Joshua Reich, the CEO of US digital neo-bank Simple is pledging to return the business to its roots, having spent the past few years “acting like a bank instead of a technology company”.
Acquired by Spanish bank BBVA for $117 million in 2014, Simple has since been bogged down in rebuilding its core infrastructure and transferring accounts to new US banking partner BBVA Compass.
The initiative has not always run smoothly, with Simple being forced to write to a number of customers last year advising them that they would have to open new accounts due to logistical problems in transferring their banking details to the new platform.
The acquisition has also proven painful for BBVA Compass, which took a $60 million goodwill impairment charge against Simple in its 2016 fourth quarter results statement.
BBVA Compass has nonetheless remained upbeat, claiming that Simple has been signing up 30,00 new customers a month.
Now it seems the bank is rethinking it raison d’etre, laying off ten per cent of its staff and taking its foot off the gas in order re-assesses its role in the market.
In blog post, Simple chief Reich says: “We have been focused on growth instead of innovation. We have been acting like a bank instead of a technology company. And that changes today.”
A number of high profile executives are among the 33 staff to be let go as a result of this commitment, including Simple’s chief marketing officer, chief people officer, vice president of operations, and vice president of engineering
Says Reich: “Today, we are recommitting to being a technology company that is completely focused on product. We are re-designing our team so that everything we do is in support of this focus.”
In a statement sent to GeekWire, Simple CMO Michelle Broderick, wrote: ““One of the best parts of working with a high-functioning executive team is that you all work together to make decisions on what is right for the company as a whole, and not what is right for any one function, team, or person. We made the hard decision that right now is not the time to grow Simple’s customer base, and without the thrill of growth a company does not need a fully staffed executive team, or a CMO. A change like this is not something we undertook lightly and we worked hard on the best path forward for the company and are now working together on the transition plan.”