial services companies in different parts of the world even that we've been able to create these scores that help people make decisions faster the other thing that probably really helped with scale was the addition of chat GPT and large language model technology to our world do you think that in a post chat gbt world the problems of scale are getting easier what has changed with large language models this is something I think we could spend a whole podcast series on Lisa personally I'm fascinated by and I think everybody else is too as I said earlier generative AI is the generational buzzword that we are experiencing these days and these open- Source models that are still I wouldn't even say they're in their infancy stage yet they're still newborn in terms of what they can and can't accomplish and I think it's a double-edged sword to be quite honest and I'll tell you why one of the reasons that we've had success in working together with some of these more highly complex highly matrixed largely regulated Industries is because P's 70 billion parameter large language model it's actually closed source which is crazy to think about that we have that many parameters in a close Source model and it's because we've been doing these type of Explorations for 13 years as a company and I think going back to when we were incubated an additional five or six so we' built up this massive library of language primarily focused on again motivation AI not generative AI but what type of language words and phrases actually engages with customers and we've cataloged and scored this model with our own developed ontology we talk about emotional language we talk about formatting descriptive elements functional brand narrative right all these things that are important in the pado world and yes could you establish an onology and apply it to the database that chat PT has or any of the other LMS out there sure but again coming back to these very regulated Industries there are guard rails and I would say 99 out of 100 clients have these AI guardrails which are limiting in the ways in which you can use open source models rightfully so right if you're a financial analyst and you're working at Barclays and your boss asks you to put a 10-year forecast together for this particular business unit are you going to go just copy and paste your income statement and your balance sheet into chat GPT and tell it to put together a 10year forecast I mean that would be incredibly easy but at the same time now all at Barclay's income and balance sheet information is part of that model and it is now open access and you have no idea who is using that information or what it's being used for so that's been a really interesting differentiation piece for us in terms of how we work together with some of our customers in the space the other really cool thing is that as I mentioned the iterations of our tools of being able to move faster and apply our learnings in a more precise way we've developed plugins with some of these open source models and we are able to utilize them in spaces Where We Are allowed to move much faster and to bring that information in and to fully understand what is going on so I think that's fascinating the last point I'll add to this which is something that I've shifted in the way that I think about this right as I mentioned we work best typically when looking at what we call a control or a piece of content that is generated by our clients or our customers to go to market with now we do have tools and products where you can generate content on the fly without any inputs you can select what is the goal of this campaign what does the customer profile look like what are you trying to drive what is the product you selling and pada will generate content for you either with or without open- Source models but this beginning this utilization of content to start we have a team they're aptly named brand content strategists which I have renamed in my own little world to pado prompt Engineers actually these are the individuals that are actually interacting and engaging with our 70 billion parameter model and they're the ones who are trained to really understand and grab that impactful language and know full well how the model is working and what's going to be most important for those campaigns our high Touch model in which we're driving the highest results the highest impact and the highest insights for our customers are all coming through our prompt Engineers it's just it's fascinating I agree really a change in

this space and how content is generated and prado's recent press release stating pado AI drives 2. 5 billion in revenue for financial services Brands is pretty impressive the press release claims the company's motivation AI which is how you prefer to it pinpoints optimal message copy with a trifecta of potential gen for marketing benefits productivity performance and compliance is this how your clients think about what geni can accomplish or how would you speak to gen's fit for financial Enterprise marketing it's a great point and really glad you brought out the press release we had quite the event in front of NASDAQ where our co-founder assoff took a wonderful picture with his hands raised in the air he's raising his hands and celebration and just all the value that we have created 2. 5 billion that is massive that is just an astronomical amount through the product right through what we've come to Market with what we put together and it's all marketing these are real dollars real impact that we are driving for some of the use cases that I talked about like that display campaign driving to sign up for coband credit cards or a paperless campaign that goes across the entire breadth of A bank's credit card portfolio and that if you can drive a singular person to stop receiving a paper statement and move to an online statement well you're going to save $ five dollar a year on that person and you're gonna save generally for the world exactly love that Lisa most importantly environmental service right I got to take my math hat off again for this but it's true that even non-traditional metrics are money savings I don't think you necess you think of someone signing up for the credit card as value you don't think of someone signing up for paper lift statements as actual monetary value for the organization which it is right but there is an Associated cost savings with that as I mentioned the $5 per person a singular paperless campaign across an entire credit card portfolio drove $2. 5 million in value that's just really remarkable yes they drove doubl digit millions of people to sign up for paper lless because of a person campaign and I think 60% of the action was driven by the change in the callon action the actual CTA button in the email that was sent out it's just fascinating and I would be curious too to that point Lisa the environmental impact I wonder what the carbon impact would be yeah because a lot of the campaigns that these organizations run have more value than just the value to that institution some of them have really high value to the end user to that consumer to potentially signing up for information Financial Services can be really confusing to Consumers and some of these campaigns that I've worked on that are about finding the right advisor and wealth management can be impactful to the financial institution but can also really be educational to the person and help them with their life and their finances yeah absolutely I love the way that you talk about that balance of not only information to our clients and customers but information to the clients and customers too and we talk about what are the rtbs of what we're trying to push sell why would you purchase this product over another one reason to believe right that's the exactly what are the reasons to believe and some of those reasons are really important to the end users and to the consumers and the customers and the way in which we experiment and we understand these reasons helps Drive information for our clients and what's important and it gets the end user to the information that they're actually looking for of what's important for them so that mirroring that like symbiotic relationship is really super cool to understand too I

think a lot of people think of marketing as evil but the right marketing at the right time is actually quite helpful to everybody involved it's about putting information in front of people and if you do it right it moates them to take action which might be aligned with your key performance indicators sure but it also gives them information that they were likely seeking or needed when they take that action it's about cutting through the noise yes absolutely cut through that noise and you want to drive engagement with the people who are actually interested what are your tips for communicating effectively with stakeholders at financial institutions if I think back to that conversation not to reference it too much but that conversation that I had during my career change fresh out of college and I mentioned this earlier but that ability to connect with people which is really driven by curiosity I'm not pretending to be interested in you talking about your marketing program I am genuinely interested and curious about how do you talk and speak with your customers I want to soak up everything that I possibly can to understand what is the problem that you are actually trying to solve because at the end of the day it's usually not just oh we need more credit cards or paperless signups right there are all these different goals that are tied to these things and so many different stakeholders that are tied to these different goals and again Financial Services highly complex highly matrixed right you can drive more credit card Acquisitions if you offer 50,000 bonus points the cost to the business of those 50,000 points is massive so all of a sudden now you're impacting bottom line dollars and is that going to be that good probably not so what if I told you that with pado we could actually offer different tiers of points and introduce our language to see if well maybe the actual points offer richness isn't as important as you think maybe we can introduce some emotional language maybe we can change the reasons to believe and we have an actual case study that showcases this where a less Rich offer one with pado language against the control with a richer offer right that's so remarkable very cool and again you can see how excited I am getting by this and honestly for those of you not in marketing be curious get to know the person you're talking to on the other side of that phone or screen table I cannot tell you how important of a skill that has been in my career and throughout all the different products that I've worked with and my life with consulting which is has shifted me around from industry to Industry and place to place right if you're passionate if you show genuine curiosity you will gain that other person's trust that's such a wonderful tip like you mentioned we are a math company and we're driven by engagement and communication and the results speak for themselves and we touched on this lately but the insights speak for themselves too and that's what I also really love is that let's just get something clear there is not a single product in the entire world that is going to win every single time full stop doesn't exist it's a unicorn however in the cases where we do lose what pado offers and what I love is that insights analysis why didn't this actually work what did we maybe rely too much on or what is an area that we can maybe focus on next time to drive performance and drive results and all of these items are feeding into the model for your particular company to help make it smarter to help it get better to help drive performance and results down the line and we have these rank orderings of the different formats the different types of functional language the different emotions that we put into Market but those change and Shi over time and the only way that we understand that is if we continue to test and to learn and to explore and I'll tell you there are a lot of our clients and a lot of business units or lines of business or whatever you want to call them that are just as jazzed or excited by the insights as they are by the results because they're feeling like they're truly connecting with their customers then in the same way that I feel like I'm truly connecting with the stakeholders of the business they're learning about them that's really great as a takeaway that there's more than just the math and getting it right and getting those results to drive more actions but there's really understanding when it did or didn't work and why and learning from that and just continuing to hone in on the messages that are going to work in any given moment yeah as not only financial services but other large institutional organizations with a lot of money are putting a lot of focus on AI and data structure and customer profiles there's a particular link there in terms of the type of data and information that pado captures through its engagement that should be enriching your customer profiles that should be helping you understand and inform as to what works what doesn't work with your customers and deep segmentation even down to individualization we've had the privilege of working with a couple customer on that personalized onetoone messaging and it works and I'll be honest sometimes it doesn't and I think that's because we are not enriching the data or they are not utilizing the data strategies in the way that relates to what Prado information is providing but it's a heck of a ride and it's a lot of fun that's great yeah there's a lot there that we can do in terms of data as well thank you so much for joining us on this podcast episode and sharing your backr ground and your experience working with financial institutions and really helping us understand how language can matter so much to a math person because I think that's really the value of P Auto is bridging that Gap and helping people see that marketing language is science and art and really valuable and so tools like verado that provide a leg up in that way are really cool to work on and really interesting and really valuable to our financial services customers thank you for having me Lisa I really feel I started as a science guy I found art in terms of the art of communication and now sometimes I forget that I came out of school as a math person but it's really great to see the co- jooin of the two and be at a company like pado thanks for joining us we'll catch you next time here on motivation AI matters until then make sure you're subscribed and learn more about how to find the right language to motivate your customers and how generative AI makes this possible by checking out the resource library at p. com