Cogent Road Tops Service Provider List (Again!)

July 29, 2010

Let’s hear it for the Three-Peat!

For the third straight year, Cogent Road has been named to the mortgage industries Top 50 Service Provider list.

Winning it this year means a lot to all of us because the past two years have been very, very difficult. The mortgage industry has been ripped apart – and reassembled inside-out. We’ve not only survived the turmoil, we’ve been able to:

  • Roll out an incredible workflow and collaboration platform called Roohmz Mortgage.
  • Invent a brand new way of keeping lender’s compliant – without human effort.
  • Launch our AVAIL automated mortgage qualification tool
  • implement a direct sales channel
  • create a few strong partnerships with complementary vendors
  • significantly increase the average size of our client
  • and increased revenue.

And, in the next few months we will roll out an entirely new version of our Funding Suite credit reporting platform. We will bring to the credit reporting industry technical functionality that has never been seen before. Exciting times.

If you’d like to read the Top 50 article, you can click on the image below.

Cogent Road makes the cover of Mortgage Technology Magazine

Cogent Road makes the cover of Mortgage Technology Magazine


Summer means surfing at Cogent Road

July 26, 2010

You can tell it’s summer in San Diego when surfboards show up in cubes at the Cogent Road office. Our office is about 15 minutes from the beach and in the summer a few of us hit the waves after work. The reality is that sometimes people disappear after lunch.


New Credit Refresh Functionality

June 25, 2010

We’ve updated our Funding Suite application to help mortgage originators easily comply with Fannie Mae’s new loan quality initiative. The basic idea was that Fannie Mae wants originators to check that the loan applicant has acquired any new debt obligations prior to funding. If so, the new debt to income ratio could trigger a provision forcing the lender to buy back the loan at Fannie’s discretion. Not good.

To assist we first received approval from all three credit bureaus to offer “soft inquiry” credit reports for the purpose of reviewing the credit profile for changes prior to funding. This new report “called a Credit Refresh” can be ordered with or without credit scores – and is automatically audited by the software to reveal:

  1. any new tradelines (new debt obligations) not previously reported
  2. any changes in debt balances for existing accounts
  3. any new credit inquiries (which we will verify as to whether was a result of a new credit application)
  4. any new public records or tax liens

If the lender wants a more detailed review, a new “side by side” viewer displays both the original credit report used for qualification purposes along side the new Credit Refresh report. All in all a very slick, easy to use solution.

Here is a two minute video of our Credit Refresh tools in action.


A Good Demo Generates Software Sales

February 24, 2010

We are putting the final touches on Cogent Road’s new Roohmz Mortgage Enterprise application. We’ve been working on the application for nearly two years, and we are now going live at our first client locations. The energy level is through the roof!

Roohmz Mortgage Enterprise by Cogent RoadCogent Road began selling the software in January – and I personally conducted every single demonstration. For me there is no way to learn how to sell enterprise software except by hearing feedback from real prospects as you sell it. Admittedly, this is not the best strategy in the world, but 15 years selling enterprise software has taught me it’s the fastest way to create powerful presentations that shortens sales cycles and generate installs.

If you are in the business of selling software I think it’s important to understand the difference between selling software and training software. Enterprise applications need to be sold using engaging word pictures that illustrate how your software solves stubborn business problems, saves prospects money, eliminates needless work and enforces consistency. Avoid the tendency to run down a list of how of your features work – doing so is like giving your prospect a giant dose of verbal Ambien.

But do demonstrate the software. Don’t make the mistake of staying so high level that you fire up a screen shot laden PowerPoint while never walking your prospect through your beautiful software. The best solution? Use PowerPoint only to illustrate high level business benefits with images and animation – then move smoothly into your software to demonstrate how easily the concept is delivered. Prospects get this – and you’ll sell more.

My first couple of Roohmz Mortgage demonstrations we’re pretty bad. While I had carefully crafted a complete presentation and flow beforehand, it was obvious I was off the mark in more places than I’d like to admit. After each demo I asked others from Cogent Road who attended to provide feedback in order to produce a presentation that sold harder. Areas that didn’t resonate with prospects were dropped – others expanded. In the end, we ended up with a polished, extremely compelling presentation created significant desire.

Here is a basic outline of how I produce and deliver enterprise software demonstrations:

  1. Identify three to five unique things your software does. If you can create interest in these areas – you’ve made it that much more difficult for competitors.
  2. Create high level business cases around each item above. How will each item help the prospect save money, improve performance and eliminate errors?
  3. Use PowerPoint to help you communicate the problem and how you solve it. (Animation with icons and arrows is great – lot’s of bulleted text is not!)
  4. After describing the item – toggle into the software to show (at a high level) how the software easily achieves the benefit.
  5. Repeat steps 3 & 4 for each item in the application.
  6. Quickly summarize the benefits of all the items you covered as you end the demonstration.
  7. Finish with a description of how easy it would be to get started – and how you will help them through the process.
  8. Improve your presentation based on your prospects responses (or long periods of silence).

After little more than a month, we have Roohmz Mortgage installations underway with 10 different mortgage lenders. I belive the short sales cycle is due in large part to taking the time to continually improve the Roohmz Mortgage demonstration.

Good selling!


Think You Had A Tough Monday?

November 9, 2009

You gotta love a Monday like the one we just had.

We teed up today’s events with a huge change to our networking gear over the weekend. It involved new DNS routing as well as gobs of new equipment to increase speed, redundancies and security. Solid planning by Brian Gardner, our CTO made the whole thing happen in a lot less time than we anticipated. On Saturday night I got a call that all was good – and I enjoyed a stress free weekend.

Cogent Road’s main application, Funding Suite is a very complex application that connects to a multitude of third party mortgage systems. Unfortunately, our new Cisco firewalls had a firmware update that caused unanticipated issues when these systems tried to access Funding Suite. I’m not making excuses, maybe we could have tried simulating these connections in production – you know, hindsight and all the rest – but regardless our system was not operating fully.

What followed was a blur of texting, cell phone ringtones and cars pulling into the office all at the same time. Brian was already on the phone with Cisco hounding them for an explanation when I got in. I did what any good CEO would do – I set a Costco sized bottle of Excedrin on his desk and left.

The entire situation lasted about an hour…which seemed like two weeks. Seeing an engineer poke a smiling face and exaggerated thumbs up in your office door brings with it a special kind of relief only software folks can understand.

Then all hell broke loose.

Lights Out!

No phones & no power. So how do we inform our clients?

I had just begun a joint interview (I could not make this up) about Avail with our industry’s most veteran technology editor and one of our large clients. Just as I finished an initial comment – everything went dark. And quiet. No computers, no lights, no phone. Just immediate dark silence – all at once. And it was still Monday morning.

Turns out a transformer blew in San Diego which took out a good chunk of the La Jolla area. This meant we had no power and no telephones. Every customer that called was greeted with what I would argue is the most awful greeting a customer could ever hear – a busy signal. Our software was up and running – our datacenter runs on huge back up generators. But our phones were flatlined.

It wasn’t until two hours later that the power came back up and our heart started beating again. Customers didn’t seem to mind the inconvenience – and some even shared their own similar stories. But, in the end, I’m glad to see this day end.


Avail: Automated Mortgage Qualifying

November 1, 2009

I love the software business. Each day brings a flood of new ideas – each a possible new application. We own a magic canvas upon which we can create nearly anything we can dream up. And we’re avid dreamers.

The funny thing is though, the market (especially the banking industry), tends to favor the tried and true. Why? Inertia I suppose. Companies do what they do – and get a bit itchy if you even hint at changing things up. At Cogent Road good software means applications stuffed with innovative functionality (read “stuff that never existed before”) which helps businesses get more done with fewer resources. And quite frankly this scares the crap out of our potential clients.

Case in point: Our AVAIL software. Rewind to February 2008.

My partner and I work closely with mortgage loan originators. While our Funding Suite application was designed to help these originators legitimately improve the qualifying ability of each applicant – many applicants simply could not qualify. After receiving the bad news, the applicant had nothing left but to walk out the door – without an inkling of what to do next. So about two years ago we began wondering if we could we create an application to help originators hang on to declined applicants until they eventually qualified. It was magic canvas time.

If this application was going to work it needed to generate a clear roadmap leading declined applicants to mortgage qualifying status in the shortest time possible. If not, these applicants would continue to drift about, or waste money with nefarious credit repair firms or futilely apply to other mortgage companies. By showing them the best actions to take right now, we could focus their energy – and get them qualified fast.

After burning through boxes of “scented” (my favorite!) whiteboard markers – we fleshed out a software application ultimately called Avail. It would eventually become the industry’s only automated mortgage qualifying assistant. It worked with the applicant for an entire year – providing four status reviews and updated strategies along the way. Clients used the software (in cooperation with their mortgage originator) to discover learn new behaviors that would legitimately improve the credit scores. Avail examined their credit accounts and revealed the types of questions mortgage lenders would ask about specific accounts in their credit. The software told them how to answer and what documentation they needed ready. Avail even showed the applicant how to get out from under their current credit card debt in the shortest time with the least amount of cash. It was an amazing application.

We expected huge results when we launched Avail in July, 2008. Instead what happened was, well –nothing. Did originators get it? Nope. Did they show it to declined applicants? Nope. Avail elicited some interest during demonstrations, only to be ignored in unison by our clients.

Turns out, like most new software applications, Avail simply took a while to catch on.

Flash forward. Today as a group, our clients enroll thousands of happy applicants every month into Avail. Large percentages of these initially declined applicants qualify for their new mortgage within six to nine months. In fact, we recently received a call directly from an applicant who had tracked us down simply to say thank you for building the software. Are you kidding me?

I love the software business.

BTW: Click here if you want to see a video demo of the Avail product.


Plants, Glaciers and Cogent Road Values

July 25, 2009

When my wife and I were in Alaska last month we jumped in a large canoe with eight others to paddle over to the Mendenhall Glacier. It happened to be a warm and sunny day which actually ended up working against us. On most days cooler temperatures and light rain create a smooth, glassy lake surface which paddlers easily traverse in about 25 minutes. On this day however, the warm air over the lake and the much colder air over the glacier created strong and steady winds. Huge white capped waves continually splashed ice cold water all over my already frozen paddle hand. It took us a full hour and forty minutes to eventually reach the tranquil waters in the glacier’s cove. My shoulder was tired, my hands were numb and I had to laugh thinking I had actually paid for this.Mendenhall Glacier - finally!

 The contrast between the enjoyable journey that could have been, and the one we actually experienced related in many ways to the tribulations small businesses face while moving toward their goals. When employees don’t understand the company’s values and instead perform work in ways they think best, the company creates an environment that generates opposing wind and waves. Effort is diffused, ideas are misaligned and ultimately customers pay the price in poor service.

In our first ever attempt to align everyone at the company – and get us all paddling in synch so to speak, I created a 45 day long blitz designed to teach specific departmental values, while also encouraging individual ideas and contribution. Here’s how it worked.

To keep things simple, I divided the company into three groups – and then assigned a specific value to each group.
Group A:   Those that interfaced daily with existing clients
Value:         Cultivate loyalty. (Increase our client’s motivation to remain a customer for life.)

Group B:  Those involved with marketing and selling to prospective clients
Value:        Cultivate desire.  (Increase the prospects desire to become a Cogent Road customer)

Group C:  Those involved with management, engineering or back office work.
Value:        Cultivate innovation. (Increase the ability to create better ways of doing things)

Lastly I assigned one overarching corporate value for all groups.
Value for all employees: Cultivate Excellence. (Increase our ability to become the best).

On Monday morning, June 1st we kicked off the blitz – complete with posters and a blitzed themed office decor. As employees filtered in to the office that morning they were presented with a small, newly sprouted plant in a colorful pot. Each pot was preassigned to an individual employee. On one side of the pot the label read (in the case of a customer service employee, for example) “I am cultivating loyalty”. On the other side the main corporate value, “I am cultivating excellence”. The idea for the blitz was that every employee was to “cultivate” his or her plant – the plant symbolizing their designated values. Each person had free rein to come up with any idea they wished to make the plant grow and no one would tell them what to do. The only rule was that during the week, the plants had to remain in the office. At the end of 45 days whomever had the largest, healthiest plant and also best demonstrated innovative cultivation tactics would win a very nice prize.

Cogent Roadies and their plants.

During the blitz employees could not avoid reading and re-reading their own departmental value and the overarching corporate value clearly labeled on their plants. As they thought about different ways to “cultivate” their plant, they would also be learning how to think and execute ideas on their own. They exercise encouraged self management because no one was telling them what to do or how to do it. I believed the blitz would strengthen our corporate innovation muscle. To further stimulate thinking and ideation, we offered weekly prizes to individuals that submitted department specific ideas in alignment with their values.

The results were beyond my expectations. New bonds formed as people interacted with others not normally in their sphere. One example was the customer service reps carrying plants into programmer’s offices in hopes of placing them by the window for the day. And we laughed uproariously at some of the wacky ideas people had to cultivate their plants. (FYI, washing a plant’s roots will not help in the least).

In the end, Linh, one of our tax product managers won a 40” flat screen TV with a plant many believed had to be on steroids. Quan (or “Q” as he is known around the office), came in second and won a night on the town for he and his girlfriend.

And Cogent Road won too.


Credit Proofreading: A New Referral Strategy

July 15, 2009
Credit Proofreading: A Referral Strategy

Credit Proofreading: A Referral Strategy

Although Funding Suite introduced credit proofreading tools to the mortgage industry almost two years ago – its seems that it only recently caught on. I imagine that tightening credit requirements require mortgage originators to help more and more applicants legitimately and quickly raise credit scores.

This is impossible without good credit proofreading technology. I’m happy to see a lot more originators embracing these tools and using them to offer a valuable service to their applicants.

In a recent article published in The Niche Report magazine, I wrote about a strategy to significantly increase referral business by correctly positioning credit proofreading to each and every loan applicant. By the volume of e-mail I’ve already received, it appears to be the right strategy for these challenging times.

I’ve posted a copy of the article for you here.

Good luck and please e-mail or comment here with any success stories you may have.


Outsourcing? Ok…maybe yes.

June 28, 2009

I have never been a fan of outsourcing. In fact, I was even quoted saying as much in a 2004 BusinessWeek article on the subject. While I still believe a company should never outsource “mission critical” components of their business, I recently discovered areas in our business I believed were core competencies actually were not.  And this got me thinking about outsourcing differently.

A company’s core competencies define what the business is and serve as its competitive weaponry. A business’ core competencies should remain within the business so they can be protected, managed, cultivated and enhanced. Cogent Road is a software manufacturing company – we design, build and distribute three enterprise software applications. Naturally I assumed that software coding was one of our core competencies – and thus off limits when it came to outsourcing.

Now this may be a blinding flash of the obvious to everyone else – but I only recently discovered that software coding was not among Cogent Road’s core competencies. It happened during a recent Focused 40 session in which my partner and I were unpacking Cogent Road’s competitive advantages. What was Cogent Road, what business were we in and what made us competitive?

We came up with the following list:

Our software engineering methodology. Cogent Road uses a software development model called Extreme Programming, developed by Kent Beck in 1997. Over the years we have customized the XP process for our type of work at Cogent Road. We all speak in shorthand which helps get large projects completed quickly and under budget – something not easily duplicated by competitors.

Our product ideation methodology. My partner and I have a natural ability to think abstractly – which is good and bad. While no one at the company is going to ask Alan or I to plan the company’s Christmas party (in our minds it would be great, but in reality we’d neglect to book the restaurant) – we easily come up with scores of software features that have never before existed. The result is that Cogent Road’s applications are full of beneficial tools our clients can’t get anywhere else. Again, a significant competitive advantage.

Our customer service commitment. A significant portion of our software is never even used by our clients. In order to better serve our clients, Cogent Road regularly devotes significant R&D resources to developing automation and back-end tools that route, manage and distribute customer service orders and requests. (You can see our latest example here). While it’s true spend time (never enough!) training our account managers – our service commitment transcends the individual to create an overall positive experience with our software, even if the client never contacts us. This too is difficult to duplicate.

On a side note, during this process we made the painful discovery that our sales process was not a core competency. It actually should be, but we have some work to do.

What else did we learn? Writing software code was not a core competency at Cogent Road. This meant that if we found qualified, highly competent outsourced partners – we could plug them in to specific areas of our engineering process. In the same way an architect can use any number of building contractors to assemble her blueprints, Cogent Road can use outsourced programmers.

Still, we are starting slowly with one specific highly compartmentalized project. However, so far I am very pleased with the speed and quality of the work. If the project is successful, and I have every reason to believe it will be, Cogent Road will likely incorporate more outsourced coders into the mix.

I’ll keep you posted.


Funding Suite Adds Paperless Document Delivery Options

June 20, 2009

As a credit reporting agency, Funding Suite works in tandem with our clients to verify elements of applicant’s credit files. Often written documentation is needed to perform this service. Consequently we receive several hundred individual documents for hundreds of different borrowers every day.

Funding Suite used to receive these documents via fax and e-mail. As our business grew, we recognized this highly manual process created bottlenecks in an otherwise automated process. Our processors constantly sorted through a steady stream of incoming faxes attempting to match each with the correct service order. This was a difficult and time consuming process and one prone (unfortunately) to human error. We eventually solved the problem and made document delivery easier (and less wasteful) for our customers, while creating more efficient internal process. Here’s how we did it.

Automated Fax Server: The first step was to eliminate our bank of fax machines by building our own fax server. Once this was integrated into our secure network the server digitized every Funding Suite fax and converted it to a PDF.

Indexing System: Next we used barcoding and indexing to tell Funding Suite what kind of fax it had received. Additionally it recognized the specific mortgage lender and borrower file to which it belonged.

An E-Folder for Every Borrower: Once a fax is received it is stored in an e-folder attached to the corresponding applicant file. Our clients now receive a digital copy of every document for their reference, along with the specific time it was received.

Client Side Document Delivery: We recognized that if the client already had the document in a digital format, our e-folder could actually eliminate the need for faxing altogether! Our next step was to provide our clients with three different document delivery options accessible directly from their Funding Suite application.

  • Barcoded Fax Cover Sheets: If the lender needs to send Funding Suite a document that exists in paper form, a couple mouse clicks creates a barcoded coversheet. When faxed to us, the fully indexed document appears in seconds within their applicant’s e-folder.
  • Direct Upload: If the client receives a document via e-mail – why print it just to fax it over to us? Instead, to eliminate faxing altogether, the lender can upload the document directly into the applicant’s e-folder. Funding Suite recognizes the type of document received and responds accordingly.
  • Virtual Printer: For any other document, the lender can select Funding Suite’s virtual printer to print it directly into the applicant’s e-folder. No paper is ever used.

Intelligent Routing: The final and most involved step was to write a series of algorithms to match incoming documents with the correct service order, department and processor. Consider the lender requesting two years of W2s. In this example the W2 order is placed electronically and queued up until Funding Suite receives the signed 4506 IRS form. Immediately upon placing the order a completed 4506 and barcoded coversheet is presented to the lender which can now be e-mailed to the applicant. The applicant signs the 4506 and faxes it back. Funding Suite servers read the document, match it to the pending W2 order and tee it up for the next available processor. A digital copy of the signed 4506 is also made available to the lender for their internal files. By eliminating the manual processes we significantly improved our completion speed – which in turn improves our customer service levels.

Although we won’t see a return on investment in terms of additional revenue since Funding Suite doesn’t charge for these enhancements – solving this problem provided an overall service improvement for our customers.