An Incubator Incubates New Guidance

By Ray Birch

MADISON, Wis.—After a decade of working to become an incubator of  innovative products and solutions for credit unions, Filene’s i3 program is making a change—and it’s partly due to the effect fintechs have had on the time to get ideas to market.

Feature Filene i3 low res

And this change, Filene says, will drive even greater benefits for CUs.

The i3 program, initially designed to foster the development of new ideas and innovations on a collaborative basis in credit unions, is moving away from its long-time, primary focus on specific products and services, to instead offer guidance and roadmaps for credit unions to follow as they work to address issues they’re facing or might potentially face.

What will not be changing is the basic structure of participation in the i3 program. Credit union executives will continue to be selected to participate on various i3 teams, serving two-year terms that begin with Filene’s annual big.bright.minds conference. This year’s meeting is scheduled for Nov. 19-20 in Durham, N.C.

Evolution & Change

“Things have to evolve and change,” said Cortney Angeley, community and events director at Filene. “Technology is everywhere and it's coming out faster, and it's impossible to keep up with, especially in the credit union space. I think i3ers are really feeling the brunt of that, plus they work in six-month cycles. That makes it hard to compete with the resources and speed of the fintechs if your i3 project is technology-based, such as an app or software.”

Angeley explained Filene also recognizes that when initial concepts are developed by the i3 teams, that’s just step one; getting credit unions to implement them has not always been easy.

“So the teams come up with these wonderful ideas, yet they are often not completely created, not fully developed,” she said. “That has proven to be challenging for some credit unions to run with the new i3 efforts.”

All of that has played a role in bringing about the recent shift in direction for i3.

“We are moving away from product development to focus more on professional development competencies,” Angeley explained. “We are still going to put the teams through the traditional i3  methods, which include two years of project team work that is handled in separate six-month segments. We’re still going to focus on human-centered design thinking, prototyping and testing. But we want our teams to come out of their two-year programs with skills that are really going to help them solve problems within their organization right away and for the future. They will be able to take something away and implement it in whatever field or issue they're trying to address.”

New Market Realities

For Filene and i3, it’s a matter of competing in a market in which the time from initial concept to market rollout has become significantly compressed.

“The fintechs can come up and create tools that are super useful and helpful and accessible for all kinds of people in such a short period of time, so how can we compete against that?” she asked.

The changes being made are part of the answer.

Angeley said that while the i3 focus won’t be on product development, if a team decides it wants to develop a product, that’s fine.

She said each i3 team is still tasked to solve problems faced by the credit union industry. One of the newest changes was matching up their projects with one of the five Filene Centers of Excellence: The Center for Consumer Decision Making, The Center for Organizational Entrepreneurship,  The Center for Performance and Operational Excellence, The Center for Emerging Technologies, and The Center for the War for Talent.

“Throughout the i3 six-month cycles, we are going to pair up the teams with fellows from each university associated with our Centers of Excellence,” Angeley explained.

In the Pipeline

Cortney Angeley

Cortney Angeley

What’s currently in the i3 pipeline?

Angeley said some teams are now developing solutions for addressing natural disasters, creating recommendations on what the future with autonomous vehicles might look like and how credit union lending will play a role/be affected, and looking to address so-called “food deserts” in which many members live.

“I am really excited about what the i3 team is doing to solve issues with food deserts,” Angeley told

A Potential New Reality

Turing to the team that worked on the future with autonomous vehicles last cycle, Angeley said credit unions will need to fundamentally shift how they approach lending and their members’ income streams. When people think about autonomous vehicles, often times images of flying cars come to mind. What many often forget is the gig-economy that comes with this transportation evolution.

Angeley said the i3 team estimates that by 2026, five million  workers will be employed in the transportation sector and they will need help since they will not have traditional streams of income. One of the findings the i3 team came up with is an income share agreement,” said Angeley. “Almost serendipitously, Filene’s Incubator is currently testing the industry’s appetite for such a product with CMFGVentures and Align.”

Angeley explained that an income share agreement would be a loan that has a monthly payment calculated off person’s income.

“If your income decreases, your payment amount decreases,” she said. “If your income increases your payment increases. If you lose your job you just don't make a payment. I see this working very well with the gig economy, rideshare drivers, and for teachers, who are often furloughed.”

Keeping Board Fresh

Angeley said another i3 team is focused on how credit unions can keep their boards of directors diverse and fresh in a way that is not confrontational to existing directors.

A separately i3 team is addressing methods for making member identification much easier and secure and streamline account opening. She said the group is looking at creating a system that would allow members to open accounts, conduct transactions and more by scanning an image of themselves—a type of “badge” created by the CU.

“As we know, member experience and new account openings have been a big point of friction for credit unions over the years,” she said.

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Copyright Year: 2019
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