Interview: John McNamara, Chief Marketing Officer at LiveVox

Q. How did you get into the collections industry?

A. When I graduated from the University of Kansas in 1983, I didn’t have a job, and I saw that American Creditor’s Bureau in Kansas City, Mo., was hiring trainees for its Phoneix office. There had always seemed to be a lot of jobs for collectors. I figured if they’re willing to train me, this may not be a bad profession. I had no preconceived notions about it. To say I was naïve is an understatement. I started with eight other trainees. They had us listen to training tapes, then they put us on the phone.

Q. Can you describe how your career evolved from that beginning?

A. I was “adopted” by some of the senior collectors at the company. They thought that I had the makings of a good professional…I had a pretty good talk off. I also had a positive attitude, so they started to help me with different aspects of the business, which helped me become the office’s top collector.

Management noticed that I enjoyed training new collectors. So I was promoted to collection manager after eight months. I transferred to our San Antonio office in 1985, and became site director. In 1987, I moved to the New Orleans office as the site director, followed shortly by a move to the Jacksonville, Fla., office, also as site director. In 1989, I returned to the Phoenix office as regional vice president for American Creditors Bureau, Inc.

In 1995, the company merged with Nationwide Credit, Inc., and I became senior vice president of banking and retail operations. I had that position until 2003, when I left to join United Recovery Systems. The company had the best technology in the business. They had the best dialer; I can’t sing its praises highly enough.  In 2004, I took a job as chief operating officer for Asset Management Outsourcing. I was working for Mike Chamberlain, who was a longtime friend and mentor of mine and one of the most innovative guys in the industry. In 2006, a partner and I started Fidelis Recovery Solutions, Inc.

Q. What was different about running your own collection firm rather than working for someone else?

A. It was a very humbling experience. I had always been part of a larger company. Now my partner and I were the entire company. My thinking was that I could start an agency from scratch and use the best available technology. When you’re at the highest level in a company, there are no boundaries to what you have to learn, from client placements to the price of gasoline to macroeconomics.

Q. You’ve been in the collections business for 25 years. How has the market evolved over that time?

A. As the market has matured it’s become more competitive, leading to client rate compression. At one time, a company like American Express might represent 33 percent of your business. Now you’re lucky if they are 8 to 10 percent. The business has become hyper-competitive. Each client is different, so the business screams for tools that boost agent productivity, like scoring, dialers and hosted products. All of those technology tools are critical to keeping this going.

Q. What do you see as the biggest change in the collections business today versus when you started?

A. The biggest change is segmentation of the business. Different parts of the accounts are worked by different groups. An account today might see low-skilled skip tracing work from India, more involved skip tracing from the Philippines, and right party connect work from an experienced collector in Ohio. A lot of that segmentation depends on the willingness of agency decision makers to outsource large functions of the business. When I started, most agencies had their own print shops for printed materials, they don’t any more. Now huge chunks of the collection business are outsourced.

Q. Why did you shift from the collections industry to technology?

A. In 2004, I ran a champion-challenger with LiveVox and other companies. When I looked at right party contacts, I was astounded with what great products they had. The president had a real passion for the business. I recommended LiveVox to my friends. In early 2008, they told me they were looking for someone to be their chief marketing officer. When I heard about what they were looking for in a chief marketing officer, I thought that sounded like me. They asked if I would be interested. I still kept a financial interest in my other business, however.

Q. How is the current economy affecting the collections business?

A. Bill collectors do not like recessions. We receive more placements as charge-offs go up, but it’s much harder to collect on those accounts. There are more accounts, but the payments people make are less. So unit transaction costs go up.

Q. Why do you think consumer delinquencies have risen so much?

A. The average consumer is financially stressed. They’re carrying credit card debt and dealing with the high cost of gasoline. Income and credit scores are stretched. Many people bought a lot more home than they needed or wanted. When they needed more credit, they used home equity loans. Now they’re having a hard time paying these back.

Q. Is the increase in delinquencies due to current economic conditions or is this a major change in consumer attitudes regarding the timeliness of payments?

A. It’s a sea change in attitudes. If you think about your parents, they wouldn’t file for bankruptcy unless they absolutely had to. Now credit is seen more as an entitlement. There’s not really a stigma in filing for bankruptcy. It’s no longer seen as a sign of failure, but as a way to make a fresh start. It’s a financial do-over.

Chief Marketing Officer for LiveVox and chairman and founder of Fidelis Recovery Solutions, Inc, John McNamara is a 25-year industry veteran with experience in all phases of collection and recovery operations with intense focus on technology applications. Prior to joining LiveVox, John was COO for AMO, SVP of Operations for Nationwide Credit/ACB and VP of Operations for United Recovery Systems, LP.

John is a frequent speaker/panelist at national collection conferences. John was recently named to Collection Advisor magazine's list of the Top 50 Most Influential Collection Professionals for 2006. In 2007, John was appointed Vice President and Board Member of the Georgia Collectors Association.

John is a summa cum laude graduate of Kennesaw State University with a Bachelor of Business Administration degree in Finance.