Nashville bank executives launch Sonata to serve fast food industry

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Two Nashville, TN-based banking veterans are teaming up for their third banking venture, this time with an eye to the domestic market.

With the launch of Sonata Bank, Chief Banking Officer Dan Dellinger and Taco Bell Franchise Owner Farzin Ferdowsi intend to grow the financial institution into a national digital platform serving restaurant industry employees. fast.

Dellinger, president and CEO of Sonata, was instrumental in launching two previous banks. He partnered with Ferdowsi, the CEO of Brentwood, Tennessee, Management Resources Company, for both ventures.

Dan Dellinger

Authorization granted by Sonata Bank

Dellinger and Ferdowsi started Brentwood-based Premier Bank, now BancorpSouth, in 1997. The two joined forces again in 2005 to form Reliant Bank, now United Community Bank, where Dellinger served on the board and as financial director.

The idea for Sonata Bank was born in 2019, when Ferdowsi approached Dellinger to launch a technology bank offering digital products and services.

“I felt like it was a pretty good idea at the time, but the timing just wasn’t quite right,” Dellinger said.

Then the COVID-19 pandemic hit, showing how various industries, including banking, could operate successfully in a remote environment, Dellinger said.

“It became very clear that we could create another bank in this area of ​​Middle Tennessee that could be technologically advanced, have a single branch that provides products and services, and have a remote workforce” , did he declare.

The banking entrepreneurs’ plans for Sonata go beyond offering digital commercial banking services. They eventually hope to launch a national banking platform that serves employees of fast-food franchisees, a market segment that has a particular set of banking needs, Dellinger said.

Ferdowsi, who owns 90 Taco Bell restaurants in central Tennessee, southern Kentucky and Atlanta, has seen the issues franchise owners and their employees face with revenue and access to banking services, said said Dellinger.

By offering banking, rewards and benefits, Dellinger said Sonata can meet the needs of fast food industry employees and help employers attract and retain talent. Dellinger said he plans to add non-banking products such as telehealth and financial literacy to the platform. The goal is to help franchise owners offer a competitive set of employees to reduce employee turnover.

“We create the products and services,” he said, adding that the franchisee would pay subscription fees to Sonata to offer the services to its employees. New recruits would be asked to download the Sonata app as part of the onboarding process, dellinger said.

Sonata selected Jack Henry for its core banking system, Dellinger said, adding that the company’s open application programming interface allows the bank to easily “lock” additional products onto its app.

“Everything will be under the Sonata brand, and that’s extremely important. With these employees, you want a single point of access for these different products and services,” he said.

Dellinger said he expects the business model will also give Sonata access to a younger customer base.

“A lot of these employees are young – 18 to 20 years old,” he said. “What we’re looking for is not just to establish that relationship early on, but to sustain it through the different stages of their lives, whether it’s professional career, college, home, whatever. … The average lifespan of a bank customer is around 14 years, so if you can get them early enough and keep that relationship and provide a good customer experience, then the chances of them sticking with you are very good.

Not a de novo

Rather than file for de novo banking, Dellinger said he and Ferdowsi reached an agreement to recapitalize a small, family-owned bank in Sebree, Kentucky.

“The family didn’t want to sell” 132-year-old Sebree Deposit Bank, which has been renamed Sonata Bank, Dellinger said. “They wanted to find someone they could work with and take them to the next phase of their lives. They loved what we were doing, they loved the Nashville market, and they loved the quick service segment. This is how the relationship developed.

Sonata Bank has raised more than $20 million in capital, half of which comes from 15 fast-food franchise-owning investors, Dellinger said. These franchisees represent more than 100,000 employees.

Sonata plans to launch its application targeting the QSR market in the second quarter of next year. The bank will first roll out the product to Ferdowsi’s management resource firm before branching out to other regions, Dellinger said.

Dellinger said he thinks there are other opportunities to eventually fund the QSR industry — franchise owners who may be too small to bank at some of the larger institutions.

“New franchisees don’t go to Bank of America or Chase to get their credit because they’re going to say, ‘You’re way too small for us.’ So our opportunity or entry point is with franchisees who don’t have a level of sophistication yet, or who may not have established credit facilities yet,” Dellinger said.

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