Looking back, I wish I had done it sooner.
You can still pick up traces of his Brooklyn accent, but don’t let that fool you: Vince Passione has been on the cutting edge of experimenting with new ways to use the internet for banking since before the term cyberspace ever entered the popular lexicon.
Passione was raised in a tough, Italian immigrant neighborhood in New York, long before anyone thought Brooklyn would turn into a haven for hipsters. He picked up valuable life lessons along the way and inherited his family’s work ethic. He started working when he was 13 — and has kept up a frenetic pace ever since.
After college and a 10-year career at IBM, Passione got involved with early internet-based finance projects, working closely with both the former CEO of Citigroup and then the founder of Ameritrade. But by the middle of the last decade, Passione was ready to do his own thing, and he subsequently helped to evangelize a new concept: a cloud-based lending-as-a-service platform that ultimately became LendKey.
The company, which started in 2009, has since struck partnerships with hundreds of banks and credit unions to help them conduct digital lending, including programs for private student loans, student loan refinancing, and home improvement loans. We caught up with Passione to learn the backstory of a typical guy from the neighborhood with a very atypical resume.
Q: You’re a product of 1970s Brooklyn. What memories stand out for you?
I like to joke that I spent 18 years trying to get out of Brooklyn and now everyone wants to get in. I grew up with my three sisters in a four-story brownstone in the Redhook section of downtown Brooklyn. My family lived on the top floor, my grandparents lived in the middle floor, and my aunt and uncle occupied the two bottom floors with my six cousins. Every house on my street was family owned, so we referred to them by their family names and not by their street addresses.
Q: What did your parents do?
My mother was a homemaker and my father was a New York City policeman. He worked two, sometimes three jobs, to ensure that my sisters and I could attend the local Catholic school.
Q: The Brooklyn you knew was a lot different than present-day latte and croissant Brooklyn.
Brooklyn wasn’t gentrified back then, but it was a very interesting place to grow up. The neighborhood was comprised of guys like my dad, who were policemen; along with firemen and longshoremen who worked at the Atlantic port unloading cargo ships. 1970’s Redhook Brooklyn was an Italian American neighborhood where entire families lived together in a single brownstone which gave it that small town feel. It was also a tough place to grow up, with more than its fair share of organized crime and drugs. It was my “Bronx Tale,” and it taught me a lifetime of lessons that have served me well to this day.
Q: When did you realize you had a knack for tech?
I was always interested in technology. My dad bought me electronics kits and I learned to build things like ham radios. Popular Science was also standard fare. I just enjoyed it. When I got to high school, the guidance counselor told me about a technology summer internship being offered at Polytechnic University (now Tandon Engineering School at NYU) for high school sophomores. I spent that summer learning differential equations and FORTRAN, and working as part of a team that modeled the 911 NYC Police response system. I enjoyed it immensely.
Q: After college, you went to work for IBM.
I loved it. It was a dream job.
Q: But it was also a big organization. And then you went to Citigroup, another big organization. How did the idea of doing something more entrepreneurial come about?
It’s a long story. I was an IBM systems engineer in a group supporting Citigroup, which was then building its own ATM network. John Reed was chairman at the time and he was sponsoring a project to replace the company’s entire ATM network infrastructure with products developed by IBM. The program took three years to complete and turned out to be a big success. I was recognized by the bank and IBM for my contributions and was later promoted to business unit executive in charge of IBM’s business relationship globally with Citigroup. Eventually, Citi got tired of me selling to them and I joined them as chief technology officer of the US Consumer Bank. One day, I received a phone call and was asked to report to the chairman’s office. He explained his vision for an internet bank and said he wanted to incubate this idea away from the bank. It was my responsibility to select the right technology partners and integrate their systems to help build what would be a brand-new bank. This was the 1990’s version of fintech partnerships and being an “entrepreneur.”
Q: How did it turn out?
We launched the bank in 1999. But not long into it, Citi announced a merger with Travelers. I spent the next three months in transition meetings where I got to meet Sandy Weil, the former CEO of Citigroup, and Jamie Dimon, currently the CEO and president of JPMorgan Chase. In one of those meetings, I was asked to review the technical architecture for Citi Financial Interactive, Citi’s internet bank. Sandy had major concerns that what we had built would disintermediate the Salomon/Smith-Barney brokers. The merger took its toll on many areas of the bank, and when John Reed resigned, I decided that it was time I try my hand at entrepreneurship.
Q: How did you eventually connect with the company that later become LendKey?
I became an angel investor in 2008 and was asked by the partners at Gotham Ventures if I was interested in meeting some companies in the peer-to-peer student lending space. The Great Recession had basically destroyed the lending markets and several startups were exploring ways to get wealthy individuals to fund student loans via a peer-to-peer lending model. This was also the beginning of the “bank disruption” movement. I liked the space, and one particular company, LendKey, had completed a significant buildout of a new loan origination and servicing system. I did not believe the peer-to-peer funding model would scale and agreed to invest in the company if we pivoted into a platform that would enable banks and credit unions to enter the digital lending market. We were contrarians who believed that banks and credit unions might actually adopt new technology and avoid being disrupted. The rest, as they say, is history.
Q: As you look back on your career, what’s been the biggest surprise about the way things turned out?
I never thought that my dream job would turn out to be an entrepreneur . I wanted to be six feet tall and play second base for the Yankees. I’m five foot seven.
Q: You didn’t start out with that idea that you just had to start a company?
No. In fact, once I got to IBM, I thought I’d work there until my retirement ceremony 35 years later when they hand out the Rolex. I never thought that I’d ever leave that company.
Q: What changed for you?
I got the entrepreneurial bug while building out the internet bank for Citi. Many of the companies that we partnered with were startups, and I admired their founders for their vision and willingness to risk it all for something they believed in. I never saw myself taking that kind of risk, but once the Citi project was over, it seemed like the next logical step for me in my career. Looking back now, I wish that I had done it sooner.
Q: What’s the craziest thing about you that your employees don’t know?
Probably that I teach snowboarding in the mountains — especially at the age of 56. I also love to get together with the guys I grew up with and play poker. We have been doing that for over 30 years and it keeps us connected.
Q: Is there a favorite quote you try to live by?
“The truth is your best defense.” I must say it around the office at least a dozen times a week. We work in a highly regulated industry and have built a strong reputation based on keeping our commitments to our clients and taking responsibility for what we do.
Q: Who do you most admire in your professional career?
Joe Ricketts. He started off as a stock broker and became an entrepreneur relatively late in his career. He raised $17,000 from friends and family to get Ameritrade started, and never sold a share of stock after it went public.
Q: What’s your favorite book?
I am an American history fan, so “Founding Brothers: The Revolutionary Generation,” by Joseph Ellis.
Q: One movie that you’d pick to watch?
“Groundhog Day.” It’s all about self enlightenment. I believe we might all like the chance to live a specific day over and over again and perfect ourselves.
