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Flying high: Starling founder Anne Boden
At the stationery counter in Fortnum & Mason's store three days before Christmas,
a middle-aged woman was fending off questions from customers who assumed she was a shop assistant.
They were not to know that Anne Boden is the only woman in this
country ever to have founded a bank, or that she was trying to take a
call from a Bahamas-based billionaire to secure £48 million of funds.
On that fateful day five years ago, Boden had slipped out of
her offices in Mayfair and was wandering round the ornate halls of the
store on London's Piccadilly when her mobile phone rang.
The news was better than she had dared to dream.
She had secured a funding deal for her fintech banking business,
Starling, from Austrian-born investor Harald McPike.
Boden had flown to the Bahamas to meet him earlier that year, expecting to raise £3 million at the most.
But after a grilling lasting three days in his offices and on board his luxury yacht, he agreed to put up far more cash than she had hoped or expected.
The deal allowed her to forge ahead with her vision of creating a
fintech firm, which she says will break the mould of British banking.
The moment was all the sweeter because just months earlier, it looked
as though a feud with a much younger male colleague was going
to oust her from the business she founded.
The story is recounted in excruciating, raw detail in her book, Banking On It, which reads as a cautionary tale for any female entrepreneur to watch her
back.
Boden, 60, and Tom Blomfield, 35, formerly Starling's chief
technology officer, were an unlikely partnership from the
start. The pair looked like, as she says in the
book, 'the establishment banker and the tech dude'.
'It was interesting to see people's assumptions about us,' she
says.
'In fact, I am the tech person, I am a computer scientist.
Tom's a lawyer.'
In the midst of a tense struggle to line up funding in February 2015, Blomfield tried to force her out in what she describes as an attempted coup.
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Such was her shock at the turn of events, she actually considered stepping
down, going so far as writing a resignation letter, before
realising Blomfield wanted her to take personal responsibility for the company debts.
At that point, she decided to 'take back control'. Blomfield and other key members of her team were
out, and Boden found herself back at square one.
'That was my low point, when I had to start again,' she says.
'If Tom had been Tanya, would there have been a coup?
Probably not because the culture would have been more inclusive.
I wasn't expecting it, I thought of him as a protege,
not a rival.
'Lots of people asked me how I managed it, how did I deal with it, where did I
find the resilience.
I almost gave up, but that was not an option.
'The idea people's careers are a seamless success is a myth.
On the surface they may seem to have perfect careers and a perfect existence,
but life isn't really like that.'
Boden secured a funding deal for her fintech banking business,
Starling, from Austrian-born investor Harald McPike, pictured
Boden picked herself up and Starling now has 1.7 million accounts in total, including almost 1.42 million retail accounts and over 256,000
small firms, with £4 billion of deposits and lending of
£1.5 billion, most of which is through government-backed schemes.
The bank has raised £263 million from McPike and Merian Global Investors, and £100 million from an RBS fund to boost competition and innovation in banking.
In a trading update recently it said it had broken into profit,
making £10 million on an annualised basis.
'We will already be profitable by the end of the year,
' says Boden. 'As the number of customers grows our cost
base stays the same.'
She poo-poohs the idea of selling out to a bigger bank and is
planning instead on listing Starling on the stock market.
Blomfield went on to co-found rival Monzo, which has warned that
the pandemic has created 'significant doubt' over its ability to continue as a
going concern.
Corporate dramas and yachts off the Bahamas are all a very long way from Boden's early life
in Swansea.
An only child, her father was a steelworker and her
mother had a job in a department store, but business
acumen ran in the maternal line.
When women master technology they tend to rise to the top very quickly because they have greater empathy
'My mother worked in the store but she had lots of
businesses including a car hire company and a
builders' merchant.
My grandmother was a very capable woman who built a few houses and rented them for an income. My grandmother
and my mother were entrepreneurial. To me that was normal.'
Boden's first exposure to the world of finance was when she ran her school's bank
at the age of 11.
She went on to work at a string of conventional lenders including Lloyds, RBS and Standard
Chartered before striking out on her own, leaving Irish bank AIB in 2013 to set up Starling.
She chose the name because the birds are sociable, adaptable and friendly - but also like to flock into new territory and knock rivals off their perch.
Starling operates through an app on customers' smartphones,
and is therefore able to operate without the expensive legacy of branch networks and creaky old IT systems.
Boden is not the only woman at the top of her industry. Female bankers
are having a moment.
Two of Britain's big six lenders - RBS and TSB - are run by women, Alison Rose and Debbie Crosbie.
Does Boden think they will make a difference?
'Yes. The women getting these jobs are very, very good.
They have to be. They read what's going on in the world through a different lens.
Women are not arrogant, thinking we know everything.'
Starling operates through an app on customers'
smartphones, and is therefore able to operate without the expensive legacy of branch networks and creaky old
IT systems
Boden backs Rose's efforts to support female entrepreneurs,
particularly in tech.
'People invest in people with a similar outlook and background to themselves.
In the technology space, the venture capitalists tend to have been tech entrepreneurs and they tend to be men.
It is odd that people think tech is something a man does. I have always thought tech was quite feminine.
It is all about maths, structure being neat, the
beauty of code.
'When women master technology they tend to rise to the top very quickly
because they have greater empathy.'
She is convinced the mainstream banks will accelerate branch closures due to
the pandemic.
'It is like the move from the High Street to Amazon,' she says.
There is also a move away from cash and debit cards.'
'People are using phones or mobile wallets. The question is, if cash becomes obsolete, what happens to the vulnerable?
We have an obligation to bring them along with us.
We have customers into their 90s who are very good at using technology, it
is a canard that above a certain age people can't use
tech.'
As for negative interest rates, 'no, we shouldn't go there,' she says, adding:
'The big bank systems can't cope with negative interest rates,
the tech is really difficult to change.'
As for coronavirus, she says: 'There will not be a
banking crisis but there will be a jobs crisis.
We have to get a shape of an economy where there are enough jobs in businesses
that are sustainable in the future. I think
it will take to end of 2021 to 2022 to recover, but the push to digital will make companies
to be more efficient.'
She hopes the pandemic will encourage Britons to get on top
of their finances, whether they are among the lucky ones able to save during lockdown, or the less fortunate who have struggled.
'Just start saving a bit at a time.
I find it really sad when people get into competitive spending on things they
don't need, but it is equally sad if they are obsessed with
savings and spreadsheets. Money is there to be enjoyed.'
Banking On It: How I Disrupted An Industry
by Anne Boden is published by Penguin, price £20.00 hardback.
Also available on Kindle for £9.99.
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