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I'm a simple customer... First: $117M? That seems like an astonishingly low amount of money. Second: The service you get from simple really is that good, pro

by blhack 13y ago

I'm a simple customer... First: $117M? That seems like an astonishingly low amount of money. Second: The service you get from simple really is that good, probably better than what most people would expect. The app is amazing, their website is amazing, their customer support is amazing. It feels like a bank from the 21st century, not from the stone age. This acquisition actually makes me really sad. Simple is awesome, and I really hope that it doesn't get screwed up by this.

lyinsteve 13y ago
If you check the press release, Simple is still considered a separate business entity and the Simple CEO is retaining his position. Apparently nothing will change.
- jaysonelliot 13y ago
  It's one thing to remain a separate entity, but anyone who's ever worked for a company that's been acquired can tell you that's not the end of the story. Profitability targets get set. Quarterly pressures are exerted. The parent company doesn't tell them how to do their job, but they set goals. Goals that may or may not fit with the way they do business, and may be more focused on short-term profits than long-term health. Most acquisitions start out with promises like "we don't want to change anything," and remaining a separate business entity is a much easier way to integrate than jumping in with both feet from day one. But that's not usually the way things play out after a few years.
Karunamon 13y ago
The onboarding process on the other hand is opaque and nigh-useless. I got shot down for an account with these guys due to a .23 (that is not a typo.. twenty-three cents) report on chexsystems from five years ago. Every bank I've had the ability to talk to an actual person was able to see that this is clearly absurd, I am not a serial check bouncer/overdrafter/etc and to get my account going. Simple..notsomuch. I'd love to use them if they'd let me.
- publicfig 13y ago
  I had issues with the signup process as well, but I will say that a lot of those come from using Bankcorp as their backer. They are, ultimately, the ones that accept or deny you, and I don't know how much information Simple has when it comes to those decisions.
- nhangen 13y ago
  I had heard so little from them that I assumed they were in the throes of dissolution. I guess I was wrong.
  - FireBeyond 13y ago
    I'm still blown away that they don't/can't offer joint accounts. I mean, I'm fairly sure that's not a limitation of Bancorp, so ...
- cbhl 13y ago
  If indeed the report is that old, why not just send the offending bank the .23?
  - Karunamon 13y ago
    I have. And my chexsystems report shows that it's been paid off. The negative info is still there.
- pbreit 13y ago
  Same for me. First time I ever got declined for a checking account (out of at least 20). And no help from Simple support.
- norova 13y ago
  I still have some very shitty things on my credit report, from as recent as three years ago, and I was accepted no problem. Frankly, I was surprised.
jonknee 13y ago
> $117M? That seems like an astonishingly low amount of money. That seems like a lot of money for a mobile banking app. They didn't actually hold deposits themselves or make loans, the activities that are worth money in banking. They were sort of a VPS for banks--a "bank" sitting on top of real banks that made some painful things easier. Hard to profit that way though.
- mathattack 13y ago
  You hit the nail on the head. They're viewed (and valued) as an app on top of a bank. Without holding and investing deposits, they don't get the other financial benefits. Perhaps their end user data could be worth something, though.
  - toomuchtodo 13y ago
    They get half the interchange fees on every transaction. That's the benefit, worth MUCH more than "interest" (which is only at 0.01 percent at the moment). The other half of the fee goes to Bancorp. TL;DR Its about the transaction volume.
    - jonknee 13y ago
      > They get half the interchange fees on every transaction. That's the benefit, worth MUCH more than "interest" (which is only at 0.01 percent at the moment). The other half of the fee goes to Bancorp. They have a lot of costs for that interchange fee though. That's not where banks make they money and the .01% interest you mention is what they pay, not what they would earn if they actually held your deposits. If they held your deposits and worked like a regular bank it would be dramatically more profitable: $10,000 in your account means they would owe you $1 a year in interest. They could simply park that about anywhere else and make a decent amount, but banks really make their money by leveraging.
      - doki_pen 13y ago
        Not to mention that for every dollar they are holding they can lend out a lot more. Deposits give them more investment/lending power.
pilsetnieks 13y ago
$117M seems very little in light of yesterday's news about WhatsApp but in absolute terms it's still an astoundingly large amount of money. I'd wager that the founders wanted their FU-money to eventually pursue something new.
webwright 13y ago
They raised $15M+, which pegs their valuation somewhere in the 50-100M (as a guess). So $117M means that the founders get rich and most of the investor money gets returned at a 1-3X multiple. Not shabby for 4 years of effort, but not what most investors are looking for.
ssmoot 13y ago
For a counterpoint: I find their overall product pretty obvious and underwhelming. I mean, no joint accounts? Taking days to connect an external account? The savings goals are certainly nice, but I can get that with most other banks (just don't have the online management component), otherwise they don't offer a whole lot beyond "pretty". I put a lot more weight into the convenience of drive-through cash deposits a couple blocks from my house. Or spending an hour at the branch and walking out with a loan. Or a rewards card that applies 5X points to my mortgage for purchases I was going to make anyways. I wouldn't say I'm a "fan" of Wells Fargo. Or that they're particularly "amazing" for any of this. And their iOS app kinda sucks to be honest. Functional but meh. That said, they set a minimum expectation for their offering that Simple doesn't meet and no amount of pretty Apps or direct-to-live-human (I mean how often do I call my bank? I couple times a year?) service is going to make up for. The biggest one for me though is Joint Accounts. I mean seriously. It's weird to me as a married guy that my wife and I should maintain multiple separate bank accounts. That alone makes the offering fairly useless for me. If I were single and didn't have a mortgage, I could see how I might have different priorities. The only reason I'm still a member at this point is that closing an account, needing to hook up a new external account (we changed primary banks during my membership at Simple so the external account I opened with is no longer the one I need to transfer funds back to for closing) is cumbersome.

by blhack 13y ago

lyinsteve 13y ago

If you check the press release, Simple is still considered a separate business entity and the Simple CEO is retaining his position. Apparently nothing will change.

jaysonelliot 13y ago
It's one thing to remain a separate entity, but anyone who's ever worked for a company that's been acquired can tell you that's not the end of the story. Profitability targets get set. Quarterly pressures are exerted. The parent company doesn't tell them how to do their job, but they set goals. Goals that may or may not fit with the way they do business, and may be more focused on short-term profits than long-term health. Most acquisitions start out with promises like "we don't want to change anything," and remaining a separate business entity is a much easier way to integrate than jumping in with both feet from day one. But that's not usually the way things play out after a few years.

Karunamon 13y ago

The onboarding process on the other hand is opaque and nigh-useless. I got shot down for an account with these guys due to a .23 (that is not a typo.. twenty-three cents) report on chexsystems from five years ago. Every bank I've had the ability to talk to an actual person was able to see that this is clearly absurd, I am not a serial check bouncer/overdrafter/etc and to get my account going. Simple..notsomuch. I'd love to use them if they'd let me.

publicfig 13y ago
I had issues with the signup process as well, but I will say that a lot of those come from using Bankcorp as their backer. They are, ultimately, the ones that accept or deny you, and I don't know how much information Simple has when it comes to those decisions.
nhangen 13y ago
I had heard so little from them that I assumed they were in the throes of dissolution. I guess I was wrong.
- FireBeyond 13y ago
  I'm still blown away that they don't/can't offer joint accounts. I mean, I'm fairly sure that's not a limitation of Bancorp, so ...
cbhl 13y ago
If indeed the report is that old, why not just send the offending bank the .23?
- Karunamon 13y ago
  I have. And my chexsystems report shows that it's been paid off. The negative info is still there.
pbreit 13y ago
Same for me. First time I ever got declined for a checking account (out of at least 20). And no help from Simple support.
norova 13y ago
I still have some very shitty things on my credit report, from as recent as three years ago, and I was accepted no problem. Frankly, I was surprised.

jonknee 13y ago

> $117M? That seems like an astonishingly low amount of money. That seems like a lot of money for a mobile banking app. They didn't actually hold deposits themselves or make loans, the activities that are worth money in banking. They were sort of a VPS for banks--a "bank" sitting on top of real banks that made some painful things easier. Hard to profit that way though.

mathattack 13y ago
You hit the nail on the head. They're viewed (and valued) as an app on top of a bank. Without holding and investing deposits, they don't get the other financial benefits. Perhaps their end user data could be worth something, though.
- toomuchtodo 13y ago
  They get half the interchange fees on every transaction. That's the benefit, worth MUCH more than "interest" (which is only at 0.01 percent at the moment). The other half of the fee goes to Bancorp. TL;DR Its about the transaction volume.
  - jonknee 13y ago
    > They get half the interchange fees on every transaction. That's the benefit, worth MUCH more than "interest" (which is only at 0.01 percent at the moment). The other half of the fee goes to Bancorp. They have a lot of costs for that interchange fee though. That's not where banks make they money and the .01% interest you mention is what they pay, not what they would earn if they actually held your deposits. If they held your deposits and worked like a regular bank it would be dramatically more profitable: $10,000 in your account means they would owe you $1 a year in interest. They could simply park that about anywhere else and make a decent amount, but banks really make their money by leveraging.
    - doki_pen 13y ago
      Not to mention that for every dollar they are holding they can lend out a lot more. Deposits give them more investment/lending power.

pilsetnieks 13y ago

$117M seems very little in light of yesterday's news about WhatsApp but in absolute terms it's still an astoundingly large amount of money. I'd wager that the founders wanted their FU-money to eventually pursue something new.

webwright 13y ago

They raised $15M+, which pegs their valuation somewhere in the 50-100M (as a guess). So $117M means that the founders get rich and most of the investor money gets returned at a 1-3X multiple. Not shabby for 4 years of effort, but not what most investors are looking for.

ssmoot 13y ago

For a counterpoint: I find their overall product pretty obvious and underwhelming. I mean, no joint accounts? Taking days to connect an external account? The savings goals are certainly nice, but I can get that with most other banks (just don't have the online management component), otherwise they don't offer a whole lot beyond "pretty". I put a lot more weight into the convenience of drive-through cash deposits a couple blocks from my house. Or spending an hour at the branch and walking out with a loan. Or a rewards card that applies 5X points to my mortgage for purchases I was going to make anyways. I wouldn't say I'm a "fan" of Wells Fargo. Or that they're particularly "amazing" for any of this. And their iOS app kinda sucks to be honest. Functional but meh. That said, they set a minimum expectation for their offering that Simple doesn't meet and no amount of pretty Apps or direct-to-live-human (I mean how often do I call my bank? I couple times a year?) service is going to make up for. The biggest one for me though is Joint Accounts. I mean seriously. It's weird to me as a married guy that my wife and I should maintain multiple separate bank accounts. That alone makes the offering fairly useless for me. If I were single and didn't have a mortgage, I could see how I might have different priorities. The only reason I'm still a member at this point is that closing an account, needing to hook up a new external account (we changed primary banks during my membership at Simple so the external account I opened with is no longer the one I need to transfer funds back to for closing) is cumbersome.