Kenny Thompson on Blending Human Service and AI in Payments and Customer Experience

Russ Fordyce 🏆 (00:01.031) Welcome back to the winner circle, everybody. Today I'm here with Kenny from Basis. They are really optimizing that healthcare experience between this blend of AI and human. They are a recent customer experience award winner with us. So we're welcoming Kenny to the show. Welcome Kenny and congratulations on all the awards. Kenny Thompson (00:18.466) Well, thank you very much for us. It's pleasure to be here today. Russ Fordyce 🏆 (00:22.609) Now, healthcare customer service is almost oxymoronic in my experience. Having had a family member in the hospital recently, I actually had a decent customer experience, but it was very kind of disjointed and you get to run around a lot. You guys are really working to solve this, but before we get into all the details, give us a little bit of background on basis and kind of the evolution of where you guys... kind of came from and how you got here. Kenny Thompson (00:54.338) Yeah, well, we really specialize in the payments portion of various industries, but we are huge in the health care space as well. And you're right, it is kind of an oxymoron in that space. We've all been there as consumers. And the patient pay portal piece is clunky cumbersome. very predicated on the insurance piece as well and your co-pays and things like that. I recently just went through one of those types of experiences myself, which I've never met a deductible in, I think, my adult life and just recently had to surgery back in February and hit my deductible with the very first transaction. I kept getting, I kept having to pay and then I keep getting reimbursement checks, which is just, it's asinine to think about. we hired our chief technology and chief product officer about four and a half years ago that had spent 16 years with one of the major insurance providers in the country. And when he came here, he's like, this is a dream come true. I can really put my stamp on how to deliver the best possible customer service and payment experience in that healthcare space. So it's something we've been working on for two or three years now to develop for the entire healthcare industry but really focusing on DME space, HME space, and the hospital space itself with integrations with all of the major hospital EMRs. Russ Fordyce 🏆 (02:36.838) Yeah, and the whole kind of hospital experience is so complex too, because I don't think most people realize it, but almost every level of a hospital is a different company. And so you go into the hospital named Cardiac Unit, that's a separate company, and then you go into the supply closet of that company, and that's a different company. And so the complexities are are vast. I don't know how you didn't do it with AI before. Kenny Thompson (02:43.928) Yep. Yep. Russ Fordyce 🏆 (03:05.456) You know, it's so many, many to many, you know, trying to pull through all those strings all through that organization has really got to be just a complexity nightmare. Kenny Thompson (03:15.502) for an industry that... know, prides themselves on vendor consolidation. It is so fragmented, more so than probably any other industry that we're in. healthcare is not our only, you know, our only foray into payment processing, but we're huge in the distribution space, the manufacturing space, the construction material space. So think sand, gravel, asphalt, aggregates, concrete facilities across the country. Very, very fragmented industry as well. We're also I say heavily in with the the ISP space. So thanks softwares all these software users across the country are accepting payments typically so Anybody in that B2B space B2C now we're morphing into a little bit more with the healthcare and the different verticals out there, but it's it's crazy that's ever-expanding and we still pride ourselves in bringing that personalized touch to it, which is, I think, why we were nominated for this award. Russ Fordyce 🏆 (04:19.92) Yeah, and if you think about it, the world we're moving into is becoming less and less human, unless we get kind of in these kind of fractured environments where things kind of break down. And that's really where you're pounding for agent on the phone or trying to get in a chat window with a human. Walk us through kind of that. know, decision line of where you kind of bring in humans and how you guys treat kind of that human experience when you are, you have to do the AI. It's going to get, you know, some large percentage of questions answered. And a lot of, most of us want that these days, right? We'd rather not talk to a human if we don't have to, if we can get the job done. But how do you, how do you walk that line and blend in that experience? Kenny Thompson (05:03.918) It is a fine line because we've all become such accustomed to getting an answer from a chat bot in three seconds or less. As long as you see the little bubbles pop up on your chat bot, you know something is happening. We still pride ourselves and we answer every single phone call with a live human within three rings or less, unheard of these days. We typically get a 99 % call, or 95%, I guess, call. solution with that very first person. We have three tiers of customer success support teams here in Kansas City. So that's another thing. When we first started, we were told that if we don't rely on the big, you know, big platforms, customer support teams will never ever make it. I think they signed up when we started back in 2003 with Chase Payment Tech, we were the only ones that said we want to do our service and support in-house. And we're the only ones that made it. So fast forward, you know, 23, 24 years later, we spend millions and millions of dollars on our own in-house support team because one, we're a little bit control freaks. want to take care of our clients and our partners. So we work with, you know, a hundred and some banks across the country as well and take care of their clients. We're not a great fit for Bank of America or some of the big boys out there. It's the those community regional banks that are, you know, between one, two billion dollars in assets up to about 30 to 40 billion in assets that still pride themselves on their their community involvement and things like that. Those are those are good fits. But we we have to have the AI. have to the chat box. We have to be more efficient with margin compression every single day. I mean, we're competing regularly against the stripes and the squares and the blocks out there, the PayPals. So we have to do it more efficiently, but we're very careful not to lose that competitive advantage that we have that is our people. Russ Fordyce 🏆 (07:10.438) So you guys are selling this kind of through, I guess, systems and embedding into these other people's software platforms. Walk us through kind of a normal integration. How are they bringing it into their process? And then how does that kind of human component kind of play in when they're kind of, guess, remapping their whole process flow? Kenny Thompson (07:33.454) Yeah, we were. pretty late to the game in that software space. We'd been so heavily focused on our banking sales vertical for years and the number of banks just keeps shrinking and shrinking and consolidating. So in 2003, there might've been 18,000 banks out there that were right in our wheelhouse. Today, that number is under 2,000. So we pivoted and what we didn't realize is that pivot also helped our banking partners. Cause most of the people out there banks want to process through their banks partnership because the extra layer of security that we bring in that relationship. But what we figured out also is the software folks are the same, just cut from the same cloth. They had all jumped in bed with a processor and those processors have either sold out or they're gone over the last 20 years because there's a big consolidation in our industry space as well. Everybody, all the big five platforms have gobbled up so many of the the little guys out there that we never set out to be the biggest. We wanted to be the best and that customer service was what kind of distinguished us from a lot of the other folks. But we found out with the software folks, it was the same thing. If we make the software look good to their users and make it a very frictionless payments ecosystem inside of their system so they don't have to do what we call the swivel charm, know, method of payments of running their business inside their software. and then have to go over here to run their, you know, any type of payments and then come back over here and post it. So our tech teams typically get together after we form a partnership, map it out. In many cases, they already have a processor in their ecosystem. So it's pretty simple. They know where everything goes. They're just looking for a better experience for their users. That's what we strive to bring to the table. Russ Fordyce 🏆 (09:32.115) Well, if I'm thinking about your customer's customer, you're generally talking about, especially with SaaS companies and banks, and you get into the healthcare stuff if it comes different with consumers and stuff like that, but you're really talking to these small or mid-market businesses, SMBs, where this stuff is of life and death. This is not one revenue channel. This is the revenue channel for a lot of these companies. Walk us through that time to resolution life or death decision on how do you guys actually manage shrewd, a payment system failing, those phone calls coming in. What does that look like from their standpoint? Kenny Thompson (10:10.702) Yeah. you hit the nail on the head there Russ, it is the lifeblood of these SaaS companies and their users. We've got a partner that's in the martial arts space. And most of these guys think dojos in the middle of a strip mall, Russ's Taekwondo. And they use the software to, they have got 2,500 clients across the country. But most of these guys got into this practice or this business because they loved the martial arts. Jiu Jitsu, but they also have a full-time job. And so we have to work around their schedules and to not only onboard them, but to answer their questions. And so that is where that 24 seven chat bot does come in handy, they'll text, they'll call the sales agents that we have with this company that are assigned to the software partner. And we have to meet them where they are because like you said, a lot of them, they're not even sure what they're doing as far as setting up business license bank accounts. and things like that. we've really been pivotal in helping them navigate their own business startup and it's paid off. It's one of our top partnerships. have 1,400 clients now across the country and just in that partnership alone. Russ Fordyce 🏆 (11:27.186) Yeah. And it, it's interesting because of those tend to group together, right? It's I was in cable, know, cable, television, internet cable companies for a while. And the cable companies follow each other around, you know, one of them will do something and then all of them will go do that because they kind of figure out the market and it, you know, they figure out what people want. I can imagine it's very similar in that kind of scenario too. What's interesting to me is, know, for 20 years now, the American companies, the industry default was to ship this stuff overseas, kind of you're saying, for kind of that maximum margin gain. And you kind of go like that and cross your fingers. Yeah, and kind of hope it works. And I've been through one of those where all the work that you put into it, you don't realize that when you do that, you really have to have everything buttoned up to a T. Kenny Thompson (12:03.022) Hope it works. Russ Fordyce 🏆 (12:17.162) you know, and then you're still missing stuff. So how do you kind of prepare customers for that? And what does it what does it mean really to kind of be in Kansas City versus being somewhere else? Kenny Thompson (12:27.572) It's a... I'm from, so Kansas City, as you know, is right on the border of Missouri and Kansas. I'm on the Missouri side when I'm here and it's the show me state. So you really do have to show these folks that, we are different. One of the things we pride ourselves on a basis is our NPS, our Net Promoter Score. It is in the top 5 % of all companies worldwide and it's something we monitor weekly and there's a weekly email that goes out company-wide to tell them our NPS was that week. It's something we track and it's something we're very serious about. That's not the norm in this case. we're, we're averaging over in the mid seventies. Last week we hit over 90. It was like 92 on our net promoter score, which I've never seen us get in the nineties. We've gotten close to 89 point something, but last year was our last week. was 92 or 94 point something, which almost looks unheard of. We've had people challenges because they're like, that's not, that's hire the Chick-fil-A's and you're in a payment business. You're not giving away spicy chicken sandwiches. it's, but it is something that we hire for. We're very, meticulous on who we bring in and with personality indexes and cognitive scores, we want to make sure that somebody fits the exact model profile for this job at basis. And if they don't fit this one, maybe we like them so much that they might fit somewhere else. But it is that autonomy that we give our folks to take care of our clients, take care of our partners. We've had things get held up and funds get held up and you go back to, it is their only lifeblood. is their only Kenny Thompson (14:11.202) source of revenue. We have personally sent you know $85,000 so company could make sure they got their payroll because they had some transactions go through that were pretty sketchy. We had to get some more documentation on that is there those protocols are in place to protect them from fraudulent transactions. So it like I said that is that is what separates us. There's 1,800 different places you can get you know payment processes in the US, you can get it from Costco or Sam's Club. We have to provide a different customer experience. that is, like I said, we're top 40 processor by volume. And we really specialize in that card not present B2B space. you mentioned media, came from, or speaking, me and two of my teammates are speaking at the media financial management conference in San Antonio this week, on Monday. And we've got a ton of folks in that Russ Fordyce 🏆 (14:43.878) Right. Kenny Thompson (15:11.012) space. So from like NBC and Universal to Cox and Charger and a lot of the big boys. So we really, we really do well with that SMB, but we also have those big, you know, publicly held behemoths that we that we have to take care of as well. And it's a total, it's a different set of complexities with those guys versus Joe's bait shop, you know, bait shop and all of the hard brain regulations that we have to navigate, which is what we're speaking on on. Monday. Russ Fordyce 🏆 (15:42.301) Well, so walk us through a typical kind of inbound support call at basis. Who's picking up? What do they know? mean, it's one of the things you're talking about is having this kind concierge team, but you're spreading it across a bunch of customers. So how are you managing kind of that in-house feel? And then the other kind of question I have is, how are they empowered? What are they empowered to do that's kind of different than your normal call center? Kenny Thompson (16:06.222) So one of the ways that we've... Empower them quicker, I guess to bring them up to speed on the industry knowledge is through AI and through through online chatbots with within our internal organization So if something is called, it's it's being required calls that have to be recorded The chat bot their internal chat bot will pick up on something that they may ask a question about this And as soon as that triggers that boom it pops up on their screen that it could be this this this or this that is typically used by our entry-level customer service folks until they get the knowledge. But like I said, I've been doing this for 23-some odd years. I'm not sure you ever get all of the industry knowledge when you have to have it on a phone call to take care of a customer in their time of need, I guess. So our tier one support typically handles about 95%. Most of the calls we get, they're pretty simple, they're pretty generic. If it is a specialty call through one of our integrated customers, it's routed to a different team. So that team, so they don't have to go through all the phone trees because we've all been there. We're all... We all have a cell phone, all have direct TV, or we all have whatever type of cable or fiber. We bend those consumers and it's so frustrating to have to, my God, let me put you on hold and I'll try to get you to this person. Kenny Thompson (17:32.214) And we all sit there and listen to hold music telling us how important of a customer we are to this organization while they leave us on hold for 27 minutes. So we try to avoid that. If it's something our tier one can't get it, they get it over to tier two immediately. Tier two can typically handle it. They've been around for a few years. They've been there, they've done that. And if it's something that they can't, they will file an internal ticket and somebody follows up with them immediately. let them know here's where we're at here's what we're doing to take care of your problem. Russ Fordyce 🏆 (18:06.608) Yeah, and like I said before, think I would imagine a lot of these companies kind of come to you and they're looking for better performance, the better quality scores. I imagine they see there's declining revenue out of that channel. It can be a very big, big problem for a company if you're not treating it right. And you guys mentioned in your nomination, a kind of one partner, and we don't have to name names or anything, where they saw just a meaningful drop once they kind of went through your onboarding model. walk us through the kind of that engagement and why don't more processors do this type of thing? Kenny Thompson (18:40.846) It's expensive. mean, easily that's the number one detractor. It's expensive. Like I said, we spend millions and millions of dollars to have our own support teams in-house. It pays for itself. On your website, it's at something about 600 % cost of losing a customer to replace a customer. I haven't seen that number, but I believe it. Mr. Odo, is our founder and CEO's dad, who is a second dad to me, beat that into our heads forever ago that it is much easier to take care of a customer on a Friday than to go find a new one on a Monday. And does it always make sense financially today? Probably not, but in the long run, it always pays off. Russ Fordyce 🏆 (19:33.488) Yeah. Well, and now you guys have expanded kind of this integration portfolio. I think you're in QuickBooks, you're in all these healthcare platforms. I think you mentioned construction and dental, but you're keeping that kind of same in-house support standard intact. know, most customer service quality degrades during growth. What's the principle that's preventing that with you guys? Kenny Thompson (19:56.314) It's hard. We started, I mean, literally in a janitor's closet in one of our sister companies with two of us. When we moved into our first office, we got our own office space inside the same building. It got up to 17 people. My God, is this going be hard to maintain the culture that two people started or three people or five people? And... That's still true today. So we're close to 250 employees today and folks all over the country, primarily everybody's here in the Kansas City office. But. It is hard. I was listening to Patrick Lincione's podcast yesterday on my flight home from Florida. And he was talking about one of his latest episodes was cult or culture. And he said, sometimes it's a fine line because, you know, new people coming in, they see how this is, this is the, you know, the standard that we expect you to deliver on, you know, to our partners and our clients. And it can seemed a little bit cultish I think from the outside in because we've brought in some high-powered folks from big Fortune 100 companies and they're like this you know they get kind of the sheepish granite star like yeah yeah yeah that's cute and in about six months in they're like wow this is you guys are really you guys are really this way and I think it's It's hard for them to swallow coming from such a different world for years. And that's probably one of my main jobs is to make sure we maintain that differentiator. And as we talked about beforehand, my daughter has been with us now for six months. I want a place that I would be proud that my daughter works at. And I don't know if that's a sentiment that a lot of people feel about their workplace. Russ Fordyce 🏆 (22:01.915) No, those NPS scores tell stories when you run them internally, right? There's some questions about that. Would you recommend a friend to work here? Questions like that. And you start getting into people's psyches and you can understand a little bit better about your culture. It seems like you guys are setting a very, very high standard. we had a founder listening on the call today and Kenny Thompson (22:06.146) Yes. Russ Fordyce 🏆 (22:24.647) They said to you, you I want to build a customer service led organization and a commoditized space. What's the principles you would guide them to that are kind of non-negotiable? Kenny Thompson (22:33.74) don't take any outside money. I mean, it's a lot easier when, it's never easy. But, and if most people knew how hard it was gonna be when they started, they'd never ever take the first step. But for us, it's been that consistency of. since day one essentially. I came on board first person at bases to because I I loved and I believed in the vision of our founder and our CEO, Brad Odo. I thought, this is so different than what I'm experiencing right now. And we knew each other from a previous workspace. he, we just got out of a meeting right before this, this, this interview. And that is our number one goal is to make sure that we're still doing what we set out to do years and years and years ago. And today it's focus on others, focus on all the cars in this parking lot I'm looking out at, those people are my responsibility to make sure that they have a great place to work at and be happy and be proud of. And if you can get everybody moving in that direction, it makes the mission a lot easier. It's never simple, but it's easier, I think. Russ Fordyce 🏆 (23:59.41) Now you guys are kind of expanding the product as well. You're pushing into these other verticals, these other platforms. You're also responsible for partner relations strategy. What is that kind of integration that's missing today? What are you seeing out there where partners are kind of clamoring for more advancements? Kenny Thompson (24:19.566) helping them grow their revenue is first and foremost, especially with the SaaS folks. Most of our SaaS folks that we're working with today are working towards an exit. and we've had five, six of them exit in the last, fully exit, but start taking PE money and our VC and... It's been really cool getting to know the founders of these companies and helping them build an exit strategy based on revenue from that revenue share from basis and see it multiply their exit number, 10X in some cases. So we're able to add a lot to their bottom line and become partners, not vendors, I guess. Russ Fordyce 🏆 (25:13.501) Well, in a lot of these scenarios, at least in my experience, your SaaS platforms are usually very high margin. They're also very competitive, especially in the AI world now that we're living in. could seemingly clone Salesforce if you wanted to tomorrow. Maybe not tomorrow, but the next day, two days of cloud code. And so this turnover is happening so fast. These guys have to be building Kenny Thompson (25:30.765) Yep. Kenny Thompson (25:34.97) Yes. Russ Fordyce 🏆 (25:41.433) know, something differentiated and it sounds like that customer service piece even, you know, as simple as it is with payments is a differentiator. Kenny Thompson (25:48.174) Yeah, yes, we've got to be competitive, but our competitive advantage is our people and the way we take care of their clients and the partnerships. And it takes a little bit for somebody to see that because a lot of folks are just strictly looking at the revenue. And we've displaced other payment processes out there with software companies that were getting 100 % of the revenue. with our model at much less, much less numbers. And they're making way more money today than they were with their previous people with transparency and just honest communication, I think. So it's not dead. I told you, I grew up a farm boy in Northwest, Missouri. My dad, I mean, he was the epitome of building a reputation on a handshake. And it's not dead yet, I don't think. Russ Fordyce 🏆 (26:30.033) Yeah. Russ Fordyce 🏆 (26:45.073) No, I think we're going to come roaring back to it, or at least I hope. think as AI gives us more time and away from computers, we're going to be more human. I really hope maybe that's a Pollyanna view of the world, but I really hope that's where we're headed. Kenny Thompson (26:51.916) Yes. Kenny Thompson (26:59.336) I love it, I love the idea and I'm gonna do my part. Russ Fordyce 🏆 (27:03.629) So if you look at the industry, you're in this very kind cutthroat, highly marginalized industry where margins are very thin usually. And you look at kind of the broader industry, at how they're treating customer service. If you could change some of the things about that, what would it cost? Kenny Thompson (27:13.752) Yes. Kenny Thompson (27:25.006) I can tell you exactly what it costs, but I don't know. I would go back to what we just talked about. I do have the older I get, I have this that Pollyanna view of the world that it can be like this and like this. It's not an end or it can be end yes. It can be. We can we can do what we say we're to do for our our clients and our partners and we can still make money. And there's some cases where we're not a great fit and we will part ways as friends and move on down the road. we've had numerous partners come back and say, we've followed that shiny object in this direction two years ago. It didn't pan out. And we ended up losing it. It ended up being a black eye on our product. So. We do need to go in different direction, I guess. But I go back to our people. It's really hard to get hired on here at BASIS. And we hear that from a lot of folks that are having to fill positions. But we do it for a reason. We don't want to turn over. Turnover costs a tremendous amount of money training people and all the resources into that onboarding experience. it's been kind of our, like I said, our competitive advantage, that slow and steady growth model that we could grow like this. And we were told early on that, I could bring you on here and we could 10 extra years stuff tomorrow. And it sounds great until we heard the tactics that we're going to use to do it. And hiring masses and I can't remember what this guy's. Kenny Thompson (29:13.102) this one consultant that we talked to 20 years ago, wanted to hire a bunch of people, get them to sell a bunch of stuff, and then fire them all and keep that money. And I'm like, yeah, that's probably not in our DNA. we, like I said, we probably believe in people almost to a fault in some cases, and we're learning, but I would rather err on that side than the other. Russ Fordyce 🏆 (29:42.663) Yeah, well, Kenny, thank you so much for joining us. It's a very interesting conversation. I love the blend of human and AI, and you guys seem to be doing it just about the right mix, I think. So congratulations on all the success. Kenny Thompson (29:53.144) Well, thank you, Russ. It was great catching up with you and learning everything. And good luck on Headed South. Russ Fordyce 🏆 (30:00.625) All right, now we're gonna redo the open, because that was horrible on my part. My brain was clearly confused with the other one that I had prepared for. Kenny Thompson (30:02.528) Okay. Kenny Thompson (30:11.278) I figured. Russ Fordyce 🏆 (30:13.541) So let me just kind of open the show again. I'll cut to you. You can say thanks. And then your opening was, if you want to redo your opening, you can do that too. We can spend a minute here doing it. Yeah, I thought it was pretty good. You handled my exclusion of all your other industries served pretty well. Kenny Thompson (30:22.188) I don't even remember my opening. Russ Fordyce 🏆 (30:31.571) So let me kind of open it up. I'll blend all it together and we'll send it off to you. And if we need to cut a third one, we'll cut a third one some other time. All right. Welcome back to the Winter Circle, everybody. I'm here today with Kenny from Basis. They are blending human and AI to better serve your customers across so many industries, including healthcare. Kenny, welcome to the Winter Circle and congratulations on all the success. Kenny Thompson (30:56.024) Thank you so much, Russ. It's a pleasure being here and look forward to chatting with you. Russ Fordyce 🏆 (31:01.396) All right, we'll leave it at that.