Wake up, Buy Here, Pay Here people. It's a beautiful day. Go grab yourself another cup of Joe and say hello to Jim and Michelle Rhodes on the Buy Here, Pay Here morning show. Take it away, you two. Hey, good morning, friends. We're live back here at the Buy Here, Pay Here morning show. We've been a little choppy lately. We haven't been in our old rhythm and may not return to that, but we're happy to be in our usual slot this Friday live and have a guest standing by. Just might take a minute before they join in to say that we've been... we've had our last V eight meeting of the month last night and, uh, had great conversations. A lot of our dealers are, uh, are stepping in pledging cooperation on some of the efforts that you've heard us talk about with, uh, with data. So that, uh, that continues and I've got a meeting set up with DMS providers, uh, next week. And so we, uh, we'll continue to march ahead on that. And, uh, and welcome uh collaboration and cooperation from every direction to uh to do the work that is uh important to get us to a place where we can have uh data translated in a way that becomes more and more meaningful as we go as i say to my dealers in the v-eight groups like you know people give their time and and uh in both submitting data and showing up for meetings. And we all want to make sure that we're working with data that is meaningful, that it correlates well, and that people can make good business decisions from. So that work continues. And in that realm, in a way, we've got Ivan Korotev standing by and happy to bring him in. Ivan is a FinTech expert. He's a co-founder of Debexpert.com and he's got, or his Debexpert platform can be found at Debexpert.com. And so you'll be able to see how his operation works. Welcome Ivan. Thank you for having me, Jim. Yeah, so Ivan is joining us from a multimedia workspace in Dubai. That's kind of home for him, and it must be very late there. We appreciate you making time to join our live broadcast at this time of day, but I think that's part of his usual thing. He works with folks back in the States a lot, and so we're happy to have you here. So I think, Ivan, there's just so much for you and I to talk about. I think today we've know i shared with you before we um you know went live here that our conversations in our v-eight dealer groups are always my best barometer on what's happening you know in the in the dealer world and if if that that is any indication we are seeing a lot of our conversations where where dealers are most energized and focused it seems is around their their own kind of technical architecture in their dealerships. So, and especially that starts with a DMS, you know, the DMS is kind of the backbone of their business and many of them, virtually all of them have some degree of integration. And so, you know, that means, whether it's their payment processor or their CRM, or maybe it's an underwriting solution. We heard conversations at our meetings this month about insurance platforms, ways to track and verify customers' insurance, as an example. There's all these different elements of technology. And then, of course, the work that you and I are doing, we're There's AI is a big part of today and certainly tomorrow. So you want to share with us a little bit as a guy who's not only in buy here, pay here, you also kind of in the broader subprime, which is more than buy here, pay here, kind of share your own perspective on what you're seeing in your conversations across the industry. Yes, so what we see, because first of all, just allow me to say a few words about Debexpert. So Debexpert is an online auction for buy here, pay here paper. We sell different asset classes. We work with performing accounts. bulk we work with we sell non-performing accounts skips deficiency bankruptcy balances and by bringing deal to a largest network of investors we have traditional investors we have family offices we have hedge funds and by running a competitive auction we are providing fair market price we have been on the market for the last five years and uh coming back to your question we see that most most of all what worries most of the dealers right now uh delinquency levels because they are growing and now we see historic highest delinquency levels across, I mean, all dealers. And that's the biggest concern that we see right now. And historically, I think dealers have been have not realized that the deficiency balance is really immediate cash for them. They can sell it. All right. So, yeah, that's really kind of where we are and what we see. Right. Good. And I should also explain, I didn't say at the top of the broadcast here, that Ivan has agreed to join our executive team. you know, what in a lot of arenas would be like a chief technological officer. That's not exactly his role with us. He's he's taken on more of a role of project manager and driving some of our tech initiatives. And we are we are super pleased about that because he lives in this space. He lives in the tech side, you know, day in and day out. And he will certainly be able to, you know, make a big difference there. And Ivan, I can say, shares our desire to make a positive impact have a real difference in this industry. And so it's going to be fun. I've been working with you in that capacity, and we appreciate you coming to join us in some of these efforts that we're taking on at White Hat Way. Yes, I'm excited to join the team and contribute from my side. Last five years, I've been heavily in IT, despite my background in finance. Last five years, I've created products myself. I did automations. I built AI agents. Now in my company, I have seven AI agents, AI employees actually, that do certain functions on a daily basis. And I have hands-on experience in AI, so I'm excited to join and contribute. Good. Thank you. You've also been inside the core DNA that we created for the White Hat Way Customer Advocate. And so we've talked about that a little bit on our podcast in the past. And so I think that's also been part of our conversations. As recently as yesterday, I was talking to people from our industry who are expressing their own concerns around AI, right? What does it look like? Would I trust it in my own dealership? That sort of thing. We put out social media polls around this sort of thing. And I would say that most dealers are they're expressing a desire to implement AI in their business. And, you know, as we've talked about you and I before, it's like many dealers are, they're smaller operations. They can be kind of in a category that you would call solopreneurs. It's not like they have an executive team, you know, in the building. They're kind of the, the chief of their operation. And so I think this is where we see AI can really step in and have a tremendous impact. And so I think that will be part of the work that you and I will do together is be able to create solutions in the AI realm. And my focus right now is really with voice personas. So I think you've done a lot of that already. And so in fact, we're following a lot of your architecture in terms of how we are are creating our own personas. So we're grateful for that part as well. But I think this is all part of the conversation around technology, what it looks like tomorrow, especially in our Buy Here, Pay Here segment. And I would say this is a huge opportunity for folks in Buy Here, Pay Here. It's been said, Ivan, I'm sure you've heard this, that since I've been around the car business, they say, When there's new technology, the franchise dealers, you know, the big operations, they tend to get the new technology first and then maybe next would be your independent retail dealers. Maybe they have a bigger budget and buy here, pay here can be last. But in this AI realm, we can all get there, right? We can all get there, you know, at the same time. We all have access and so our ability to leverage that technology is I think going to have a really profound impact on this industry in the coming years. And as I say, just mostly jokingly to people, with AI, whether we like it or not, we're not going to put that genie back in the bottle. AI is out there. It is going to be part of our technology tomorrow. And so it becomes a question of how we channel it, how we choose to put it to work. And obviously that can be in analytics. And you might share with me, I know when we recorded recently a BHPH TechWatch podcast, which by the way, folks, we can link that podcast in the comments with this one so that you can find the full conversation. Ivan and I had a deeper conversation around technology. But I would say that when I think about that, I remember you shared that day, like if you were a small independent car dealer today, let's say you're a buy here, pay your dealer somewhere. Where would you first be putting AI technology to work? Right. So there are three layers of implementing AI in a dealership. First layer is personal efficiency. So we talk about helping dealer to be more efficient in processing data, in making everyday routine. So for example, I used to spend two, three hours analyzing data that i need just to go through the spreadsheets analyze now i just dump it to my cloud agent, and it gives me the data that I need to understand, I need to analyze, and I then need to spend two hours. So first layer is personal efficiency. Layer number two is your back office operations, your documentations, your marketing activities, your helping with posts, or, I mean, something that you do on the backend. And the third layer, This is your front end operations. This is your leads processing, your underwriting. So these kind of things are the four layers. So we always, I always think that we should start small with being more efficient on a daily basis, layer one, and then just expand it to layer two and layer three. Yeah, for sure. And I've also got some clips from that podcast, which we can share another time, but it's where you talked about that very thing in a little more expanded explanation about that. But I think... One of the reasons that we reached out about having you come to the podcast, you've been sharing a lot of really great content out there on social media. And one of the things that we picked up on was the conversation that you had. You had expressed kind of what you were seeing in terms of compliance. Since the changing of the guard at the executive branch of the government, new president, a lot of shifting, including the, we call it clipping the wings of the CFPB, kind of trying to do away with that. layer of regulation and now you know in your article you you were stating and we see the same is that that regulation is not going away it's just being directed to the state level instead so it's not like dealers get to have a hiatus and get to ignore you know compliance we've still got to focus on our compliance but what are you seeing out there in terms of that shift Right, that's a big topic right now. In the past, we had, let's say one spotlight on the federal level, right? Now we have fifty, right? And how and so that's from once on the one hand. On the other hand, it's not deregulation. It is really a transfer, a shift from federal level to a state level. So I ask myself, how is it going to impact by her pay her dealers. Because when I analyzed for since, since, since, since, since, since, since, since, since, since, since, since, since, since, since, since, since, since, since, since, since, since, since, One of the name was Drive Time that was under review of CFPB. And that's it. It was just three cases. So now I ask myself, if we have CFPB in every state, are we more exposed to regulation or less? So my answer is yes. So we should expect more regulation. Initially, CFPB was established as a body to control consumer rights. And most of all, it is related to collections. That's where most of complaints are coming from. So answering your question, I think that right now, I would be very cautious about everything we do. Because in my opinion, regulation is going to grow and it just on the state level it's uh might be a much higher scrutiny comparing to the federal level and i would definitely look into collection uh collection operations right right good yeah i think you know with our work at white hat way we're always trying to showcase for dealers the the uh kind of the ethical approach to uh to business and i think when we when we think about compliance, we tend to think of it and obviously with CFPB was was heavy on enforcement. Their job was to get out there and crack down on some of those things. And they tended to aim at the larger operations. When that shifts to the state, then it makes sense that at the state level, they'll be mostly responding to complaints, which can come from anywhere, any size of operation. And so dealers can find themselves in the crosshair at the state. In my experience, being across multiple states in my coaching career, I find that some states are more heavily regulated in that they have more, whether it's a registration requirement or even an annual audit requirement, that varies a little bit by state. So I think for us, what we would be advocating for is even if your state is not one that has a big budget for enforcement or whatever the case may be, We think it makes good business sense to avoid those problems that regulators of the CFPB were set out to clamp down on. We just think it makes good sense to approach your business in a way. And I always remember for whatever reason in this moment, I'm reminded of an attorney who's long since passed, but years ago, he used to speak at the conferences and he always said, you really want to keep your customers out of attorney's offices. And, you know, in this case, it's also the regulators complaint line. Right. So you really want to you want to make sure that that your customers don't have that kind of complaint. And that's that's in communication. That's in conflict resolution. You know, all these kind of things that we know that, you know, dealers can do proactively to. to mitigate a lot of what would be complaints. And look, there will always be misunderstandings between buyers and sellers. And in our finance sector, we have some of that. But we think that the approach that we advocate for would mitigate a lot of that. If we just really thought more long-minded and took care of our customers, then we think a lot of that gets addressed. But that's back to kind of the work that we do in measuring some of these things. As coaches, we've always done that. dealer groups over the las We can measure a lot of the things that are happening in a dealer's operation. And I think one of the things that we have a chance to do through AI is to address a lot of this communication thing. I think there tends to be a gap. Customers, when they get upset or they get scared, they tend to drop off communication. And that's when things get to be a problem. And so what we're working to do is to make sure that AI can fulfill a layer of communication that is going to address some of what we're talking about here. But I think obviously dealers are going to need to be mindful to make sure that they're not mistreating customers, that we're not abusing the process or otherwise mistreating the customer. And so this is where it's a little like the, some call it the Wild West. you know of uh of kind of uh of compliance and i think we we have an opportunity in our in our sector to step in there and proactively address some of these things regardless of whether there's a state agency you know knocking on our door exactly you're right uh by the way if you allow me to add another thing that also concerns me that in the past investors that uh that buy here, pay here accounts, they worked under one framework, right? Now they have to follow fifty frameworks. So how is it going to impact pricing when the dust settles and when we better understand the requirements in each state? So I assume that it adds extra compliance and underwriting on the end that might negatively impact pricing of buy here, pay here portfolios. Right. You know, this is kind of an aside, but it ties into what we're talking about. I think we heard from one of our members in a group last night who happens to have a business and a resident of Texas. texas has got some new regulation related to registration of vehicles and the dealer when they kind of explained what the news regulation was and timeline for implementation on these new rules that um they made the case that it's going to impact value of the portfolios you know that to your point what an investor or bulk buyer would be willing to pay Texas may be very much affected by you know this kind of regulatory environment so I think this is something that you know we have to be watchful of it does affect dealers bottom line it affects their value and as you know one of the things I'm looking forward to working with you and DebExpert to do is to create a DebExpert kind of an index in our V-A group so that dealers will have some sort of a measuring stick that comes from somebody besides us that says this is an approximation of the market value based on the information that we have. And so this will be, you know, among the things that we'll be able to kind of determine what are the differentiators that are going to drive the difference in these valuations. So it's just as one example of where all of this technology and all the things that are happening across DMS systems and integration, Our industry is kind of fragmented. And I think what we are striving to do is bring folks together who can kind of unite around some of those things and solidify some of that and to give dealers a place where they can get some reliable information and feel like they can trust kind of where they're at and where they're going and what the value of their business might be. But I just think that's part of our work with compliance is, you know, we've said for a long time, Ivan, that At the heart of compliance is kind of this ethics track of when you handle your business ethically, you mitigate a lot of the risk that is compliance regulation because that's what a lot of those agencies are there to do is to crack down and present or prevent and limit mistreatment of consumers. And so I think this is where from an ethical standpoint and from a business philosophy standpoint, you know, I'm guilty of talking philosophy in business a lot. And so I think it's relevant in this context because when we bring the philosophical approach that says we're going to think long-term in our business and we're going to make sure that we position ourselves to be a successful, healthy business for a very long time, then that philosophy will help to mitigate a lot of what we're referring to here. Dealers are still going to have to be mindful. As you said, fifty states means that investors have to be aware. If they're buying bulk paper out of you know, two different states, then that may be a very different methodology and it may be a different price. You know, we just have to be watchful about that. And so we'll see, but I think, you know, we covered the elements today that I hope we'd get to. I want to make sure and share your, for folks not, familiar they can see uh they can visit debexpert.com and are your uh personas available for hire now do you have ai personas that are available to go to work for others um we do not have right now available personas this is we use them in the company but i hope together with white hat way we do personas that will be available for for any dealer to use. Right. I mentioned that because I know you had shared with me a platform where you have some personas, but I think those are your personas that you're using in your own business. So we'll wait and discuss that in more depth on another day. But yeah, that's part of where we're going with So this is, Ivan is somebody who brings a lot of the architecture already. He's got the framework and the mechanics to be able to bring AI personas to market. He's got some in use already. And so now we get a chance to start into some deep testing with personas and be able to verify that they can do the job that we have set out to do. kind of instructed them to do. And so that'll be part of the work in coming weeks and months. So again, we're excited to have you join our team. We're looking forward to folks who will be able to see the impact of our collaboration on a lot of these things. And so we're very much excited to get to work on that. And any other closing thoughts before we go? I'm excited to join the team and contribute. I think that's a very exciting time where we can really contribute to everyday dealer separations and make dealer more efficient, more and have best ever lawyers, best ever finance consultants, best ever a marketing specialist just his fingertips so and i think it's very exciting and uh i look forward to uh building this uh together with you michelle and other team members yeah i appreciate that well again we know we know it's late where you are we appreciate you making time to come and uh Join the conversation. We look forward to many more. And so, folks, just remember, if you're looking to sell some paper, raise a little cash and cash out on some paper, then that's what they do over at DevExpert. And so that's a wonderful platform where you can get a fair market value on bulk paper and get bids. in a very short order i think you share with me before that typically they come to your site they upload the necessary information they typically will see uh uh offers start to come in in less than twenty four hours or somewhere in that range right right right right So it's a good way to be able to shop for multiple would-be buyers and get a good price on your paper. So be aware that that's out there. And Ivan, thanks again. We'll catch up to you on a future conversation. And I'll remind everybody, you can catch the full conversation I had with Ivan on our BHPH TechWatch episode. So look for that in the comments as well. So thanks again. Talk soon. Thank you so much. Bye-bye. See you. So I think this is part of the direction that we're going. We've been talking about these initiatives for some time. We continue to work with partners behind the scenes. And Ivan is more than a collaborative partner. He's actually joining our executive team. And that is exciting for us. architecture and knowledge and a really skilled team to some of the initiatives that we're working on. And we look forward to continuing to work with him. In the meantime, I'll let you guys go back to collecting those tax refund down payments. We know it's Friday at the end of February. Most everybody's doing a lot of business now. You guys keep after it and we will see you back here next week.
