Silicon Prairie News

SmartyPig CEO on SXSW panel ‘Banks - Innovate or Die’ (Video)

Austin March 22, 2011 by Danny Schreiber

Led by moderator Brett King (far left), panelists Bob Weinschenk, Anna O'Brien, Joshua Reich and Rob Garcia participate in the "Banks - Innovate or Die!" panel at SXSW 2011. Photo by Danny Schreiber.

For the second year in a row, SmartyPig CEO Bob Weinschenk participated in South by Southwest Interactive panel that brought a lively discussion on stage and a packed house in the seats. Last year's topic, "Banking 2.0: Financial Services Driven by People & Emerging Technologies," had the panelists focus on what each of their companies was doing to change the banking landscape. This year's topic, "Banks - Innovate or Die!," had the panelists arguing for their company's products as well as the other startups that are challenging the traditional banking model.

Brett King, author of "Bank 2.0," moderated the panel. The four panelists were SmartyPig's Weinschenk, Anna O'Brien of CitibankJoshua Reich of BankSimple and Rob Garcia of Lending Club.

At the start, King posed this question to the panelists: "Banks have gotten too big to fail, but have they gotten too big to innovate?" For the next 40 minutes, Weinschenk, Reich and Garcia provided examples and pointed out areas of opportunity in the banking industry while O'Brien provided an excellent opposing view as she represented an established player in the space, Citibank.

For a great summary of what was discussed, I encourage you to read King's Huffington Post article: "SXSW Interactive: Banks -- Innovate or Die!"

Weinschenk answers audience questions following the panel. Photo by Danny Schreiber.

Here are a two thoughts that Weinschenk shared during the panel:

In his Opening Remarks:

"I would argue that the next battle, it's not against us necessarily, it's against Apple and Google and Verizon and AT&T, companies that have as much or more money than the largest banks relative to cash set aside. I don't know about you but I'm going to be fascinated to see what Apple does with 40 billion in cash because [my iPhone] never leaves my side."

On Customer Service:

"Very often if you complain – and please don't all test this at the same time – you'll get an email back from me or you'll get a call back from me, and we really do apologize. It's very often that myself, my two founders, if we screw up, and everybody does, you'll get a handwritten note, you'll get a SmartyPig T-shirt and a 'What else can we do to help you?'

"The thing that's interesting is the dialogue between us and our costumers. We sent out 10,000 surveys the other day, and it was amazing — within 20 hours we got 82 percent. If you think about direct mail, which is generally how my bank communicates with me, it's one to two percent that might respond to you, we wound up with over 94 percent response. Of that 94 percent, 81 percent had come in and written something down on the electronic survey."

Here's a post-panel interview I conducted with Weinschenk in which he gives a brief recap of the discussion, expands on his thoughts on mobile, hints at SmartyPig's future mobile strategy and talks about the success of their prepaid cards.

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I thought Bob and the rest of the panel did very well in this panel ~ Thanks much! Even O'Brien did a great job of holding her own (I can't imagine how tough it would be to take an organization that large and convert them to be as nimble as SmartyPig and BankSimple, and I though she made it clear that they are trying as hard as they can).

All of that said, I think Bob's comments on the use of mobile are prescient. Ultimately the smaller fish are lining up to take down the giants, and the giants had better be listening.

Mar 25, 2011 at 02:57 PM


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