When Katherine Gregory sketched a business plan on the back of an envelope in 2005, she was looking to be a cutting-edge leader of the mortgage-servicing market. Just a year after launching, she was well on her way to achieving that goal, with her company, Paradigm Quest Inc., having grown to one billion dollars of assets under management—the fastest single-year growth for a financial-services company in Canadian history.
The journey, however, has been anything but easy. “We had to create the reputation to garner large institution clients, and we had to create an infrastructure to support multiple clients and their brands,” recalls Gregory, now president and CEO of Paradigm Quest. “Then, a few years after launching, the liquidity crisis of 2008 hit, and the mortgage market became tumultuous.”
Fortunately, Gregory and cofounder Donald Zuill, now CFO of Paradigm Quest, had the experience to make the business work. Gregory had spent her career in the mortgage business and had just left a major Canadian bank; Zuill had just left Highlander, which provides outsource services to multiple schedule-A banks. “We recognized some of the inefficiencies that existed in the mortgage market, and felt there was an opportunity to create a niche within that space,” says Zuill. “We sat down, got to know each other, and agreed to set forth in raising capital.”
Zuill says he and Gregory spent a lot of time signing Paradigm Quest’s first institutional client, but the company grew from there. Today, the company primarily services the mortgage-lending industry, servicing loans on behalf of institutional lenders, and it entered the asset-management space in 2012. With more than 200 employees in offices nationwide, it was ranked 96th among Canada’s 200 fastest-growing companies by Profit in 2012, achieving a growth of 496 percent since 2006.
Paradigm Quest’s Milestones
2004: Katherine Gregory begins working on a business plan
2005: Paradigm Quest begins servicing its first mortgage
2006: Paradigm Quest acquires its first $1 billion of assets under management
2010: Phase one of RUBI is launched
2011: Paradigm Quest acquires a service contract that increases business by 40%; assets under management reach $15 billion
2012: RUBI is fully launched; Paradigm Quest expands into the servicing of other asset classes
That growth, in part, is a result of the company’s IT department, led by Salim Naran. “At the end of the day, we operate in a call-centre environment, and it’s important that our service be exceptional,” says Naran. “In order to achieve that, as we grew, we realized we needed more efficiency and flexibility with our infrastructure, so we decided to go down the path of developing our own IT system.”
The result, called RUBI, which was implemented in multiple phases from 2010 to 2012, is what Naran calls a “soup-to-nuts” product. “Prior to developing RUBI, we had two platforms, plus a couple other pieces of technology, holding everything together,” he says. “The RUBI platform handles everything from origination to servicing, following our internal processes with many checks and balances.”
Gregory—whom Women’s Executive Network named one of Canada’s most powerful women in 2012—says that workflow was essential to RUBI’s success. “You have to build at IT platform from the ground up, not the top down,” she says. “It can’t be a technology solution; it has to be a people solution, and the user is as important as the consumer in defining what your requirements are. Every individual in this company has played a role in the development of RUBI.”
People, too, then, are part of Paradigm Quest’s success. “You have to be incredibly dynamic to start a company because you don’t know what you don’t know,” Gregory says. “You have to turn left and right, and it’s much easier to make those changes when you have people who can work through the challenges you have no idea are going to hit.” To that end, Gregory and Zuill surrounded themselves with people who have varied expertise. That is important internally, with Paradigm Quest being what Gregory calls “an organization of high performers.” It’s also important externally, as illustrated by the company’s long history with IT partner Allevar Inc.
“Our IT team is strong, but every so often demands arise that require specialized temporary resources, and Allevar has been a valued partner,” says Zuill.
“As an entrepreneur, you have to accept that you may be specialist in one area, but starting a company requires knowledge of many areas, and you just don’t have all the answers,” adds Gregory. “As a result, you need to be extremely dynamic, with need a team of great partners who can work collaboratively.”