 Live from San Jose, California in the heart of Silicon Valley, it's theCUBE covering QuickBooks Connect 2016, sponsored by Intuit QuickBooks. Now here are your hosts, Jeff Frick and John Walls. And welcome back here to San Jose, the convention center where on theCUBE we continue our coverage of QuickBooks Connect 2016. We're here for the rest of today and on to tomorrow for two days of this great event, third year event that it's now going on with 5,000 attendees. So record attendance, great keynotes this morning, another keynote session coming up by the way in just about a half hour or so. We'll have some guests after that and continue our coverage here tomorrow on theCUBE. Along with Jeff Frick, I am John Walls we're joined by Yumi Clark who is the SPP of product development at Capital One. And Yumi, thank you for being with us here on theCUBE. Thank you very much. First time, right? Yes. On theCUBE. Yes, first time. Capital One, what are you doing here? In a good way of course. But what do you find of interest from a professional standpoint with the small business crowd? Yes. So Capital One is here because we want to meet our customers where they are today and many of our customers are actually here at the show QuickBooks Connect where they be accountants or small business owners themselves. We are looking to build products for them and solutions for them based off of the pains that they have and the problems that they're having. And so we're here to do much of a data gathering exercise and seeing what we can provide to our users. So I assume this is an ongoing process for you, right? This isn't just a one-time hit. Generally speaking, what do you hear from the people with whom you work or that you're supporting in terms of their pain points for the services you provide and what you can do from a solution standpoint? Yes. Well, actually here at QuickBooks Connect we have been doing some informal polls with the people that have been attending and we often hear these types of things also as we're leading the businesses within the product development space. We're seeing a lot of the people talk about the passions that they have with regard to the business and oftentimes they start the business because of their passion. They're actually not starting it because they want to start a business itself because oftentimes those businesses have a lot of administrative tie to them and process. That's not what they're doing to start that business. They want to make sure that they're creating something that really speaks to them and speaks their passions and because of that they've created a small business. But then unfortunately they have to do tasks and they have to do accounting and they have to do payroll and they have to pay the vendors and they have to get up from making whatever they're making and selling whatever they're selling to deal with the reality and that's really where the opportunity at QuickBooks has done but part of the thing they're trying to do is build this ecosystem not only to provide the tools but really to provide other services to enable these folks to be successful. So within the Capital One world as you look at small businesses is kind of a category. What are some of the unique challenges that they have that you guys are trying to help them with? How do you kind of see the small business world as an opportunity? Yes, so in the same way Capital One is also looking at that ecosystem. First and foremost what we do as a financial institution is provide very competitive savings and checkings and credit cards as part of our plethora of products that we offer. From a savings perspective, we have a 1% cash back and from a credit card perspective we have a 2% cash back rate so that we're truly competitive from that perspective. In our recent surveys and the research that we've done we've also seen that many of these small businesses whether they're here or somewhere else they have more than two bank accounts they have in order to run their small business. Also what we see is that they have anywhere between 10 to 12 different applications that they are stitching together to get their financial health of their small business right. Knowing that that's the problem what we're doing at Capital One is helping them stitch that together. Not only do we have the competitive checking and savings accounts so that they can actually pay their bills and do the invoicing and the payroll. We are also looking at things to help them in the future and most recently in August what we did as Capital One is launch the Spark 401K service. 50% of all Americans either own or work for a small business so it's a huge crowd that needs to be addressed. Even though it's 50% only 13% of those small businesses are offering some type of retirement benefit and because of that we saw that as an opportunity and a challenge that we can help resolve and that's why we've launched the Spark 401K service this past August which is specifically targeted to those small businesses so they can help not only themselves but the employees that work for them think about the future. So how has this changed the way you do business? Because you're looking for new products, right? You're looking for new services. You're looking to be more expansive in the kinds of things that you're offering, right? But I'm sure the migration has, sometimes it's not natural, right? You're introducing new concepts to your workforce and to your people and so how has this impacted what Capital One does in terms of looking to stretch yourself basically to create new opportunities for your clients? Right. Well there's two ways that we're addressing the client relationship. One is that we're definitely seeing that digital transformation happen. Most recently in a poll that we took there was about 30% of small businesses were using some type of mobile device but in the most recent study that we've seen it's about 60% then it's more than doubled in terms of the mobile banking and the mobile device that they're using to run their small business and because of it we're leaning in to many of the mobile solutions that Capital One can provide so that small businesses can do things anytime, anywhere and any place as they're trying to run their business because the reality is is that they're not just sitting in one place nine to five running their business. They're running off doing other things or doing it at home. Also we're exploring different experiments so that if we're meeting the small businesses where they are trying out different devices and different technologies I don't know if you've seen some of the announcements that we've made but we're also looking at IOT and some of the Alexa form factors by which you can test and see how is my daily balance? What are the transactions going through and that sort of thing as well? So we're mirroring a lot of the technologies that we were seeing and helping small businesses make that transformation themselves where they are today. If they're using one type of device we'll be helping them with that mobile device. We're helping them with Alexa for example as well and then helping them make that transition. So many choices. Good Jeff. I was just going to say and then there's now this gig the gig economy. I wonder if you guys are kind of I'm sure you're looking at it. Kind of how do you see that as being fundamentally different? We were at a thing at the Stanford Graduate School the other day and we were talking about the gig economy and at least a small business you think are thinking about things like retirement and setting aside money for taxes and potentially there's all types of retirement options if you're a small self-employed person but then you think of the gig economy it's a guy doing four hours a week before class to do run its Uber or Postmates or all these kind of little bits and pieces doesn't appear from the outside looking at it. I have no data that they're really thinking through what is their total cost not only for the insurance and the wear and tear in the car but then the set aside for taxes and then are they putting some aside for insurance? Are they putting some aside for retirement and it just feels like that's a whole different kind of category of work and yet it's the one that's growing the most rapidly. It isn't, it isn't actually. I think that oftentimes financial institutions have been geared more towards companies, business entities and that sort of thing. If we think about the most recent Spark 401K launch that we did, we're looking at companies of one which are actually gig economy workers if you really think about it and that we are able to support those types of employees or businesses as well. The second thing that we're doing in terms of the gig economy is the reality is a lot of these people are in the same way as I was mentioning before stitching together their work life and stitching together their work life means that they're using multiple applications and multiple revenue streams in order to be financially stable and because of that, one of the pain points that we wanted to address was can we make it easy for these people to stitch together and that's why we have the aggregation of the top 12 financial institutions within Spark business so that they can get a complete financial health history of where they are today. We've been speaking with different folks from Intuit today and one of the striking conversations we had was about adoption within the accountant community and getting them cloud migrations and people with very traditional perspectives or very regimented viewpoints about this is how I do things and the reluctance to change. What are you seeing in terms of digital adoption what businesses are doing, how willing are they to accept some of these new products or understanding this is a better mouse trap and how do you grow that? Make them understand this is maximize your efficiency and lower your costs, it's all good but it's hard to get them there. Yes. One of the things that we actually see is not solving for the sake of creating a new feature and in the same way that I would feel if I were a small business just because there's something out there doesn't necessarily mean that I want to use it you have to show the benefit to that small business owner and if you think about where small businesses have been they have been going to the bank but they've become more technologically savvy using for example mobile deposit capture because that saves them time and all they have to do is take a picture and just works to deposit those monies into a financial institution and that's what we're providing as part of Capital One. If you show the benefit first rather than the solution first I suspect that more people will say I'll give it a try and that's what we're seeing in our base as well we're seeing people saying I'll give it a try I am technologically savvy I am using my mobile device more than I was before sure why not and I'll give it a try. And that works. It has been working for us and we're seeing definitely more people going towards our Spark ecosystem solution and they are stitching together all of the different applications because they are definitely feeling the pain of trying to do it themselves and it's really hard to figure out themselves. So what's your biggest challenge then? In terms of it sounds like adoption you're working, you're making progress on that front you're here surveying your customer base trying to understand what their needs are it sounds like everything's great everything's good but that isn't always the case obviously that there are challenges I mean in your perspective from your viewpoint what is it? What's the big hurdle you think that is staying or keeping in the way a progress for you as Capital One and for the small business owner? I think really honing and I think a lot of people often talk about small business owners trying to manage their financial health and their cashflow that's the reality of running a small business the question is how you solve that? Is it thinking about kind of the savings and the checking accounts? Is it about thinking about the 401k in the future? Is it about that balance? Is it about time savings and efficiency? And there's quite a fine line between thinking about just the actual solutions themselves and really offering the benefit and so that for us is kind of the biggest challenge meaning that as we test into all these different applications we need to make sure that we are improving their cashflow and showing them transparency around their financial health. It's funny you talk about whether it's a benefit or not and I just think from your customer's point of view the small businesses just all these different ways to pay which they want to take that money in and put it in their Capital One account whether it's Google Pay or Apple Pay or even have Samsung Pay I don't know why I would ever want Samsung Pay and who knows what tomorrow pay is going to be. From your customer's point of view what do they think of kind of this wave of options that their customers, the end customers want to have, they think they want to have they got people kind of pushing these different alternatives down their throat. Are they really necessary? Do we need Samsung Pay along with Apple Pay and Google Pay and I already have credit cards and ATM cards and chip cards and God help us if I pulled a 20 out I went to one restaurant they wouldn't even take cash like you don't take cash, you don't take cash. It's so much more complicated now there's just so many options coming at them I think of driving through a snowstorm at night with your headlights on you know it's just like, what do you tell them? How do they navigate this way? Oh by the way I'm still trying to just run my business. Right, actually that's one of the things that we want to do at Capital One we wanted to give small business owners the personalized delivery of data and looking at what would help them as they're running their small business because there are so many choices there we want to help them make the choices by showing them the data that says nudges them towards perhaps you might want this rather than this. That's what we're doing from a short term perspective and more longer term what we're also looking at what is the benefit that we can actually provide and showing those benefits clearly and transparently to the small business owner. There are a lot of choices out there. A lot of choices. Well Yumi, we've asked you a lot of questions the one that I think we don't have to ask is what's in your wallet, right? We know what's in your wallet. Yes, adventure credit cards. That's right, Yumi Clark from Capital One thank you for joining us here on theCUBE we appreciate the time and good luck with the rest of the survey and I'm sure this is a pretty fertile territory for you in terms of finding out what your customers need and what they want and what you can do for them. Thank you so much for having me. Thank you. Thank you. Back with more on theCUBE here from San Jose in just a bit.