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The best way to begin a company, the entrepreneurial rule goes, is to identify a problem in the marketplace and then solve it. At VidVerify, they not only solve a problem in the mortgage market, but also a major frustration. The company, says cofounder Ben April, was the result of observing lenders’ frustrations with ever-increasing industry regulation.
He explains that, after the Dodd-Frank regulations were passed in 2010 as a response to the financial crisis—establishing the Consumer Financial Protection Bureau as a direct result—mortgage bankers were faced with regulatory requirements that were vaguely defined, yet strictly enforced. “VidVerify was designed to show a pro-active approach to meet those requirements, educate borrowers regarding the details of the loan process, and provide an audit trail for lenders to show regulators in the event of a regulatory dispute, an audit or a borrower’s post-closing concerns,” says April.
The concept took the form of a video platform, which sends messages automatically from lenders to borrowers as a pro-active approach to compliance.
What VidVerify offers clients is a library of more than 150 professionally produced videos that cover “virtually every aspect of the mortgage industry,” as well as the loan transaction itself, says April. If clients want other videos, they’re able to create them or upload their own existing content. Either way, all video scripts are vetted by VidVerify’s compliance partners, including one of the industry’s leading law firms. After approval, VidVerify handles automatically distributing the content to clients.
VidVerify’s story is proof that not all great journeys follow a straight path—and that adapting a business idea along the way, rather than sticking to an original concept, pays off. The transition from idea to execution took almost five years, and it was just a year and a half ago that the company significantly switched things up to take the form it is today. Originally, it was going to be a service that would record the final stages of a home loan transaction at the closing table, April says. But the home-loan demographic skews older, the company found, and adapting video technology didn’t come easily to some.
So they pivoted to the company’s current form. April likes to reiterate the importance of drawing support from a network: “Deep connections within the industry have helped support VidVerify through a dramatic shift in strategy and through both growth phases,” he says.
VidVerify’s cofounders include Barry Sandweiss and Tim Stern (you might recognize their names from Cultivation Capital and SixThirty—their network has been critical to VidVerify’s success), though they’re not involved in the day-to-day operations. The company is run by April and Laura Hopkins, the company’s senior vice president of sales. She’s “played the most significant role in developing the service and growing the company to-date,” says April, who largely handles product management and prepping the company for growth.
After all, VidVerify’s culture is sales focused, says April. “Everything we’re doing, every day, is focused on improving our service offering and bringing on new clients,” he says. “We’re still a small startup, and we’re even smaller now than we were during the company’s first iteration. We value our outsource partners tremendously, and have used them to keep our operations costs low.”
As Hopkins works from her Lexington, Kentucky office and April from his Clayton one, they both continue to build prospects, as well as present to new clients.
Currently, their competitors include “almost any other video service.” Although some mortgage service providers have incorporated video services into their products, April says, not all of them have been as successful.
It’s no surprise that April wound up taking the startup route: Both of his parents were entrepreneurs who ran their own direct marketing firm for 20 years until they retired. Before launching VidVerify, April was drawn to small companies for the majority of his career, getting especially excited about participating in their growth.
April had one startup before VidVerify—and its success is promising. In the early 2000s, April had a conversation with friends in the mortgage industry that helped him see an opportunity to develop and launch a CRM service specifically geared toward the mortgage industry, he says. “My life and career were at a point where I was able to take a calculated risk and try turning an idea into a company.”
April’s CRM service grew to be the industry’s largest and was ultimately acquired by one of the key back-end system providers. April says that VidVerify “presents a similar opportunity.” “We’ve already made great inroads with some of the mortgage industry’s largest independent lenders,” he says.
Verification of Success
VidVerify is seemingly everywhere, though you might not always be able to see it. To date, VidVerify has distributed more than 200,000 video messages to lenders and prospective lenders through its clients.
Hopkins has recently signed agreements with two of the industry’s Top 10 lenders, says April. “We’re quite proud of our client list, as well as our partner list,” he says, though he adds that not all clients have formally announced their use of VidVerify. For that reason, April says, names will be kept under wraps for now. However, in addition to Hopkins’ new signees, VidVerify has also brought on four of the industry’s Top 50 lenders and two of the largest in St. Louis.
Backing the startup is SixThirty’s FinTech accelerator: the incubator has selected VidVerify as part of its most recent cohort. UMB Bank also signed on to invest in the company.
VidVerify also has the stamp of approval from Bankers Insurance Services, which has reviewed and endorsed the service. April says the company believes in VidVerify so strongly that it provides clients a discount on their E&O premiums just for using the VidVerify platform.
Plans are now in the works for VidVerify to expand to a second industry vertical, though April remains vague on what precisely it is. He does hint, however, that it’s a “similarly regulated industry where consistent, compliant messaging, automatically delivered on the company’s behalf, will provide immediate great value to the companies within that sector.”
“While VidVerify’s applicability in the mortgage industry is a natural fit, as we look to the future, any compliance-focused, regulated industry stands to benefit from the platform’s automated and monitored video distribution,” April says, pointing out the insurance, other financial services, healthcare, and automotive industries as key examples.
Whatever the next step winds up being, VidVerify’s certain to keep changing the face of how the industry works, one video at a time.