In the Familiar Faces series, our Target Accelerators Program Managers check in with companies who have participated in one of our Target Accelerators programs. This is a chance to dig in and learn more about each company’s growth since completing their Target Accelerators experience and our way of continuing to root them on every step of the entrepreneurial way. Welcome to Familiar Faces.
Checking in with Branch, 2016 Target Tech Accelerator alum
Atif Siddiqi is the founder and CEO of Branch, the fintech company that partners with employers to accelerate payments and empower working Americans. Businesses turn to Branch for a more cost-effective, faster way to pay employees and reduce the costs of paper checks and paycards. Employees that sign up with Branch can receive a zero-fee bank account, free instant access to earned wages and digital reimbursements, and auto-budgeting tools to help them manage their cash flow between paychecks.
Atif started the company in 2015 as an Entrepreneur in Residence at Idealab, an incubator based in Pasadena, California, after seeing technology for hourly workers had not changed since his first hourly job. As the application gained traction among employees across the country, Branch was selected to participate in the inaugural class of the Techstars Target Retail Accelerator program. Continuing its growth in Minneapolis, Minnesota, Branch has been honored with a Webby Award, Fintech Breakthrough Award, Gartner Eye on Innovation: Financial Services, and Star Tribune’s Top Workplaces in Minnesota. Atif has been recognized as one of Employee Benefit News’ Top 20 Digital Innovators in Benefits and EY Entrepreneur of the Year: Heartland.
Target Accelerators: Atif, thanks for reconnecting; congratulations on all of your accomplishments and growth. Branch completed the 2016 Tech cohort with Target Accelerators. Thinking way back to then, what motivated you to join the program? How has what you learned during the cohort influenced how Branch has grown since?
Atif: I started Branch to help hourly workers grow financially. We did this first by providing an easy way to pick up shifts and earn more income. We wanted to create a great user experience that wasn’t readily available in enterprise technology and something that workers would actually enjoy using. We began offering Branch as a free application, and it spread pretty widely across the US, including a significant number of Target locations.
Because of that traction, we connected with one of the team members in Target HR who invited us to apply to the inaugural accelerator program. We got in, and as part of that program we were able to learn from all parts of the whole organization, from the C-suite to store managers. It was a fantastic experience because we learned how to take the critical mass we had grown at large companies organically and scale this out within the enterprise. It also allowed us to dive deeper into the challenges of this workforce, including the tie between work and finances.
Since then, we’ve focused on creating financial technology that meets the needs of hourly workers and other workers living paycheck to paycheck, reimagining financial services from the ground up. We’re able to reach these workers by partnering with employers and businesses who are looking for a way to accelerate pay for employees at this time. The program also led us to relocate the company from SoCal to the Twin Cities. We’ve grown from a team of three to over 90 employees.
Target Accelerators: What have been some of the more challenging aspects to growth? What advice could you offer other founders based on your learnings?
Atif: When we first launched, we were educating companies and enterprises about the challenges hourly workers were facing and how increasing flexibility was key in attracting and retaining them. There was also concern around smartphone adoption and hesitance around having employees use their own devices. The market is just catching up now, with the pandemic reinforcing how essential this workforce is and accelerating the need for digital payments and financial flexibility.
Another challenge was navigating working with large companies. How could we best service those companies without getting distracted or losing focus of the product direction and vision? As a startup that lands a large customer, you often want to do everything possible to make the customer happy, oftentimes this includes a lot of customization requests from the customer. The challenge becomes not taking up a lot of resources, and making sure it’s not derailing the product roadmap and company focus for just one large customer.
Target Accelerators: 2020 has certainly been a challenging year for business as we knew it; how has the fintech industry evolved to tackle the new normal? Branch specifically?
Atif: The fintech industry had already been working to address a lot of the problems that arose during the pandemic, such as cash shortages and slow payment methods. The events in 2020 only accelerated those needs, and luckily we were prepared to help address these issues readily. For example, we had launched our digital wallet in October 2019 in partnership with Mastercard and Evolve Bank and Trust in order to become the first earned wage access provider to provide early access to earned wages instantly, at no cost to the employee or employer. It’s always been a goal to provide employees as many fast, free options as possible. This better positioned us to apply and expand our faster payments technology to other use cases, such as digital tips and mileage reimbursements.
We’ve been able to help employees and employers during this time too. Especially with the increased demand for food delivery and most ordering with credit cards or apps during the pandemic, we were able to partner with employers like Domino’s franchises, whose payment systems didn’t necessarily have the quantity of cash needed to pay employees tips immediately after each shift. Since we don’t require an employer to pre-fund payments, we’re able to get the payments to employees quickly and help employers maintain their cash flow. We found this applied to other industries such as salons, where we’ve offered digital tip disbursements to stylists at salons like Supercuts and Costcutters right after each shift.
Another aspect that had been growing before the pandemic was digital banking. Hourly workers are underserved by traditional banking options, and with the pandemic, had less reliance on physical bank locations. We were able to offer them fee-free banking services and contactless payment options to better meet their needs, as 76 percent of hourly workers had increased their use of contactless and digital payments because of COVID- 19.
Target Accelerators: As a leader, how have you kept your team motivated and focused on a growth mindset despite the challenges of the current environment?
Atif: A growth mindset is one of the qualities that we value in every Branch employee. Natural curiosity and adaptability are traits we look for in candidates, so that growth mindset is pretty clear early on in the hiring process. That was definitely put to the test in 2020, when we shifted to an entirely remote-first culture. Before, we had a mix of in-office and remote teams, but most of the team had been working from our Minneapolis office. We realized that we would be working in this environment for a long time and could improve on processes and how we communicated. We redefined our culture and communication practices, and the team has been really great at embracing that.
The team has also been great at prioritizing, as the pandemic impacted on the types of verticals we focused on. Especially when it first started, we really had to evaluate where we were seeing strong demand, where were companies growing, and which essential workers were going into the workplace. It’s been a collaborative effort, and I’m really proud of the way our employees have adapted quickly to address these challenges.
Target Accelerators: So, what’s next for you and Branch?
Atif: We want to continue to address the obstacles hourly workers face and help them grow financially. One of the major ways we’re doing that is by expanding our partner network.
Technology platforms have seen a growing demand to provide this type of value add and we’re excited to partner with them at no cost to them, the employer, or employee. We’ve been able to show that if you solve for the challenges with workers, it has a significant impact for their employers. We’ll also continue to evolve the platform and create more tools to modernize how employers pay their employees.
Another priority this year is continuing to foster financial wellness and addressing what that looks like since the pandemic. We’ve fostered financial wellness by offering the ability to access funds faster and eliminating unnecessary fees so that employees can grow their account balances over time. Especially as the pandemic has impacted employees’ hours and challenged how they meet their financial goals, we’ll dive deeper into how we can provide them the tools to help better meet their needs.
And personally as a founder, I hope to keep continuing to grow the company and maintaining a strong work culture. We were among the top workplaces in Minnesota, a competitive region for top employers, so that was a really great honor.
To learn more about Branch, visit www.branchapp.com.