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Fintech for Millenials

The biggest issue with “fintech for millennials” that you have to understand millennials more, than fintech.

Read our full research“Money of the Future”. Download PDF (20MB)

Intro. Once, a Yelp/Eat24 employee wrote a lengthy blog post to her CEO, Jeremy Stoppelman, about her compensation, which she said came out to about $8 an hour after taxes. A few hours later, she said she was fired. It created a hot debate about how expensive the Bay Area is to live in, and whether or not companies should pay entry-level employees more.

Here’s one millennial-age woman’s response to the former Yelper, Talia Jane: “After reading your article detailing the absolute struggle you dealt with while working for a Bay Area based corporation, I felt it imperative to address your concerns and, above all, your obvious need for financial assistance. It sounds like you’ve hit some real post Haitian earthquake style hard times, so maybe some advice will help while you drink the incredibly expensive bourbon you posted on your Instagram account and eat that bag of rice, which was the only other thing you could afford!”

“I’m not much older than you. I will be turning the big 3-0 in three weeks time. It seems like a lifetime ago I sat in my sophomore year apartment crying about how I would never again be able to relate to Baba O’Riley or Scenes from an Italian Restaurant. But here I am, having survived my 20’s with some grace and a lot of humility.”

“However, despite our less-than-a-decade difference in age, it seems we are worlds apart in the concept of work ethic. But somehow, I’m not surprised. Those five little years are incredibly important.” “I was young and confused and scared, I wandered into a bar where the old Irish bartender was a family friend, hoping he’d give me a drink and some advice about my plight.”

“Listening to my problems, like most bartenders do, Mike walked away and came back with the General Manager of the restaurant. After coming in for an interview several days later, I was offered a hostessing shift two days a week that paid fifteen an hour (which worked out to a weekly paycheck, after taxes, of $168.00). I agreed to it. It would be temporary, but it would be better than making nothing at all.” “Sure, it’d be great to tell people I was working for Conde Nast or Vogue, but what wouldn’t be great would be the fact that I couldn’t afford to be slave labor, even if it helped my resume. Reality had to take over and I accepted that. So I worked in a restaurant.”

“A year later, I was making enough money to move into the City with my best friend. I worked four days a week making anywhere between $50,000 and $60,000 a year — more than many of my former classmates with much more flexibility and far better hours. I was able to travel three times a year, go out with my friends, pay rent, pay for groceries. Above all, I was able to write. And at 26, I signed to United Talent Agency in LA and began my journey into television screenplay writing.”

“I dealt with the pitying looks of my former classmates or their parents when they would see me at the hostess stand or walking into the service station in my heels, laughing to myself knowing their child was addicted to coke and hating their “amazing” job. I paid my dues. I did what I had to do in order to survive, with the help of my family. I was gracious and thankful and worked as hard as I could even if it was a job that sometimes made me question my worth. And I was successful because of that.”

“But you are a young, white, English speaking woman with a degree and a family who I would assume is helping you out at the moment, and you are asking for handouts from strangers while you sit on your ass looking for cushy jobs you are not entitled to while you complain about the establishment, probably from a nice laptop.”

“To you, that is more acceptable than taking a job in a restaurant, or a coffee shop, or a fast food place. And that’s the trouble with not just your outlook, but the outlook of so many people your age. You think it is somehow more impressive to ask strangers for money by writing some “witty” open letter than it is to put on your big girl pants and take a job you might be embarrassed by in order to make ends meet.”

“She believes Yelp should cover the cost of the financial decisions she’s made which include living alone and accepting that salary, two options that any sane person would never make. She believes she deserves these things that most of us would call luxuries. You expected to get what you thought you deserved rather than expected to work for what you had to earn. And that’s the problem entirely.”


Coda. McKinsey in their report “Millennials: Burden, blessing, or both?” suggest: companies often complain about the unrealistic expectations of millennial workers, but heeding their call to action can improve the work environment for everyone.


Because all the peoples of the world are part of one electronically based, intercommunicating network, young people everywhere share a kind of experience that none of the elders ever had. . . . This break between generations is wholly new: it is planetary and universal.

Yes, the youngest generation differs from the older ones. But this has always been true. Can you define everyone born between 1980 and 2000 by a handful of generalized characteristics? You know the answer.

It’s time for leaders of organizations to stop debating the millennial problem, hoping that this supposedly exotic flock of sheep will get with the program. Instead, they should see how questions and challenges from their youngest employees can spark action to help their companies change for the better. It’s easy to say that young people haven’t matured enough to resign themselves to the reality of what’s possible.

Yet they are asking an important question: “Why does it have to be this way?”. In the process of listening, leaders will soon realize that young people want the same things we all do.

Even high-performing young professionals acknowledge the harsh economic realities they’ve seen and the stress they experience. Many in the United States continue to bear the burden of thousands of dollars in student-loan debt.

Coming of age amid the global financial crisis, they have also observed firsthand the weakening of the social contract as corporate scandals stripped workers of their pensions and companies cut costs or closed their doors, leaving committed workers and their families financially vulnerable. This has understandably influenced their decisions to join or leave companies and sharpened their desire to find meaning and purpose in the chaos of the world in which they’ve grown up.

Millennials also speak of themselves as hyperconnected globally—always on—with resulting work behavior that seems peculiar to some of their managers. But this natural affinity for technology provides them with unique skills and insights that managers can use. They’re efficient, and they also see patterns not always evident higher up the hierarchy.

People analytics has been gaining momentum in a wide variety of organizations, but few have thoughtfully used research to understand their youngest employees better. Many companies have learned that employees are eager to hear from top management. But the young ones in our research expect this to happen at hyperspeed: real-time, two-way communication that accepts input from everyone, followed by fairly immediate action. Here, tech firms are leading the way.

Many young people thrive on collaborative work and support from colleagues, but few companies have figured out how to build a culture that helps existing employees to mentor new ones. Personal relationships are crucial for companies anxious to stem attrition or hang on to their young workers.

This young generation has grown up watching entrepreneurs reach the height of success before age 30, taking on responsibilities usually reserved for older executives and gaining unprecedented wealth. Many young professionals want a chance to flex their entrepreneurial muscles; they chafe at the lack of advancement opportunity in today’s flat structures. Any kind of movement that promotes professional development is a plus.

Young employees, more than their older coworkers, value the genuine blending of their work and personal lives. Leaders may be apprehensive at the prospect, but there are simple ways to make flexibility work. Journeys, a leading specialty retailer where young workers make up a large majority of the workforce, has created a core time block when all headquarters employees must be in the office unless they are on the road for work. In return, employees are responsible for their results, regardless of their work hours, which they are otherwise free to choose.

Flexibility is also important to millennials starting families: many young women, and a growing number of young men, cite their families as a top priority and want more family-friendly policies at work.

But that’s only the start. We understand that implementing most of our recommendations will be challenging. They change the nature of work, establishing a new standard for the way leaders, managers, and employees interact. Companies will therefore not only more effectively retain young professionals, who may eventually become their leaders, but also increase the engagement of all employees across the organization.

We’re also optimistic that young people can help show the way, not because they are so different, but because they are expressing common human needs and raising relevant questions about why more progress hasn’t been made already. Leaders who listen, who have long-term horizons and the courage to break new ground, can improve their odds of building a lasting legacy that serves generations to come.

New graduates may be working for more than a half-century. A recent analysis found that, on average, the class of 2015 won’t be able to retire until age 75. According to the Center for Retirement Research, the latest trends in Social Security claims imply that the average retirement age today is 62—which means that at the current rate, millennials may end up working some 13 years longer than their parents. Of course, that’s all unlikely, but it’s equally an argument for millennials to do more right now in order to be able to retire earlier.

Research shows that millennials are passion-driven workers. By some estimates, around half say they would take a pay cut in order to work for a company that aligns with their interests. While pursuing a passion even though it pays less is admirable, it isn’t going to help you retire any earlier. On the other hand, it might be easier to work longer—as long as you’re healthy—if you’re doing something you love. But the fact remains that it’s harder to save on a limited income.

A Pew survey last year found that 53% of millennials expect to “have enough money to live the lives they want.” Trust in the future is great, but it isn’t cash. That money won’t be there if you don’t put it away yourself.

Millennials are hesitant to invest, thanks in no small part to the mountains of student loan debt many of them still face. But while paying down debt is still a huge priority in the early years of their career, so is planning for their retirement. The boom of robo-advisers is pushing this concept forward.

Entitled, tech-driven job hoppers.” That’s how some people might describe millennials, but Brad Harrington was tired of hearing the stereotypes. As executive director of Boston College Center for Work & Family, he works closely with millennials, many of whom are completing undergraduate degrees and pursuing MBAs.

Millennials have a reputation for not staying at a job longer than 12 to 18 months. In Harrington’s study, however, participants said staying with their employers was their preferred strategy to advancement versus leaving their organizations. In fact, 60% of millennials said they plan to stay in their jobs to advance versus 25% who want to get ahead by moving from employer to employer.

While millennials are more heavily immersed in technology and know how to better utilize it than other generations, Harrington says that doesn’t make them people-averse.

Millennials are less likely to be bound by gender roles than their predecessors. In fact, 51% of men said they would consider staying home if their spouse’s income was adequate, while just 44% of women said they would want to stay home.

While millennials are willing to work hard, they’re not willing to sacrifice their personal life, and work-life balance was the most important factor in choosing a job.

While much as been written about the social consciousness of the millennial generation, “how much I am helping others” and “contribution to society” were among the lowest ranked items in importance of career success measures for the millennials surveyed.

Compared to other generations, Millennials often have delayed milestones that indicate adult transition, such as marrying later, having children later, and buying a home later.


As large cities are predicted to grow by 28% by 2030, 100 million more youth will be added to their populations, according to a recent report commissioned by the Citi Foundation from the Economist Intelligence Unit (EIU).


The study aimed to find out the difference between the perception and reality that this “youth bulge” will have on cities. On the one hand, the additional population taps a world in which resources are already scarce; on the other, such a deep pool of talent can contribute to a better future.

And it’s not always a pretty picture. According to the resulting Accelerating Pathways report, while young people surveyed remain optimistic about the future and favor an entrepreneurial mind-set, they are struggling to get jobs. Current global unemployment levels for millennials are roughly 3.4 times higher than for other segments of the population. The millennials surveyed also said they are having trouble getting access to technology, pay equity, and support networks.

One global theme that emerged was how many youth still need financial support. Over three-quarters (77%) still live with parents or relatives, and more than half (57%) receive money from their families every month. Perhaps that is why many of the respondents said that the stability of a position drives the reason for the work they do. That doesn’t mean they don’t want to strike out on their own.

The majority (77%) dream of working for themselves or starting their own business.


“Young people may respond positively to policies or programs that foster a mind-set of measured risk for personal or global growth, while laying the groundwork for long-term stability,” the authors found.


The researchers went on to rank the 35 cities based on their policies and environments for young people. They scored them based on 31 indicators that contribute to young people’s economic prospects—from the city’s GDP growth and local government policy to levels of youth engagement, education, employment, and health.


The TOP10 “Cities For Millennials” are: 1, Toronto, 2, New York, 3, Chicago, 4, Singapore, 5, Hong Kong, 6, Washington, D.C., 7, Los Angeles, 8, London, 9, Sydney, 10, Miami.


The optimism felt in this group of young people across the globe makes them more likely to move to a different urban center in order to make connections with mentors, jobs, and new opportunities—all of which are integral to boost their economic standing. Nearly half (47%) of those polled say they migrated to their current city of residence to have a better life (taking a new job or going to school) in the last five years.

Computer and technology skills are cited as the most desired by 62% of employed youth surveyed.
According to a recent Accenture survey, only 15% of the class of 2015 said they’d rather work for large a corporations than small to mid-sized companies and startups. But so much of the wisdom and training out there for entry-level job seekers reflects the values, needs, and hiring processes more common among traditional employers.

The early days at a startup can be equal parts exciting and terrifying. With few established ground rules, employees usually need to be jacks-of-all-trades more than those at larger businesses. The upside? Being forced to improvise and think on the fly in a fast-changing environment can hone career skills that might otherwise take years to learn.

Startup life often gives employees the opportunity to experiment and see their ideas from conception to execution. Unlike more formal corporate structures, which rest on several layers of approval and oversight, startups are typically much less rigid. As a startup employee, you’ll need to take ownership of projects, balance big-picture thinking with the nitty-gritty details, and contribute directly to the success (or failure) of each initiative you handle.

That takes an entrepreneurial spirit and an excitement for creating things. Did you build a website during your college days or develop an app? Showing that you have the initiative to turn ideas into reality proves you can take the lead on whatever projects are thrown your way. You might also consider preparing an idea or two to pitch the hiring manager during your interview. Having that kind of forward-thinking attitude shows you can make an impact by coming up with creative solutions on your own. It also shows you’ve done your homework on the sorts of things the company already has in the works and indicates you’re excited to build on them.

The biggest and possibly most important lesson you can learn from working at a startup is how to mess up. Failure simply comes with the territory. The excitement that pushes you to try new things can also backfire, but learning how to move forward afterward is critical—not just to your career but to the success of the company. Demonstrate how your own failures have helped you grow. Share any relevant stories about how you’ve overcome stumbles and missteps—and taken the time to understand why you made them. It isn’t about making excuses for past errors. It’s about analyzing failure and learning from it, then showing you can move forward in a mature, professional manner.

If you’re like many millennials, the startup environment more closely matches your workplace values and personal style than more established companies. Working for a startup can help you expand your horizons and gain diverse experience quickly during the crucial early years of your career. Keep these tips in mind, and you’ll be well on your way.

Who says you can’t combine work and play? Not millennials, at least. Recent research suggests they aren’t the strictly utilitarian business trippers their parents tend to be. While traveling for business, millennials are spending more company money than their gen X and baby boomer colleagues. But before your company puts its expense accounts on lockdown, it’s worth first considering how that trend could be an opportunity rather than a threat.

Enter what some in the travel industry are terming “bleisure” travel (to the dismayed groans of others). At first, “bleisure” only referred to business trips that were extended for pleasure. Now the word encompasses leisure experiences that are woven throughout a business trip.

For example, millennial travelers use Tinder, the dating app, to solicit travel advice from locals and find social opportunities. In fact, the social dimension of travel is so important to millennials that hotel chains are redesigning their properties to meet gen Y demands. Marriott (Moxy), Starwood (Aloft), Hilton (Canopy) and even Virgin Atlantic have rolled out new hotel concepts focused on younger travelers, taking a nod from W Hotels and Kimpton. These millennial digs feature stylish interior design, ubiquitous Wi-Fi, social space, shared workspaces, and creative amenities like free bike rentals and happy hours.

Say goodbye to annual performance reviews and rigid nine-to-five working hours. “This generation of managers is going to identify metrics that determine whether people are productive or not,” says Espinoza. Frustrated with the idea that productivity is measured by the number of hours you sit at your desk, millennials are going to focus on better ways to measure performance. “Things like key performance indicators will continue to be a movement,” says Espinoza. Millennial managers will avoid formal annual performance reviews, replacing them with more frequent and informal feedback systems that allow for better communication between managers and employees.

Emotional intelligence is the new buzzword among millennial managers. Concepts of self-awareness, self-regulation, and relationship building will be key to millennial-managed workplaces. “Millennials are highly relational,” says Espinoza. While you may hear the old generation of managers say, “I don’t want to be friends with anyone who works for me because one day I might have to fire them,” Espinoza says millennial managers would never take that attitude. This generation of managers will put people and relationships first.


The difference today is that millennials are willing to shop elsewhere, because we are simply not going to accept that these are the only products on the market. We are willing to try new startups and their innovations, since they speak our consumer language while the traditional banks do not.


Millennials are set up to be empowering managers that support employees in moving forward in their careers. Millennials are good listeners, and as managers, will seek out ideas from employees. “Millennials are problem solvers. They want to improve things, not just defend processes and keep things the same as we’ve been doing over the last 10 years,” says Espinoza. Millennials are willing to try new things, challenge processes, and think differently about a situation. They’re also very supportive and will be more likely to sponsor employees, providing them with learning and growth opportunities.

Millennial-focused leadership platform Levo launched the Levo 100: a list of 100 millennials trying to “redefine the world through their careers.” According to Levo, the list is meant to debunk millennial stereotypes, and the selection process assessed things like zeal instead of just financial growth.
Most millennials are not motivated by money at all, instead aiming to make the world more innovative and sustainable. And according to the Deloitte 2015 Millennial Survey, about 8,000 young professionals from 29 countries believe the world is getting business wrong today.

Wisdom often comes with maturity, but a growing number of young entrepreneurs are proving that age doesn’t matter when it comes to achieving success. In the new book “2 Billion Under 20: How Millennials Are Breaking Down Age Barriers and Changing the World”, coauthors Stacey Ferreira and Jared Kleinert shared the stories of 75 ambitious entrepreneurs who started with an idea and turned it into reality.

Good leaders connect with employees, but the longer you’re at a company, the harder it can be to relate to a new generation of hires. Sri Shivananda, vice president of global platform and infrastructure at PayPal and former vice president of global platform and infrastructure at eBay, has resolved the issue through reverse mentoring—learning from his junior employees.

Early in his career, Shivananda learned from senior employees. Once he became a leader, he gave back by mentoring team members. As he moved up through organizations and teams, he realized that his training and education were not going to be sufficient. “I had adopted my learning from those who walked the path before me, but when it comes to learning about what’s trending, the folks I needed for help were a completely different set of people,” he says. “These are the younger members of the organization. They have the keys to trends and information I wasn’t being exposed to.”

Shivananda says reverse mentoring also helps leaders connect with millennials. “Often leaders look at millennials and don’t understand them,” he says. “Reverse mentoring gives me an opportunity to do that, not just by learning in terms of technology, but by engaging and maximizing the workforce. It gives me an ability to demonstrate that this is a place to come to work and be appreciated. Somebody wants to understand and learn from them.”


The next big step is for organizations to also begin thinking about Generation Z, those born in the mid-’90s to early ‘00s. Generation Z currently makes up a quarter of the U.S. population, and more than 20 million of them about to enter the workforce, all fueled by their own motivations and needs.


Snapchat as mirror of millennials and their needs

In case there was any doubt that Snapchat wants to be the mobile generation’s mass media, it’s added Cosmopolitan Editor-In-Chief Joanna Coles to its board of directors. Cosmo and the startup were already connected as the women’s magazine runs a Snapchat Discover channel. Coles also interviewed Spiegel on stage at Cannes last year. WWD reported the news and Snapchat has confirmed to me the addition.

For Snapchat to turn all its attention into a business, it needs to find a way to merge advertising with its content. That’s a challenge since much of what’s watched on Snapchat is amateur-made clips sent between friends or posted on Stories. Injecting ads into these experiences could feel interruptive and uncool. After expanding access to President Obama’s State of the Union address by making it available on Amazon for on-demand streaming, the White House is now targeting the younger demographic with the launch of an official account on social media service Snapchat.

If you still think Snapchat, a company valued at $16 billion, is just a teen sexting app, you’re not listening to the kids. In a mere 15 months since its first Live Story, Snapchat has transformed itself from a photo-based messaging app into the singular obsession of the media and advertising industries. “We have two major businesses,” says Snapchat’s chief strategy officer Imran Khan. “One is communication, and the other is entertainment.

Communication—a string of messaging products including photo and video sharing, voice calling, and texting features, as well as a tool to exchange money on the service—will, in the near term at least, be monetized through 99¢ snap replays and branded photo filters. What has everyone atwitter about Snapchat, though, is its entertainment ambitions—the company’s attempt to build both a distribution channel and a content lineup for 13- to 34-year-olds, who make up 86% of Snapchat’s U.S. users. Think Comcast for kids.

The TV business, though, is desperate enough to reach millennials that it is racing to work with Snapchat. The service boasted in September that it has more than 4 billion daily video views, a figure that has doubled since June and now matches Facebook’s scale, despite Snapchat having one-tenth of Facebook’s daily user base.


Yes, millennials are annoying customers, but here is the irony: everyone wants these features. Consumers want to be able to manage their finances from their phones and tablets while limiting their visits to bank branches and bank tellers. Plus, everyone hates bank fees, particularly their complexity and lack of transparency.


In addition to Live Stories, earlier this year the company launched Discover, a network of name-brand channels—traditional players such as Comedy Central and ESPN as well as digital-first ones such as Vice—producing professional content, often exclusive to it. How big is Snapchat already? The company claims that more people watch college football on Snapchat (via a packaged Live Story) than on traditional TV, and top Discover channels attract more viewers than all but a handful of premium cable channels.

Players in Silicon Valley, Hollywood, and Madison Avenue speak of Snapchat’s potential with awe, bewilderment, and more than a little fear. But what, really, is Snapchat’s strategy? Can the app truly be the long-awaited digital beast that slays traditional TV? Nobody can precisely explain why Snapchat is so popular. Even supporters call its products “confusing,” its business a “conundrum,” and its cofounder and CEO Evan Spiegel a “contradiction.” Spiegel himself has struggled to define the service: This summer, he published a curious video entitled “What Is Snapchat?” that befuddled viewers. Sir Martin Sorrell, CEO of the advertising conglomerate WPP, points to how the youngest generations are embracing Snapchat with unique patterns of behavior, then adding, “so Snapchat seems to be really on the cutting edge,” as if that explained the cause and effect of its success.

Cocky, erratic, difficult, petulant—these are some of the ways Spiegel is described by those who would give anything to work with him. He is disrupting the traditional media landscape, yet embracing its most established formulas. The 25-year-old CEO is an opinionated, independent paper billionaire who until a year ago still lived with his father. He’s a notoriously private media mogul who dates a supermodel.

Virtually every partner, advertiser, and investor quoted in this story is older than Snapchat’s millennial sweet spot. Spiegel wants their content and their money, but he’s building Snapchat for the Andrew Wattses of the world. Daily Mail’s Jon Steinberg, 38, jokes that Snapchat is the first product that ever made him “feel kind of old”; he recalls emailing Spiegel to suggest an interface change he found confusing. “He wrote to me and said, ‘People will figure it out—you’re not really the target.’ ” In other words, Snapchat isn’t for you, old man! “That was kind of profound for me,” he says. “Every teen I see using this thing has no problems with it.”

Much like its peers, Snapchat thinks it can revolutionize brand advertising for digital platforms. “There’s a tremendous pent-up demand for big-brand advertisers to allocate their brand advertising to digital,” Snapchat’s chief strategy officer Imran Khan told Fast Company told. Most advertisers are still pouring resources into television and print media—this year alone, advertisers allegedly spent $32 billion on magazine and newspaper ads—but social media companies like Facebook, Twitter, and YouTube are all betting they can strike gold when the ad industry begins to rely exclusively on digital.

A key rationale for why tech giants like Snapchat should target big-brand advertisers is because it can be difficult to judge the success of a campaign, which means advertisers with smaller budgets may be turned off by the lack of obvious results. But for a brand like Taco Bell, throwing money at a digital platform like Snapchat makes sense as part of a national campaign. Taco Bell’s chief brand engagement officer told that Taco Bell has been more successful on Snapchat than on any other social network—but comparing that success to other efforts, such as TV ads, is a challenge.

“We learned we needed to adjust the way we talk to Snapchat’s audience, because they detect when it’s advertising,” says Coca-Cola North America content SVP Emmanuel Seuge. The company’s ads repurposed from TV and other social networks performed poorly during Snapchat’s Live Story for the NCAA Final Four tournament. The soda brand continued working “hand in hand” with Snapchat to develop more ad programs; not long ago, as part of Snapchat’s back-to-high-school Story featuring scenes from kids’ first day of classes, the completion rate for a Snapchat-exclusive 10-second Coke spot shot up to 54%.

Still, brands like Coca-Cola are eager to invest money and resources into Snapchat as the company fine-tunes its advertising push. “[Snapchat] is not going to get held to the same sort of rigorous metrics that we can now put in place for other vendors with more granular data,” Coca-Cola exec Ivan Pollard explained to Fast Company. “We’re willing to risk a bit of money to learn.”

What millennial want from banking?

Goldman Sachs has released a study “Millennials: coming age”. It is one of the largest generations with the greatest purchasing power. However, it needs completely different services and ways to do business.

A smart device that tracks your spending and makes purchasing recommendations according to your financial means, a silent savings platform that automatically takes a percentage of your monthly income to save for the future before you can spend it, and a new credit rating system which uses a wider frame of reference—eBay ratings, for example—are among the ideas to emerge as a result.

“We were intrigued by the recent Millennial Disruption Index identifying which industries in the U.S. are most likely to be transformed by millennials, the largest generation in American history, which put banking at the highest risk of disruption,” Rufus Leonard Creative Director Louise Jorden explains.


‘Millennials’ regard banking and financial services as overly complex and old-fashioned needing simplification and synchonrization with younger customers’ behaviors and needs. Brand loyalty in banking is very low among this age group—99% claim to be ready to swap banks, and 12% would swap bank brand for a free monthly coffee. ‘Millennials’ are especially concerned about the ethical behavior of the banking and finance industry—1 in 3 18- to 24-year-olds most value sustainability in a bank, for example (above and beyond digital experience).


Younger bank customers want greater control over their finances with banks more open and inclusive in the decision-making processes they employ to manage this group’s money. Though they are also least likely to see the benefit or value in visiting a bricks and mortar bank, they are hungry for further innovation in banking online.

The banking industry is ripe for change with the rise of fintech startups, the growing popularity of blockchain technology, and the dominance of millennials. Banks should take a note from startups. Startups have experienced massive growth in a short amount of time for a variety of reasons. First and foremost, they know how to run lean and have mastered the art of streamlining their operational processes on both the front end and back end.

The most innovative startups are also investing in something that very few banks have historically paid much attention to: branding. Consumers buy into brands, and startups know that an investment in branding can serve as a key differentiator for a company.


“Millennials are also investing, lending, and sharing money much differently than their parents, and they are assisted by a growing set of tech-driven tools to do so”


Branding is much more than just a logo and company colors; it is a highly-developed roadmap of a company’s identity, defining the manner in which that company communicates, what they believe in as an organization, and providing context for how they operate and why. Investing in branding allows companies to become more “human,” allowing them to resonate with key audiences in an authentic manner and build trust and loyalty among their consumer base.

Lastly, startups regularly invest in data collection and data management. For all decisions, whether minor or of great importance, startups use data to make strategic decisions that result in profitable outcomes. They are able to profile their client base and target audiences through data analysis and in turn, make valuable assessments about behaviors and spending habits. Banks have access to enormous amounts of client (and demographic) data, but many of them aren’t utilizing these informational goldmines to their advantage.

As they have been society’s fastest-growing demographic in recent years, Millennials have continuously been a hot topic of conversation in the banking industry. Given the dominance of the Millennials, banks must now prioritize their approach to attracting constituents of this key demographic – both as clients and as employees. If they haven’t yet asked themselves, bankers should focus on this one question: are we speaking to the Millennial audience and offering them the mobility, growth and development they are looking for?

“Millennials are also investing, lending, and sharing money much differently than their parents, and they are assisted by a growing set of tech-driven tools to do so,” writes CB Insights. New York-based CB Insights updated its list of the 63 FinTech startups targeting millennials”. The list includes robo-advisors like Wealthfront and SigFig, personal investing sites like Motif and Robinhood, and savings and finance trackers like Acorns and Hello Digit.

Every generation has its financial goals. For much of the past few decades, the goals have been independence through home and car ownership along with a growing retirement account to supplement Social Security and pensions. Millennials have entirely different life goals, and yet, financial institutions have yet to respond with the kinds of products needed to satiate them. Just to start, this generation has the greatest levels of student debt in the country’s history. That means that almost all the products currently offered by banks are mostly irrelevant, since major purchases like homes will be pushed back, perhaps indefinitely.

Amazingly, we have seen almost no innovation in student loan lending from the traditional banks, while there has been tremendous innovation in the market from startups like SoFi, Earnest, CommonBond, among others. What gives? Imagine if the first thing a traditional bank said to a college graduate and potential new customer was “open an account, and we can help you refinance your student loans with a lower rate and save serious dollars during repayment.”

There are all kinds of other financial products that traditional banks should be engaging with. Newer models of credit scores, like those from Affirm, could greatly help younger workers find loans. RobinHood and others are trying to show that stock trading fees are obsolete. Banks have so many opportunities to engage with millennials, it is disappointing to see how much they have ignored this demographic.

Yes, millennials are annoying customers, but here is the irony: everyone wants these features. Consumers want to be able to manage their finances from their phones and tablets while limiting their visits to bank branches and bank tellers. Plus, everyone hates bank fees, particularly their complexity and lack of transparency.

The difference today is that millennials are willing to shop elsewhere, because we are simply not going to accept that these are the only products on the market. We are willing to try new startups and their innovations, since they speak our consumer language while the traditional banks do not.

Goldman Sachs highlighted some emerging trends that it said need to be on the radar for investors. The seven topics Goldman explores – and two of them: how the blockchain could disrupt everything and the effect of America’s youngest cohort Gen Z. As the oldest Gen Z’ers enter their mid- to late-teens, Goldman said this cohort will soon surpass Millenials in size and that their influence is already evident. The group is the most diverse to date, digital is at its core and it’s decidedly financially conservative, according to Goldman analyst Christopher Wolf. “While not the first generation of youths with a desire to be heard, Gen-Z is arguably the first with the means,” he added.

Photos: Getty, company profiles, shutterstock, Partick Leger, Flickr user jose jara ramirez, Flickr user Patrik Nygren, Flickr user Jose Kevo, Flickr user O de Andrade (MoScha);  

Life.SREDA VC is a global fintech-focused Venture Capital fund with HQ in Singapore

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