BBVA’s decision to hire a former Amazon executive to lead the online-only bank it acquired in 2014 could return Simple to its roots as a true alternative to traditional financial institutions.
David Hijirida joined Simple this week as its chief executive, taking over from Dickson Chu, who had been interim CEO since May. Hijirida had worked at Amazon for 11 years in various roles within Amazon Web Services, advertising and payments after stints at Washington Mutual and FleetBoston.
Observers see him as passionate about putting consumers at the center of digital experiences. One said the move bodes well for Simple’s future after a rocky three years.
“That principle will serve him well as he seeks to right the ship because he'll have to re-establish a value proposition for Simple that differentiates them from traditional banks (like BBVA) and the increase in online-only competition,” Jim Perry, a senior strategist at Market Insights, said in an email.
Simple has faced challenges since its sale to BBVA. Josh Reich, Simple’s former CEO and co-founder, acknowledged in a company blog post upon his departure in May that Simple failed to uphold its “product-driven” vision.
“From 2014 through 2017, we were primarily focused on infrastructure projects,” Reich wrote. The projects were “important projects that we had to do as a business, but did little to directly help our customers.”
Reich said Simple would strive to be more innovative this year. It has already introduced more budgeting and savings features for its account holders in 2018.
It's not clear how many such accounts there are, however. Neither BBVA nor Simple has disclosed the number of active customers. Estimates range from as little as 33,000 users in 2014 to roughly 3 million accounts today.
Simple also endured layoffs last year when the company terminated 33 employees, but claimed it would offset those losses with new hires in other areas. In the blog post, Reich said Simple was acting more like a traditional bank than a technology company.
“Simple as a firm has had some trials and tribulations in recent times," so this hire is "perhaps an attempt to take a look at what an outsider can bring to the organization,” said Jacob Jegher, senior vice president of banking and head of strategy at Javelin Strategy & Research.
The hiring of Hijirida continues a trend of banks turning to other industries to bring fresh perspectives to digital strategies, Jegher said.
And poaching an executive from Amazon makes sense, given that the online retail giant is seen as a good example of customer care and digital innovation.
Banks are “asking themselves, or should be asking themselves, about what nonbanking experiences are like,” Jegher said. “The benchmark for consumers” is coming from areas outside banking.
Simple did not respond to a request for comment from American Banker, but Chu said in a press release that Hijirida’s background played a role in his hiring.
“We worked hard to find a leader for Simple with the right and rare combination of financial services knowledge, a track record of delivering great products, and a work ethic that aligns with our values,” Chu said.
The press release went on to say Hijirida “will helm an ambitious agenda of product launches slated for 2019.”
BBVA gave no specifics, but Perry said Simple will have to compete beyond a current 2.02% APY promotion for its savings account.
“We both know that a rate strategy will be matched by others,” he said. “Hijirida will have to find new ways to retain customers who have become disenchanted post-BBVA and find a new way to make consumers believe that Simple can live up to its name.”
