“Values Are Immutable; However, Culture Can Adapt”

An Interview With Co-Founder of BankMobile, Luvleen Sidhu

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I had the pleasure of interviewing Luvleen Sidhu, Co-Founder, President and Chief Strategy Officer of BankMobile, the largest and fastest-growing mobile-first bank in the country. BankMobile, a completely digital bank, has a mission to help the underbanked, millennials and middle-income Americans have an affordable, effortless and financially empowering banking experience. Luvleen has been recognized for her accomplishments as one of CEO Connection’s Most Influential Women of the Mid-Market in 2018 and 2017, CEO Connection’s Mid-Market Young Leader in 2017, one of Bank Innovation’s top innovators worldwide in 2017, 2016 and 2015, and ‘Most Innovative Woman in Banking – Greater New York’ and ‘Best Women Owned Financial Services Company – New York’ in Corporate America’s 2016 American Businesswoman Elite Awards – just to name a few!

Thank you so much for doing this with us! What is your “backstory”?

I graduated from Harvard in 2008 when the financial crisis hit. The first day of my career was the day of the Lehman Brothers bankruptcy… and I was joining Lehman Brothers! That was definitely a very interesting start to my career. It impacted my professional trajectory and influenced why I founded BankMobile.

After my time at Lehman in their fund of hedge funds group on the investing side (later renamed Neuberger Berman), I joined Customers Bank, which is our parent company today. At Customers Bank, I led business development and specifically looked at how the bank could take advantage of a new digital model that was more in alignment with the future of banking. After that, I attended Wharton Business School, where I majored in strategic management, and spent my summer at Booz & Company, where I consulted for a well-known financial services company to help them develop a strategy to launch a digital bank. After I graduated from business school, I deferred my fulltime offer with Booz, and in that time started working at BankMobile.

Why did you found your company?

Banking is one of the least customer-centric industries that exists today. I founded BankMobile to focus on solving consumer pain points and providing the best customer experience through technology and innovation. The reality is that banking is typically a frustrating experience that lacks transparency and most banks make money by having their customers mis-manage their money! In the U.S. 1/3 of Americans are living paycheck to paycheck and almost 50% of Americans cannot afford a $400 emergency, yet banks charge these same Americans $32 billion a year in overdraft fees alone. BankMobile is focused on utilizing technology to make banking accessible, affordable, and seamless.

What is it about the work you’re doing that’s disruptive?

We recognize that consumer needs and behaviors are rapidly changing and banks have been remarkably slow to adapt to these changing needs. For example, Americans on average are walking into a bank branch only one time a year, as opposed to interacting with a bank on a mobile device 20 to 30 times a month. Still, traditional banks are using their branch networks as their primary customer acquisition channel even though, on average, a bank branch opens only 1 net new checking account per branch per week or 52 net checking accounts per branch annually. This is a very inefficient customer acquisition model and is subsidized by charging Americans exorbitant fees. BankMobile instead has no branches and, through its digital presence, is able to attract over 300,000 new customers each year. Additionally, traditional banks spend on average about $300-$1000 to acquire new customers while BankMobile – through its digital platform and B2B2C strategy – is acquiring new customers at about $10. By addressing consumer pain points and acquiring customers in high volume and at low cost, BankMobile is disrupting the banking space.

We all need a little help along the journey – who have been some of your mentors?

My dad, who has been a veteran banker his whole life, has been a great mentor to me as I embark on disrupting the traditional banking space. Although most of his career was in “old school” banking, his experience in the industry has helped me gain the knowledge I need to be innovative in the space while respecting the fundamentals of the business. Another mentor for me, whom I view as confident and a great visionary, is Sheryl Sandberg. She is not only building a company that has significantly impacted and connected the world, but also serves as an ambassador for women, encouraging them to lean in and live their fullest potential professionally and personally.

How are you going to shake things up next?

This is just the beginning for BankMobile. We have so many exponentially growing technologies now at our fingertips. This includes artificial intelligence, biometrics, IoTs, and blockchain, to name a few. All of these can have a dramatic impact on how banking is delivered and experienced by consumers. For example, we are moving towards a world where things all around you can become your wallet. Maybe your fridge serves as a payment vehicle to buy more milk when it runs out which it can detect with sensors. Or maybe, it becomes the norm to pay your bills through voice banking using your Alexa. These use cases are likely to become pervasive in the very near term.

Can you share some of the best words of advice you’ve gotten along your journey?

“Tough times don’t last but tough people do.” My dad echoed this piece of advice to me throughout our BankMobile journey. We’re in a business that is experiencing rapid growth and change, which leads to obstacles that continuously appear. He helped me see that challenges can also be opportunities, depending on how we look at them. Really, those who continue to push forward will always find a way to accomplish what they have set out to do. We first launched BankMobile as a direct to consumer strategy, and we did experience growth using this strategy but not at an exponential rate. We realized we needed to grow exponentially to truly be a disruptive force in the industry. At that moment in time, we could have either continued down a path of low profitably and low growth or viewed this challenge as an opportunity to think more creatively on how to boost our growth. It was through this creative thinking that we entered into the B2B2C space and became the first digital bank to become a major player in “banking as a service.” that allows us to grow exponentially.

“Values are immutable; however, culture can adapt.” This was a really helpful piece of advice for me given that I’ve struggled with balancing BankMobile’s high growth with having a strong company culture. By understanding that core values are the most important foundation of an organization and recognizing that the culture can adapt over time helped me feel liberated. I now understand that our core values as a company which are based on respect, trust and constant innovation will keep us unified and focused on our objectives and with this solid foundation, the strength of our culture develops over time.

What’s a book/podcast/talk that’s had a deep impact on your thinking? Share a story with us.

“How I Built This” podcast, where they interview CEOs of leading companies that are truly disrupting their industries. The podcast has been a great way for me to be able to hear directly from successful entrepreneurs how they think about disruption and how they navigate the challenges of growing a business with capital needs, regulatory scrutiny, business model challenges etc. and in the end, find a way to make it work. There’s a lot to learn from and I benefit from hearing their experiences as I lead and grow BankMobile.

Some of the biggest names in Business, VC funding, Sports, and Entertainment read this column. Is there a person in the world, or in the US whom you would love to have a private breakfast or lunch with, and why? He or she might see this.

I think it’d have to be Jack Ma from Alibaba. He’s done an exceptional job of combining e-commerce, payments, financial services and many other verticals under one company and growing massive market share while, most importantly, being a customer-centric company that really differentiates itself in terms of experience. I would love to hear his thoughts on how he’s been able to build – over a relatively short period of time – an empire, essentially, that addresses consumers’ needs across the spectrum while also experiencing high growth and profitability. 

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