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Customer Obsession: The Chime Way with Zach Smith, SVP of Product, Chime

May 21, 2020

I had the honor of co-hosting a Menlo Ventures Product Assembly Dinner with Zach Smith. He shared the lessons he learned throughout his career as a product innovator. Because the dinner was a gathering of product managers across the product community, we wanted to share the overall learnings with a broader group.

Chime, the fastest-growing company in the U.S. challenger banking segment, is a technology company focused relentlessly on helping members achieve financial peace of mind. Their DNA is opposite that of big banks, which profit when you overdraft. Chime doesn’t charge fees, gives you access to paychecks two days early, helps you grow your savings automatically, and keeps you updated on your spending and account balance. When you sign up for a Chime bank account, members get a Chime Visa debit card, a spending account, an optional savings account, and an award-winning mobile banking app that helps keep them in control. The Chime mobile app is available for iPhone and Android devices and has been featured as one of the best money management apps on the App Store.

The Chime story hits a personal note for me. When I was three, my parents fled the instability of mainland China to chase the American Dream. How they thought they would be able to achieve that with only $20 in their pocket is beyond me. Not because I didn’t believe in their ability to hustle, work hard, and grind their way to success, but because of the lack of financial infrastructure in place that would give them a platform to save, invest, and borrow—the atomic components in building financial stability. In San Francisco, you can barely find a good meal for under $20 let alone try to open a traditional bank account with that amount. Yet, the story of my parents’ struggle to find a stable financial foothold in their new world is not a net new one. The median worker’s income in the U.S. is $34,000. Sixty percent of Americans have an hourly job. Two-thirds of Americans don’t have a college degree. Seventy-eight percent of all Americans live paycheck to paycheck. What this suggests is an imbalance between the financial services the majority of Americans require and the current options available to them. Had Chime existed when I was growing up, I think about the life-changing ways their products could have helped my family secure financial stability and freedom. What is clear is that Zach and the broader team at Chime are building for the future—where the vast majority of Americans have a real chance at financial peace of mind.

I’ve been extremely fortunate to spend more time with Zach over the last few months. Zach is everything you would want in an innovator and friend. He’s extremely entrepreneurial at heart, having sold his first company Boomerang to Groupon at age 26. At Groupon, he launched one of the most profitable businesses, Groupon Coupons, before leading all mobile product development. While extremely analytical, he’s able to distill complicated topics into the simplest terms (and with great gusto as well!). He’s the life of the party (having been crazy enough to allow me to host a 30-person dinner in his living room—pre-COVID of course!). Yet, what’s the most striking about Zach is his deep empathy and passion for others. An investor in Tecovas and 305 Fitness, he’s always been crazy passionate about building for large and overlooked communities. It’s quite obvious why Chime has been the perfect home for him for the last 3+ years. The more time I spend with Zach, the clearer it becomes how foundational customer understanding and obsession are to the heart of product decisions at Chime alongside overall company culture. Even the way Chime talks to its customers is unprecedented. Just take a look at Chime’s Instagram and you will get a sense of what I’m talking about.

Chime’s Instagram — Engagement per post is 10x the norm!
Chime’s Instagram — Engagement per post is 10x the norm!
Bank of America’s Instagram
Bank of America’s Instagram

I think of Chime like a friend and a coach, providing much needed emotional financial support. It truly understands the member’s POV and engages with them accordingly.

But how do Chime and the product team under Zach go about this customer obsession?

In one of our early conversations, Zach and I covered the list of other incredible companies that operate this way. Take ServiceTitan (a platform for home service businesses) as an example. The founders Ara Mahdessian and Vahe Kuzoyan lived with their first customer for a year(!) and would take conference calls out of his office (a pest control company). Jeff at Amazon is famous for always keeping one empty chair in meetings to represent “the customer’s voice.” While Zach and the team at Chime are not relocating into customer homes or metaphorically finding creative ways to represent the customer (at least to my knowledge), they have implemented an extremely systematic way to incorporate customer values.

The Chime way is continuous, uninterrupted engagement with the customer.

In an average week, Chime’s research team interviews up to a dozen members and surveys thousands of current and prospective users. This connection with the customer forms the core of the discovery process that informs nearly every product initiative. The conversations can be generative and open-ended or focused on specific themes the product team is trying to fine-tune.

Some of Chime’s latest features and offerings were insights derived directly from customer feedback. For example, Chime’s no-fee overdraft feature SpotMe came directly from customer requests. And during COVID-19, Chime aggressively expanded its SpotMe program to give certain users access to cash before government stimulus checks arrived. The team had originally piloted the program by offering 1,000 users a SpotMe limit up to $1,200. About 500 users had accepted the offer, using $150-$300 on average. As a result, the team expanded the program to ~100,000 users and upped the SpotMe limit to $200 to help users suffering from the coronavirus-induced recession.

This level of corporate dedication is unprecedented but severely needed. In March alone, over 10 million Americans filed for unemployment benefits. With the majority of Americans having little to no savings, this will inevitably create extensive hardship. As always, Chime is doing its part to help and not without significant risk to itself. As CEO Chris Britt has stated, “We’re putting real dollars on the line, without interest rates or guarantees. We’d love to give it to more people. If we had greater certainty that the payments will hit our accounts, we’d do it.”

By listening directly to the customer on an ongoing basis, Zach’s team is always in lock-step with customer needs. But it’s not just the product teams on the phone! Zach opens these calls to the rest of the company. User research, marketing, engineering, member support, designers, you name it — all join regularly. As a result, the entire organization is constantly calibrating to customer feedback.

Chime’s dedication to customers extends beyond interviews and feedback. A ritual unique to Chime is Greenheart Day, which is a day employees commit to customer support. Every single employee at Chime (from developers to accountants to executives) is trained in member services and for one day out of the year, they work the frontlines in answering customer phone and email inquiries. Nothing solidifies customer understanding like having to answer to customers directly and continuously.

Lastly, Chime’s customer-obsessed culture is only possible through the incredible people they hire. Zach says they look for people who can convey—in very authentic ways—a desire for impact while showcasing the empathy and product instinct to create innovations where they have no prior expertise. As Zach says, “There is no amount of research that replaces the multiplier that is human empathy and intuition.”

Creating impact and improving the lives of their members is the underlying motivator for Zach and the Chime team. It centers and baselines every single conversation, every decision. As a result, customers love them for that. You only need to spend a few moments with Zach’s team to realize the incredible amount of customer love they receive. Customers write songs, share videos, and share heartfelt stories about how Chime has changed their life for the better.

The Chime way, the customer-obsessed way has changed the lives of millions of individuals. Because of Chime, everyday Americans can put gas in their car when they’re low on cash, and the $33B in overdraft fees charged by US banks may well be a thing of the past. The Chime way is about empowering customers to have a voice and a platform to improve their financial lives. It’s about collaborative discovery and empathetic solution-building. It’s about building with the belief that the future should not be limited by financial instability and that everyone deserves the chance to pursue opportunities. At Menlo, we could not be more proud of the team and mission behind Chime and look forward to continuing to build toward that future together. Because at the end of the day, the American Dream was meant for everyone.