How to Sell AI in the Mortgage Industry | Mike Brown (Gateless)

Carter (00:01.344)
Hey Mike, give the people a quick intro. Who are you and what do you do?

Mike Brown (00:07.028)
Hi, well I am a father, a husband, and I love to hunt, fish, and sell stuff. So, and surf. So I like to say that, I guess the best way to put it is, you know, I like to be good at what I'm doing no matter what it is.

Carter (00:27.662)
That makes a lot of sense. Is there a USurf a lot in Jersey? Or is it super cold there? okay.

Mike Brown (00:30.542)
Yeah, that's good, sir. Yeah, no, actual start in business was I ran and operated two retail surf shops here in the mid 90s to 2000 and like 2006. Yeah, yeah.

Carter (00:44.19)
okay, that's pretty cool.

You've led sales teams at Black Knight, ACA Group, and now Gateless. What's the biggest difference in how you build a revenue team at a smaller company versus a massive one?

Mike Brown (00:57.634)
You know, think initially it's if you're going to a big company, there's already some structure there, right?

Carter (01:02.892)
Right.

Mike Brown (01:03.502)
What's been great about this Gateless experience is I started out as a sole contributor as chief revenue officer. So I got to really test all the things that I've been teaching for the past 10 years when I went into sales management, I had to actually apply. And with that, we're in this world of AI revolution. So I've been able to just very, very flexible, in a very flexible manner, be able to create an operation that, for example, a Black Knight,

We had six or eight people running sales ops to gather data, to make sure the systems are in sync. And have a guy, one of my good friends, Scott Kennard, who runs ops for me and does about 20 hours a week. So with the tools, can build out more, you can do more with less people. That would probably be the biggest difference, I think.

Carter (01:55.405)
Really? So you're saying in your job now you're using a lot of AI tools to do stuff where you don't need as many people.

Mike Brown (01:59.318)
Yeah, 100%. Yeah, so we have a team now. We've increased by two folks over the last six months. We'll probably end up hiring next year. But as we do hire and go downstream, there's a... I mean...

A day doesn't go by where I don't get two or three solicitations. And I try and look as much as I can that interests me. We use tools on top of Salesforce that are very economical and very, really, know, roughly very easy to use. I mean, I've been using them myself and that's been the cool thing about this is when I bring people on, I'm like, look, I know how to do this. I've used these tools. So it's a must have. Whereas, you know, 10 years ago, you know, using the CRM or not, you spend half your time just getting people

and try and update Salesforce.

Carter (02:48.824)
That's really interesting. I don't want to go too far off the rails, but like what specifically? Cause I always hear, AI, you know, is getting rid of all these jobs and I never know like what is hype and what is real are the, are like, how far does that go? So yeah, what specifically are you?

Mike Brown (02:57.261)
Yeah. Just the outreach. You know, the outreach and the amount of creativity that you can leverage with the AI, right? I mean, you can take meeting notes, drop them into Gemini and come out with, hey, I want to follow up email, but I want it addressed in this manner. I want you to address this person a specific way. And it spits it out without you having to spend time thinking about it.

Carter (03:19.69)
Your philosophy at gateless is be excellent at what we do and partner with people who are excellent at what they do. How do you decide where your lane ends and a partner begins or partners begins?

Mike Brown (03:28.845)
you

You know, it's very much, I would say, functionality and staying to what, you know, you can get really good at like three things, right? So at Gateless, we do credit, income and assets today. And we want to be the best at that. want to be, you know, my former CEO at Black Knight used to say, we want to be, you know, an inch wide and a mile deep in the space, not vice versa. And anything more than that is a lot and it's not attainable. so where

we decide very strictly what our guidelines are. And if there's things that we see other people doing that we think we could do or could do a better job of, we'll start kind of poking at it. But not until we're ready and not until we're finished with our initial mission are we gonna go there.

Carter (04:15.798)
Okay, that makes a lot of sense. You've said on LinkedIn, everyone's talking about AI as a must have, but the lending industry is still early in adoption. How do you bridge that gap between the conference narrative and the buyer reality?

Mike Brown (04:30.518)
Yeah, I mean, that's a big deal. know, everybody who's an executive has been told by their board or their boss CEO that we have to use AI. I mean, it's on the news every single day. All these companies coming in and, know, Twitter firing 16,000 people or, you know, things like that, like where we're all of sudden, hey, we're just going to go down the AI, burn the ships, right? We're going to go down the AI train. The mortgage space is very different in that it's heavily regulated. So how you

Carter (04:49.005)
Right.

Mike Brown (05:00.462)
approach and deliver your product and how that product gets introduced to a borrower in a highly regulated environment needs to be very, very provable. And so you have to be in the middle of, okay, is this provable? Does it work with regs? And if it works with the regulations, we can leverage it in our space. But if not, it's a nice to have and it's something that we can...

We can, know, potentially downstream will be accepted, you know.

Carter (05:31.096)
So it's people are fired up, but you're saying it just takes a long time to get that adoption just because you have to jump through so many hoops usually.

Mike Brown (05:38.051)
Yeah, mean, if your generative AI can spit out hallucinations and, you know, could potentially not approve you for a loan, Carter, even though you're eligible for the loan, you don't know, right? So if all of a sudden you get denied a loan and then you go to the regulator and say, hey, I know this company is using gen AI on their chat bot and I bet you it made my decision. And if that was a case, you could see a lot of backlash in that in our space.

Carter (05:49.528)
Right.

Carter (06:05.826)
You know, a lot of companies are pitching AI right now. I know you just mentioned some of these lenders are seeing some of these products as a nice to have. How do you get buyers to see something like smart underwrite, for example, as a real operational advantage instead of just another nice to have AI?

Mike Brown (06:22.092)
Yeah, no, I mean we have a provable financial model that specifically lays out the steps that the manual steps or the human deliverable steps that we cut out of the process so we can prove out the ROI on the product. We don't do that just so that's just at the initial sales pitch will say here's what we think is going to happen. But you you Mr. Prospect or Mrs. Prospect should come in and validate our numbers and then we encourage our clients to run us in a specific

channel or place and compare us with others. We've seen clients report anywhere from 5 to 12 days savings between app and clear to close. We have a client in the loan store who said on a podcast, know, they're getting 3x production increase out of their best underwriters using our tool. So it's really get in the door, but also ensure that you're proving the product out. We don't want to do our reporting initially. Once we get someone live,

Weekly monthly however long we think we need that the reps to come through the machine to be able to deliver meaningful data We'll come back and show you every month how the tool is behaving because two reasons one We need the tool to get smarter and faster, right? So we call it auto clear our auto clear rates are Round-trip documents going through our machine when I started two years ago is about five percent Right now our average is at about 20 and we have some clients that are reporting over 30 and newer clients going

live in the 40s. We expect the tool to get smarter so that 25 % of the files, so if you're a loan officer, you had a one in four shot of your borrower's application getting completely approved at night in under five minutes, one out of four times, you're going to use the tool, right? And then that subsequently, next year or the year after that, should be 50%. So we're interested in improving the tool, but we're also interested in ensuring that the client recognizes the return on investment.

Carter (08:21.782)
Okay, that makes sense. So it's pretty obvious when they see the results, they see the ROI, that's, that's like, you don't have to sell them so, so crazy hard at that point. Like it may, makes sense.

Mike Brown (08:29.854)
Exactly. With AI, I've been saying this, it's more of a prove it works than pretend it's going to work. You got to prove that the tool is going to work. It's challenging because we're looking at a CRM here that's AI driven. How do you do that without

investing time, investing your data, putting time into that, right? And that's what we're asking folks to do. So we have to be pretty flexible from a contracts perspective as well in terms of, hey, give it a shot and if not, we'll give you an out.

Carter (09:05.676)
You said I'm consistently getting on calls with prospects who want to boil the ocean and solve for every edge case with one solution. How do you on those discovery type of calls, how do you reframe that conversation and get them focused on one small thing to automate rather than trying to focus on so many different things?

Mike Brown (09:21.014)
I don't. I don't.

If I want to know who's gonna want to dance right away, there's there's no reason to spend time You know talking somebody at a very high level in an organization out of there I'll point out that there aren't two there isn't one tool that does everything there isn't one drug that cures all illnesses, right? I'll point that out But I don't spend time trying to change someone's mindset when they've when they are coming in saying I need to solve these five problems When I can solve one or two of them, I will tell them I'll solve these

these one or two problems, I'll show you what we can do. And I've had conversations being very transparent like that, that lead to deals. And I've had others where they say, well, this isn't what we're looking for. And then, know, six or eight months later, they're gonna come back and be like, wow, you were right. mean, because selling AI in our space right now.

half of my job is trying to understand if what my would-be competitors are saying is actually real or is something they're going to be doing, right? Because everybody can do anything with AI, you know, you can vibe code in LOS, you can do this, you can do that, but the reality is to get a finished product out the door and get it adopted by clients, that's really, really hard. so, spending time, you know, knowing that ours works is important, but more importantly, it's understanding what is an

there yet too.

Carter (10:42.584)
How do you know when something is just hype, really? Does it just come down to they use the product and it doesn't work as well or like as far as your competitors go?

Mike Brown (10:51.565)
Yeah, no, it comes down to, you know, how are they doing that? A lot of times with us, it's, I've been fortunate in being placed with this great company with, you know, my team here.

How do they, I know how, we know how hard it is to do what we do. So how can a two person startup who just got 6 million in funding, prove out everything that we're going to do. just, last month we, um, processed our 1 millionth application through the system. So the amount of repetition that it takes AI to learn, right? How is a $6 million startup in California with a lender who does 300 loans a month going to get the amount of data and reps that are, that's going to train it, the machine to do.

what it needs to do. Does that make sense?

Carter (11:36.342)
Okay, that makes a lot of sense. Yeah. You've hired a lot of salespeople over your career. What's one thing on a resume or in an interview that makes you immediately more interested and what's one thing that's an instant pass for you?

Mike Brown (11:43.311)
You

Mike Brown (11:52.409)
Great answers to questions. There's a gentleman I interviewed one time who had no sales experience and I asked him, hey, why should I even consider you? And he goes, I'm brand new, I haven't had time to pick up any bad habits.

And that guy's a homer right now. He's doing great. He's at one of our competitors, Quasite competitors. He does a great job. The will to win, the desire to compete is important, right? So the, like to win, I wanna win. And that can be, you I wanna make a lot of money, that's winning. I wanna be really good, that's winning, right? But the need to prove yourself every day is important because competitive sports,

hobbies, things that you have to do and practice. Musical musicians, you have to practice an instrument to get better at it, right? Anybody who has the will to put the work in to get better is really who I think that's probably the number one thing.

Carter (12:53.016)
How do you see that I get the musical instruments and doing some sort of hobby, but beyond that, how do you see that desire to win in interview or on a resume? Like how does that come up?

Mike Brown (13:04.065)
Ideally they tell you about it right out of the gate like because that's what if you're in sales, that's what sales managers are looking for They want somebody who's gonna come in and attack They don't want somebody who's gonna come in and be sheepish and not want to go to conferences or be worried about You know what people are going to think if they make a mistake worried about making mistakes, right people who are eager to fail fast that that to me is is is something that we're working towards in in that engagement and that question like you can tell and

the first 10 minutes if somebody's like that or not.

Carter (13:38.542)
Okay, perfect. Well, I think we got some good stuff here. I will end it here.

Mike Brown (13:42.191)
Okay, cool Carter.