Jon Gaskell and Mike Ferrari worked for 16 months to develop SmartyPig as an application enabling consumers to save for a particular goal and let others contribute to the account. It's partnered with Iowa-based West Bank, and has worked to ensure the project meets federal AML and security standards.
BTN: SmartyPig has been live for about a year now, how has it gone?
Mike: Literally within three months of going live we had customers in all 50 states, that was very exciting for us, primarily because we don't do any advertising. We really utilize social networking, social tools like Twitter, our blog, Facebook, to get our word out and we have built an incredibly loyal following that really takes it upon themselves to help spread the word.
Perhaps the most exciting aspect for us happened about a month or two after we launched and we were contacted by a very large financial institution in Australia, ANZ, they were extremely excited about what we were doing.... Within a few months after that we were able to launch SmartyPig successfully in Australia. It was extremely exciting to us because we saw the future potential of global expansion for the idea.
BTN: What lessons can bankers take from this?
Jon: I believe banks need to be more innovative, not only in the back room but up front and show their customers that they embrace big thinking and blue sky and that it's going to show in their products. People are looking for something new, something that's going to give them a lifeline of sorts, that's the whole idea behind SmartyPig, about helping people take that first step.
BTN: From a tech perspective, what's the coolest thing about SmartyPig?
Mike: As a platform we have developed a true banking application. So when ANZ approached us and wanted to license the product we weren't tied to our US banking partner's technology platform. ...The cool feature of SmartyPig is that you can make your goals public, [and these are] interest bearing savings goals that your friends and family can contribute to. This is something that was brand new to the financial space. In fact, it was something so new that we had to sit down with the banking regulators and the FDIC to walk them through exactly how we were going to approach this.
BTN: Was security a worry?
Mike: Absolutely. The security, things like anti-money laundering, there's obviously a host of issues that we had to address very seriously. It took us 16 months to develop SmartyPig for a reason. I think part of that is first and foremost online security was paramount to what we were doing.
Jon: I wouldn't use the term worried. They were very interested in how we were going to make this work and fall within FDIC guidelines. They were very interested in making this work, and it was definitely an exercise in endurance to make sure everything was ship shape.
BTN: What kind of advances can we expect to see going forward?
Mike: The first one is we have a lot of customers using site aggregation tools like Mint.com, Wesabe, Yodlee and Geezeo, so we are working hard to make sure that SmartyPig can also be integrated into these user accounts. The second is a mobile application, that would be focused primarily on some of the newest technology coming out like the iPhone and the new Blackberry. And finally we've heard from a number of customers a desire to enhance SmartyPig for things like charity fundraisers.
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