nCino CEO focused on 'long-term' as shares surge 150% in public debut

nCino shares are skyrocketing following its public debut. nCino CEO Pierre Naude joins the On the Move panel to break down the IPO.

Video transcript

JULIE HYMAN: We've got an IPO today. It raised $250 million and is trading much higher. nCino is the company retirement, NCNO is the ticker on that company. Pierre Naude is the CEO. He is joining us now.

Pierre, so you all are a cloud computing platform for financial institutions in particular. And it's always sort of difficult to suss out. There's a lot of cloud companies out there. There's a lot of fintech companies out there. What is it that nCino specifically does that makes it different from the other firms that are doing similar things?

PIERRE NAUDE: Yes, thanks for having me, Julie. So yes, a big difference. When we started the company in 2012, nobody was building bank software in the cloud. And I saw lots of innovation in payments in banking. But nobody's ever attacked the deep processes like the compliance and the processes around onboarding a customer, making loans of any type, from the most complex syndicated loan, all the way down to the most simplistic personal loan as well as opening accounts on a single based platform focused on the customer.

And I really-- we had this vision that we're going to make banks function like fintechs. It's that easy, simple to work with them. They've got a fantastic cost of goods model, which is in deposits of 0.6% or less, OK? And I always said if we can drive efficiency, you know, this could be the coolest business to be in. So we really wanted to make banking fun again and where people could work in a flexible environment.

ADAM SHAPIRO: Pierre, as a banking consumer, where might I interface with what you do at my bank? Would I ever know that you are the software behind what I'm doing if I'm at Citi or Wells Fargo or JPMorgan?

PIERRE NAUDE: Yes. So yes, how you're going to find it. I'm gonna give you a few customer examples.

If you open an account, maybe you apply for a new loan, you've got a small business person, OK? And we've got very specific statistics on this. We take processes that normally take two or three days down to seven minutes. And so that is a totally different experience for you as a consumer or the bank to actually do that.

And so what we do is we go to banks. We understand they can move across the spectrum that far. And you literally get them in place, move them about 50% to the goal. And then they can change the processes without writing code. And that is the holy grail here on these platforms.

MELODY HAHM: Pierre, a larger question about your stock price, just thinking about how oversubscribed it was, can you tell us more about the pricing model here? Because we've heard from several investors in VC, in Silicon Valley who specifically talk about this issue, right whether it was the Lemonades or even in your case right now that a stock should not be popping 150% if it was priced correctly. What's your response there?

PIERRE NAUDE: Yes, you know, I'm excited for our employees. This is a big event for us, OK? But we are actually focused on the long term. And when you do that, you literally look at your customer base. You look at the trends in the industry. And I think digital transformation is where this whole thing is going.

With COVID, people have to work from home. Banks that use nCino can literally underwrite and approve loans, open accounts, from home, from anywhere. So that experience of bank employees. What I call it, we clean the kitchen. We come in and we get these processes of compliance in place and really drive optimization and efficiency.

But then once we got that in place, we push that out to the end consumer. And now you can apply for that stuff on your phone, on a tablet, on your laptop in that same efficient, user-friendly way, OK? And I think what you're seeing is that the whole industry is moving towards this. And before it was kind of like, well, when we will get to it. Now it's becoming imperative, especially with COVID and the pandemic.

JULIE HYMAN: Adam, it's your turn to be muted. It's Adam's once a day muting, Pierre.

ADAM SHAPIRO: There we go. Pierre, does your software, we go to more blockchain and the banks integrate blockchain, will your software ride atop and be complementary to that, or does that threaten what you are providing?

PIERRE NAUDE: No, we are right on top. So here's what you have to think. We're not a payments company. We don't process payments. We don't do point of sale ATM driving card transactions, OK? But on top of that is what I call the fat middle of the bank. That's where all the people sit. That's the compliance. That's your loan approval, underwriting, and packaging.

That's why nobody's tackled this. It's complex. It's a lot of point solutions. And we said we're going to build this whole platform that goes all the way across from commercial banking to retail banking to small business, account opening. And so we sit on top of all those transaction processes and that brokering or blockchain. And we literally hollow out the bank to be a lot more efficient and run like a fintech, fast, convenient, and consumer friendly.

JULIE HYMAN: Pierre Naude is the CEO of nCino. Congratulations on the IPO. We hope to talk to you again as the company matures as a public company. Thanks again.

PIERRE NAUDE: Thank you for having me. I appreciate it.