Customer-Centric Community Banking: A Conversation with IncredibleBank CEO Todd Nagel

In this special episode, Sean and Gina welcome Todd Nagel, President and CEO of IncredibleBank, the country’s first national online community bank. With bank branches in Wisconsin and Michigan, an expansion plan for new locations in key markets and a digital-first approach, IncredibleBank’s growth path is reaping rewards for this signature financial services brand. Not satisfied with the status quo in banking, IncredibleBank boasts a unique marriage of trademark customer service and award-winning innovation. With a passion for people – employees and customers alike – Nagel believes that banking should be at the center of every community with bankers leading by example through philanthropy, local business development, community-building and creating conditions that foster a robust economy.

Text Transcript

Intro: This is Believe In Banking, a podcast series for decision makers, influencers, and leaders, featuring experts taking on the financial industry’s most pressing issues with insight and empathy. The podcast features information and conversations designed to enlighten and empower. Here are your Believe In Banking hosts, Sean Keathley and Gina Bleedorn.

Sean Keathley: Welcome to our podcast for Believe In Banking. This is Sean Keathley, President & CEO of Adrenaline.

Gina Bleedorn: And I’m Gina Bleedorn, Chief Experience Officer at Adrenaline.

Sean Keathley: Gina, I’m excited about today’s episode. We have a star guest today. Mr. Todd Nagel is President and CEO of IncredibleBank. Todd, welcome to our podcast.

Todd Nagel: Hey, thanks for letting me join you guys today.

Sean Keathley: We are delighted to have you on and our listeners are going to really enjoy your story, I know it. If you don’t mind, IncredibleBank has a bit of a unique origin. Would you mind introducing yourself and just talking about the inception, your style as a CEO of going against the grain a little bit and just talk a bit about the bank and your roots and where things are headed.

Todd Nagel: Okay, great. Yeah. I’m Todd Nagel, I’m the President and CEO of now IncredibleBank. I think we do have an interesting story. We actually started as a community bank in 1967, which just happens to be the year I was born. Obviously I wasn’t with the bank at that time, but that’ll give my age. And interestingly enough, it was purchased by a farmer, Ron Nicklaus, who is a patriarch, if you will, of our company. And is now owned, fast forward, by his two sons in their fifties.

Todd Nagel: And we are a unique company. We’re about $1.7 billion in assets today with only two shareholders, which I think is unique in banking and unique for a bank our size. But we started off as a small community bank, just with one branch and fast forward to today, we have 15 branch locations. And then also a rather large national presence. And really the national presence came around in about 2007. We were thinking about how do we increase our funding on a national basis, because loan demand was so great. And of course that happened just before the big real estate crash.

Todd Nagel: So, the reader’s digest version is we started an internet only bank called in 2008, 2009. But our original bank, our mothership, if you will, was called River Valley State Bank. And just two years ago, we combined our River Valley State Bank brand with our brand and IncredibleBank was the surviving name. So that’s a real, real fast story of our history.

Gina Bleedorn: With that name Todd, I don’t think anyone that hears the name IncredibleBank would not want to know more about the bank. It’s such a bold statement and promise. And then if you look at the way it looks, even the identity it seems to carry with it, this big promise of something different. You’ve been featured all over the place regarding what you’ve done. But how do you live up to that name? How do you deliver on IncredibleBank?

Todd Nagel: Well, it’s a great question and it’s one, believe it or not, we don’t take lightly. If you’re going to call yourself IncredibleBank, you’re really putting yourself out there. And you need to have a great sense of humor, but you have to take it very seriously because it certainly opens you up to all kinds of criticism. And we knew that going into it. We actually chose the name through a really long, long story. But our old CEO one year dressed up like Mr. Incredible Banker. And so how we came up with was really watching him. And he actually looks just like the character on the movie, which made it even more fun, of course.

Todd Nagel: So, it really all started in fun. And on a serious note, we tried to bring that theme through it. We just don’t take ourselves too seriously. We try to work hard and have more fun than we work, which is really neat. But we have a customer service model that is also a trademark that we call the Incredible Customer Experience or ICE. We’re now in a playbook version number five, the rough draft is on my desk right now. And we train every single employee that comes to work at IncredibleBank when they’re a new employee. And then we do repetitive training every year to make sure that all of our employees live up to our minimum customer standards.

Todd Nagel: And we say things to people like, they’ll say, “Todd, that wasn’t an incredible experience.” We’ll say, “You know what, you’re exactly right, but we’re going to work on making this an incredible experience.” So, we don’t try to be something we’re not, we know that we’re mere mortals, but we really are focusing on the experience of banking which is about as boring as it gets. And checking accounts are about as boring as it gets, when it comes to products, right? I don’t know how you make a checking account sexy, but you can certainly create an incredible customer experience and you can certainly make people feel good. That’s what we’re about.

Sean Keathley: Well, it’s remarkable because we do hear a lot from community organizations that the people are what makes them stand out, but we have not met organizations that take it to heart like you do. And I think it is a balance between being bold and not taking yourself too seriously. And I think with that and your digital background, I’m thinking both those things perhaps prepared you for this last year that no one saw coming. So maybe talk a little bit about that. Just the commitment and the culture and how every single person believes in the bank, but also your digital launch full decade ago. How did that dual strategy put you in a position to succeed in the last year with all the headwinds of COVID and the challenges that your communities you serve faced?

Todd Nagel: Yeah, certainly the timing couldn’t be better for the launch of a pandemic, as ridiculous as those sounds, because like the military, we had to mobilize our entire workforce. And luckily we had a good portion of our workforce that was digital first, that was leaning digital first, however, trying to create an incredible customer experience. So our secret sauce is we actually answer the phone and talk to people and call you back. And we have a standard that we have to call you back by the end of the day, no matter… And that’s 1159 at night, if it has to be. But we were set up very nicely, having and being able to open up accounts online unassisted by people that definitely helped us.

Todd Nagel: And then of course, when PPP came around, we literally had to set that product up overnight and we were ready to go before the big banks. I love picking on big banks, just because it’s easy. And we love competing against big banks because it’s easy. And when we set up PPP, we actually had customers from larger banks that we had been prospecting for a long time, come over to us. And we were able to stand up some technology really quick and given the size of our company, mobilized really quickly. So I think having a company that’s entrepreneurial and opportunistic and likes to have fun.

Todd Nagel: And we promised everybody right from the start that our goal was to not eliminate jobs. Now that’s a tough promise when you don’t know what the future is, but I think that helped our people say, “Okay, I’m not worried about my job. This isn’t something I know, but I’m going to jump in and get started.” And I think we opened something like 1500 checking accounts online in the first three months of the pandemic. And I know for sure we did 2300 PPP loans, all electronic because obviously our branches and lobbies were closed. So yes, having the platform being digital first, and then I think also being entrepreneurial helped out a lot.

Gina Bleedorn: You have the claim of being the first national online community bank. You were very much ahead of the curve. When many institutions, community institutions are looking to get more digital, you started digital, but since you chose in a way to add the physical branches, what do you think you get from that physical channel? And how do you leverage the physical versus the digital, where you started, to get the best return really from each and give the best experience to customers within each?

Todd Nagel: It’s a great question. Again, I think having started, which was 100% digital, you couldn’t go into a branch and open an account because no branches existed. And then having the legacy 50 year old River Valley Bank brand, which was brick and mortar hand-in-hand delivery certainly was a challenge when we put the two cultures together. However, what’s been fun is, I remember our mission statement that we came up with in 2019 and it was our 2021 vision, which was three years out. And that was to make all our transactional people into digital ambassadors. And I’m paraphrasing that. And so we were talking about being digital ambassadors in our branches in 2018. I think now looking back, that’s pretty forward-thinking.

Todd Nagel: So, our people really have transformed from being very transactional. Come in, bring your check, deposit it to being digital ambassadors. And what that means is we actually help more people with their mobile banking and perhaps set up ease statements than we do actually cash checks, or we help them with their consumer capture, which is taking a picture of your check and depositing on your phone today. Then we do actually people coming in and asking for cash or transferring cash back and forth.

Todd Nagel: So, I think that was fun for us to be ahead of the game. It was real fun to take your traditional transactional banker and get them leaning towards the digital side and say, “Hey, you don’t have to abandon talking to customers, opening the door for customers, handing customers a cup of coffee. But if you get this digital, this mobile, this online banking skillset, you can really help customers move forward and cement the relationship.” So it was actually very… I don’t know if it was well-planned, but it was planned out. And so today how we do that, Gina is we actually have, let’s say a motorhome customer in Kentucky that’s on bordered by a branch in let’s say Eagle River, Wisconsin. So it’s actually branch staff that are onboarding a digital customer in one of our branches. So we’re still utilizing the same people who are experts in banking. It’s been fun.

Gina Bleedorn: That’s a incredible, no pun intended step towards omni-channel delivery that everyone, every bank struggles with, even retailers struggle with. How many times are you somewhere and you say, “I did something online, or I need help with my app.” And a banker, or even a retail associates says, “Sorry, go call the number.” And you pioneered omni-channel in a way through actual physical training of people. And that’s makes a lot of sense and you have done so because you have that incredible, truly customer centric lens, more so than many and most that we talked to, as far as the extent to which you go to think about the customer first at every turn. Talk about even what happens at the branch, your standards about treating customers inside a brand?

Todd Nagel: Yeah. Again, going back to our playbook, our ICE playbook, which I love to say is version 5.05 years into it. We do things like open the door. One of our standards is we ask our people to open the door for all customers. Now that seems like it’d be really easy to train. And it seems like it’d be really easy to manage. I can tell you it was the most difficult customer service standard we ever put in, for a number of reasons. People like older gentlemen saying, “No lady can open the door for me.” And so we’re like, “Well, that’s okay. Don’t make him mad. Let him open the door for you if that’s the deal.” But we do things like that.

Todd Nagel: All our employees wear their name tags on the right side. We couldn’t figure out if it was supposed to be in the right side or left side. So I think we did rock paper scissors, and we came up with the right side, but all our employees have a name tag on. All of our employees opened the door for all of our customers. All of our employees welcome the customer the same way. And all of our employees end the conversation, the same way, we have actual scripts. All voicemails are standardized with their own voice that tells them when there’ll be back. There’s nothing more frustrating, you get a voicemail that says, “Please leave a message, but I don’t know when I’m really going to call you back.”

Todd Nagel: So, things like that, which seem really simple, are really hard to deploy and they’re even harder to measure. And really the only way you can measure them is you have to go and observe. So we’ve hired secret shoppers to this day. We take a lot of pride on getting customer testimonials or customer reviews back. And our goal is to have at least 30 to 35% returned, because if you’re going to be a customer centric organization, you have to have that feedback in order to improve the customer experience. But we spend a lot of time… Our brand promise is, “No bank treats you better.” So again, if you’re going to have a bold promise like that, you have to be able to prove it out. And we’re working every day on trying to improve the digital experience and the in-person experience.

Sean Keathley: So, Todd, one of the things I think is really unique about IncredibleBank, and you’ve already said it, although you’re officially maybe a community size bank, you’ve got this digital first part of you that has made you more of a national player, and you don’t really think of community banks or even community credit unions as your competition. So talk to us about this national plan, the overall customer experience and how you truly do think that these big national players are who you compete against. And thus, why you think with the more of a community bank approach to customer service, et cetera, you’ve got a leg up on these guys.

Todd Nagel: It happened out of a problem we had to solve. So after the real estate crisis of, and it really hit us in 9/10/11, it happens in the Midwest where it hit us later. I said, “If we ever get out of this, I’m not going back.” So we decided we needed to have diversify our loan portfolio. And of course in Wisconsin, Northern Michigan, it’s mostly commercial real estate. So we were searching for what I would call equipment financing. And if we could do it on a national basis, that would be great, if we could do it with the OEM manufacturer, that would be great. And we discovered that this motor, home financing niche and it just so happened I was passionate about motorhomes. So that’s believe it or not, the short story.

Todd Nagel: What it did for our balance sheet was significantly diversify our credit risk. But it also opened us up to a whole new customer base on a national basis. And while had deposit customers in 50 states, we did not have loan in 50 states. So the fun part about it was we discovered these different, I guess they call them niches now, across the United States in the loan and deposit world. And then we support those through our local branches in the different towns, which is fun. And we think the differences, is the big banks aren’t really concentrating on the retail customer. We feel they concentrate on other forms of income. And that’s our main source of income is net interest income and of course, non-interest income. And so we really want to focus on giving a better customer experience because people forget what you say, but they always remember how you make them feel. And so we just think we can beat the big banks every day.

Todd Nagel: It’s really hard to talk to anybody if you call a big bank, just pick a big bank and dial their 1-800 number and see how long it takes to talk to them. So we give out cell phones and our call center is supposed to answer within two or three rings, which generally happens unless we’re really, really busy. So again, there’s just, I think right now, depending on what statistic you look at, big banks control 70% of the deposits in the country, and there’s less than 5,000 banks. So community banks should be hunting these big banks, it’s easier. Why hunt the neighbor in your town? There just isn’t as much market share.

Sean Keathley: I hope you take this the right way. It feels like there’s been a combination of lucky and good. Is that a fair thing to think about? We are a company that creates brands, the Incredible Foundation is amazing how that became your brand, your love for mobile homes. And just, again, I said at the outset, thinking differently, and those things were serendipitous and timing and whatnot, but I think without a culture, your leadership and this company-wide focus on what you’re going to go do, you don’t even execute on it. So is that a fair way to think about how you guys have had some of the successes as you continue this journey to be a really unique institution?

Todd Nagel: Yeah, there’s no question. Some of it was very deliberate and some of it was just flat out being at the right place at the right time, there’s no question about that. And you make your luck if you set yourself up to win. And I think that we knew that culture just drives strategy, but it also eats strategy. So we had to get our culture aligned before we… Think about it. We changed from River Valley State Bank to IncredibleBank. We took a 50 year legacy brand and we changed it to IncredibleBank. It was a huge move and it scared us to death. And we really had to get our company ready and our culture ready before we did that. And there was some tough moves there with personnel and other things.

Todd Nagel: But certainly, I think what’s been fun is we take community banking on the road. So just because we’re headquartered here in Wisconsin doesn’t mean that we can’t finance a home in Oklahoma, they use concrete there as well. And those are the kinds of things we kid around, where people be like, “Oh my gosh, how do we do a house in Oklahoma?” And I’m like, “Well, I don’t know, is concrete made different there?” So we just got to have fun and get sarcastic with each other. And then some of stuff, it just gets catchy. And I think people want to be around where the action is. And so, yeah, we have a little bit of the firetruck syndrome and that people want to know what’s going on over here, but there are a lot of people that can’t work here Sean, we’ve hired some traditional bankers and we scare them to death. They quit really quickly.

Sean Keathley: Right. I think to back up, I often think about the definition of luck is timing and hard work. And then to your point, you guys know who you are and it is an opt in mentality. And I think the tenure of your team is a testament to the right fit people, really help you deliver. And then just one of the things I saw, and I know, although this national expansion, just thinking about your roots and what the mid… Well, when I think of it in the Midwest, and I don’t know how many banks have a 15 acre farm. And just talk about why you would do that and talk about the IncredibleBank Foundation. I think it just underscores what you’re talking about with the culture you developed at the bank.

Todd Nagel: Yeah. And our founder, Ron Nicklaus, who’s now 85 years old. He was a farmer before he was a banker. He was one of the largest green bean harvesters and planters of green beans across the country. And in the eighties he bought the bank. So he’s never lost his farming roots. And he started this, what he calls a garden, which I think when you get over 15 acres is no longer a garden, but he wanted to grow vegetables for the employees as a way to give back. And then the farm kept growing and growing and growing and growing. And he grew more vegetables than 300 employees could eat. So then we started donated into food banks and we started delivering and we actually have a delivery mechanism that sends them to all our branches.

Todd Nagel: And to give you an idea, we’re in rural America. So our most Southern branch to Northern branch are six hours away. So when the vegetables start growing, the Nicklaus Farms deliver, which are our owners deliver vegetables to all our branches. And then we distribute them to employees, customers, and then whatever’s left over, go to food banks. So imagine walking into an IncredibleBank branch and leaving with a dozen ears of sweet corn. That doesn’t happen, right? So that’s just kind of fun. That’s how we get involved in the community.

Todd Nagel: And then our IncredibleBank Foundation is a charitable organization that our owners donate over $500,000 a year into the foundation. And I’m trying to keep the balance up. But every year they spend every dollar. So it’s more of a charitable giving fund as I call it. And we give back to the communities we serve, these deposits really started in the communities that we serve and they should be recirculated in the communities we serve. So it’s a lot of fun to be involved with. And our employees will volunteer at the farm and pick vegetables and deliver vegetables. And when you walk into a food bank, being a bank with bags of vegetables, for people that you’re helping, it’s really a lot of fun. We’ll actually have people come to the bank and say, “We heard you guys give vegetables here, we don’t believe our neighbor.”

Sean Keathley: They don’t believe it.

Todd Nagel: So, we’re like, “Here’s some cucumbers, man. Here you go.”

Gina Bleedorn: And by the way, I have two, 4X8 foot gardens that are an immense amount of work in my backyard. And so I’m here to qualify that you’re far beyond garden’s size, but also the fact that you do the things you do is well incredible. But also the fact of the amount of times you’ve said the word fun. You really have fun. You create and cultivate a culture of fun. You exude that to your customers, to your employees. How do you keep banking fun?

Todd Nagel: That’s a great question. Because banking by nature is boring. I’ve probably said that three times too. And I just was thinking and our teams think about how can we make sure our employees are having a good time because it’s not the most exciting work in the world. And there are less customers coming into our locations. That’s just a fact. And so some of the people that we have are really social, they’re social monsters. So we do things like, okay, we pop popcorn. There’s a bunch of banks pop popcorn, but how many banks go out and deliver a 100 bags of popcorn to businesses on a Wednesday, you walk in with a hundred bags of popcorn. People are like, “Well, what’s the deal?” “We’re just bringing you popcorn.”

Todd Nagel: So, we just try to have fun. One of the other unique things that we did, because we’re always trying to tell people to deliver a concierge experience, which is something that someone’s not expecting. One of our bank managers put a freeze-e pops through the tubes on the drive-through. So I’m like, “Wow, that was interesting.” He said, “It was a really hot day. It didn’t work out real good though Todd, because they started to melt and then the tube got stuck. I’m like, “Well, it was a cool idea.” We have this thing called the Sunshine Award. So we sent them a nice card with a $100.

Sean Keathley: I would know while we’re helping you rethink the drive off experiences because your freeze-e pops have ruined all your pneumatic tubes.

Todd Nagel: That’s exactly right. But I think you have to be empowered to do stuff like that and don’t get me wrong. We’re a very serious organization because we’re taking care of people’s money, but we’re in the customer service business and we need to make people’s day. And I think in order to do that, you have to be positive. And some days people come to work and they just don’t feel positive. So if we can all laugh a little bit and have some fun, there’s no reason why you can’t have fun at work.

Sean Keathley: I’m trying to think of somebody you remind me of in terms of a company and I have to leave the financial sector. I mean maybe a Nordstrom’s comes to mind, someone who famously doesn’t have a return policy. In Nordstrom, one of their big successes is an intentional focus on the customer, but there’s also just amazing empowerment of the employee. Is that a part of what you do to make this company-wide, is you lead people by example, but you must empower people to live this brand. Then it’s a living, breathing thing for your organization.

Todd Nagel: Yes. And what we learned is we do have a charitable foundation, but what we learned is, and that becomes formalized and you have to apply for the dollars and so on and so forth. But then we’ve got these branches in a widespread geography. And so we said, “Hey, we have to start giving like $5,000 to each branch and let that market manager donate that money in their communities, the way they want to do it. How would we know down here at corporate, who we should donate to, in their community.” So we learned that Sean.

Todd Nagel: We also learned same thing with sponsorship dollars that even though we have a nice, awesome, centralized, cool marketing department, that we may not know who to sponsor in a community three hours from here. So we give that market manager their own sponsorship budget, and they can do what they want as a part of IncredibleBank. Those are things we learned along the way. And then the employees like, “This is the greatest thing in the world.” Well, duh, then all the employees in that community rally around it, and it becomes a much more significant event for the community and for the employees. And so generally most of our foundation gifts we give or we try to give to organizations that our employees volunteer for. And that’s, I think how some of this empowerment happens.

Gina Bleedorn: Your definition of down here at corporate you’re about the least corporate corporate that I’ve experienced.

Sean Keathley: Todd, I think one thing our listeners would love your perspective on, we’ve actually had BM Technologies, which is a true fintech and someone that doesn’t think they have everything they need to serve the banking market. They’re thinking about partnerships as a way to collaborate, to do banking. Many commune in your organizations. And as you mentioned, there are thousands of them. The average size organization is still quite small in relationship to the monster players that have the unlimited budgets. But you’re a little unfazed by this fintech push or invasion, I think largely it’s based in your understanding of being a digital bank, but why would other community banks, why should they not shutter at the notion that FinTech’s are coming for all their business? How would you address that concern and talking to your constituents?

Todd Nagel: Thank you for that. First, I want to go on record, I’m a huge fan of FinTech’s. And the if any FinTech’s wants a partnership, please call me. I wish I would it have in the bank for square. That’s kind of a cool deal because I think it gave small businesses, micro businesses, a better product than, than the banks could come up with. So, I’m a huge fan of FinTech’s. However, I agree, Sean, I don’t think community banks should fear them, rather embrace their ideas because they’re the innovators of the future of banking. And that’s what consumers and small businesses want. So let’s not block momentum, let’s just join it. But when people say stuff like, “Well, are you fearful that the United States postal service is going to take over banking?” And I’m like, “No, they can’t even deliver my mail on time. Who would go there?”

Todd Nagel: I think community banks get fearful of some of these different challenger banks and FinTech’s. Unfortunately what happened to a lot of digital banks and there’s not a lot written about it is while they didn’t fail during the pandemic, they didn’t have that one-on-one capability of talking to customers. And a lot of people were panicking very quickly. And I think that’s where community banks stepped up and were able to deploy a lot of people quickly to talk to customers. And that’s why we grew deposits like we did. And that’s why there was an Exodus of large banks to the community bank sector. These FinTech’s are technology companies looking to partner with banks and make our customer experience better. So I think it’s something we should embrace, not fear, partner with, not try to shut it.

Gina Bleedorn: It is very clear that you believe in banking, which is of course the name of our podcast. Tell us why you believe in banking, Todd.

Todd Nagel: Yeah, I believe in banking because I think it is the center of every community or it should be the center of every community. And if you’re a bank serving the community, you’re doing the right thing. And really, if you think about it, a bank is owned by the members of the community. And we’re just lucky enough to have an FDIC signified institution to redistribute the dollars in the community. So to me, a perfect dream of banking is that we give a loan to a local apartment complex and the tax bill might’ve been $1000 on it when it’s done. And once it’s built the tax bill is $70,000 and some of that money helps build a park that others in the community can enjoy.

Todd Nagel: So, I think community banking has a long, long runway ahead of it. And I always believe, Hey, there’s less community banks than there ever was. That should make us more valuable and we should be more important and we should take that responsibility more serious and become more significant. And I believe most community banks are the leaders in their communities and leading by example, through philanthropy, economic development, and really creating a robust economy.

Gina Bleedorn: Well, Todd, I said, when I met you, you are a very un-bank CEO, bank CEO. And I mean that with admiration, not that there’s anything wrong with bank CEOs at all, but you are atypical and you’re different in how you think about it. And I think that in those differences, there’s a lot that the industry can learn about how they can apply some of the type of things that you’ve done, if that’s right for their organizations, to what they’re doing. And regardless of what anyone thinks about it, you have clearly been successful in your path, your atypical path to building IncredibleBank to the bold, beautiful brand that it is today with a corresponding bold and beautiful promise to customers and communities. So we thank you sincerely for being on with us today.

Sean Keathley: Yeah. Likewise, Gina. If nothing else people can learn about leadership, passionate about our organization, we believe in a lot about brand experience, people really embodying a brand promise, being differentiated. And like you say, in a sea of sameness and the commoditization of banking, you guys have carved a unique path and we just thank you. We wish you all the best in your journey and hope that we can help you continue to be successful.

Todd Nagel: Well, thanks to both of you. And I appreciate the opportunity chat with you all today.

Outro: You’ve been listening to Believe In Banking, a podcast series created to empower decision makers, influencers, and industry leaders in financial services. Be sure to also join us on our flagship site,