Entrepreneur

Online banker Simple, once among Portland’s most promising tech companies, is closing down


Online banker Simple, one of Portland’s most prominent tech businesses for the past decade, is shutting down as part of its parent bank’s own sale process.

Simple notified employees of the pending closure Wednesday and told customers Thursday, calling it a “strategic decision.” Simple told clients it will transfer their accounts to BBVA but set no timetable for the change.

In November, BBVA announced it would sell its U.S. business to PNC Financial Services Group for $11.6 billion.

“We’re focused on the things that make the most sense for the company’s future whether on a standalone basis or a potentially combined basis with PNC,” BBVA said in a written statement Thursday. BBVA is also shutting down two other financial technology services it owns, Azlo and Open Platform.

Founded in 2009, Simple moved from Brooklyn to Portland two years later amid a renaissance in Oregon technology entrepreneurship. It was instantly among the city’s most prominent tech businesses, promising a consumer-friendly, no-fee approach to online banking.

Simple sold in 2014 to Spanish banker BBVA for $117 million and never found its footing under the new ownership. The company struggled to compete as larger banks adopted many of the convenient online banking features Simple helped pioneer.

The company faltered as it tried to resolve a central tension over whether it was foremost a bank or a tech company. Simple laid off 10% of its staff in 2017 and replaced nearly its entire executive staff. Nine months later, founding CEO Josh Reich quit.

“I suspect PNC is prioritizing their existing online banking tech,” Reich tweeted Thursday. “I’m saddened for the closure but happy for the journey and the lasting change that Simple has had on the global banking world. Customer experience matters. Great teams matter.”

READ  Pittsburgh's tech leadership expresses concern over visa suspensions - New York Business Journal

Simple has been among Portland’s largest tech employers. Its current staff numbers 220, according to BBVA, 80% of them in the Northwest.

BBVA didn’t announce details of Simple’s dissolution or the fate of its Southeast Portland office, at the east end of the Hawthorne Bridge.

“There continue to be many details to address as part of the entity’s wind down,” BBVA said in Thursday’s statement. “As we work through regulatory approval and integration plans, our longer-term staffing needs will become more clear.”

Simple embodied both the aspirations and disappointments of the Portland tech community in the years after the Great Recession. Capitalizing on mobile technology, social networking and cloud computing, Simple was among a new generation of hopeful Oregon startups that ended the Silicon Forest’s historic dependence on hardware manufacturing.

Others from that generation included Jive Software, Urban Airship (now Airship), Elemental Technologies, Puppet, Jama Software, Janrain and Act-On Software. They collectively attracted hundreds of millions of dollars in venture capital and hired thousands of people.

All endured their own share of setbacks, though, and none grew into a really large company. Some still operate – Puppet says it hopes to go public this year – while others sold to larger tech businesses that continue to operate in Portland.

No big new tech company has emerged in Oregon since the 1990s and the old ones are steadily vanishing. The $8 billion sale of Wilsonville-based Flir Systems, announced Monday, leaves just two publicly traded technology companies in Oregon.

Simple’s dedicated customer service and a commitment to helping its clients save money, rather than spend it, differentiated it from larger, more establish banks and earned it a devoted following among customers.

READ  How a Google reject built a $160m company and sold it to Google

Online, there was an outpouring of disappointment from some of those clients Thursday.

— Mike Rogoway | mrogoway@oregonian.com | twitter: @rogoway | 503-294-7699





READ SOURCE

Leave a Reply

This website uses cookies. By continuing to use this site, you accept our use of cookies.