Join me as I sit down with Tal Clark, the CEO of Instant and trace his remarkable path from Marine Corps helicopter pilot to fintech innovator. In this episode, Tal shares the ethos behind Instant's mission to revamp the way American workers receive their wages. As we peel back the layers of the earned wage access (EWA) market, you'll discover how Instant stands at the vanguard, offering employees fee-free access to wages that could very well redefine financial stability for many.
Dive into the heart of innovation with our discussion on the transformative nature of EWA and how Instant is leading the charge by integrating payment cards, tipping services, and wage access into one seamless employer solution. Tal gives us an insider's look at how their platform is not just a tool but a movement, setting itself apart from traditional payday loans and altering the financial landscape for employees nationwide. With an eye on the future, we predict the rise of EWA as an employee benefit standard and consider the evolving regulatory environment that's shaping this dynamic industry.
Wrapping up, Tal offers a personal glimpse into his life post-military service, his corporate experiences, and his fervent commitment to service and opportunity. He illuminates the leadership lessons he's garnered from commanding large teams and how building a culture of success yields the greatest rewards.
Join me as I sit down with Tal Clark, the CEO of Instant and trace his remarkable path from Marine Corps helicopter pilot to fintech innovator. In this episode, Tal shares the ethos behind Instant's mission to revamp the way American workers receive their wages. As we peel back the layers of the earned wage access (EWA) market, you'll discover how Instant stands at the vanguard, offering employees fee-free access to wages that could very well redefine financial stability for many.
Dive into the heart of innovation with our discussion on the transformative nature of EWA and how Instant is leading the charge by integrating payment cards, tipping services, and wage access into one seamless employer solution. Tal gives us an insider's look at how their platform is not just a tool but a movement, setting itself apart from traditional payday loans and altering the financial landscape for employees nationwide. With an eye on the future, we predict the rise of EWA as an employee benefit standard and consider the evolving regulatory environment that's shaping this dynamic industry.
Wrapping up, Tal offers a personal glimpse into his life post-military service, his corporate experiences, and his fervent commitment to service and opportunity. He illuminates the leadership lessons he's garnered from commanding large teams and how building a culture of success yields the greatest rewards.
Welcome to the Leaders in Payments podcast, where we talk to C-level leaders from across the payments landscape. We'll be discussing the products and services that impact the payment space today, as well as trends and predictions for the future of payments. We will also hear stories from our guests about their journeys to the top.
Speaker 2:I think that we will continue to see continued innovation around the space that is becoming, and EWA will continue to become, a priority for employers over the next three to five years. Outside of those key verticals that we've seen early on, it will expand across verticals.
Speaker 3:That was Tal Clark, CEO of Instant. He is my special guest on this episode, episode 299 of the Leaders in Payments podcast, and I'm your host, Greg Myers. Instant strives to give every working American fee-free access to their earned wages when they want it, where they want it and how they want it. Tal and I talked about the earned wage access market and what makes Instant unique and different in the space. We also talked about Tal's journey from Marine Corps helicopter pilot to Instant CEO. We've got a great episode ahead, so let's get started. Hi, Tal, Thank you for being here and welcome to the Leaders in Payments podcast. Super Thank you for having me, Greg, Absolutely, let's dive right in. If you don't mind, tell our audience a little bit about yourself, maybe where you grew up, where you went to school, where you currently live, a few things like that, and maybe a little about how you eventually were led into working in this great payments industry.
Speaker 2:Yeah, that sounds good. I grew up in a small town in northwest Mississippi, just south of Memphis, called Drew Mississippi. Really, the only thing that Drew has been famous for is also the hometown of Archie Manning who's a few years older than me, but that's sort of its claim to fame Went to school at undergrad in Mississippi State, finished there and spent seven years in the Marine Corps flying helicopters. After that, I started a career in the agricultural business, which is sort of what I knew and ended up on the West Coast, spent some time in San Francisco and got an MBA at the University of San Francisco. Then, at some point shortly after that, moved back to Memphis, tennessee, which really was close to home, sort of the city that was closest to my home Spent some time there, ultimately raised our kids there, and that's where I really became involved in the payment space.
Speaker 2:There's a group that invited me to join with them. We started a business called Money Network. At the time it was one of the first, if not the first, payroll card businesses. We ended up being the largest share pay card business and ultimately sold that in 2008. We sold that in 2008 to First Data, then spent some time there through about 2017-18, and then retired. At least I thought I was retiring and didn't really expect to get back into the business, but candidly, I sort of missed being in the business and I was dabbling in looking at getting into a card business again, starting a card business myself. That's about the time I met some of the folks in Instance. I knew the chairman in Instance and they invited me to join them as a board member, then ultimately moved into the CEO role, for instance, about two years ago.
Speaker 3:Well, let's talk about Instance. Tell the audience what Instance does.
Speaker 2:Yeah, at its core, what Instance does is we want to make sure that employees have access to their wages every day. We want to make sure they have access to their wages in a way that meets their needs when they want their wages, where they would like their wages to be paid and how they would like to be paid. We're trying to meet all those challenges to really put their pay and their control. After all, these are wages that are earned and we want to make sure they have that access. Instance has been unique in providing that access at no cost to both wages and tips. That's our core mission is to make sure we continue doing that in a way that fits employees.
Speaker 3:Are there certain verticals or types of businesses that this is a better solution for?
Speaker 2:It has been historically, although I think it ultimately will move across most employee groups. It very closely parallels the early payroll car days in that quick service restaurants, table service restaurants, staffing, retail are probably the key industries. I've been the most industry for the most focus for earned wage access and tips. We also see it moving into industries such as healthcare, such as manufacturing, transportation, and ultimately this becomes a table stakes benefit, we believe, so that employees are going to look for ways to manage their compensation, no matter where they may be working.
Speaker 3:Who is your end customer, the employee or the employer?
Speaker 2:We're a B2B provider of earned wage access and tips services, so we're selling to employers. Then from there we certainly work with the employer to make sure the employees have the awareness of instance that they need and make sure they understand the opportunity. We are a B2B business. We say B2B to C, okay that makes sense.
Speaker 3:What role, would you say, instant plays in the marketplace?
Speaker 2:Yeah, that's a great question. The role that we want to make sure that we are fulfilling is access to wages. We're really targeting our efforts at those employees that sometimes you need access to the cash that you might not have on hand, and, through surveys that we've done, we understand that the alternative to what we can provide as earned wage access generally is not a good one High cost Payday loans. Sometimes, you know, people borrow from family members. We also know that people need cash. They might sell things on eBay they might not otherwise sell. So what we're really trying to do is is fill that gap between paydays so that employees have access to that cash when they need it, you know, for those emergency situations or situations when they just need to buy something they're not expecting. So that's really the role and in our goal is to make sure we can fulfill those needs and you've mentioned a couple of times about tips.
Speaker 3:So you have a product called instant tips. Can you talk a little bit about that solution and the value it brings to the industry?
Speaker 2:Yeah, absolutely it's.
Speaker 2:It's similar in that our goal again is to make sure that they have access to their to their tips each day, and what we do with instant tips is we essentially, you know, move cash out of the restaurants and in many cases today, restaurants Because people are paying credit or debit cards more often than not, restaurants Literally have armored cars dropping off cash or having managers go to banks to get cash Before they open in the evening so they can make sure they have the ability to pay out tips on a daily basis.
Speaker 2:Anyone who's worked as wait staff Understands that's one of the values and benefits that, you know, those working in that space really enjoy is the opportunity to earn and receive their tips daily, and so what we're doing is Continuing to make those tips available to them daily, but we load that immediately onto an instant card so that they have free access to those tips only Instant card each day and they can move those funds Wherever they would like to, or they can spend them using our instant visa card, so they have that choice as well.
Speaker 2:So some employers have, in the restaurant space, have moved tips into a normal payroll cycle, so you've got groups of employees in some restaurant environments that are now. You know they used to or have historically received their wages each day, but now they go on a paycheck and they might not receive them every two weeks and we know from our research and from talking to these employees that that's simply not what they want. They want access. They want to continue to access daily Without it being, you know, part of a typical payroll check. So that's what we do with instant tips and look forward to continue to expand that as well as much as you can divulge.
Speaker 3:What are your product plans for 2024?
Speaker 2:Yeah, we look, we're. We're gonna continue to innovate to make sure we Continue to focus on our goals of serving employees and serving our employers. One of those things that we're really doing in 2024 is making sure that we have the best app in market and we're really close to launching that. We actually launched it at HR Tech in October of last year but you know, trying to finish up the final version will have that in market within the next few weeks. It's so excited about that. It really meets the expectations of Millennials and Gen Z from my app engagement and an interface perspective, and We'll be competitive with any sort of banking app or payments app that you would see out there. So we're excited about that.
Speaker 2:And the other thing is we we want to innovate to assure that we sort of meet that requirement of receive your pay when you want it, where you want it and how you want it, and historically we have done that with the instant card, but we're trying to. We will be Innovating so that that payment can be moved in other directions, either through the instant card or without the instant card as we go forward so excited about those things and I and I think we really have an opportunity to change the way things are done in the space. One of the things that's really unique about instant is they were able to pull together a card, the ability to pay out tips in, the ability to pay out Earned wages all under one roof. There's no one else in the space that is able to bring all those things to bear for an employer. Everyone else is dependent on an outside of relationship for doing one of those three things. So really puts us in a unique position and we want to continue to build on that as we go forward as well.
Speaker 3:All right. Are there other things that differentiate you, or those sort of the main three things?
Speaker 2:Yeah, that's, that's key. I mean the fact that we, that an employer, can work with us and get all those things without, you know, three vendor relationships or two vendor relationships. That's very critical. I think it's very important to employers, you know. The other thing is instant establish the opportunity to get earn wages at no cost, and that's critically important. We have competitors who have been generating, you know, upwards of $30 and fee income from employees for access to these wages, where we've been doing it at no cost to the employees. So that will always be a base of our program and we'll continue to do that, because those, those are the two things the ability to deliver all those services and to do it in a way that provides access to boy and no cost or there are the really the key things that differentiate us from our competition.
Speaker 3:Well, let's talk about the earned wage access industry as a whole. Where do you see it headed in the next maybe three to five years?
Speaker 2:I think that we will continue to see some of the things I've mentioned. You'll see Continued innovation around the space. It is becoming, and EWA will continue to become, a priority for employers Over the next three to five years. Outside of those key verticals that we've seen early on, it will expand across verticals. We will also see the number of employees participating grow because there'll be new ways to access their wages, and so I think it you know, by those few things, it will become a table stakes benefit over the next three to five years for employers. We already see employees today. We know that they're 79% more likely To accept a job that provides them access to their cash each day, and so we see that demand coming from employees and that'll continue to grow, and so it again will become table stakes benefits, similar to a 401k or whatever other benefits an employer might be offering. So we see that key as we move forward.
Speaker 2:The other thing that we in the EWA space to our encountering now there is some regulatory framework that's being developed. We're constantly monitoring that and adjusting for that, both at the state level and the federal level, and so we'll continue to do that. You know the regulatory efforts will have some role in sort of guiding the industry and where we go, so we sort of look forward to meeting those requirements. Instant has been unique also in being able to deliver our services in all 50 states, and a number of our competitors have not been able to for various reasons, and so we'll continue to do that. Today we're working in Nevada and Maryland, missouri and other states that have had changing legislation to make sure we make those requirements. So, as we go forward, those will be things that we'll need to continue to work on.
Speaker 3:You know, I think in this space sometimes there's a misconception or at least you know I've done several interviews with companies in this space and there can be this misconception of Ernway Jacks us being similar or like a payday loan. So what are your thoughts on that?
Speaker 2:Yeah, well, look, honestly, I think it depends on the model and how it's delivered and what employees are required to pay for that access. Let me start by saying that, at a high level, ernway Jacks us is nothing but a good thing, and in almost every model it's a benefit for the employee when compared to the alternatives. Right, so it is. It is certainly puts employees in a better position than being required to go to, you know, a payday loan business on the corner nearest their workplace, which may or may not be in most cities, they seem not to be in great locations to start with. So, as a whole, ernway Jacks us is certainly not comparable to that and it's certainly a benefit to employees and it should not be put in that category.
Speaker 2:The instant has done its part to assure that. You know, ewa is a whole and certainly instant is not viewed as a payday loan, because you do have access and no cost. With instant, I think an argument can be made. If you're charging absorbent fees to an employee for access to their wages or even giving them the option of making a tip or a donation for their wages, I think all of those things can be punitive and while I do view them, even even those as a, as a improvement over the payday loan access. It certainly is not where I would like to see the industry go long term. Right, I think there are ways to do it that shed a better light on the space and create the opportunity for employees to have that access without nearing the cost associated with the payday loan. So so no, I don't think it's a payday loan in any form or shape. You know, we've got to make sure that we're communicating the value and the benefit as an industry to employers, to employees and regulators, so that they understand the benefits.
Speaker 3:Let's circle back to the legislation question, because it's interesting to me. So you have, you have the 50 states, which I assume many of them have their own unique laws and legislation. Then you know, is there a national thing or is there an attempt to make a national law that would supersede the state laws or sort of maybe explain that dynamic a little? Yeah, that's, that's a great question.
Speaker 2:And so, yes, so we've seen. Nevada was one of the first that created Urnway Jacksess legislation. We've seen other states follow Maryland, missouri, few others as well. California is in a review process right now. So the states have been active, the becanded. I have been surprised.
Speaker 2:You know my time in this space and the time that I spend in the prepaid card space. During those years when we were developing those products, we certainly got legislative and regulatory attention, but it was at a point where the industry had a much larger market share and more volume and usage. We're seeing Urnway Jacksess both legislative and regulatory activity I really think much earlier in the life cycle than I would expect of these products. And but to the industry's credit, I think you know we're working even with our competitors through associations Innovative Payment Association and others, to make sure people understand the story.
Speaker 2:There is work going on at the federal level. There is a bill working its way through Congress now that addresses Urnway Jacksess. We also are seeing activity from the CFPB and believe there will be some rulemaking at some point from the CFPB. So I do believe that there is a preference that we could have some federal rulemaking or federal legislation versus states doing their own different thing because in many cases these states have pursued separate requirements, separate rules, things that are different summer easier than others and it would be, I think, better for the industry that we had some federal regulatory guidance. A rulemaking from the cfpb or legislation would probably be helpful to the space. But I think we're all gonna have to kind of wait and see how that works out. But I do believe it'll be an active year in twenty twenty four for some of that so this is a question.
Speaker 3:You may or may not know the answer, but I think it's interesting. How did we get to where wages were paid every two weeks?
Speaker 2:I will tell you that I have a pretty good hypothesis there. So I think that if you I mean if you go back through history, wages were paid daily and wages were paid in cash and they continue to be. You know, we were an agrarian society through war two for the most part, and wages are still paid daily, or so it really started. With the advent of direct deposit. We're moving to checks first. So it started with the movement to checks, you know, led by companies that were paying a lot of people on behalf of employers and writing a lot of checks, and extending the time between those checks became a financial incentive for for those businesses right. And then, as we moved into direct deposit, the same thing was true. So in many cases if you were paying via direct deposit through large payroll organizations, you would receive funds on wednesday for payroll that would not be deposited or access provided until friday and wednesday may be the latest. So you take a large amount of cash that was flowing into the accounts of these payroll companies and still does today is to their benefit to hold that cash as long as they can right and to get as much of it as they can. So payroll cycles have been extended in large part for that reason.
Speaker 2:It's it's financial incentives for the businesses that were handling the payroll and it was, you know, also some incentive from the employer's part from a workload perspective, right, if you're doing payroll bi-weekly instead of weekly, then obviously you have less cost in that payroll. So those are the things that. That's. That's sort of what got us to where we are, which is, you know, it's their financial incentives for either the companies that are processing payroll or businesses themselves to stretch that period as much as they can. And that's why I think it's so important that we find ways to help these businesses get back to providing that access on a daily basis, and you know many of the businesses want to do that. I'm not sure that that all of the payroll companies want to do that. I don't think it's no. Ultimately, if we can get to the point where paying everybody every day and that's, there's not a lot of float incentive involved in that for the companies that have been generating a significant amount of revenue off of payroll float over the years.
Speaker 3:Yeah, makes perfect sense, okay. So let's switch gears a little bit and talk about you and you talked about a little bit of this earlier, but maybe go a little bit deeper. So you're a helicopter pilot, which I I think in the 294 episodes I've done, you're the first one, so so you got that going for you. Maybe fill in the time between then and maybe money network if there was a time in there you did other things and then maybe talk a little bit about from sort of money network, like what, what led to the start of that? How did you get involved in that?
Speaker 2:and maybe forward to your, to your role now sure, sure, well, just stop me if I'm if I'm giving you too much. But I left the marine corps in 93 and my background and my family's background was in in agriculture. So I went to work in agriculture business for a us subsidiary of a company, a summa tumble chemical out of japan, and it was a very interesting time. It was a role I enjoyed it's and it's a great industry to be a part of. Still today. I've got good friends in that industry and started as a sales representative for them, covering, uh, the southeast, south parts of the southeastern part of the united states, and really enjoyed that and then moved out to their corporate office in san francisco bay area, specifically walnut creek, and spent about two and a half three years out there and it was a great time to be in the bay area it was sort of the during the internet boom and learned a lot. I worked on my MBA and got that out there during that time and really expanding my knowledge of just business in general. I worked as a planning analyst and a product manager and then spent some time on m&a activities in that business, learned a lot about the japanese culture, which was interesting, and really enjoyed that. Did that for a few years and then After that I had an opportunity with that business to move back to Memphis, which again was sort of home for me and really enjoyed our time there.
Speaker 2:But we spent the next 20 years in Memphis and about three of those years were continuing that agricultural business, running a regional sales organization for that business, and then had mutual friends that had the idea of prepaid payroll cards and at that time it was a novel idea. It was. You know, we've got a ton of people who cannot access their pay via direct deposit because they're not in an environment that allows them to establish a check and account, and so we started that business in 2001,. I believe it was. We started that business in 2001. And it was really. You had three or four guys that were from the networking business and then I was from the ag business, so you had four or five guys that were starting a payroll card business that need nothing about payroll, which was sort of a thing. But we had some good partnerships with Concordia Fess at the time and Libri, who you may have talked to in the past, had some products there that we thought we could use and we did that. So Concordia Fess was helped us get the business started.
Speaker 2:And we started that business and grew it over a couple of years we had, you know, starting any business is tough, but we were one of the first. We were the first in market on a widespread basis. We closed accounts like Kmart at the time, who no longer exists, but also American Airlines and AutoZone or some of our key clients early on. That really got us started. And then, you know, we were winning deals in the marketplace and we're recognized for that and at one point we were competing with ADP. But after winning those few deals and them seeing our solution, they formed a partnership with us. So we ended up becoming the payroll card for ADP, which ultimately sort of was the you know, sort of the rocket ship we needed for that business and did that.
Speaker 2:And then we won Walmart, probably about 2006 or 2007. And then, so obviously the business was growing really fast. We ended up with the largest share in the prepaid payroll card space and sold that business to First Data in the summer of 2008. That's the story of Money Network. And then from there, I spent about 10 years at First Data doing numerous roles senior leadership roles there, leaving the prepaid business for both open and closed loop, spend some time establishing an international footprint for prepaid, primarily in the UK and Mexico, and we looked at Singapore and some Asian countries there. So we did that for a while and I had sort of left behind the Money Network business to do other things with First Data but then was brought back in to that business, ran it for two or three years before I left First Data in 2018. So that's my history up until the point of getting involved with Insta.
Speaker 3:Well, let's keep on the theme of talking about you. What are some things you're passionate about? So maybe one work related passion and one personal passion.
Speaker 2:For work related. I've always been involved in businesses that are both creating opportunities for others and serving others, and that's really what I'm passionate about. I want to make sure that I'm involved with businesses that have the right goals and are providing value and benefits to others, whether it's our clients or to those that work in the business. So that's what really drives me is the opportunity to do those things. I'm a personal standpoint. Things that are most important to me are my faith and my family and really spend a lot of time on both and creating kids and kids and really enjoy spending a lot of time with them and making sure that we can do everything we can to enjoy each other while we're at every chance we have to be together. So that's really it for me. And then, outside of that, I do a little from a recreational standpoint. I still do some flying today and enjoy doing that when I have the opportunity and between those things, that really takes care of most of my time.
Speaker 3:Obviously, you've had several leadership roles in your career, so how would you define success and leadership?
Speaker 2:Giving the opportunity, creating the opportunity for those around me to be successful, creating the opportunity for those around me to achieve their goals.
Speaker 2:You know, again, I really want to create opportunities for our coworkers, our family, our friends, the businesses that we work with. I think, as a leader, if you can create those opportunities and make sure that those that you're responsible for leading also have the opportunity to achieve their potential and achieve their goals, that's really what it's all about for me, and really especially at this stage in my career making sure that, again, we're creating opportunities for everybody at instant, as an example, to be successful. It's a, you know, when we look at numbers and financials and sales and all the things that we manage as a business. For me, it's about making sure that each employee here has the opportunity to be involved with the business that's doing the right things, and look back on that time and know that they spent, you know, five, 10, 15 years whatever they end up being of their life, in a business that was helpful to others and created opportunity for them and ultimately rewarded them and their families. So those are really my goals and I think that's what leadership is all about.
Speaker 3:All right. Well, Tau, we've covered a lot of ground about you, about the company, about the industry as a whole. Is there anything else you'd like to add before we wrap up the show?
Speaker 2:No, I don't think so. I think it's been great to have the opportunity to visit and appreciate your show. I know you've had a number of friends and acquaintances on here as well and I think you're doing a great thing by sort of bringing to light some of the innovation and personalities and good people we have in the fintech space. So appreciate that.
Speaker 3:Yeah, thank you so much. Well, thanks for being on the show today. I know your time is very valuable, so I really appreciate you being here. All right, thank you, greg. Thank you, and to all you listeners out there, I thank you for your time as well, and until the next story.
Speaker 1:Thank you for joining us this week on the Leaders in Payments podcast. Make sure you visit our website at leadersinpaymentscom, where you can subscribe to the show and where you'll find our show notes. If you enjoyed listening, please share on your social channels as well.