- 2 days ago
Polly founder and CEO Adam Carmel joins HousingWire’s Allison LaForgia to discuss the launch of next-gen Hedge, completing PollyOS, a vertically integrated capital markets operating system designed to give mortgage lenders real-time visibility into loan-level profitability, pricing and performance.
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00:00I'm Alison LaForgeo with HousingWire, and today I'm sitting down with the CEO and founder of Polly, Adam Carmel.
00:09Adam, thank you so much for joining me today.
00:13Thanks for having me.
00:14Now, when you founded Polly in 2019, you had a vision for how capital markets should work.
00:21How has that vision and the lessons that you've learned since first launching Polly shaped Polly into what it is
00:29today?
00:30When Polly was started back in 2019, we always had this vision of building the mortgage industry's first vertically integrated
00:37capital markets operating system.
00:39I mean, it actually dates back to when I was originating mortgages myself, when I was never able to get
00:47loan level attribution, understand profitability in real time, and then make informed business decisions.
00:53And I was always having to wait until month end cutoff, and all these legacy antiquated tools were incapable of
01:00solving it.
01:01And so when Polly was first started, we're going to be hyper-focused on building a system, starting with a
01:07pricing engine, that delivers unlimited flexibility and granularity and workflow automation.
01:12And since then, yeah, we've learned a lot of lessons.
01:16But I think the most important one we've learned is that we need to evaluate everything we do using first
01:25principles.
01:26So ever since Polly was started, we've noticed that there's, at best, a lot of incrementalism in the industry, and
01:36at worst, nothing.
01:37And so that's created over the last couple, 10, 15, 20 years, a tendency to, one, see slower adoption with
01:49new technology and tooling.
01:51And then, two, the industry has been conditioned to operate in this certain way for so long, they've never had
01:58to think about, okay, well, what can be different?
02:01What can be better?
02:02And how would we want this in the most, like, perfect scenario?
02:06And so we've said, okay, we don't want incrementalism.
02:09And we're not going to do anything that is incremental.
02:13And that's hard because, you know, of course, we want to push fast, but the industry has historically not moved
02:21very fast because of the legacy vendors.
02:27And so there's been this internalization within the company where we've had to figure out where we can push really,
02:35really hard and really, really fast, but then also where we should slow down and make sure everything is really
02:40dialed in and perfect.
02:44Now, you mentioned sort of the onus here, how this is something that you've really strategically thought out for years.
02:53And you touched back on how this really comes from a place of pricing, hedging, and trading having operated in
03:01different systems.
03:02What have lenders lost by working that way?
03:06And what made you believe that it was time to really think that outdated model?
03:11If you were to ask a mortgage company today or a bank, what is your revenue today?
03:17What did you generate in revenue today?
03:19How what is your and how does that tie down to all your, you know, the GLs in the accounting
03:24system today?
03:26They would not know if you said, hey, what is my day one expected revenue versus my actual revenue?
03:33And what is the reason there's margin erosion?
03:36They would not know.
03:37There's a myriad of questions like that if you were just to dig in.
03:41And so we want to solve we've been wanting to solve that.
03:44And in knowing that.
03:48Provides tremendous value in ROI.
03:52An impact to the lending community.
03:54Because if ultimately the the the lever in this industry between volume and revenue per loan is the what is
04:02the margin per loan?
04:03And so being able to evaluate what is my profitability per loan and then how do I bring that all
04:10the way upstream into the pricing engine and know it in real time and having that loan level attribution throughout
04:16once the loan is locked.
04:19You can start to make real time informed decisions that have a major impact on your profitability.
04:27And the reality of it is a 30 year fixed loan is a 30 year fixed loan.
04:32So if you are able to achieve better profitability, then you get to choose as a lender.
04:37Am I going to pass that margin or some of it back to the consumer and just increase my volume?
04:42Or am I going to be able to make more money, basically?
04:47And there's never been a better time to figure out how to optimize margin when rates 30 or the 30
04:52years over 7 percent.
04:54Now, it always matters, but it matters even more when the market is selling off and where it is today.
05:02And so this has been the vision.
05:05This has been the dream.
05:06We've wanted to do this for years.
05:08But then it goes back to those two things.
05:11First principles thinking and and recognizing when to push hard and fast and then and then when not to.
05:18And so we've been working on this.
05:21We've known we wanted to do this forever, but we we want to we wanted to make sure it was
05:26done exactly right.
05:28We didn't want to have it half baked and we wanted to realize the full vision, number one.
05:32And then number two, we also just given the strong growth and momentum, we said, OK, let's make sure that
05:41we are super focused on our core products before we go talk about and announce all these new things.
05:50And so here we are in this really fun position where we're able to do both.
05:59Adam, the way that you explain this, it makes such an incredible amount of logical sense that it makes me
06:08really ask and consider if the question at the heart of Poly at OS is what did we actually make
06:16on this loan?
06:16Why has answering that question been so hard?
06:20When markets and industries don't have competition, there's no reason to innovate.
06:29And this industry really hasn't had anything competitive for 20 plus years, 25 years.
06:37And so if everyone's growing revenue and making a lot of money, there's no reason to spend a bunch of
06:46money to innovate.
06:48And that's really harmed the industry over the last 10, 20 years.
06:55And so, of course, now along came Poly and we're just trying to figure out what we can do to
07:01partner with our customers and the lending community, even if they're not customers.
07:11Listen, learn, be humble, be agile, all of it.
07:17And just figure out what we can do to maximize the value, the ROI, the support, the service, and then
07:25build these really, really cool things that hopefully resonate.
07:29You just mentioned a couple of really key things.
07:32You mentioned partnering with lenders in the industry and partnering with industry professionals and how I think that really ties
07:40into the building of Poly OS, which took clearly years of development and collaboration with capital markets leaders.
07:50How did partnering with those leaders and industry partners help you overcome challenges that lenders can face in implementation and
07:59new tech adoption?
08:01Absolutely critical and not possible without the partners that we've been able to build this with.
08:11It's one thing to have an idea and it's a completely different thing to then execute on it.
08:17And it's a whole different thing to make sure that as you're building something like this, it's not for just
08:26a limited cohort of the lending community.
08:30And so, and this goes back to our architecture and now being completely AI native, which is we've always, like
08:39our ethos has always been, we want unlimited flexibility, configurability, granularity.
08:44And so, you know, yeah, we've had this thought of building Poly OS since 2019 when the company was started.
08:54But, you know, you need to do one thing at a time and then as you're doing it, you need
08:58to listen and learn and be humble and recognize that there are so many different styles of doing things.
09:07And so whether it's how to model pull through or look at attribution or what analytics people want or don't
09:18want, you know, and curating that.
09:20Ultimately, we wanted to build something that is flexible and configurable such that any lender of any size of any
09:32channel doing any product is able to maximize the value in the ROI of this system.
09:39And so, and then also democratize its power, right?
09:45Like, so you've got the top few lenders in this country that certainly have the intellectual horsepower to process some
09:57of these things.
09:58Maybe not all these things even, and being able to democratize this system so that they can compete with those
10:06super, super large companies at the top, you know, one, two, three, four, five.
10:12That's a really, really cool feeling.
10:14That's a really, really cool thing.
10:16I'm going to press you a little bit on this, Adam.
10:18Tell me some of the people who have been the most fun for you to partner with as you've gone
10:23through building this capability.
10:24There's been a lot, you know.
10:28Obviously, working with folks like Rob Kessel and Gary Malice and other folks like Kristen or Dawn or internally too,
10:41you know, we've got an amazing group of people, John and Brandon.
10:44Like, this was not, this was a team effort and I've played like a 1% role in it.
10:52It's very, very, very cool.
10:53Well, I can, there's a whole list of people naming them all.
10:57It'd be impossible.
11:00Yeah.
11:01But, you know, and then, of course, as we're, as we've been able to put this system into beta and
11:08start to work with folks that are already customers of ours,
11:14and they've been super forthcoming and holding us accountable.
11:19And this goes just to our culture of we want to be humble, we want to work hard, we want
11:22to work fast, and we want to do the right things.
11:25So I think it's just like this kind of reflexivity between building this really, really cool product and overall system
11:33and then just the culture we have within the company.
11:35You've talked a lot about intentionality as you've looked to launch Polly OS and realize this full vision ecosystem.
11:43As Polly grew from its original launch to a full capital markets operating system, what did you have to change
11:52your mindset about or even reevaluate as you went to actually build this?
11:58Obviously, for me, I like to move very fast.
12:04And so, but on something like this, you just can't.
12:08And so, number one, I'd say that I had to check myself up a lot, like, hey, let's get this
12:14thing going.
12:14Let's get this thing to market.
12:15Let's do whatever.
12:16And the team kept on saying, hey, like, you know, obviously this needs to be not only right, but it,
12:24you know, and John and I always talk about it.
12:27If we're going to do something, it's got to be 10 times better than anything else out there.
12:31And that's like a minimum.
12:32Like, it's not like that's the ceiling.
12:35No, that's the floor.
12:36And so, you know, we are.
12:38So that's number one.
12:39Number two, as part of that pace, we also started to recognize that over the last couple of years, the
12:51available technology massively changed, right?
12:53Like three, two years ago, doing things, you know, leveraging AI was, wasn't even a thing.
13:02Now it's, you know, like our primitive instinct.
13:05And so being able to both go deep and wide at the same time this year has been like a
13:12real education curve for us.
13:14And, you know, and then three, of course, it's really ensuring that we are super transparent and communicative with the
13:29customer partners that are, they've been giving us this advice, telling them, hey, this is the vision, but check us
13:35up.
13:36What do you see is working and not working value and not the value that we think and, or that
13:44you think, excuse me, and recognizing that that open line of communication and not having dogma around any issue is
13:54like super, super important.
13:55There is so much going on with Polly.
13:59It seems like this is just scratching the surface.
14:02We have so much ahead of us.
14:04Where can we find out more information?
14:07There's a large, large team from Polly that will be at National MBA in Chicago in a couple of weeks,
14:13which we're really excited about.
14:15I think we've got like a record number of meetings to talk about Polly OS and other things.
14:21We're hosting dinners.
14:22We've got a really fun and large event on Monday we're co-hosting.
14:27So we'd love to meet with you.
14:28We'd love to talk to you.
14:29We'd love to just share with you what we're up to and, and then what's coming in the next year
14:34or two.
14:34Now, Adam, congratulations on the launch of Polly OS.
14:38And with Polly OS now being complete, you're entering a whole new era for Polly.
14:45What are you most excited for next?
14:48Getting it to market.
14:49It's, it's been a long time coming.
14:51No, you know, we, we, we are always cooking up new things, figuring out, is it the right thing or
15:00is it the wrong thing?
15:01Obviously, we don't want to put anything out there that's, that we're not like super convicted on.
15:06And that would be, you know, driving a lot of value in ROI, ultimately to drive, you know, improved revenue
15:13or driving costs down.
15:20Maximizing the, the loan officer experience, things like that.
15:24And so there are a lot of things coming.
15:27Um, we're really pumped up about it, but on the other hand, this kind of goes to, we're just really
15:34focused for the next bit of time to ensure that we get this thing.
15:39The Polly OS totally dialed in all of the lending community who's already signed up for it.
15:46And we're in the process of, uh, onboarding hyper successful.
15:51And there's a lot more for us to do with, with it.
15:55And so right now we're just like scratching the surface.
15:57And, um, frankly, for us internally, we've never been more excited.
16:01There's never been more enthusiasm and there's never been higher, stronger conviction.
16:04And so, um, I think the next year or two for us are going to, it's going to be like
16:08really, really exciting.
16:10And I think, and the team's like pumped.
16:12So I think that maybe that's what I'm most excited about.
16:15What a fantastic place to be, Adam.
16:17Um, congratulations again on the launch of Polly OS.
16:21I'm so excited to see what this next era brings for Polly.
16:26Thank you very much for having me.