How ChatGPT will power ApexEdge’s next generation product and workforce (Episode 1/2)
- ApexEdge helps bank and fintech users cancel and negotiate bills.
- The firm is developing the next generation of its product with ChatGPT at its core in a bid to decouple scaling from hiring.
The public launch of generative AI in the form of ChatGPT greased the creative wheels for the impact of these types of technology. We’re seeing experts and firms scurrying, just trying to wrap their minds and their hands around AI.
We had something similar a few years ago when chatbots for financial services started getting interesting. The thing is – these were primarily black-box technologies that seemed very abstract from daily life for consumers and for the teams of developers at banks tasked with managing them.
ChatGPT changed that and with a slight change in interface, it’s unlocked a lot of use cases for financial services. We’re early for sure in this evolution but companies that have been studying the space are already beginning to make a move. ApexEdge provides consumers – through their banks and fintechs – subscription management tools. Want to easily unsubscribe from a subscription to a streaming service you’re not using much? ApexEdge makes that easy. It even has created technology to help you negotiate how much you’re paying for your subscription services.
The firm, which has been curiously studying the evolution of generative AI since ChatGPT-1, is already at work building the next generation of its product with ChatGPT at its center – including embedding it into how its flagship product works, as well as implementing AI tools internally to boost efficiency and increase productivity.
For ApexEdge, it’s a lot about scaling efficiently.
This is one of the first cases we’ve seen of a fintech firm embracing the next generation of AI tools so openly.
This story is part of a collaboration between ApexEdge and Tearsheet Studios. To read more, please head over to Tearsheet where there’s a downloadable guide and two episodes of a podcast about how ApexEdge is using AI as a foundation for the next generation of its product, as well as an important resource inside the firm.
Steve McKean is the CEO of ApexEdge, which runs Billshark, a popular consumer app that enables people to easily cancel subscription payments they’re making to streaming services, for example. ApexEdge utilizes the same technology to enable banks, FIs, and PFMs to offer similar services to their customers.
The following excerpts were edited for clarity.
The impact of generative AI
Steve McKean, ApexEdge: I have kind of two perspectives on generative AI. I really do believe this is the third great wave of transformation over the past 25 years. You had internet and then mobile, and then generative AI. And in terms of what we specifically do, aside from the generic use cases that most other companies have, quite simply for us, generative AI is going to enable us to complement humans with bots, and to give our great team superpowers in doing their work. It's really both.
We are actively prototyping generative AI in the business to help us deliver on the services that the company has, which are bill negotiations and subscription cancellations.
What will happen in financial services
In our ecosystem, we work for distribution with banks, fintechs, and other e-commerce participants. And then the other side, we deal with merchants and service providers. And so it's very probable that on the merchant and service provider side, they'll be using generative AI to interact with their customers. Depending on what we're doing, depending on the service, with bill negotiation, we save an average of $300 per bill per year for consumers. Companies aren't going to give generative AI the right to give away $300 -- you're going to have to talk to a person. So I don't necessarily see them using generative AI because I don't think they're going to be using it to give away money and keep people on their platform.
But I think when it comes to cancelling services, and there's a lot happening in the States right now around subscription cancellation -- there was just a three to one vote on the FTC about one click cancellation. So I do see a lot of those participants using generative AI and you will have bots talking to bots, no doubt.
Bill negotiation as a retention opportunity
When you take a look at bill negotiation, we've had plenty of conversations with our counterparties. And they view what we're doing as a benefit to them because we're keeping people on their platform. In terms of merchants, when we're cancelling service, we believe there are opportunities to open up a retention opportunity, because the truth of the matter is 15% to 20% of people that cancel end up resubscribing within a year. And so it's a really fertile area for retention.
I actually see generative AI, particularly in the subscription cancellation side, creating more granular, personalized experiences. Overall, it'll create a better experience for the consumer -- I think there's a better chance that they'll get what they want. And the same with the merchant. So I see generative AI taking the gravity out of an interaction, and helping both the merchant and the consumer get to where they actually want to get to, in a much more cost effective way.
ApexEdge's experience with AI
I'm fortunate that we have a really outstanding team, starting with our CTO, Michel Mora. There's a group of us, including myself, that always have a lot of curiosity about new technologies. We started following the GPT model several years ago with GPT-1 and -2. What we decided to do when we look at our business, we don't want to be tied to having to hire people to scale our business. We want to decouple scaling from hiring. And that's why we looked at GPT and other AI very, very early.
The other thing we wanted to do is to be able to create different pricing structures, which we're in the process of doing, when you decouple hiring from scaling. That was the economic impetus, and you certainly have the intellectual curiosity impetus.
And so what we started doing two and a half years ago is we started looking at the GPT models, and also the models Amazon and Google were working on. We decided to invest on making our platform AI-enabled. And what that means is, if a bot is doing the work, instead of a human, your operating processes will still scale, your quality processes can still scale. So right now you're seeing a lot of cool use cases around generative AI. That's all fine and good, but we want to have operating and quality and security processes that scale with using that generative AI. For the last two years, we've been making those investments in our infrastructure. And what's really cool is, we're pretty much at the end of the cycle of making those investments. So most of the time we're spending now is on the actual prototyping, because we've already thought about making sure our platform can have the bot do the work instead of the human. So we're in a really good spot to take advantage of this.
Pricing changes with AI
Well, it's a little bit early to talk about that. Our hypothesis, our goal in the marketplace is to deliver a concierge personalized level of service on a SaaS basis. That puts goalposts on how much our service will cost, since it's not directly coupled to hiring. You go from a usage based model to a SaaS model, and you're able to decouple scaling. And we think that it'll take a little longer to happen on the bill negotiation side, because it's more complex. But we can see that happening on a subscription cancellation side in the next 18 months, if not sooner.
Humans + technology
I really believe that our team and generative AI work in tandem it because there's a lot that you learn by having your team being involved -- whether it's chat or phone, or whatever process it is, we have multiple processes. And a lot of times what we learn is fed back into the generative AI, so there's absolutely a feedback loop between the AI learning what our team learns. To me, what works hand in hand is not replacing humans with bots -- you have this flywheel going and your team's contributions can be amplified with AI.
Challenges working with AI
I think the hardest pieces of it are to make sure you maintain your security and your security protocols -- we are SOC2 because we work with financial institutions. We spend a lot of time training our team on security protocols. I think another piece is just the conductivity, and how the generative AI works in your ecosystem, making sure it can interact properly with all the systems. So the actual plugging into the generative AI model and having it do what you want to do is not that hard -- it's really plugging it into your own technological ecosystem to make sure it works smoothly.
Timelines of incorporating AI
Our prototyping and ideation started when ChatGPT came out, our production rollout schedule started to take shape when we knew GPT-4 would actually work. I expect we'll be rolling this over the next quarter or two.
I would just tell you that it's it's the number one thing we're working on.
Looking ahead on the AI journey
I think we have an 18 month journey here of incorporating GPT into the business. There are other use cases, too. You have all the use cases you've probably heard about in terms of cogeneration, and marketing and creating content. But to me, those are not unique to our business. Those are use cases we should be adopting. But there's nothing unique about them. It's like, your marketers use this to write and your coders use it to do code, and we'll use it for customer service. Those are all very garden variety use cases that we will incorporate with the business. So I really kind of see two branches.
The first phase will be around introducing GPT-4 into subscription management and the second phase will be on bill negotiations. That will take 18 months. I can already see where GPT-4 will allow us to create different products and product sets. Those are in the very early formative stages, though. I think we have some good ideas. You can't eat it all at once, though.
What I would tell you is I think it really opens up the imaginations and possibilities to build products and services that were high human touch before, to make them lower human touch. I think you'll be able to build products and services in fintech that you couldn't build otherwise, that used to require a high human touch, which would have a lower human touch at a lower cost.