Gary Dolman: Starting with the customer

Gary Dolman was the chief financial officer at challenger bank Monzo. He started his career at PwC as a chartered accountant, working in London and Australia, before spending time at a series of major investment banks – including ING, ABN Amro and Japan’s Mizuho Group. Disillusioned with large banks, he decided to turn his hand to start-ups and helped form Monzo in 2015.

How did Monzo begin?

We started with the belief that a lot could be done if we weren’t restricted by legacy IT. We thought we could offer people a far better deal than they were getting from the major banks.

Initially, we decided we would only offer a retail current account rather than selling a multitude of products. We focused on setting up the basics and getting a banking licence. Ahead of that, we launched a pre-paid card, which we could do without a banking licence. We thought it would be a good way to test the product and to get our name out there.

We thought we might be able to roll out 20,000 cards but the thing took off like nothing on earth. By the time we completed our licence application, we had 400,000 accounts. We set about converting those into current accounts. Today, Monzo has around two million current accounts.

Monzo quickly became 'cool' - was that deliberate?

It wasn’t a conscious thing, but it was more about the nature of the product. It was ground-breaking in the banking industry. We started with a group of followers that were really ‘into’ technology, who liked that we were taking on the big banks. We got a bit of 'cool' from that. The 'hot coral' card was also popular. People felt they were buying into something.

What was different?

It was all about giving our customers the type of information they wanted in a way they understood. We put artists and designers to work, ensuring that they started with a blank sheet. What would a bank statement look like in an ideal world? Too often, when we looked at what banks were providing, it didn’t meet customer needs.

We hadn’t started out from the same point, with legacy systems. Instead we had started with customer expectations. We wanted to start with the customer experience and build out. We considered what an ideal bank statement would look and feel like. It needed to be easy to understand.

How did you find the transition from the corporate world to being an entrepreneur?

As an entrepreneur, every week feels like the most important week of your life. Working in a large corporate is more like a long-distance steeplechase – the obstacles are fairly well sign-posted and you can prepare for them ahead of time. Being an entrepreneur is more like a sprint with hidden hurdles – you’re never quite sure what’s coming round the corner.

Coping with growth was a real problem. At one point, we were growing at 4% a week. That meant we needed to be growing our customer operations capacity by 4% a week and that’s really difficult to do. It was a huge challenge.”

Why did you move away from the business?

I retired from the business earlier this year. I’d done five years end to end and wanted to pursue a range of activities rather than being dedicated to one company. I recruited my successor, took time to hand over and then stepped away.

I’m now spending time on a small portfolio of things including advising and mentoring business leaders and chief financial officers.

Given your time again, would you do anything differently?
I’d have done it all a whole lot sooner. I’d say to anyone at the start of their career, have a go at start-ups. Pick one you believe in and give it a try.

Do you believe the industry is fully disrupted?

Yes, it is disrupted. There was perhaps some scepticism at the start about how well this would do but two million customers is more than a flea-bite on the industry. Looking at Lloyds, Barclays and so on, they are often copying things that Monzo has done. In the early days, it was like they were patting a child on the head and saying ‘there, there’ but now they realise it’s really working and they need to respond.

However, I really believe this disruption will continue. It has reached a wider group than you might think. The parents of millennials often use it because it’s the easiest way to move money between themselves and their offspring. The more people use it, the better the product becomes.

DISCLAIMER
By necessity, this briefing can only provide a short overview and it is essential to seek professional advice before applying the contents of this article. This briefing does not constitute advice nor a recommendation relating to the acquisition or disposal of investments. No responsibility can be taken for any loss arising from action taken or refrained from on the basis of this publication. Details correct at time of writing.