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Creating Value: Finding the Right People for the Job

Posted by Wendell Brock on Thu, Apr 02, 2009

Whether you intend to start a new bank or buy an existing one, you’re going to need some help. That help is found in the form of qualified organizers—the entrepreneurial individuals, who pursue the business plan relentlessly and, eventually, create value in the new banking entity.

The organizer’s responsibilities are varied and time-intensive (usually 10-20 hours per month). A de novo or purchased bank project doesn’t get off the ground well unless the team of organizers is focused and unified. This means the organizers must be ready to contribute productively to committee discussions and assist in making informed planning decisions. Those decisions cover a variety of topics, from branding to operations:  

•    Branding: The organizers build the new bank’s brand from the ground up, deciding what the bank’s mission will be, how it will differentiate itself, what the logo will look like, etc.  

•    Human resources: The organizers must recruit and hire a qualified management team.

•    Project management: A branch location must be selected and modified or built to suit the bank’s purposes. IT systems and other support vendors must be priced and selected, etc.

•    Operations: The team must select the products and services the bank will offer and strategize on how those products and services will be distributed and fulfilled.  

•    Bank Policies: The organizers/new board of directors assist management in drafting and approving the bank’s policies and procedures, a very critical part of banking.

Contributing insights and shaping decisions are just the beginning of the organizer’s responsibilities. However, a pivotal part of what the organizer does is raise capital—both by investing his or her own money and by recruiting more investors to the project. The recruitment process begins with the organizer contributing a sizeable list of names of potential investors. Once the capital campaign gets started, the organizers must be willing participate in their share of the weekly meetings to pitch the investment opportunity.  

The ideal organizers and where to find them

Obviously, not everyone is well suited to be a bank organizer. Decisions need to be made, networking needs to be done, and money needs to be raised. These tasks are not easily accomplished by someone who doesn’t have the right characteristics and skill sets. Ideally, your organizers will be:

•    Visible in the community
•    Opportunistic
•    Task-oriented
•    Motivated by challenge
•    Outgoing, enthusiastic
•    Able to juggle several projects at once successfully

Knowing what to look for is half the battle; the other half is knowing where to look to find it. The simplest means of locating potentially suitable organizers is to recruit within professions that typically attract the above qualities; below is a short list of professions:

•    B2C service providers: Contractors, plumbers, dry cleaners, car dealers, insurance agents, general contractors, financial planners, doctors, dentists, real estate agents

•    B2B service providers: CPAs, marketing consultants, real estate brokers, pharmaceutical account representatives, office supply representatives  

•    Niche business owners: franchise owners, hotel operators, ethnic market owners, retail store owners, technology providers

Here’s the big picture to remember when seeking out organizers. The organizers you select should operate successful businesses and have access to and represent the segments of the community your bank will serve. In addition, they must be motivated enough to stick with the project for the long-haul. And finally, it takes the right person to understand that starting a bank, or re-branding a purchased bank, is an enormously challenging, but ultimately rewarding endeavor.

Topics: Buy a bank, organizers, Start a bank, finding organizers, business owners, qualified organizers

De Novo Banking: The Search for Organizers

Posted by Wendell Brock on Mon, Mar 30, 2009

With megabanks struggling to achieve profitability, the opportunity is ripe for savvy banking entrepreneurs to create nimble and modern community banks from the ground up. Unfortunately for banking customers around the country, the pace of bank start-ups has actually slowed down rather than ramped up. Several issues are to blame, but a significant obstacle is the challenge of finding and recruiting willing bank organizers. The same challenge can throw a wrench into an organization group’s plans to purchase an existing bank as well.

The team of organizers provides the de novo bank with insights, contacts, talent, direction and, of course, organization capital. The right team can turn the vision of a banking start-up, or a purchased bank, into a profitable and satisfying local community investment.

When the business plan is solid, the arguments for becoming a bank organizer are compelling: the experience can greatly enhance the organizer’s position in the community as it helps the community thrive and grow. The ability to become part of such a project at the ground level and, ultimately, create a powerful investment are often reason enough for the right personalities to jump on board.

In today’s world, however, potential organizers have been reluctant to commit. In general, they’re nervous about dedicating the time and resources to the project. That nervousness is likely rooted in a few different issues, including:

•  Excessive media coverage about the supposedly unstable state of the banking industry

•  The performance of the prospective organizer’s own business; organizers who are struggling to keep their own businesses afloat in this economy won’t want to dilute their focus by committing to a new bank project

Sweetening the pot

To be successful in recruiting qualified organizers, the individuals spearheading the project must recognize these challenges and address them with prospects immediately. Some talking points that might be helpful in this regard include:

•  The media’s coverage of the banking industry is over-simplified; the majority of community banks and balance sheet lenders are effectively managing through this current economic cycle.

•  The new bank has the opportunity to operate at a significant competitive advantage, because it opens its doors with a clean balance sheet.

•  Devoting time and capital to a new bank project is an investment and, as such, adds diversification to the organizer’s assets.

•  The success of the new bank can add stability to the organizer’s existing business by solidifying that organizer’s position and visibility within the community.

Finally, while it is important to build an organization team quickly, it’s also crucial to select organizers who will be committed and involved throughout the process. Overselling the opportunity and understating the commitment when recruiting organizers is a strategy that’s likely to backfire.

Next week I’ll discuss the primary responsibilities of the organizer and what characteristics might qualify an individual to be an effective bank organizer.

Topics: organizers, finding organizers

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BankNotes© is published by De Novo Strategy as a service to clients and other friends. The information contained in this publication should not be construed as legal, accounting, or investment advice. Should further analysis or explanation of the subject matter be required, please contact De Novo Strategy at