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Banking Startup Simple Acquired for $117M, Will Continue to Operate Separately (techcrunch.com)
280 points by uptown on Feb 20, 2014 | hide | past | favorite | 208 comments



I've been with Simple for about a year and a half, and slowly moved from my TD Bank account to using Simple exclusively for personal banking. They've blown me away with how a bank can operate if it just joins the 21st century. Everything from their UX to their customer service is outstanding. Calling them on the phone reminds me of going in to my local bank when I lived in a small town in Iowa.

Then again, this is pretty much the way I felt when I joined Commerce Bank in 2002. They were leaps and bounds above any other bank in everything from their down-home attitude to their evening and weekend hours. Then they got acquired.

Things weren't too different with ING Direct. Joined up for their interest-bearing checking and used them as my savings account. Had wonderful experiences. Then they got acquired.

Tangential, but relevant, I got HostGator as my hosting provider many years ago—they were a little company in Texas with great service and great people. I'm leaving them this month. They got acquired, and everything changed.

I hope this goes well for Simple. I really do. But I'm preparing myself. I know the signs to watch out for. First they'll get an automated phone tree, and I'll have to tell the robot what I want. Then it will get just a little longer to wait for a person. A couple fees will show up, nothing much, just little stuff. Tiny, unobtrusive, totally defensible, annoying policies will start taking hold. And soon, it'll be just another online bank—albeit one with a very pretty iPhone app.

I hope that doesn't happen. But I'm bracing myself anyway.


I've had pretty much the exact same banking experience. Commerce Bank was incredible when it came to service, both in the branches and over the phone. The web site wasn't so great, but not specifically bad either compared to most others. TD Bank (which acquired Commerce) was just OK.

ING was absolutely remarkable. Less so after being acquired.

And Simple is by far the best banking experience I've had. The interface is so well done, the customer service has been phenomenal. I actually find myself on my banking tab nearly every day (happily), adjusting goals and making sure I'm on target.

I still use mint to manage all my accounts and consistently wish the interface was even half as good as Simple's. Mint is another example that stopped being incredible after being acquired - or at least stopped progressing in any useful manner.


Agreed on all fronts. Rooting for the Simple crew to keep their product rocking.

I also have to note that the Spanish banking system is among the worst, most troubled, in the world. Santander recently bought Soverign bank (US regional bank) and it makes me wonder whether they are trying to address solvency from bad loans with fresh deposits however they can acquire them.

makes me nervous to think about having any serious amount of funds with a spanish bank.


Simple's support is definitely outstanding. I get little notes like "Fixed it! By the way, it's not my business but I like that you hyphenated your name when you got married." that really reinforce that there are actual humans being allowed to solve problems, not fill out a script.


Exactly. Here's a recent interaction I had with Simple support. http://cloud.mattermill.com/image/2w0W1v0z3E0d


I have a 40+ message support thread comprised of me and Simple support sending gifs back and forth to each other.


Pics or it didn't happen.


It's a thin line to walk. I would feel quite different if that happened to me.


Same here. One time a Simple rep made a comment about how they liked my employer. While the comment itself was innocuous, I expected them to have a bit more discretion when going through my transaction history.


It could be a very subtle AML tactic. BofA asked me if I remembered the name of the staff member who set up my business account prior to letting me make a wire transfer. Of course, since they can't tell you it's AML you think they're insane until you catch on and give the standard answers.


Really? That reaction strikes me as quite odd. Do you not chit-chat with tellers at your bank in person?


No, I've never chit-chatted with tellers, nor would I want to.


You may be the odd one out then. I've spent a fair amount of time in lines at the bank and most people are quite chatty.


Even still, there's a difference between random chit-chat and the bank representative looking into your transaction history and making comments on it.


Cultural behavior differs widely even between regions. Whats true at your bank could be entirely different 500 kilometers down the road.


I do not chit-chat with my teller about items they see in my transaction history.


Neither do I, but they almost always mention my employer -- that's what we're talking about.


But they figure out your employer by looking at your direct deposit?


In all seriousness, why?


Does it matter?

Simply put, I parse that as a creepy attempt of simulating a personal relationship that just isn't there.


Agreed; I'm getting sick of this faux-friendliness that's trendy in American customer service these days. Banks and B2B startups are equally as guilty. I don't want to be asked how I'm doing or discuss the weather every time I call you for a quick question, wasting lots of time with useless polite banter. I'd rather a business call with an established vendor go like this:

* Ring, quick answer

* V: Yeah?

* Me: I need X changed to Y.

* V: Got it.

* Me: Thanks. end call


One institution I am forced to deal with regularly has this horrific phone intro (from a live person):

"Thank you for calling XXX where it's always a great day, my name is XXX and how about you tell me what I can help you bring home today?"


I would be genuinely depressed by having to lie all day. This makes me appreciate more my standard European grumpy wait-staff.


What about at Trader Joe's how they always have a nice conversation with you, what's your take on that?


Depends on what the conversation is about. The ring on my finger? (similar to the example above?) No-no.

The weather, because it is summer and hot? Ok. Just banter.

The crowded store and the fact that I had to stand in line 5 minutes? ("Crazy, we didn't expect that many customers today!") Yes! Shows they are aware and care.

It's not that I don't want to interact, I just don't want to be dragged into that 'we're friends' game.


In my experience it feels different in part because you have the person in front of you (it's harder to fake seeming genuine face to face).

It also feels different because they are talking while they are doing something else, unlike on a phone call where these questions are preventing you from doing the communication you need to do to finish the call. It would be more similar to Trader Joe's employee stopping you on your way in to ask you a bunch of questions about your day and the weather outside.


I live in NYC and was actually thinking about Trader Joe's and checkout lines here generally when I wrote my comment. Cashiers here generally don't waste anytime with small-talk and that's understood as common practice since we're all in a hurry. In other parts of the country, some small talk is expected and one party will be viewed as rude if they don't participate. I prefer we skip it.


I use self-checkout even when the line's longer, so that I don't have to talk to someone.


I feel the same way. It would bother me to know that the support person has an opinion regarding my personal details regardless of what that opinion is.


They have an opinion, whether or not they're stating it to you.


I might wonder which of my personal details they don't like on this cozy level.


If I'm still getting excellent support, I'm not sure I care.


One thing is that it can be a sort of breach of trust. While of course banks have access to this info, it's sort of an unwritten rule that they're not going to go looking through it just out of curiosity/malice.

Obviously this depends on the situation, but usually info like bank transactions are considered private.


Seriously. I don't want to myself or my wife to be judged by my bank support because my wife took my last name.


Just because they didn't say something doesn't mean the judgement isn't there.


I love ING Direct.

I just wish they offered Two-Factor authentication for "360" accounts.

Relevant link: https://www.facebook.com/CapitalOne360/posts/101515573342295...


Honestly, it would be great if they had passwords instead of just a maximum 6-digit number (!!!) for auth. It's fucking absurd.


>It's fucking absurd.

On an unregistered browser, someone has to guess the answer to two security questions and the PIN. Did it occur to you that maybe it's not a problem since it's been that way for at least 8 years now (I signed up in 06)?


Yes 8 years ago poor security was a bit less of a risk.


Do other internet-only banks offer such a feature? I'm pretty done with "360".


In the UK it's common to use card readers which can use the chips in our cards to generate a response to challenges from online banking.

It also allows you to only authorise specific actions e.g. transferring a specific amount to a specific payee, so protects against replay attacks.


Same. Ever since they ticked under the 1% interest rate, I've been looking for a better alternative (ah I loved the 6% back with ING in '05).


Surely the interest rate has more to do with the Fed than the bank?


I think acquirers are aware of notions like yours (I used to work for one of the acquirers you mentioned). These companies will eventually start to take great care to preserve the brand and product of the acquired company.

My experience with one of the banks you mentioned has not changed since it's been acquired.


I love ING direct. Even after converting to 360 they've still been pretty good.


Hi Jason, Consider www.grb.net - John.Pozzi@comcast.net


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.


> $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.


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.


Speaking as a layman, it seems like actual banking is a commodity while Simple's UX is not. I don't know how to translate that to valuation, though.


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.


> 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.


Not to mention that for every dollar they are holding they can lend out a lot more. Deposits give them more investment/lending power.


Sort of. If an individual bank has $30M on deposit, then they only have $30M to lend to mortgage borrowers. In order to be able to have $30M in deposit they must have investors invest $3M into the bank (i.e. Tier One Capital must be ~10% of deposits). If this were a real life example this fictional bank would have to borrow from their local federal reserve bank to cover any daily cash flow needs (e.g. Customers withdrew more money from their savings accounts then they deposited in one day).


Interest isn't what they collect on deposits, it's what they pay. Banks lever up and invest those deposits for much higher returns.


haha well the interest YOU get may be 0.01. But the loans banks give out charge a much higher interest rate. 3-5% for a home right now depending on factors.


Right, but that's securitized and sold to investors. And if I'm a bank, I can go to the fed discount window and get cash cheap.


Right - and they can lever up 10 to one or more on this.


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.


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.


Same for me. First time I ever got declined for a checking account (out of at least 20). And no help from Simple support.


I had heard so little from them that I assumed they were in the throes of dissolution. I guess I was wrong.


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 ...


If indeed the report is that old, why not just send the offending bank the .23?


I have. And my chexsystems report shows that it's been paid off. The negative info is still there.


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.


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.


$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.


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.


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.


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.


A source close to Simple tells The Verge that the company, which had raised $15.3 million, had been shopping itself around in search of a buyer since business wasn't progressing as quickly as it hoped. "They had kind of run out of steam," said the source...

Source: http://www.theverge.com/2014/2/20/5429916/bbva-acquires-simp...

Simply (no pun intended) building a layer on top of the existing banking infrastructure isn't really that innovative. The big potential in this space is building a new banking platform from scratch, instead of relying on existing/legacy technology. Unfortunately, the investment required is higher than VCs seem willing to risk.


  > Simply (no pun intended) building a layer on top of the existing banking infrastructure...
This was what turned me off. I signed up for an invite right after they announced the service (something like 2-3 years ago at this point, when they were still BankSimple). But they took sooooo long to launch and in the meantime I became disenchanted with corporate banking. With Simple, the money still ends up in corrupt financial institutions and that's something I can't morally justify (I realize I am probably still doing business with corporate banks, but why do more than necessary?).

I now use a local credit union and I get far, far better service than I ever did with BoA. The credit union has a branch 3 blocks from my apartment, across the street from where I work, and on campus at school. Plus they have ATMs in many of the local businesses I visit. Simple just can't compete with that, so for me, it's all upside.


Yes, I was in early too. I never committed money to them because they just kept missing features that I needed. Like transferring money to another bank. Or transferring money to another bank to an account that isn't mine. Or a savings account (or the much ballyhoo'd but never launched automagic movement of spare money into a savings account to get the interest working for you).

It ended up that customer service ended up being pushed as the differentiator (the interface I can get with Mint), but I've had great customer service experiences with both Ally and Charles Schwab. And I get all those previous features I wanted, plus things like ATM refunds. So Simple ended up being a feature-bare product in comparison.

I think their customer growth tailing off was a direct correlation to their feature launch velocity tailing off, and I attribute that to the legal stuff around banking being really hard, rather than any slacking on their part. Hopefully the purchase will allow them to leverage more existing agreements to get more features up and running.


> Like transferring money to another bank. Or transferring money to another bank to an account that isn't mine.

These sound like good avenues for fraud, i.e. places where a bank would need to put in a fee so they can afford computers and people to watch for fraud when someone attempts one of these transactions.

> Or a savings account

My Simple account bears interest every month. I suspect they implemented this automagic movement of money without actually exposing it to the user.


Just because something is a possible attack vector for fraud, doesn't mean it shouldn't exist. Other US banks offer the feature. And, at least in the UK, it's a standard thing to do. If they combined with two-factor auth, then it's no less secure than the debit card and PIN they offer.

The interest of a Simple checking account is no more than the interest on any other banks checking account, so I don't think they're doing it at all. Checking accounts usually accrue some tiny amount of interest.


Help me out here, I'm not sure if I'm following: Is it _not_ possible to transfer money from Bank A, your account, to Bank B, your brother's account with that system? I.. guess I'm missing something, because that surely cannot be true - that's how I pay my bills.


Yes, it's not possible. This is the very same way my wife and I were running bills for years, and yes, that's why I didn't move to Simple due to that feature not being there.


Interesting. So, if you forgive my ignorance once more: How do you use a Simple account? I mean.. What can you do with it? Grab cash from an ATM only? Write (oh my god, please say no) checks backed by that account?

In other words: If you cannot transfer the money to a different account, how do you USE the money at all?


You still have a debit card that you can make purchases anywhere with.


Simple was/is a dressed up version of a prepaid debit card with a good mobile app and a good web ux. Typically prepaid cards net $1-$4 per active user per month depending on the level of fees. An active user is someone that has loaded cash onto the card. So if Simple had 100,000 customer which could translate into 100,000 loaded cards, its gross revenues would be between $100K-$500k per month (1.2-6m per year). My guess is the 100K number is simply customers that ever signed up for it and that their active accounts (loaded cards is much much lower). Kudos to the Simple board, investor and team - selling at that sort of price is unbelievable. I would happily work with any investor who could help me get that sort of valuation for my companies.


I use simple as my main bank account, and I'd say it is pretty innovative - essentially because usability is a feature and simple has by far the best usability of any bank.

What lets them down is the overall power of their offering and the rate at which they have been developing it. If the banking backend was the constraint, maybe this will help them to accelerate.


Yes on the slow development rate. I pretty much signed on to their mailing list as soon as they announced themselves. After hearing nothing for over a year I gave up and switched from bricks and mortar to ING (now Capital 360) which solved most of my issues, so my motivation to go through the bank changing hassle is now really small. I think it took something like 3 years to actually get the "you can now use us" email.


Entrepreneurs used to start banks knowing they were building a lasting institution.

Banks have survived hundreds of years, through hardships like depression and war, long after their founders were all gone.

Now the business model is "shop around for a buyer if your growth isn't high enough in the first five years."

Kind of sad.


> The big potential in this space is building a new banking platform from scratch, instead of relying on existing/legacy technology.

It's likely nearly impossible to build a bank from scratch because of regulatory hurdles. That's why Simple had to team up with a partner bank instead of going it 100% alone. I remember reading a blog post from Simple about it, it seemed they had no choice to partner with an existing bank (if I find the post I'll share it). The banking system is broken on purpose. This is why banks operate like it's the stone age and get away with awful service and fees - there's little chance of nimbler competitors coming along and eating their lunch.


Another piece of the puzzle is that a single new bank isn't going to have it a whole lot better when it comes to interbank stuff (probably they have it worse, having to build useful relationships).


> Another piece of the puzzle is that a single new bank isn't going to have it a whole lot better when it comes to interbank stuff (probably they have it worse, having to build useful relationships).

Interbank transfers -- wire and ACH -- are processed through central clearinghouses. You just show up with a copy of your bank charter, pay the fees, and you're now on equal terms with any other bank when it comes to moving money around.

The hard part is getting that charter in the first place. Just two months ago, the Bank of Bird-in-Hand, Pennsylvania became the first new consumer bank to be chartered in the United States since 2010. One bank, in the past three years. It was huge news in the banking world, even made the Wall Street Journal and the Financial Times. It's an Amish bank -- they have a drive-through lane for horses and buggies.


They had to spend $800,000 just to get approved. http://lancasteronline.com/business/new-bank-of-bird-in-hand...


Okay, that means that it won't be any harder for them, but their money transfers will still be just as bad as everybody else.


Not so sure. In the UK we had Metro Bank a US funded startup bank, started a couple of years ago.


It's been a long, hard slog for Metro Bank. To date, they've raised £641m (that's over $1bn) in investment and racked up total cumulative losses of over £130m ($220m).

And don't forget Metro didn't build their own platform - they outsourced all their technology.

Despite their apparent enthusiasm (see links at the bottom of this post), I don't think VCs are ready to sink over a billion dollars into a single startup, even if it is a bank. They're looking for billion-dollar exits like Facebook and Whatsapp, not a $1bn investment with a $100+bn exit.

VCs Start Pining to Own a Bank - http://www.bankinnovation.net/2014/02/vcs-start-pining-for-a...

“I am dying to fund a disruptive bank.” - Marc Andreessen - https://twitter.com/pmarca/status/432651247909208064


I'm pretty sure the more awesome VCs, like hn-user pmarca at a16z, would have no problem writing checks for $100mm+ to fund a team to fix banking. The other day they were actually bemoaning the lack of people trying to do so.


link? Or are you referring to "Why BitCoin Matters"?


twitter.com/pmarca about 5 days ago. It's painful to search, but related to this conversation thread: https://twitter.com/Shotz018/status/435568470093070337


It was not innovative in terms of technology. It was innovative in terms of design. Which can be just as big of a leap forward.

Sure, it would be awesome to rebuild a bank from scratch, but that doesn't mean there wasn't innovation here.


Of course it's innovative. They built a better mousetrap. It's not disruptive per se, but almost nothing else is.

What is a bit sadder is that they weren't able to stick it out until they started building their own platform.


I always wondered how Simple would acquire non early-adoptor customers. It seems with BBVA there is a natural channel to international markets and millenials.


I agree 100%.


I really, really, really want to use Simple.

But they don't have joint accounts, so my wife and I would have to go through a lot of trouble to use their service. It's interesting to say that they are not able to expand as fast as they wanted when they are missing this HUGE feature. Not having this feature has kept me from using their service ever since I received a very early beta invite.


I'm in exactly the same boat. Very early invitee; basically have no use for it without joint accounts.

I transferred a few hundred bucks to Simple when I signed up and finally moved that money back out just last week. I'm done waiting. :(


Simple just recently added free instant transfers between Simple accounts. Not as convenient as a joint account, but that's good enough for my wife and I to make the move to Simple.


Does your wife have her own income? My wife is currently a student and I would have to manually transfer money to her account quite often because there would be no other deposits into her account. Can you auto draft between accounts?


There doesn't seem to be a way, no.

I'm on a similar boat. She manages certain budgets, so every pay check I make a few instant transfers (so I can categorize/track on my side) and that's it. And if she uses her account (debit card) for other stuff outside the budget, I just instant transfer.

The real problem would be if both earned an income, as there would be no way to "share" a goal. (A feature which Simple is supposed to be working on.)


No she doesn't, but I'm going to have some part of my direct deposit go into her account and use the instant transfers for any one-off transfers.


I'm a Simple customer, and I'm getting married in March. The lack of joint accounts has been a concern for me for the past few months. I was really hoping they'd announce something soon about their plans on that regard.

But with this news that they're being acquired, I now have even less hope than before. I love Simple, but I'm now wondering if I'm going to have to find a different company to give my business.


I suspect being acquired by a bank makes it easier, not harder, to do things like joint accounts.


But Bancorp supports joint accounts. I used to have a joint Perkstreet account which also was just a layer over Bancorp.


Then it's either Simple, Simple's state of incorporation, or their specific agreement with Bancorp. Whatever it is, the IRS says it's not them.


Same here; we use it for our separate accounts, but the primary joint account has to remain at a more traditional credit union. They even sent out a notice to all customers regarding tax returns – the IRS requires joint returns to be issued to a bank account listing both names.


That one actually baffled me - it's in direct contradiction to the IRS FAQ on the subject.

http://www.irs.gov/Individuals/Frequently-Asked-Questions-ab...

> If I am filing a joint return with my spouse, must our refund be deposited to a jointly-held account?

> You can ask IRS to direct deposit a refund on a joint return into your account, your spouse’s account, or a joint account. However, state and financial institution rules can vary and you should first verify your financial institution will accept a joint refund into an individual account.

Not sure if it's a state, Simple, or Bancorp policy, but it's not an IRS one.


I can't imagine a life wherein a joint account is not insanity.

Why not have one account for each of you? Simple has instant account-to-account internal transfers.


Many couples would find it just as annoying as having separate refrigerators and simply transferring food between the two before withdrawing and eating it.


Well aren't we fortunate that holding two separate accounts in a relationship is nothing like this at all!!


Account-to-account internal transfers is relatively new and they did not have that feature when I was approved from the beta.

But, account to account transfers does not solve the problem at all. I don't want to have to transfer money from my account to my wife's account manually. It's so much easier when she can just access a shared account and move money as needed.


When I moved to my current job a year ago, I shut down my business and closed a checking, savings, business checking, and credit card account with Bank of America. I had a Simple invite sitting around, and thought it made sense to consolidate and...Simplify, making my single Simple account my sole bank.

I couldn't be happier with that decision, and believe that I have been saving money (in both fees and in general) because of Simple's interface.

So with this news, I feel excited for their team, but still very nervous. I joined Simple precisely because I was tired of dealing with a megabank (like many folks here), so if Simple can continue to buck the trend and stay customer-focused and agile, then I'll continue to be all-in.


When I was a kid without a bank account, a 401K or other investments to worry about, I used to put my money in envelopes: one for a new bike; one for a video game, etc. I could glance at my cash and know exactly what was safe to spend without performing mental math.

Simple's Safe to Spend feature is the digital equivalent. I can aside money for rent and emergencies in digital envelopes. I never thought personal finance was fun and easy until I began using Simple. It changed the way I think about money.


The problem is I use credit cards for reward points and I only pay them off once a month. It sounds like you can only get budget reports for money you've spent on your Simple card. Correct me if I'm wrong. This wouldn't be too helpful to me. The budget tool would be awesome if it encompassed all my cards.


I really want a nice envelope budgeting debit card, but for my purposes Simple wasn't it. Most notably, if you mark a transaction as coming from a specific goal, and the amount of the transaction is more than the goal, the goal gets set at $0, and there's no way to determine what the balance was before you marked the transaction. You can unmark the transaction, but at that point you'll actually have more in your goal than you did previously.

Basically I want Simple but with a richer transaction history. It doesn't have to be as cumbersome as a full double-entry account system, but it needs to have roughly a similar level of account history.


I'm not a Simple customer but the way I do this at my fuddy-duddy bank is having a separate "spending" account and a "bills" account (two checking accounts). Every week I "pay" myself into the spending account from the bills account (spending is basically food + gas + shopping). Paycheck goes into the bills account which at the start of the month has enough to cover all expected bills for the remainder of that month.


Sounds similar to YouNeedABudget. It's switched the way I think in a very similar way.


I've been using Simple for well over a year now can say that the software and website are absolutely amazing at monitoring and tracking your money. It has its flaws though: transferring is pretty much limited to automated mailed checks and accounts you own (they recently added simple to simple instant transfers), and no B&M banks to get things like large cash withdrawals (I do fee-less cash advances at another bank when I need money) or cash deposits.

With that said, I'd actually prefer a quicker integration with BBVA with hopes that their backend banking infrastructure would improve, but I wish they had done it with a more prominent US bank with more branches (BBVA has very few).

Edit: want an invite? Email in profile.


I'm a Simple user and occasionally the lack of checks has been a problem.

One specific incident that I had was that I needed a cashier's check to close on my house, but I didn't know the exactly amount until a few days before closing. I paid $50 to have them overnight the check. The check didn't not arrive overnight and I ended up having to chase it down at a FedEx hub so I could have the check at closing.

During this whole time, I had a chat with the SAME rep. I had a whole long conversation that lasted over two weeks regarding how to get the check, asking for the check, talking about problems with the shipping, and even getting a refund for the overnight shipping.

This is what was amazing to me. The same rep was tied to my conversation. When I had problems with Comcast, every time I called I talked to a completely different person and I had to explain my issue over and over again (even worse I often got dropped during a transfer and had to call back and do it all over again).


It's a problem with online only banks also. I was in a similar situation with a closing, needing a cashiers check from usaa. I had to wire the money instead. Does simple allow for wire transfers?


I checked and it seems they accept wire transfers, but you can't send them :(


I was one of the early customers of Simple. When I received their card in that lovely cardboard with a rubber band on, I was hooked. I really wanted to move to Simple.

But did not. I mean I still have an account a few hundred dollars in it, but I have never found a reason to use it.

My main account is a combination of Credit Union and Chase. Chase's mobile App does all that I need, and the credit union staff are so fantastic, I have stayed with them for 15 years.

In addition Chase comes through for "serious" banking stuff like wire transfers, LoCs etc.

All the best. I still have the cardboard they sent me as an example of how something simple can be lovely.


I've enjoyed my experience with Simple, but the complexity of actually getting money onto the dang card was a huge turn-off. It just took way too long and the reasoning for the issues came across like a glaring incompatibility between the banking industry and startup culture as a whole. Why did I need to pay myself via Square just to get a few hundred bucks on my card? And why did it take 12 hours to show up? And why, if I do a bank transfer, does it take more than a week? I hate to say it, but when you're called "Simple," there shouldn't be that many hoops.

And while the app was impressive and offered a lot of smart thinking, Capital One's app is not so far behind what the company's doing as to make it a total downgrade to use the big bank's app instead. And unlike Simple, I can easily deposit money anywhere and most of it is available to me immediately.

Simple is awesome for spending money, but the problem was that there was really no good way to deposit it. Perhaps the bank buyout could help make that issue a little less painful.


Wait a second, name one bank that does it better in the US. The problem is the US banking system is in the dark ages. The bullshit that we put up with in the US is unfathomable in Europe. If you hand someone a check (cheque?) in the UK they look at you like you're from 1957. Why? Because banks provide a modicum of modern service. Bank transfers are fast, cash machines are free, debit cards are secure, etc etc. Of course people complain about banks equally as they do in the States, but that's only because they don't realize how truly asinine banking can get.

Now even though I've live in the UK since 2011, I opened a Simple account and it's been a breath of fresh air. The transfer to and from my other accounts is far simpler than any of my other US accounts. Also, I can receive wire transfers for free (imagine that, receive money for free!? The Wells Fargo founder must be spinning in his grave at the sound of that). Contrast this with the old experience of calling up a bank and saying I want to transfer money to another account and they tell me I have to call the other bank, because ACH is a "pull" system.

Sorry to get off on a rant, but Simple is the best of the best in my opinion as a customer having dealt with at least 10 different banks over the last 20 years in both the US and UK.


Please see the part I said about there being a "glaring incompatibility" between startup culture and the banking industry. I'm not saying it's Simple's fault. I'm saying that what it's offering (easy to use banking done mostly from your phone) is ultimately beholden to all the stuff it loses from not being a traditional bank (long delays between transfers, no easy way to deposit a check). And that ultimately holds back Simple's promise.

The banking system sucks and is way behind where it should be. Simple, for all the amazing stuff it does, exposes some of those huge faults by tripping into them. And in many cases, they're problems they simply can't avoid because of the way the system's set up now.

I hope Simple becomes more successful and uses its corporate parent's clout to fix these problems once and for all.


I deposit money in two ways: 1. Direct deposit from my employer, 2. I use the mobile app to scan a check I write to myself from my other bank account (limit of $3000) (another option I haven't used, is just to mail a check to them) 3. Use external account transfers to pull money in from other checking accounts.

I've used all three of those methods and they've all worked just fine for me.

The biggest issue I've had is the inability to write a check, which doesn't come up often but often enough I have to have a separate bank account for that.


More than a week for a transfer sounds weird; I've done a bunch of transfers to and from Simple and it's the standard ACH time (2 or 3 days I think?).


In the UK it now takes seconds with the faster payments scheme (most banks participate).

http://www.fasterpayments.org.uk


Shutting down in 1..2... Despite what the CEO says, I don't see how Simple is going to see the light of day in a giant that manages $800+ billion in assets...too bad, the prospect of a new type of banking was something I was actually excited about.


I'm not so sure. BBVA is hardly a household brand name - they might be quite happy to use Simple to gain a foothold.


>the prospect of a new type of banking

...

>The acquiring company, BBVA, is a 150-year old financial services corporation

I think that was the problem.

I predict they kill it within 6 months, either overtly or by halting all development.


Or maybe they acquired Simple to gain next-generation online banking for their own customers. If they were feeling very ambitious, they could take further advantage of Simple's bank abstraction layer to license the system to other banks and/or credit unions -- a sort of online banking-as-a-service.


Probably. I'm having a bad day. I still won't be surprised if it grinds to a halt though.


The killer for me is that it didn't seem to have a way to track spending from my credit card. To get the benefits, I'd have to give up my rewards card, and the rewards and customer protection are more important (to me) than a clean interface.

Maybe this acquisition can help that.


I've enjoyed banking with Simple over the past couple years, but if they move my account to BBVA, I'll be leaving for a credit union.

http://en.wikipedia.org/wiki/BBVA#Criminal_charges:_money_la... http://en.wikipedia.org/wiki/BBVA#Connection_to_drug_syndica...

I know most banks have some skeletons in their closets, but BBVA seems to be less ethical than average.


I signed up for Simple because of the pretty video and app and I was hooked. I now spend everything from Simple and just use my old Wells Fargo account for recurring bills. It's a beautiful app, has a cool goals feature, and alerts you right away how much you just spent, which is helpful for verifying your receipts. Their customer service is like WP Engine status and you can chat them right away. Their transaction categorizing it 10x better than Mint. Mint puts 1/3 of my stuff as uncategorized.

I only hope they don't go the way of Mint, even though they're two different products. Has Mint improved any features at all since they were acquired?


Has Mint improved any features at all since they were acquired?

Not really. I looks pretty much the same to me as when they started and it certainly looks the same as when they were bought, five years ago.

I'd be very interested in knowing how many product and engineering people still work on it. (if any…)


Well, they added the nice "feature" of bugging you sign up for partner offers, whether loans, credit cards, or whatever.

So: changes, yes. Improvements? No.


> Well, they added the nice "feature" of bugging you sign up for partner offers, whether loans, credit cards, or whatever.

That was the whole business model that Mint was based upon. They'd give you the service for free, and make money on lead-generation.

When they were a startup, they could afford not to be quite so annoying about it. Now that Intuit owns it, they can no longer keep burning cash. They have to show that they can make a profit. If lead-gen won't do it, then they'll have no choice but to start charging.


Most of the original team is gone. We have a startup that is trying to innovate and fill the gap in this space. If you're interested, check out https://www.budgetsimple.com


Mint categorizes most of my stuff correctly, it can take a little learning for it to know what services are tied to what category. Also, I see Simple and Mint as different services. At least how I use Mint, I track all of my income and expenses through it (loans, cards, investments, etc...), while simple just handles a single bank card. While there is some overlap in functionality between the 2, I don't see them as the same.


Yea, Mint is the aggregator of all of your accounts into one platform so it's pretty cool in that regard, although there haven't been many improvements since 2008.

The absolute best thing about Simple is their goals, I just got into them and they really reshape your thinking about planning your money for future goals. What makes them better than Mint is that they actually hide your money in your goals every day


Early user of simple here and, while their design was excellent, there was little else to recommend them. Plenty of other banks offer no-fee atm access and have apps. Those banks, unlike simple, reliably process transactions. They went down more than once, which meant my card was declined. The customer service rep was nice when he told me their servers were down. No advance notice. It would be nice to have a bank that, you know, works.


This criticism is silly - they are a startup and you should know what you were getting yourself into. Plus, credit cards in the event it's down?

I myself never experienced downtime and they've only gotten more reliable, better customer service, and more features.


If the product wasn't in beta, why shouldn't you expect reliable service?


It is reliable! Growing pains happen. Downtime happens. Expecting five nines from a little startup, even when it's out of beta, is silly!

I've built three companies now and it is really hard! Balancing up-time, product development, customer support, and bug fixing is difficult. I'm sure interfacing with legacy banking systems made it even worse. If it were down all the time (the way Reddit was during their major growth phase) then I would agree, that is an issue. But they are not and were not - insignificant downtime is not something to criticize, there are other more constructive things to criticize about the product which is consistently evolving anyway.

It upsets me to see people on HN get up on their soapbox and say demoralizing things about trivial issues (that are part of the life of a growing product) of little startups that are doing well, continuously improving, and doing their best.


I have a simple account, and I don't find it hard to budget money or track, nor really use the bank interface to do much than paybills.

I really found it as an unnecessary layer.


BBVA client here.

This is surprising to say the least. The BBVA online banking is a prime example of a forgotten service to their clients. The .pt website will often output errors in Spanish.

Not sure if I should expect the tech to trickle into existing services, one can hope. It seems to be a nice deal for BBVA to expand to the Americas and for Simple to get in Europe.


If you're in need of a new bank, Schwab is pretty great on a couple of fronts (and hilariously awful on others.)

The good:

1) They have great customer support. You call and get a super-nice, helpful real genuine person in Colorado or Arizona, 24/7. 2) They refund all your ATM fees from any ATM anywhere (this is maybe mostly a big deal in New York where cash only is still a major thing) 3) If you have an IRA with them, they have a suite of index funds which are well-regarded, and which you can trade for free.

The bad:

1) Their website is pretty awful, but also totally usable. 2) They have some restriction for their checking like you have to sign up with $5k or direct deposit or get an IRA or something, I don't remember. This didn't matter to me though, because I needed an IRA and use direct deposit anyway.


Another +1 for Schwab. They're truly awesome.

The con you listed isn't exactly accurate. You don't need an IRA, or direct deposit.

In opening a bank account, they automatically open a brokerage account, in doing so there is no minimum balance in either account. No direct deposits required, no IRA, no requirement to even use their brokerage accounts.

Real cons I've found: 1. You have to actually mail in a form to set up electronic transfers to other bank accounts (either your own or someone else's). After learning about square cash I no longer find this to be an issue. 2. You can't do international wire transfers directly from the bank account. You can however transfer the money to your brokerage account and do the wire transfer from there. 3. If you initiate an ACH pull from another bank account you have they place a 3 day hold on the money. Annoying but can be avoided if you can use an ACH push from the other bank.

And the pros: 1. They do refund all ATM fees, including foreign ATM fees. This was extremely useful when I was in Japan which is cash only and where I was getting hit with $15 ATM fees. 2. They also absorb the fee Visa imposes on foreign transactions (both currency conversion fees, an the Visa cross-border fee of approximately 1%). 3. Unlimited free checks, free return envelopes for sending in things you have to mail them. 4. Customer service so good I always put down the phone smiling and elated. I've never been transferred to another person when dealing with them!

All in all I highly recommend them unless you need to make cash deposits, or need to make international wire transfers frequently.


Schwab has been the only bank I have ever dealt with, and I have no intention of moving away. They are a professionally run outfit with focus on all the right things.

As mentioned, the customer service is stellar. I have never had to be on hold much more than a few minutes and the person on the other end has always been engaged and knowledgeable, all the while remaining totally professional. I think this image of them was cemented for me when I found that their hold "music" was that Friday's jobs report!

The website is not great on the usability front and some things are placed in questionable locations. The search functionality is also frustrating and obtuse many times. The same is true of the mobile app. However, they are functionally more than sufficient and work perfectly fine. And, worst case, you can always just call them or do the online chat.

I think they are on the more expensive side as a brokerage, but their integration there is satisfactory (that being said, I am not an active investor)

They also don't nickel and dime you on things. I was amazed when I found out that other banks charge for getting extra checks and a checkbook. Admittedly, checks are in less and less use these days, but you still need them sometimes. Schwab offers unlimited checks for free. Spare debit cards may be charged, but I am not sure. I have not lost my debit card (yet!)

The bank side is located in Reno, NV, so any checks have to be mailed there. However, this isn't entirely true. Schwab does have physical locations to serve their brokerage clients and since the Checking account requires a brokerage account (although it doesn't require it to be funded), you can still use their physical locations to deposit and withdraw money, and then move it around online or on the app.


> The bank side is located in Reno, NV, so any checks have to be mailed

You can use the smartphone app to deposit checks just by taking a photo now, actually.


That's true, and I completely forgot that you can do that. In fact, that's how I last deposited a check!


There is no fee for replacement debit cards.


I really love my experience with Schwab as well, and have been with them for a long time. Last I checked, the major restriction on their checking account is that you also need to open an investment account, but neither one has a minimum deposit so the overhead isn't actually super substantial.

There are some interesting feature gaps in what they let you do on the site, that occasionally mean you might have to send them a physical letter or fax (!), but on the whole I'm pretty content with the functionality there as well.


Wow. I closed my Bank of America account and have been depending on Simple alone for a while now. I was really looking forward to seeing Simple flourish on their own, but hey, congrats to them! Let's hope for the best here.


By the time I finally got a Simple/BankSimple invite, the online features and offerings from my local/regional bank (Frost, for those of you in TX) matched "close enough" to what Simple was offering at the time that there wasn't any advantage to moving everything over and leaving a bank I've been with for 18 years. Sure, the UI's not as pretty, but that's not everything.

I still have the account, and like my USAA one, transfer money into it every month as a secondary emergency fund in case something happens with my Frost account and I get locked out over a weekend.


Frost's UI/UX is no where near Simple's, IMHO. My girlfriend was using Frost for a long time, saw me using Simple, and wanted to switch over immediately - super happy since. Since then every mobile banking app I've had to use (ATFCU, Chase, Citi, and BofA) is ridiculous. Bad design, limited functionality, no concept of UX (BofA's mobile app at least has it together but their webapp is stupid).


I fully agree that Frost's UI/UX is nowhere near Simple's, but it lets me do what I need to do online, and I can deposit checks via my Android phone now. Good enough.


Funny, usaa has a pretty good mobile app, with check scanning (unfortunately they only allow that if your military + credit card).


I know I should be happy for them but I'm sad. It's rare to find a company in the bank/personal finance space executing at such a high level consistently. Also, I have never seen a great company in this space continue to be great post acquisition.

Commerce Bank and Mint have been mentioned already. I'll also add Outright which was a great little app acquired by Godaddy.

Nature of the beast I suppose...


As a Simple user, I want them to stay exactly the same, as the contrast they offer to almost everything else out there is outstanding.

But as an outside observer, I hope they grow like crazy. The amount that the banking industry needs to be shaken up to the point of near-destruction (preferably without the taxpayers having to bail them out) cannot be understated.


I recall reading (and no, I can't find a source now, sorry) that Simple had a lot of trouble initially because they weren't a bank in many of the ways that you need to be a bank in order to work with other banks.

So hopefully this will give them the 'establishment' they need along with the independence to keep innovating. Hopefully.


This could be a great move for Simple. It could allow them to execute really quickly on the core product and user experience, while giving them access and expertise to backend banking support. Staying independent meant the latter was more challenging than any engineering/product problem they could want to solve.


I got excited when I got my invitation long ago, but it came out to be an expensive service for me - expensive, as to use it, I had to part with my 1.5% cash back (which totals to over $1K per year) from my PayPal Debit Card. Same with other similar services like Moven, Serve, GoBank, and the rest.


I don't see why anyone would use Simple for Banking. They don't pay any great interest rates at least not that they advertise and their features are equivalent to what you can get with CapitalOne360 formerly ingDirect but those guys will pay you interest on your deposits.


Looking at the numbers, if you have $10,000 in your checking account, CapitalOne360 Checking pays .2% APR while Simple pays 0.01%. With $10,000 in your account, that's a difference of $19 / year. To me, that's negligible. Especially with inflation being an order of magnitude higher than both.

https://home.capitalone360.com/rates https://www.simple.com/policies/rates/


There is no minimum balance at Capital One 360 to get 0.2% interest.


Neither is there a minimum balance for Simple, unless I'm missing something.


Do you get good interest rates anywhere? Last time I checked at banks I think checking accounts had .06% and even a long term CD was around 0.9%.

I'd be better off just playing the market at that point (or using something like betterment/wealthfront to hold most money).

Simple is nice because the interface/app are solid and they have incredible customer service. The only other thing I'd want from them is a decent rewards credit card.


The best I've found are with Ally -- 0.85% for a MM account and 0.25% for a checking account. Still pretty meaningless, which is why, despite banking with Ally, I keep a sizable amount of my money in Betterment.


Credit Unions in my area (Portland, Or) have checking accounts that pay 1.0%-1.5%. No interest from Simple is the main reason I don't use them.


Based on your average monthly balances in checking, is this really more than a few thousand a year? To me, the Simple app is worth at least that.


If you have 120k with an interest rate of 1.0%, you are basically losing out on about $3.33 a day. In one year, you end up losing out on the amount of money you would need to buy a nice UHD monitor. It's simply not worth it, IMO.


Who keeps $120k sitting in checking earning 1%? That's underwater against inflation.

I am baffled by anyone who peaks their checking account beyond 30-40k.


Sure, a capitalone360 Checking account will give you 0.85% for certain balance minimums.


"Certain balance minimums" in this case means over $100k. Until you get over $50k it's only 0.20%.


I am a customer of theirs. It's quite limited, and I don't think I can recommend it unfortunately. They're nice people and their support is peerless, but people don't tend to choose a bank on those criteria.


The interest I receive for my day to day bank account is pretty meaningless. I use simple because of their budget tools.

I'm sure CapitalOne has "budget tools" marked off of some internal checklist but imagine it's pretty crappy.

Giving up a few bucks a month in exchange for a great budgeting tool is the reason I use Simple.


No, but I don't choose a bank because they have budget tools, you can easily use Mint for that for free if you need that sort of thing.


Mint is terrible compared to having the budgeting tool directly integrated with your banking account.


How so? I efficiently budget with Mint. It's able to consolidate all of my family's accounts and seems to do a great job at categorizing.


Mint has never worked for my wife. When she's out looking to spend all of our money she doesn't want to be bothered trying to open up mint and get a current snapshot of our finances. She also doesn't care about our 401k or brokerage accounts.

The only thing which has worked is the Simple app that by opening it tells her exactly how much money she can spend without sabotaging her savings goals.


I don't want interest on my deposits. I want a simple bank where if I put X money in, I can take X money out. That's it.

I would use it, but I can't because I have a working US visa and they only let you make an account if you're a US citizen.


Every single bank allows you to do what you want.


Sorry, I should've clarified. I want that and _only_ that. I don't other things that typical banks offer, because they create complexity where I want none and waste my time with spammy offers that I'm not interested in. I don't want to be using/understand only 5% of my bank's capabilities.


I keep a few hundred bucks in a Simple account just so I get access to more ATMs. Other than that, they've been pretty underwhelming. A slick smartphone app doesn't make up for all their other lacking features.


That's my point, you can get free access to AllPoint ATMs with a capitalone360 checking account and they pay interest and you don't have to worry about multiple bank accounts. Which is why I'm surprised anyone would bother with Simple.


Yeah but that slick phone app means you find out immediately when $.02 of interest is added to your account. Hard to overstate the importance of that, you know.


They had a fancy interface, but that's about it. I'll stick with my credit union that I know won't try to fuck me over.


I have had Simple for a couple years now and really love it. This makes me sad. BBVA and other international and even national banks like them are the scum of the earth. Already in the process of closing my account.

So. Sad.


This isn't actually surprising, to me. I'm indirectly with BBVA through SmartyPig, which is pretty in line with Simple as well.

Good deal to the Simple team, I hope this works out for everyone involved well.


I love simple. I just wish they would address concern related to how they invest my money. For example, I would prefer that they give their customer the options to invest our money for things that that we approve. For example, I want my money to be invest in local communities instead of building nuclear power plants.

Of course, if you want your money to build nuclear power plant and move large scale jobs abroad, then I support that as well. The point is to give us option on where our money get invested. I have called simple.com a few times, and it looks like it is something that they are not thinking about right now. I hope with the new investment they would start thinking about the larger pictures of how the money they collect is invested.


I've never heard of a bank offering such a thing, and it sounds like a horrendous nightmare to manage.


I guess you are right, because it has NEVER being done and it is really hard to do, we shouldn't do it.


Banks don't have incentive to build nice interfaces for their users, because they're a State-guaranteed oligopolized cartel.


For a company so invested in disrupting banks, it's sad to see them going to a massive global conglomerate.


Let's hope they don't go down the toilet like ING direct did after Capital One acquired them.


Shame it wasn't by Coinbase.


Love Simple. Congrats to the team, well deserved. Please keep it simple!


A 150yrs old financing business acquires Simple, an innovative financing business.

Now, you want to make me believe that Simple will stay innovative and that this acquisition is best for the user?

Yeah, right.


despite being 150 years old, from what I've heard about BBVA, they seem to be making a real push to be innovative. They've fairly recently moved all of their staff onto Google Apps which is an interesting move.

The way I see it, someone has looked at their online/mobile banking, and said "what can we do better here? what are other people in the industry doing?" and seen the way Simple operates, and the general satisfaction of their customers.

It'll be interesting to see what happens from here


Ouch


Simple is a great example of how someone can go into an old, broken industry, make a company that would not be considered a tech startup, and still scale rapidly and change the industry. Bravo!


How have they changed the industry?




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