Shield Compliance President and Chief Operating Officer Tony Repanich explains how his company’s technology automates regulatory compliance and risk management
Tony Repanich will be the first to dispel the stereotype of the cannabis business owner. The image of a perpetually blitzed “stoner owner” just isn’t true, he said.
“It isn’t that at all. These are folks coming from very traditional industries with great business backgrounds, whether it’s in branding, or operations, or legal, and applying their talents to this industry,” he said. “I have an incredible amount of respect for the pioneers that have gone out and decided to create this brand-new industry.”
Repanich should know — he is president and chief operating officer of Shield Compliance, a private company focused on banking compliance that helps streamline federal and state compliance processes for financial institutions that choose to bank with cannabis businesses. The company has 33 investors and currently serves three clients. Though Repanich can’t name these clients, he said one has a presence in 30 states.
Repanich spent the first 25 years of his career in the traditional banking sphere, working the majority of that time at Peoples Bank in Bellingham. There, he held various leadership positions, including executive vice president and chief retail banking officer, and helped bring the bank’s assets from just under $200 million up to $1.5 billion.
It wasn’t until he left the bank to serve as Pacific Century Holdings’ president and CEO that Repanich entered the world of cannabis banking. That group was composed of investors looking to start a cannabis-specific financial institution to help solve the banking challenges associated with the industry because cannabis remains federally illegal.
“The market was a lot different in 2016 than it was in 2019,” Repanich said. “We weren’t able to overcome the hurdles it would take to do that, but in the process I learned a lot about the cannabis industry.”
While serving as principal consultant at FI Partners, Repanich met Noah Carey, founder and CEO of Shield Compliance. The Shield team wasn’t well-versed in day-to-day cannabis banking, so Carey said he’d move the company from Chicago to Seattle to get Repanich to join his team. “For Noah and the original investors, I think they were at an inflection point where if they didn’t bring in someone like me, they were going to have to make a decision whether to continue down this road and continue with the company,” Repanich said. “It was a great opportunity, and the timing was perfect.”
Repanich joined Shield in June 2018 and began raising additional capital and retooling the product, which included moving development from offshore to onshore, building a product team that was better-connected to the banking community and recruiting customers beyond Shield’s initial beta client.
That Repanich has changed so much within Shield in such a short amount of time came as no surprise to Russ Lee, who worked with Repanich for about two decades as the chief financial officer and later as president of Peoples Bank.
Now executive vice president of special projects at First Interstate Bank, Lee described Repanich as a smart, empathetic person who has always been finance-oriented.
“He’s very committed to the customer, the customer experience, and it’s always kind of pervaded his thought process,” Lee said. “(Repanich has) gone from being a guy who probably never participated in the marijuana business in his whole life to one of the experts in about five years.” It’s this big-picture thinking that attracts Repanich to his work.
Although he’s only been with Shield for a little more than a year, Repanich said he finds the world of cannabis banking fascinating because of its complex challenges and regulatory hurdles. For example, it’s much harder for community banks and credit unions to compete and carve out the “brand-new space” that is cannabis banking because they don’t have the capital for high-tech investments that big banks do, Repanich said.
Repanich said he is excited to have an opportunity to chart new territory because the cannabis industry is largely ignored by larger banks, leaving few players in the cannabis banking space.
“What I saw there was an opportunity to marry up technology with a willingness to serve this industry, so it’s kind of a brand-new puzzle to solve, which I think is really fun,” Repanich said. “The other piece is, regardless of what people think of cannabis ... the states are dependent on this tax revenue now and these small business customers deserve banking.”
Originally published in Puget Sound Business Journal
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