“People want services that are both digital and sustainable” — A Q&A with Michael Schweikart, co-founder, Tomorrow
“People want services that are both digital and sustainable” — A Q&A with Michael Schweikart, co-founder, Tomorrow
Michael Schweikart is co-founder of Tomorrow, Europe’s first digital sustainable banking platform and a certified B Corp. After launching a not-for-profit that linked refugees with jobs, he turned his attention to financial services, partnering with Inas Nureldin and Jakob Berndt to start a completely digital current account committed to being a sustainable option for customers.
Why did you start Tomorrow?
Over the course of our careers, my co-founders and I have seen how money moves the world, but not always in the right direction. Banks use our money, the cash we have in our accounts, to invest and support organisations that do not have the best interests of the planet at heart. Since the Paris Agreement in 2015, banks have invested US$ 2700 billion into fossil fuels — they aren’t slowing down the destruction of the planet. So, how do we change that? As consumers, we can take our money elsewhere, but there needs to be somewhere else to take it.
At the same time, we saw a number of start-ups disrupting the overall user experience of banking. So, we thought, wouldn’t it be great if we could combine a great UX with a way to have a genuine impact on our finances.
That’s why we launched Tomorrow.
How did you meet your co-founders?
I wanted to start a company that would have a positive impact. I started in corporate finance, working for a management consultancy, before moving to Berlin to immerse myself in the start-up ecosystem. While I was there, I launched and ran a not-for-profit platform, connecting refugees with jobs. We did a lot of good, but it was hard to scale, constantly be chasing grants, and secure funding. It made me realise that while I wanted to have an impact, sometimes you need money to do that.
I started talking to my network about starting something new, and it happened to be that Inas was doing the same thing at that time. My flatmate knew us both so introduced us. We met for coffee, and it was definitely a case of co-founder-at-first-sight, or whatever the business version of love-at-first-sight is. The connection was such that, when Inas needed to move to Hamburg for family reasons, I decided to follow him so that we could work together.
We realised that, while we had many complementary skills, we needed someone who could cover marketing and communication. Another contact put us in touch with Jakob, who had been intending to take a rest after launching his previous business, but once we met, we really hit it off and he fortunately decided to join us as a co-founder.
What is Tomorrow’s mission and vision?
We want to make it easy for people to have a positive impact on their finances. We do this by providing a digital, sustainable current account for consumers. When you bank with us, the money in your account is being invested, but only into social, sustainable, and ethical bonds. These bonds finance climate protection, affordable housing, clean water, helping small farmers — various projects, and good causes that contribute to improving life on the planet.
Ultimately, we want to be Europe’s largest sustainable bank.
You mentioned user experience — what do you offer that other banks don’t in that space?
Part of the issue with banking right now is the lack of transparency. If I use a traditional provider, I have no way of knowing how the money in my current account is being used. Even with newer options, which might come with an app and a dashboard, it doesn’t show me much. With a Tomorrow account, customers get an impact board within the app, so they can see in real-time how their money is being used, where it is being invested, and what the impact is, as well as all the functionality they would expect from a state-of-the-art mobile current account.
2020 has been a hell of a year for everyone. From a founder’s perspective, how has it influenced your approach to growing a business-like Tomorrow?
I think from a personal perspective, I’m a little more cautious. I’m more aware of how quickly things can change. We spent a lot of time finessing our plans to see us through the year — I was rewriting 2020’s by the end of February, and each month it feels like something new has to be incorporated, or we need to reiterate. I definitely see the value in being flexible and agile, which we were, but I think we’re much more focused on that as a business this year.
We’re much closer as a team as well. We’ve had to do more with less resources, and I think while that’s restrictive, it also forces us to be more innovative and efficient. We’ve also seen that this year has accelerated a lot of issues we focus on, particularly the digital user experience and sustainability. We’re truly digital, both in what we offer and our business model, and as a result, our customer growth is exceeding our initial expectations. People want services that are both digital and sustainable.
How has that informed your plans for 2021 and your overall strategy?
Our aim for the next year is to grow our customer base significantly — currently, we have 47,000. This will cement our position as we look to add new services and product lines. Those include asset management and sustainable investments. That might seem like a strange move — I think the natural assumption is that our customer base would be younger people wanting to act in a more socially conscious way, but we have a complete range of people, from 18 years old up to 45 or 50, and the average is 35. They want to invest, and they want to do so in a way that is sustainable and transparent.
What’s one piece of advice you’d give to new founders or people thinking of starting a business?
It’s actually two pieces of advice — always work on your business model and get started as fast as possible. You need to have a really good idea that you’ve tested and worked out, but then you need to get going with the flexibility to change it if needed. We’re a good example of that — we originally planned to start with investments before moving into retail banking, but it became clear that the platform to do that was too expensive, so we switched our priorities, and now we’ve built our customer base and shown there’s a real demand for our products. That means we’re now in a much stronger position to offer investments.
How important has the relationship with ETF been to your growth?
It’s been vital — not just with the investment we’ve received, but as a sounding board for ideas and management challenges. The ETF team are perfect sparring partners and people we trust when they offer their perspectives. Fintech is an incredibly complex and dynamic space, as it should be, so the value-added support has been helpful. We want to build a great business, and ETF’s advice has been a great asset on our journey.
