Insights from 9 Global Banking and Fintech Innovation Leaders

There is no rule book for innovation leaders, or a single path leaders take to create new solutions or companies. But, there are similarities in their personalities and passion. Innovation leaders create enthusiasm around them, and motivate others to follow their lead. Here are some excerpts from nine exclusive Banking Transformed interviews that reveal how innovation culture is created and sustained.

While interviewing innovation leaders from around the world for my Banking Transformed podcast, I tried to explore the different strategies small fintech firms and large banking organizations use to build innovation as a foundation for growth. I discovered that the key to being an innovation leader is complete organizational integration, where support of the process starts at the top … and permeates the entire organization.

For fintech firms, the process is often easier, because the size of the organization is smaller, and the mission of the organization is to build something different from what was already in the marketplace. In most cases, the vision for innovation came from the founder, so the culture was established from the outset – from the top down.

For larger, legacy organizations, where I interviewed the head of a new entity within the organization, the passion for innovation was still paramount, as was the strong focus on what the unit was intended to achieve. In each instance, the digital unit and the leader were fully supported by the leadership of the larger organization. In other words, the new part of the larger legacy organization was not an “innovation island,” but clearly part of an overarching mission within the legacy bank to be an innovation and digital transformation leader.

The following are excerpts from some of my favorite Banking Transformed interviews, where I discuss the innovation process, how an innovation culture is achieved, how passion and focus in sustained over time, and the challenges that are faced. The innovation leaders include:

  • Daniel Schreiber, CEO and Co-Founder of Lemonade, Inc. Schreiber shares how artificial intelligence, behavioral economics and a focus on transparency and purpose have been used to disrupt the centuries-old insurance industry.
  • Dustin Cohn, Head of Brand and Marketing over Consumer and Investment Management for Goldman Sachs and the Marcus direct bank operation. Cohn discusses the building of a new digital banking brand within a legacy financial firm and the mission of creating a unique customer experience.
  • Henry Ma, Executive Vice President and CIO of WeBank. Ma reveals how WeBank became the largest digital bank in the world and their mission of delivering financial inclusion at scale by leveraging AI, blockchain, cloud computing and big data.
  • Jay and Luvleen Sidhu, Co-founders of BankMobile. The Sidhus explain the recent moves by BankMobile to become a digital platform provider and how a relatively small regional bank can create a digital banking leader.
  • Benjami Puigdevall, CEO of imagin, a digital lifestyle platform created and supported by CaixaBank. Puigdevall discusses digital transformation at CaixaBank, the importance of an innovation culture and the development of imagin.
  • Colin Walsh, Founder and CEO of Varo Money, Inc. Walsh shares why Varo pursued the first national charter in the U.S., the benefits of being a mobile-only bank, and how to gain scale in an industry that may already have too many players.
  • Jayesh Patel, the head of Liv, the first digital-only lifestyle bank from Emirates NBD. Patel explains the digital transformation process at Emirates NBD, the importance of an innovation culture, and the development of a challenger bank within a legacy banking organization.
  • Scott Case, the CIO of Truist. Case discusses the status of the historic merger between SunTrust and BB&T, the role technology and innovation has played, and the impact that COVID-19 has had on the intended results.

To listen to the full interviews, visit the Banking Transformed page on The Financial Brand or subscribe to Banking Transformed on your favorite podcast app.

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As an innovation leader, do you need to come from the industry you’re disrupting?

Schreiber (Lemonade): We tried to think about new areas of the economy that were left relatively untouched, relatively neglected, by the transformation of the digital era. With insurance, we encountered a space with huge opportunity … dominated by players who were founded during the industrial revolution.

We said, “If we really want to engage in first principles thinking, if we want to try and reinvent the way things are done, then it’s best that we not know how they are done.”

It’s the knowledge curse. Once you know, it’s hard to unknow. We said, “Let’s milk our ignorance for all its worth in order to try and rethink things from scratch.”

We thought through what kind of insurance company we would like to interact with as consumers. Why did people not trust their insurance company? Why do people hate the paperwork and the faxes and the bureaucracy in the process? And, we built something kind of from scratch – sketched it out on a board. Lemonade today bears more than a passing resemblance to what we sketched out those five years ago on the board.

Dustin Cohn (Marcus): Instead of starting with what we knew, we started with a blank sheet. We did not have legacy technology, we didn’t have any legacy products, really no legacy internal organization to deal with, and we tried to think with a very open mind. And, at the end of the day, we wanted to leverage consumers to help us build Marcus.

It was the view through the lenses of the consumer that helped lead the build of the brand.

Having people from multiple backgrounds created a unique combination. It’s the unique blend that allowed us to think out of the box.

What is the biggest barrier to moving an organization from legacy processes to digital processes?

Schreiber (Lemonade): To begin with, most executive teams are the wrong people. They’ve been groomed for 30 years for legacy preservation, when what is really needed is business transformation. Often, the shareholders are also wrong. You’ve got a class of shareholders who just want their 5% dividend year in, year out, with low volatility. They don’t want you placing big bets on technology and transformation. So that means that your board of directors is wrong. Every element of the business is wrong.

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How do you create an innovation culture?

Puigdevall (imagin from CaixaBank): There must be a strong commitment from the top management of the bank, because innovation and the use of technology to enhance the relationship with the client is in the DNA of CaixaBank. Of course, this commitment has to be consistent and has to be stable. It’s not a matter of what’s in fashion. I think that’s very consistent in the last 20 years – the strategy of how to use technology to create new services.

In addition, in the year 2000, the bank decided to create a subsidiary that would focus the talent and the resources to develop a digital business. This was a kind of spinoff, with very digital-oriented talent to execute the strategy of using technology to enhance digital services.

Dustin Cohn (Marcus): A key ingredient is the mix of people. We hired about a third of our employees on Marcus by Goldman Sachs from Goldman Sachs itself. We have about a third of our employees from consumer finance outside of Goldman Sachs, who can bring best practices across the industry and across different organizations. And then, about a third of us, like myself, come from outside financial services completely. We can bring best practices from completely different industries.

And certainly, a leadership team from within the parent organization and within Marcus that is committed to innovation and delivering the best retail consumer experience.

Jay Sidhu (BankMobile): You’ve got to have a vision. If you don’t have a vision of what you’re trying to achieve, you’re not going to have innovation … you will just have incremental changes. Then you must decide how to use technology, the changing trends, the customer behaviors, the regulatory environment, etc., and create a passion for execution. If you have these four things, you will create a very successful innovation culture.

 Colin Walsh (Varo): Sometimes it’s about blending people who are just wired very, very differently. They should be wired around consumer centric design and iteration and agile mentality and how you use data and tech to drive a consumer business.

That’s what motivates us, and what brings us together, and it’s bound by that common purpose. It is a little bit of a petri dish of taking people that just see the world through a very different lens, and getting them to collaborate effectively and focus on the bigger picture.

Scott Case (Truist): It’s super important to have leadership that understands the importance of things like design thinking, client experience, client in the middle, in this emergence of ecosystems and partnerships that we have to tap into and have the capabilities to meet the client’s expectations. It’s setting the vision, and then having the courage to go get it done.

Then lastly, it’s our purpose. We constantly take the compass heading on client input, our purpose, and that’s how we set the vision and then we go execute.

Jayesh Patel (Emirates NBD Liv): 60% of innovation culture comes from the board and the executive team. If you look at the Emirates NBD executive team, they’ve been huge sponsors of innovation from the start. They have not only allowed us, but they’ve inspired many of the people in their team to do more. I know a few organizations that have tried it and unfortunately, haven’t seen as much success.

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How important is simplicity in the innovation process?

Puigdevall (imagin from CaixaBank): Simplicity is of utmost importance. This is something created by the pure digital players who changed the way to develop and to offer totally digital services. Today, simplicity is always key.

The imagin platform is an example of simplicity in a banking value proposition. CaixaBank has hundreds of different products to offer to the whole database of clients. imagin has only two, or three products of each category. That simplicity makes decisions for the client easier and this is very powerful to generate engagement with the client.

And the one-click capability is always very important, but probably more difficult to execute than simplicity, because it depends on the system – the legacy you have and your IT capabilities. It’s something we always keep in mind when defining new services.

Henry Ma (WeBank): It is the customer experience that our target segment would expect from services like ours, because they are very much used to the mobile and digital experience. Everything must happen a few clicks away … in real time.

The big data technology that we have adopted, and also the credit model that we have prebuilt, allows a customer to apply for credit, and receive funds from us, in less than five seconds. In fact, five seconds is the commitment that we make to our customers.

Similarly, when a customer is trying to do a drawdown, it’s also only a few clicks away and the money will go out of the bank within a second. Since it takes a while for the receiving bank to process the transaction, our customer will be able to see the fund in their account within a few minutes.

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What is the biggest challenge to creating an innovation culture?

Luvleen Sidhu (BankMobile): Change is hard. In a business, it’s no different. It’s easier to go the course that you’re going than to pivot. I think that even a disruptor has to be careful. No one can become complacent. Organizations need to keep thinking and reflecting on what changes need to be made, because change never stops. Organizations all have to continuously have this paranoia – but a constructive paranoia – where they stay on their toes and keep thinking about where is the industry going.

Henry Ma (WeBank): A challenge was that we had limited budget from the very start. We learned it was important that, to be successful in the long term, it’s important to think big … but also be able to start small.

It’s also about having the right blueprint in mind, but being able to start humble, start small and scale up iteratively.

Jayesh Patel (Emirates NBD Liv): If needing a digital proposition is done as a “tick the box” task, you’re likely to fail. When we did it, we didn’t come out and say, “We want a digital bank.” We went out and said, “Look, our customers are changing. What is it they want?” Maybe the answer wasn’t a digital bank, but in our case, we believed it was.

Scott Case (Truist): The biggest challenge has been we have 60,000 plus or minus teammates and we had to bring two companies together … and it’s a human endeavor. When you think about the need to get the alignment all the way at the top of the house, as well as to every single one of our teammates and partners and vendors, it’s tough at times.

And then the focus needs to be on driving positive client experiences.

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How do you get employees to commit to innovation?

Colin Walsh (Varo): It’s about hiring the right people. If you have people who care deeply about what you’re doing, they’re going to put their all into it.

And, I say often that I like to hire missionaries, not mercenaries. And I want people that believe in what we’re doing, because I believe in it. This is why I started the company in the first place. And you can really feel it when you meet people at Varo, I think there is a real consistent sense of authentic purpose to what they’re doing.

How quickly should it be from ideation to implementation?

Henry Ma (WeBank): Being a digital bank, we emphasize agility. We could be doing hundreds or maybe even thousands of updates in a single month. In fact, unlike a typical banking institution, where they want to control the number of changes to their environment as much as possible to mitigate the changed risk, we actually operate in a very agile way because the architecture that we have adopted is fully distributed.

And, because we are only changing the features of the products on a very small percentage of our customers, even if things go wrong, it’s not going to create too big of an impact. We can usually complete ideation to production within 10 days.

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What advice would you give legacy banks wanting to transform to innovative, digital banks?

Jayesh Patel (Emirates NBD Liv): Don’t innovate or pursue digital transformation because you want to do it as a check mark. You really have to believe in the process and the destination, because it’s not easy. I also think organizations need to get good advisors and partners who can help with the pitfalls.

Next, you need to get a good team in place, not just on your tech side and certainly not just bankers. 80% of my team is non-bankers. They’ve come in and they’ve built something that they want.

The Future of Innovation in a Post Pandemic World

Globally, the pandemic impacted consumers, communities and businesses, representing the most significant disruption to daily life in more than a century. For financial institutions, it was a wake-up call for digital transformation that was moving far too slowly.

While many unknowns still exist, it is clear that many financial institutions will not survive going forward if they do not embrace the opportunity that COVID represented from an innovation perspective. Responding to the crisis will require new business models and a new culture of innovation.

The decisions made at the top of banks and credit unions now will shape the future of these organizations. The interviews above, and all interviews done on the Banking Transformed podcast, can help financial institution executives understand some of the most important things that must be done to succeed going forward.

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