The online financial services company SoFi was founded in 2011 by four Stanford Graduate School of Business classmates to provide alumni-funded student loans. (See "A Vested Interest," October 2012.) Since then, the company has expanded its financial products to mortgages and wealth management and seemingly adopted an alumni relations approach to customer service, offering members social events, career counseling, and webinars. Macklin shares the key to SoFi's success: Be relevant in several aspects of members' lives.
SoFi started as a peer-to-peer student loan lender. How did you know alumni would financially back students in this way?
It made perfect sense to us at the time. Stanford alumni knew better than anyone the rigors of the program, the ambition required to graduate, and the kind of success graduates could anticipate. We believed that alumni investors would want to help students, many of whom were a lot like themselves not long ago, get a leg up.
You've changed your business model and no longer provide alumni-backed student loans. How do you see yourselves now?
We're a modern financial company. We help out members in many ways across their lives in terms of money, careers, and relationships. Money is at the heart of what we do, but we go above and beyond that. If you become unemployed, we provide one-on-one counseling, look for a job for you, and offer resume assistance, interview techniques, and salary negotiating tips. We're involved in our members' social lives, even their romantic lives. We've hosted more than a hundred singles events across 40-plus cities. Our members seem to trust us.
Social events, career help, webinars on personal branding. Why would a financial services firm branch out in those directions?
The general benefit we offer our members—we're intentional in calling our customers members, because we believe we're in it together—is a promise that we are sitting beside them instead of across the table from them. Finance has a tendency to be a transactional industry. By helping our members in different ways, we can help them find better jobs and pay back their loans. And be happier. Then, they're more likely to tell their friends about us.
These areas have been the domain of alumni relations shops. Is there anything universities could be doing better?
You have to remain relevant. It's tough to be thinking about giving money to my college if I'm still paying back student debt. Colleges could be more sensitive to that situation. Inform alumni about refinancing options. That may be self-serving for SoFi, but I believe graduates would welcome such information. Then it would be easier for schools to engage in money-raising activities. Employers are taking a better lead by informing their employees about debt repayment. But for college alumni, it's left to the individual to work it out. That's a missed opportunity for institutions.
What advice can you offer for being relevant in alumni lives?
Going the extra mile to help customers regardless of the enterprise is just good business practice. Relevancy helps create a lifelong relationship, one built on trust and a mutually beneficial symbiosis. We see huge value in providing members with tools and services that empower them to achieve their goals across money, career, and relationships. To stay relevant, talk to customers about where their real needs lie, and then find a way to fill those needs.