Those of you who regularly read MORTECH Musings know how bearish we have been on technology spending in the mortgage industry. Down 10 percent in 2008, possibly down another 10 percent in 2009. When the near future of the business is uncertain, managements have difficulty in committing significant amounts of capital to build out technology infrastructure.
If lenders are to invest in technology, that technology will enable efficient and collaborative transaction management. Collaborative transactions incorporate unique company skills and organize the constellation of internal and trading-partner knowledge.
Effective internal and trading-partner interactions can create competitive advantages that rivals will find hard to match. Effective interaction binds talented people, corporate experience and decision-maker judgments in unique combinations. Automating collaborative capabilities goes beyond the implementation of technology systems or re-engineered processes. Competitive advantage is born through the organization of the collective company knowledge and skills.
The ability to collaborate through technology is characterized by the concepts that define the current stage of the Internet's development, "Web 2.0." Applications of the principles of Web 2.0 function over the Internet and deliver services through interpersonal connections that grow in effectiveness as increasing numbers of people make use of them. Most popularly embodied in social networking and interaction sites such as LinkedIn[R] and YouTube[TM], Web 2.0 has emerged from the down mortgage technology market in products developed by companies such as Dorado Corporation, San Mateo, California.
Dorado Corporation describes itself as the only "enterprise lending automation company that gives banks a network to stream-line the loan process from start to finish." Dorado has developed a Web-based technology and delivery system to be used by both large and emerging lenders.
Dorado's networked, on-demand lending automation system is designed to increase productivity and gain control over the service levels in a lender's customer distribution channels. Based on a Web 2.0 platform, the company's solution offers lenders full transactional and loan transparency along with the ability for multiple users across functions to collaborate for real-time decision-making.
Founded in 1998, Dorado is a private company run by Dain Ehring, chief executive officer and founder, and Rob Carpenter, chief technology officer.
They have developed a comprehensive lending platform, the Enterprise Lending System (ELS). ELS was built to integrate all loan channels, products, services, personnel, customers and all trading partners to lending transactions. The operating imperative in the design of ELS is to give lenders a single view of a transaction that extends enterprisewide.
"We've built an on-demand network of applications and services to simplify and improve the lending process," says Ehring. He says, "[ELS] enhances collaboration between all participants in the lending process while serving every lender channel. By coordinating the activities of banks and their partners around the loan file, we deliver benefits to everyone involved."
So it seems that Dorado has anticipated the needs of lenders in a down market. For a better understanding of Dorado, I posed a series of questions to Ehring. His responses provide insights into the thinking and financial future of Dorado as an important vendor of mortgage technology.