“Bank Zero failed to deliver on the hype it promised when it launched,” said one banker after the neobank was bought by Lesaka Technologies for R1.1 billion. This comment appeared in a News24 article that summed up the news with: “Bank Zero has disappointed, with only 40,000 funded accounts after seven years.”
I’m not sure I would agree with the editorialised “disappointed” comment, nor the banker’s assertion that it “failed to deliver on its hype”.
This is a neobank that just sold for over the R1 billion mark to make it a bona fide start-up unicorn. That’s not failing to live up to “the hype” in my book. It’s a pretty remarkable feat to have built a functioning neobank, with all the long-winded regulatory approvals, get 40,000 bank accounts and over R400 million in deposits. Then, they were bought by an innovative business trying to reinvent payments, Lesaka.
Cue all of the “zero to hero” headlines that have appeared after the sale became public. They are all well-deserved. With “only” R400 million and 40,000 accounts. And bought by a Nasdaq-listed payments powerhouse in the making.
I often lament that people who build things – iPhones, bank apps, printers, and courier services – just don’t use their own products. Or, as a Microsoft executive once described it to me, “We eat our own dog food.”
If they did, they would fix the obvious user experience mistakes and numbskull time-wasting extra steps. I know Bank Zero’s founders use the app because it is filled with the intuitive and obvious enhancements you’d expect if the folks who built it still used it. I know this because I open accounts on all the banking apps that are launched. My favourite banking apps are Bank Zero and Discovery Bank, whose AI enhancements, account-hiding, and 911 features are world-class.
Meanwhile, the unimpressed banker, Radebe Sipamla, a co-portfolio manager at Mergence Investment Managers, added: “Perhaps in more focused hands under Lesaka, it can do better, as I think Michael Jordaan was likely dedicating more of his time to Rain than Bank Zero.”
As it happens, I know one other person, besides Jordaan, at Bank Zero from her days at FNB. Lezanne Human is a modern-day everywoman and a trained mathematician who found herself in banking. I’ve had some of my most interesting discussions about mathematical advances and testing the theoretical limits of human understanding with Human, who mentioned her mathematical obsession the first time we had met, at an FNB-sponsored art fair. Because I was fascinated with the biographies of physicists and mathematicians and the advances of science (I read a lot about scientific discoveries, even if I don’t speak maths language), we have stayed in touch.
Read More: Bank Zero taps in with Apple Pay
Over the last few years, I’ve interviewed Bank Zero CEO Yatin Narsai many times. He’s smart and driven. Like Human and the other high-ranking FNB refugees who built Bank Zero with sweat equity, they have nothing to do with Rain – arguably one of the most innovative mobile operators in the world (which doesn’t even sell airtime, the voice-based progenitor to the WhatsApp world we all live in now). But that’s a topic for another time.
I sometimes worry that I use too many adjectives in my columns – a specifically verboten subject for the journalism lecturers at Rhodes University who taught me the first draft of news writing. Journalists are meant to be objective, never subjective.
But those adjectives are appropriate for Bank Zero. It is worthy of superlatives. How do I know? I drank the Kool-Aid earlier this year and moved my business account to Bank Zero. My conclusion: I’m an idiot for taking so long. Also, it’s free.
Bank Zero is everything I need for my small business bank account. Once it enables a few more features, I will move Stuff’s account over too. Although Bank Zero is rudimentary compared to my former Big Four bank, and only available via mobile app, it’s all I need.
Also, it is “good enough.” This is a concept I have been extolling for the last 20 years about why innovation in Africa is such a successful model for the rest of the world. “Who needs all the bells and whistles when all you want is the steam train?” – to recall the steam-powered age when that metaphor was invented.
Moving to Bank Zero has been one of the best business decisions I have made in years, I feel. I just saved my small business a bunch of money by using something “good enough” to do my banking for free.
How do I know I made the right decision? A really innovative, forward-thinking financial services company called Lesaka Technologies just bought them for over a billion rand and turned them into a unicorn. I’m happy with my business choices. Also, it’s free.
This column first appeared on Business Live.
