Card Transaction Robust Data and Its Impact from Oban McTavish
Oban McTavish discussing Card Transaction Robust Data at a Spade conference

Making Transaction Data Make Sense with Spade’s Oban McTavish

Episode Overview

Episode Topic:

Welcome to an insightful episode of PayPod. We get into the world of fintech innovations with Oban McTavish, co-founder and CEO of Spade, on how Card Transaction Data is being revolutionized. Oban McTavish shares his insights on the challenges and solutions related to making transaction robust data clearer and more meaningful. This discussion not only highlights the practical problems many consumers face with cryptic bank statements but also explores the technological advancements being made to address these issues effectively.

Lessons You’ll Learn:

This enlightening discussion provides a comprehensive understanding of the intricacies involved in payment processing and the importance of high-quality transaction data. The episode sheds light on the direct impact that clear card transaction descriptions can have on reducing fraud, enhancing customer experience, and improving financial management both for individuals and businesses. Additionally, listeners will learn about the strategic moves fintech companies like Spade are making to modernize the financial landscape, ensuring that banks and customers can navigate their transactions with greater confidence and ease.

About Our Guest:

Oban McTavish is the Robustco-founder and CEO of Spade, a company at the forefront of improving Card Transaction Robust Data through innovative fintech solutions. With a background in business administration and finance, Oban has a deep understanding of the banking and payments industry. His career journey includes founding another startup and working as an investment analyst, experiences that have equipped him with a unique perspective on the intersection of technology and finance. Oban’s leadership at Spade is driven by a commitment to developing solutions that enhance card transaction data transparency and protect consumer interests.

Topics Covered:

The episode covers a range of topics including the future of real-time payments, digital wallets, and the shift towards mobile and account-to-account transactions. Tracy Prandi-Yuen elaborates on how real-time payments are becoming a foundational element of modern card transactions, offering immediacy and convenience that traditional methods cannot match. Discussion extends to the global adoption of these systems and the varying impact across different economies. Additional themes explored include the role of AI in enhancing payment security, the evolution of payment infrastructures like FedNow, and the strategic importance of local payment systems in the face of geopolitical challenges.

Our Guest: Oban McTavish- Innovating Card Transaction Robust Data for Better Banking

Oban McTavish is a trailblazer in the fintech industry, serving as the co-founder and CEO of Spade, a company dedicated to refining the clarity and utility of Card Transaction Data. With an educational background in business administration and a major in finance, Oban has cultivated a robust understanding of the financial sector’s complexities. His academic pursuits provided a strong foundation, enabling him to navigate and innovate in the competitive landscape of financial technologies. Before his entrepreneurial journey, Oban gained significant experience as an investment analyst, where he honed his skills in evaluating market trends and investment opportunities. This role deepened his insights into the mechanics of financial markets and the importance of strategic decision-making in business growth and development.

In his early career, Oban ventured into entrepreneurship straight out of college by co-founding Hubly, a tech-driven startup aimed at optimizing financial workflows. Although he later stepped away from Hubly, the experience was instrumental in shaping his understanding of business operations and the challenges of startup ecosystems. His journey through the startup landscape was marked by learning from each venture, whether it involved direct participation or observational learning from the sidelines. This accumulation of experience fueled his passion for addressing inefficiencies in traditional banking systems, particularly those that affect transaction transparency and consumer trust.

At Spade, Oban McTavish has directed his efforts towards solving some of the most pressing issues in the fintech space, notably the often cryptic and confusing financial transaction descriptions that consumers encounter. Under his leadership, Spade has developed cutting-edge solutions that leverage modern technology to provide clear, understandable transaction data, significantly reducing the frequency of fraud claims and enhancing the overall user experience. His vision extends beyond mere business success; he is motivated by the potential to make a lasting impact on the financial industry by introducing more transparent and reliable processes. This commitment to innovation and consumer protection reflects his broader goal of transforming how financial transactions are understood and managed on a global scale.

Episode Transcript

Oban McTavish: I think it’s a great example. Funnily enough, the problem we’re trying to solve is to help your bank be able to determine the appropriate risk or the likelihood of fraud associated with the transaction by using more accurate, higher fidelity data that just isn’t available to them. So the customer benefit for you is that you don’t get confused, you don’t have to call your bank, waste your bank’s money and waste your time, and maybe even cause harm to a merchant by filing a dispute just because you don’t recognize something and everyone benefits. And, I think that’s the sort of the idea behind Spade, is like, what if we could rebuild the card payment rails knowing everything we know now about the world, instead of relying on something from the 1960s

Kevin Rosenquist:
Hey, welcome to PayPod, where we bring you conversations with the trailblazers shaping the future of payments and fintech. My name is Kevin Rosenquist. Thanks for listening. Have you ever looked at a transaction description on your bank statement and thought, what the hell is that? I don’t remember making that purchase. Of course, you have. We all have. Most of the time, after some sleuthing, we figure it out. But sometimes we end up calling our bank to report fraud, even if the transaction is legit. Spade is a company that is changing that. Their product helps banks create transaction descriptions that make sense, imagine that. Today, I’m talking to the co-founder and CEO of Spade, Oban McTavish, about how his company is fixing this problem and why it took so long for someone to finally do it. I, recently, took over hosting duties for this show PayPod, so I hope it’s okay that I’m saying this, but I live in Colorado and I’ve been to a few marijuana dispensaries in my time here, and early on, there were at least two times I remember calling my debit card company because I could not figure out what the charge on my statement was. Because they used cryptic titles, especially, the marijuana companies, and the dispensaries. Obviously, we got it worked out, but it was annoying. On top of that, I used to handle the daily financials for the last company I worked for, and a huge pet peeve of mine was having to hunt to figure out what a transaction was. So when I saw that I was interviewing you Oban, and I saw what you do, I’m like, “Oh, thank God. Somebody is finally trying to make these transaction lines make sense.”

Oban McTavish: Honestly, it’s funny that you say the dispensary thing because that’s an example we use in one of our decks when we’re talking to banks. We’ve been there. But there is no standardization when it comes to how these things appear. There are actual character limits, for example, the Visa and Mastercard, both set a specific number of characters you can include in, like the name of your business, like that little description you’re seeing. But all the bank knows, especially for certain types of businesses, is that 40-something character description plus an MCC code or a merchant category code which merchants can decide on what they want their merchant category code to be. So if you’re somebody like a dispensary, there’s a real strategy, I guess, one could call it, where these businesses are being listed as ATMs, which is very funny. So I think it’s such a good example of why something like Spade needs to exist because all of these transactions are happening on rails that were standardized in the 1960s. So if you thought about what we would think about payments in the 1960s, e-commerce wasn’t a thing. The idea that there would be a software business deploying the biggest thing they had to think about was someone phoning you up and trying to sell something.

Oban McTavish: Now we have the proliferation of e-commerce, and digital businesses, and the types of businesses you can spend money at are proliferating rapidly, which has resulted in infrastructure or piping, that’s just not purpose-built for what the types of commerce that are happening today. It has created a massive problem. So I think it’s a great example. Funnily enough, the problem we’re trying to solve is to help your bank be able to determine the appropriate risk or the likelihood of fraud associated with the transaction by using more accurate, higher fidelity data that just isn’t available to them. So the customer benefit for you is that you don’t get confused, you don’t have to call your bank, waste your bank’s money and waste your time, and maybe even cause harm to a merchant by filing a dispute just because you don’t recognize something.

Kevin Rosenquist: Because you don’t know.

Oban McTavish: Exactly, and everyone benefits. I think that’s the sort of the idea behind Spade, is like, what if we could rebuild the card payment rails knowing everything we know now about the world, instead of relying on something from the 1960s?

Kevin Rosenquist: That’s what I was thinking. In my scenario, my time is wasted, the customer service or fraud prevention rep’s time is wasted, or both, probably. So there is value in making the transaction lines clearer for everyone.

Oban McTavish: Absolutely. I think that’s what people forget sometimes. This whole ecosystem of fintech, obviously, there’s benefits to banks. Banks make lots of money and you could argue about whether or not the banks need to make more money. But the reality is if you’re helping your bank become more efficient, especially, from a fraud perspective, there are real victims of fraud. I think one of the most interesting things we’ve seen is that we’ve been flagging businesses that have a web presence as websites that are correlated to high-risk activities and scams. Obviously, there’s a benefit to the bank. We say, “Hey, there’s this kind of strange place your customer is spending money at.” But so many of those things are scams. Good people have fallen for a scam and are suddenly being charged money, and by helping your bank better prevent you from falling for that scam, you’re protecting the consumer. I think it’s one of the cool things about working in payments and working in fintech is that this is money touches everything. By helping these businesses that hold our money and do make lots of money themselves, by helping them, oftentimes you’re helping the end customer sort of stop fraud or not have to deal with that dispute because these aren’t victimless crimes. You’re not stealing from JPMorgan Chase when you’re committing fraud. You’re probably stealing from a person in a lot of ways, even if they are made whole in the end.

Kevin Rosenquist: That’s a good point, too. That’s a real good point. There’s a line on your website that says, “Build with an API that knows MGRS because UX 53846 isn’t where your customers stop for coffee.” I love that, that was a great line.

Oban McTavish: Yes.

Kevin Rosenquist: What is it? What is the hurdle? Why has it taken so long for someone to come along like Spade and say, all right, there’s a better way?

Oban McTavish: I wish I could pretend that we’re the first people to ever recognize this problem, but we’re not. I think there’s been a long line of businesses, some of our competitors today, but also businesses who have been around a lot longer than us who have looked at this and said, hey, this isn’t the way it should be. A lot of banks have spent the money themselves trying to fix this problem, but I think what we forget is that while cards are a ubiquitous payment methodology and that we all get to swipe pretty much wherever we want in the United States, at least in North America broadly and across the world as well, I think we all forget that this is an incredibly complicated and interconnected system. You have banks who are issuing a card to a consumer, and you have merchants all over the world who are supposed to be able to accept this thing, but Visa and Mastercard are just clearing houses who are moving money between all these players and saying, hey, we’re all good to go, you said yes, you said yes, let’s make it happen. But the reality is that there’s no way Visa or Mastercard could have gone around to all of these merchants and said, hey, you should accept this card, which is sort of the rise of what people call acquirers, people who help businesses accept payment.

Oban McTavish: Some people like Worldpay or Stripe or any of these players and you have to have a global standard that Visa and Mastercard are setting, there’s no one maintaining this standard. There’s communication, we’re all speaking the same language, but you can’t control what someone’s going to put in that message. I think the reason this is such a strange and sort of unique problem is that you have all of these people who have to agree. As you know, technology at banks is very antiquated and old. So to make any of these changes is like you’re asking the entire planet to change how they communicate about something. It’s just not going to happen. So I think the sort of the beauty of this is that this is a problem that, in my opinion, will never go away without some sort of concept. For Spade it’s like, let’s make a parallel pipe. We shouldn’t be beholden by this global standard that’s built on this infrastructure that’s going to struggle to change. What if we could just build it from the ground up where everyone can benefit? Some people have approached this problem.

Oban McTavish: What I would describe in sort of a machine learning first approach, they say, there are these cool models, whether it be like the large language models that we’ve all sort of known come to love recently, or just sort of more traditional machine learning techniques, and they said, well, machine learning is good at identifying an entity within a string of text. What if we put pointed models to that? What if we get this? I think those initial attempts were successful in some ways, and that they proved that there was some value. You can look at lots of businesses that have done this and they say, oh, well, we’ll tell you who the merchant is. They’re good at picking out big merchants. But I think what we realize at Spade is that by going from a data-first approach saying like if you wanted to do this well, accurately, with a high rate of coverage, you can’t rely on a model having seen every transaction or training a model on transaction data because if that was all you needed to do, JPMorgan Chase would have done it.

Oban McTavish: Bank of America, any of these businesses who have seen more transactions than Spade will ever likely see. They’ve been around for so long. If that was all you needed to do, that would have been done before. But the hard part was building a truth file, like a set of data about businesses bringing together best-in-class data vendors, bringing together data you can find yourself and had a factual list of merchants and then worked from that side saying, hey, we know of every business on the planet in the United States, etc. How about if we said, hey, this transaction belongs to this business? That difference of approach, I think, is what drove us to be unique in our capabilities, unique in our ability to work with certain kinds of customers, and help solve problems in a new way. So it’s not that we’re the first people ever to think about it. I just think we’ve taken a very novel approach that’s resulted in a solution that, in my opinion, is better than anyone’s ever seen before in this industry, despite us only being around raising our first round in November of 2021.

Kevin Rosenquist: It’s interesting, too. As you mentioned before, people getting scammed and all that, or the people are the ones who pay. I think that we’re all so conditioned to be cynical about that kind of stuff, that when you do see that weird charge on your credit card statement, your brain goes to scam before it even goes to, oh, well, maybe this is a purchase, a legitimate purchase. So you’re on edge, you’re fired up and you go, okay, I got to call my bank before you even think about it, where you might have spent that money.

Oban McTavish: Exactly. I think the sad part is that in those situations, the small business might have spent money on suffering. Because in the end, the small business, let’s say, it’s a retailer, a local mom-and-pop shop, they’re not fighting Mastercard. The money that comes back to you is coming out of the pocket of that merchant in a lot of these cases. Sometimes you have been scammed, and sometimes you have had your card stolen. But there’s also sometimes it’s just an accident. I think we help people solve the active side of things. But there’s also a passive benefit whereby by providing your customer with more data in general, your customer is going to be less likely to commit, what’s called first-party fraud or accidental fraud, accidental first-party fraud. So to speak, where you’re accidentally being like, I didn’t make this purchase because the reality is, you did. You could argue about that. You did set that, buddy. This shouldn’t be disputed. This is a real transaction. But your bank can only fight so many of these things. Merchants don’t have the bandwidth to combat all of these things, and there’s often not even that much evidence. It’s your word against theirs, or they’re eating the costs, etc. So I think it is interesting. I think we forget there’s just something special, there’s something magical about cards and that it does feel you can go anywhere in the world and you take out this little piece of plastic or metal and you stick it in and you tap it and it’s done. That’s crazy. I think we forget how insane that is. Tap your phone.

Kevin Rosenquist: Just tap your phone.

Oban McTavish: Exactly. We forget how insane it is that we’ve sort of taken the system for granted. There are all of these problems that still exist there that I think I get excited about solving. I think we underestimate when we’re like, oh, we don’t think that where does this money come from? There’s a whole interconnected network of players. We’re all saying like, yeah, we’re good to go. This isn’t fraud, this is a real car that hasn’t been stolen and isn’t listed somewhere on the dark web. All of these things have to happen unbelievably quickly, and we sort of benefit from it because we don’t even think about it. We’re like, yes, of course, I have my card. I just tapped it. That’s just crazy.

Kevin Rosenquist: It’s crazy. Then we’re the first ones to be like, what is taking so long? Why is it that I have to wait 20s for this? It’s funny.

Oban McTavish: 20 whole seconds.

Kevin Rosenquist: Oh my gosh, this is horrible. I remember there was a comedy thing. I think it was Louis C.K. or somebody at one time who was like, talking about people who complain about their flight being delayed or getting there late or something like that. He’s like, did you not just fly through the air like a bird? Did you not realize that? We lose our perspective.

Oban McTavish: We do. I think we take for granted the protections that the system provides. It’s interesting. I don’t know, RTP or real-time payments and paid by bank in many of these things. People have been saying it’s like the death of the credit card for a long time. But I think in North America at least, the benefits that exist within the system. Yes, people are making money, but there are also protections. If you transfer someone via something Venmo, you can’t call that money back. The money is in the pocket of this person. Everyone’s had that situation where you’ve purchased something online and it just hasn’t shown up or it’s shown up broken. How do you think that works? When you call your bank and say, hey, this thing didn’t show up or it broke, or you go to the merchant help site, and everything gets reversed. It’s because there are people in the middle of all of these systems saying, hey, hold up, let’s make sure this is real. We’re going to call this money back here. We’re pulling this out. Okay, this isn’t a fraud. This is an incredibly complicated but also incredible system that has a ton of consumer value and consumer benefit, even if there is sort of that ancillary part of banks making a lot of money and sort of merchants. Everyone’s transacting, everyone has to make money. But there are huge benefits for consumers there.

Kevin Rosenquist: You have two degrees. One in business administration and one in finance.

Oban McTavish: It’s a major. I did my degree in business administration. I majored in finance.

Kevin Rosenquist: Got you. Are you a machine-learning guy, too? Do you do code?

Oban McTavish: I have, I can write some very terrible code. I’ve never sort of written anything in production. One of my co-founders, Cooper, our CTO, would be rolling his eyes at me saying that. Let’s say, I can’t code, I’ve attempted. There have been times I’ve jokingly attempted to set so I could code and I’ve failed abysmally every single time. But me and Cooper went to high school together and we took programming courses in high school. Then we took Advanced Placement Computer Science. He went on to study math and computer science, and I studied finance, I went the other route. So at one point, I could probably do an okay job of writing something, but not so much anymore. So I rely on people far smarter than I am to figure out the complicated, important stuff, and I get to do the fun stuff.

Kevin Rosenquist: That worked out well that you guys went to different areas.

Oban McTavish: It did. That’s what sometimes people ask. They say, oh, how do you find a good co-founder? I’m like, go to high school with them. That’s it, it’s as easy as that. I honestly don’t have any good advice for that, which is too bad. I think we do have a third co-founder test, again,  meeting this person was just luck. Well, not luck and serendipitous timing and all this stuff like this. This was like somebody was like, hey, you’re looking for this specific person. I have the exact person for you, which is an insane thing to happen. Somebody is leaving a role somewhere else at the exact time you’re looking for the profile. They happen to be this unbelievably talented operator, and they’re willing to take a shot on yourself and one other person. This is a crazy amount of serendipity that’s required. So I don’t have any, I wasn’t systematic about it. We could just stumble into it. It’s kind of a beautiful little situation when you end up with this. But it makes me laugh sometimes.

Kevin Rosenquist: Well, there’s some luck there, too. I think about some of the people I went to high school with and was friends with, and I’m like, they wouldn’t be good co-founders. No.

Oban McTavish: No, there is some dumb luck. There’s some luck.

Kevin Rosenquist: I’d love to talk about Hubly, briefly. It’s an interesting product. I feel like it’s kind of almost like a Salesforce or HubSpot for the financial world. Is that a good comparison?

Oban McTavish: That’s a good comparison. It was a great first company. I learned a lot in terms of what you learn at your first company you make some mistakes, but you also learn a lot of sort of what it takes, the effort required, and how much of a grind this is. I did that for two years right out of college. Then COVID-19 happened and I decided to go a separate way. Because it was one of those things, one of those moments, I think, where you’re looking ahead at the rest of your life and saying, at least for me, if you want to build a business, you have to believe and you have to be like, I think this is going to be enormous, and it’s going to be a world of changing business because that’s what I set out to do. I didn’t necessarily have that faith anymore. If I didn’t have that faith, it wasn’t the right place for me. Because I think that’s what you need with founders. You need founders who are willing to put in the effort and the time because it is such a grind. If you don’t have that belief it’s no, it’s no skin off anyone’s back. It just wasn’t the right place for me anymore. I left to try to figure out exactly where is that place I wanted to land. That led me down a very winding path for me to end up starting Spade.

Kevin Rosenquist: You’re young, too. Especially, at that moment, you come out of college and you’re fairly naive and you don’t know what going on. So you have to find your way somehow.

Oban McTavish: Absolutely. For my background, I started a company right out of college and as you said, I think it’s almost naivety and even trying to do that. It’s a superpower to not know how hard something is and then try to do it. Because you’re not even aware of how difficult the thing you’re about to try to do is. So you can sort of go smiling and it’s like if no one had ever told you how hard it was to run a marathon and you just heard on paper you’re like, oh, let’s just run a little far. You’ve never even tried to run a half marathon. So how hard could a marathon be? But if you don’t even know how hard something is, you can approach it with fresh eyes. It’s easy to be motivated when you’re like, of course, why wouldn’t I do this? How hard could it be?

Kevin Rosenquist: When this going to get hard, you’re just like, okay, this is harder than I thought, but I can keep trying.

Oban McTavish: Exactly. I’ll be okay. It’s just a little bit longer. It gets easier from here. Sometimes it doesn’t, sometimes it does. Starting a company, I don’t know if it ever gets easier. Even when you do it again, certain parts of it certainly do because you’re doing something that you have done before versus the first time you’ve ever done it. So you have sort of a playbook, but then if things are going well, suddenly you’ll find yourself in a world that looks completely different than what you knew. Now you’re back to square one and figuring it out on the go. Now the stakes are even that much higher, too.

Kevin Rosenquist: You briefly were an investment analyst for a financial company after that. Did that help? Were you like, this isn’t for me, I got to found something else, or was that a catalyst at all?

Oban McTavish: I’ve been lucky in that. It wasn’t for me. I think I just learned a lot and was trying to make a decision as to what I wanted to do with the rest of my life, not with the rest of my life, but what I wanted to do next. I had choices. I could have been very happy working at a hedge fund for maybe the rest of my life because I think I just want to learn. I want to learn. I think investment funds of any type are a cool opportunity to do that. Whether you’re a VC or at a hedge fund or a PE fund, what you’re doing is like trying to deploy capital into interesting companies. These are just different lenses on that. I think in some ways, being a founder is a lot like those jobs. But instead of finding a company, you make what you think could be the perfect company. At least, that’s how I look at it. So my experience there, it wasn’t that I didn’t like it. I think I learned so much. It was such an incredible experience, being able to talk to management teams, being able to hear how people who have been investing money into businesses and what makes a good business, and thinking about that question for longer than I’d been alive. It teaches you so much.

Oban McTavish: Then I think I was building Spade alongside that experience. But in the earliest days, back when we weren’t even incorporated business, we had like an API that Cooper was building and was sort of on the side for both of us. It was like getting demand and upkeep. I had the choice to say, do I want to keep pushing down this path of finance, or do I want to try to do something else? This opportunity that I see, Spade could be something real. Do I want to follow that path? So I think in some ways,  don’t think of it like it wasn’t for me. It’s like I just had learned what in that moment, I could extract from that experience so that I could move on to the next thing to keep learning. There’s a very good chance, obviously, it depends on how Spade goes, but who knows where I’ll end up in the future? Hopefully, Spade can go forever, but eventually, you’re probably getting so big that I’m not the right person or maybe there’s someone better than me and it’s on to the next experience. Maybe that’s being the chairman of the board, maybe that’s another company. For me, it’s always a pursuit of knowledge, experience, and growth. Funds are a very interesting way to do that and so starting companies.

Kevin Rosenquist: Because you’re pretty young, so I was wondering if I’m going to be interviewing you again someday and you’re going to be one of those serial entrepreneurs with six different companies under your belt.

Oban McTavish: If I’m lucky. I often feel unbelievably lucky to have two goes at it. Because most people don’t get one. I think most people don’t have the opportunity or aren’t in the position to try to start a company right out of college, it’s a uniquely privileged position to be in.

Kevin Rosenquist: And both are so successful thus far. Hubly’s doing well from what I could tell.

Oban McTavish: It still exists. I think it’s what success looks like. What I would say is that success is never in a straight line and up into the right. Even the most successful companies always have periods of challenges. I think Hubly is a good example of what sticking out can do. We started that company right out of college and it still exists. Two of my co-founders are still there and putting effort and time and growing it. To build something that’s still lasting and still around after those years is incredible. I think it’s just so challenging. To start one company and to be able to say, oh, you know that first one didn’t have the outcome I would have wanted, it wasn’t growing so fast, it’s been around longer, and it’s not a $500 million company or whatever, so I sold it to whatever. That didn’t happen. It still exists and it’s still growing and doing well. I get a second chance to say, hey, I learned a lot from that experience. No, it wasn’t an instant overnight success, but I still learned a lot. Now I can try to scan and have another swing at it because as I said, I don’t think most people get the chance to do that.

Kevin Rosenquist: I think that’s very true. Is there anything in particular that draws you to entrepreneurship?

Oban McTavish: I think it just goes back to learning. It’s a very fast way to learn a lot of stuff, to learn about businesses, to learn about what makes a good business, what makes a bad business, learn about the business models, the different factors, and the decisions you have to make to execute.

Kevin Rosenquist: That’s kind of a crash course in business, I suppose.

Oban McTavish: Exactly. There are just some things you can’t learn by reading a book. There are certain problems that you’re going to face or experience when you have skin in the game. You’re going to learn very quickly about what it takes to succeed and the challenges.

Kevin Rosenquist: That’s a very good way, a very good point. Having skin in the game versus just getting your first job out of college where you’re working for a hedge fund or something and you want to prove yourself. Sure, you have a lot of motivation. You get a lot more motivation when there’s actual money involved and your own money is involved.

Oban McTavish: Yes, and I think people forget. I think it’s why fundraising is such a uniquely painful experience for a lot of people because the rejection isn’t just a rejection of your idea. It’s a rejection of you. Because those are kind of one of the same, especially, in the beginning. When it’s just the co-founders of a company and you’re sitting around ideating, or maybe you have a couple of customers and making a little bit of money when someone says, I don’t know if it’s going to be a big business, not depending on what you want out of it, they’re telling you you’re wasting your time which is painful.

Kevin Rosenquist: And which is very bad for you too.

Oban McTavish: Exactly. They’re not willing to say, I’m going to bet my career on you because that’s what a lot of investors are doing. I think people forget that, yes, VCs are investing other people’s money, but they are the protagonist of their story. I often think that the most powerful relationships are the ones where you can help both people benefit. At the end of the day, in my story, if Spade is successful, I’m like, yes, I won, and I can be happy and I can go and tell the kids, but whatever it is. But for them, if you’re a good company, you could make this person’s life. That’s their mortgage. That’s their kids going to college. This is funny because I think these are real people who are also taking often massive bets on you. People get fired, especially, these days, being a VC, it’s not that I would say, it’s a little maybe different type of risk to building a build But I do think there’s a real level of like that’s what makes a powerful partnership is when you can both say, okay, we’re betting on this together. You believe in me because, in some ways, you need me to be successful because you’re going to your bosses and their bosses, the LPs need this to work out, too. I think they’re helpful. A little bit less skin in the game than the person who’s betting their livelihood on it.

Kevin Rosenquist: I think their livelihood, their family, whatever.

Oban McTavish: Exactly. It’s the beginning. I often think it’s very funny when being a founder is so much that I’m just convincing people to bet on you as a person because in the beginning, there isn’t a business, it’s just an idea. I think so much of that is, them putting their faith in you and then putting their trust that you’re going to do whatever it takes to make it happen even if that’s working late or maybe it’s just grinding it out. There’s a really bad buzz. I don’t know if you can hear that. It’s very loud outside the office.

Kevin Rosenquist: I can’t hear it, no.

Oban McTavish: That’s impressive. Oh, my God, it’s so loud. They’re just worried that you’re just hearing the music straight.

Kevin Rosenquist:  No, not that I can tell. We’ll see what the editors say.

Oban McTavish: Perfect. I think it’s just a good example of one of those things where you have this opportunity and you’re trying to push for it. Then people are betting on you and they’re just saying, hey, do I think you can do it? And you have to put in the time and the effort and the actual grind to make it happen because no one’s going to do it for you. You take a vacation day, well, you just slip back tomorrow to do it anyway. I think, especially, in the beginning, it’s about the people and the founders being able to willing and able to put in the work regardless of how little feedback they’re getting.

Kevin Rosenquist: Yes. I’ve talked to various founders before entrepreneurs. Whether it’s this or fintech, AI, or all sorts of stuff, it’s always like, what’s the key to success or what are some of the keys to success? Almost always people come up with the people that you get involved in it because everyone has to have, as you said, that gusto and that drive because it’s not just, I’m going to take a vacation day, and someone will cover for me and I’ll come back. That’s not how it works.

Oban McTavish: No. It’s funny you say that because sometimes the hardest part is that there is no feedback loop. I think so many of the people are like type A striver type folks who fit well into these bigger corporate environments, who crushed it in school, and who have these incredible resumes, they end up at a startup and they’re like, what is this? The reality is the feedback loops are often either so long or so opaque. Because you did everything right, it doesn’t mean you’re going to get a good outcome. It’s painful. I think one of the most painful things you can experience is you do everything right and it still doesn’t work. It doesn’t matter how hard you work or what the steps are. You read the book, and you did everything perfectly, it didn’t work. That is a painful experience for certain types of people. I think it’s painful for everyone. But some people take it harder because maybe throughout their whole life, they’ve had that feedback loop. If you work hard and you study, as classes and college are not impossible, you’ll probably get a good grade. There are no tricks. It’s all in the book. You learn and you get it done, and you get a good grade. That’s not how it works with starting a company and in many careers. That’s why I think that willingness to take a risk, that willingness to be comfortable being wrong or on an infinite treadmill with no feedback is something that takes a special kind of person, and trying to find those people, especially, in the beginning, is so important because most of the time, you’re just going to be banging your head against this wall, making no progress, and maybe something is going to happen, or maybe it will never happen and you just wasted all your time. But you have to be okay with that.

Kevin Rosenquist: That’s true. That’s a good point, too, because we grow up with everyone being like, if you work hard, you can be anything you want. You can do anything you want. You can be successful. That’s all fine and good to motivate young people. But when it comes down to it, that’s not always the case. It helps to work hard and try and do all that stuff but doesn’t guarantee anything.

Oban McTavish: No, exactly. I think it’s painful because sometimes you want that feedback loop. You want the performance review, like this is a great job, gold star A+. But in a startup environment, oftentimes that doesn’t exist. Even if you get the best performance review the company can still fail. There is no guaranteed path or there’s no way to ensure success. I think it’s a hard lesson to learn.

Kevin Rosenquist: I agree, I agree. It’s not for anything to hurt.

Oban McTavish: No, it’s not. But I also don’t want to make it sound like there’s only one type of person who can build a company. Because I think in some ways, it goes back to the most incredible part of this whole thing. It’s like we live in a country or even all over the world. Hopefully, you live somewhere where you can take that shot and say, oh, I have a cool idea. That’s kind of the beauty of technology. It equalizes. Some kid with a laptop in New York City is just as effective at starting a company as some kid with a laptop in the middle of nowhere in the forests of British Columbia where I’m from, up in Canada where no one knows what high school you’re in or no one knows what college you went to or whatever. But if you have this special idea or you see an opportunity that no one else sees, you can pursue that and have the opportunity to maybe build something great.

Kevin Rosenquist: For sure. Let’s get back to Spade. I saw on your site that you recently raised a cool 10 million, Series A funding. Congrats on that.

Oban McTavish: Thank you.

Kevin Rosenquist: Aside from my weed store scenario earlier where I had to do detective work to figure out what the hell I bought, what are other ways that low-quality transaction data negatively affects people and businesses?

Oban McTavish: I think it negatively affects banks. When you swipe a card, the merchant has to say yes. If you think about it, a card presents transactions that you’re physically sticking in the card, that’s a pretty low-risk transaction, especially if you have to type in your PIN or maybe you’re tapping your iPhone. It’s like, you need to have the phone, you need to be able to get through the biometrics, there’s a lot of security there. So the merchant is like, okay, that’s pretty cool. It goes to the bank and the bank has to say, are we okay with letting this transaction go through? Is there enough money in the account? Is the credit card currently maxed? Is this a store that we’ve is fraudulent? That’s all for a physical place. Imagine e-commerce, where it’s like they have no idea how you’re authorizing this. Maybe somebody typed in your credit card number on a web portal and they stole your credit card and now they are typing in it. That’s where Spade helps. We’re saying hey, we’re going to give you incredibly robust data about where this card, with whom this card transaction is taking place. Most of the time if you think about it, your bank knows a lot about who you are, the cardholder, but knows very little about where you’re spending the money. That’s where Spade comes in. So we work with a lot of logistics and trucking companies where they have a card and they have drivers, and they’re issuing cards to these folks all over the country, and they’re driving around and they need to swipe their cards by gas.

Oban McTavish: This is the limit, can’t be 50 bucks because you’re filling up an 18-wheeler trip, and you’re spending $700 at a gas station. Gas stations aren’t known to be the safest places. They’re like, you’re in the middle of nowhere. So we help our customers by telling the issuing banks, the bank where the latitude and longitude of the card transaction, and where is this gas station located. They can look and say, okay, we know where the truck is because there’s GPS. How close is the physical truck to the gas pump? We’re talking feet. Then they can do that in that window when you stick your card in or you type in the PIN or you tap that little spinning two-second, please wait. That’s where we operate. So we can help with those real-time authorization use cases and then even fraud. Banks are running large models. They’re setting up all these rules that are like okay, if it’s this problematic merchant, don’t let the customer spend here. If it’s this scam, don’t let them spend here. They’re assessing all sorts of patterns about how you spend. If you take our data and plug it into your models, you can get around anywhere between 15-plus percent better overnight. This is just more money in the bank’s pocket. If you were to decline transactions and less fraud so that when someone steals your credit card, your bank would find out dramatically faster, and save everybody’s money in time.

Kevin Rosenquist: You also mentioned in your site that revolutionizing card issuing. In what way does transaction data help with that?

Oban McTavish: If you look at the ecosystem surrounding cards, there are a lot of banks, obviously, the original card issuers that have been around a long time. Then there’s a lot of fintech companies. I think oftentimes you see fintech companies approaching their biggest competitors, the banks oftentimes trying to build novel features, whether it be allowing someone to make rules, giving rewards based on geographic location data, building features surrounding where customers spend their money doing unique sort of offerings and things like that, and all of that’s driven by data. We’re working with cutting-edge financial technology companies. We’re trying to do incredibly novel experiences, whether it be like, let’s pay out a reward based on you going to a specific target because we’re going to give extra cash back because you went to the one in your town or the specific small business that doesn’t have any normal, large scale reward scheme and like, hey, go 10% off by spending this cool restaurant.

Oban McTavish: It’s a very novel and modern card experience that I think everyone wishes they could offer. We’re helping our customers do that so they can compete with the largest players in banking. Then from a business banking perspective, we help our customers with our categorization and instantly do their customers’ taxes. So rather than having to say, you go into your portal and okay, let’s classify all these expenses, we have incredible efficacy at helping our business banking banks, like our customers help their customers file their taxes in a completely automated way, which is an incredible benefit. It saves the small business owners’ time. It saves the accountants’ time. Everyone wins. That’s what we mean by revolutionizing card issuing. It’s because there’s a lot of this cutting-edge technology happening, that’s built the underpinnings of which are the card transactions. We’re helping you do this in real time.

Kevin Rosenquist: So one of these days I’m going to look at my statement and go, hey, my bank finally integrated with Spade because I’ll understand what the hell it says.

Oban McTavish: Exactly. I think that one of the coolest experiences is when we see the features that we’re building going live with our customers. That’s such a cool experience. Hey guys, let’s all look at our lunch expenses or whatever. okay, how much are we matching? Let’s make sure you can test it in the wild by swiping your own business banking card and see, where’s the pin on this transaction. It’s very cool.

Kevin Rosenquist: That is cool. Well, the company is Spade and they’re working hard to make sure that we don’t call our banks needlessly trying to figure out what we spent our money on. Oban, thanks for being here. I appreciate it. It’s great talking to you.

Oban McTavish: Thanks for having me, it was great.