‘We are here to make pensions simple’ – BL meets with PensionBee CEO Romi Savova
Romi Savova is the Founder and CEO of online pension provider, PensionBee, which was founded in 2014. The London-based firm is one of the fastest-growing businesses in the UK, and in April this year the business listed on the London Stock Exchange (LSE). Romi talks to Business Leader about the inspiration behind the company, its disruptive influence in the sector, and what it means to be a leader.
Can you give an overview of the company?
We are here to make pensions simple, so everyone can look forward to a happy retirement. PensionBee helps our customers to combine their old pensions into a new online plan that they can manage from the palm of their hands. We also give them control and clarity over their retirement savings, so that they know exactly how much they have saved, how much they need to contribute to reach their goals, how they’re investing their pension, and whether that’s in line with their beliefs and values.
From the age of 55 onwards, the PensionBee product gives our customers the ability to withdraw their pension and spend in retirement. We aim to be with our customers from the ages of 18 to 80, and provide them with an excellent lifetime pension experience.
Would you say you have disrupted the sector with PensionBee?
Yes, because pensions have traditionally been quite boring, complicated, and shrouded in mystery and paperwork, which tends to disengage most normal people from saving for retirement. The reality is that the State Pension is probably not going to provide most people the kind of retirement income that they would like to have. So, the ability to create a product that’s easy to use, and also engaging for our customers, is absolutely disrupting the industry, but it’s also hugely beneficial to consumers.
Why did you create PensionBee?
I struggled with my own pension when I left my previous role at Morgan Stanley, and I had to move my money somewhere. What I uncovered is that pension providers just don’t know how to talk to their customers, and they don’t know how to serve customers in a way that enables them to have control and clarity over their pension – and ultimately build up their savings. A lot of pension providers are set up to work with financial advisors or set up to work with employers, meaning the consumer is rarely thought of.
Can you tell us about your career prior to PensionBee?
I started my career in finance at Goldman Sachs in 2008, where I worked in the risk management division, and I became familiar with the overall financial services system. I then achieved an MBA at Harvard Business School and had broader exposure to business management. Following graduation, I came back to London and joined Morgan Stanley, working on mergers and acquisitions, capital raisings and getting to know the pension sector well. It was after I left Morgan Stanley that I started PensionBee.
What was the biggest challenge you had to overcome to get this product and company off the ground?
The biggest challenge is making everything come together in the initial phases – you start from a blank sheet of paper, and you must build everything. You’re going from zero to a minimum viable product, in a heavily regulated industry, with a lot of different work streams that need to effectively align together. Then there is the challenge of having a scalable business model that is well refined to help bring in investors, creating a team and then, ultimately, getting your first customer. All those pieces need to be in place.
How have you grown the company?
We are a business that’s been predominantly angel-funded prior to our IPO this year. PensionBee has had investments from a large number of investors, and also some strategic investment from State Street Global Advisors, which enabled us to finance the business for many years.
In April, we listed on the High Growth Segment of the Main Market of the London Stock Exchange and raised over £50m of capital, which has enabled the business to continue growing at the rates that we have enjoyed in the past few years.
Through this, we have the ability to help around 30 million people manage their pensions more effectively. A huge focus of the business is to acquire new customers and also to help our customers do more with their pensions. The capital that we raised is being used for getting new customers on board, and then also for building out the type of product that our new and current customers wish to see from us.
Where does your personal motivation come from?
PensionBee is a very purpose-led company; we have a huge vision, which is to live in a world where everyone can look forward to a happy retirement. That is motivational because you know that the work that you put in every day is driving change for a vast number of people and, ultimately, that’s the most rewarding thing that you can do as a human being.
You mentioned earlier about the IPO. Was that always the long-term goal?
We’ve been very upfront and explicit that we wanted to be listed. Most financial services businesses that serve consumers, ultimately, do list on the Stock Exchange. So, it’s always been something that we knew we would do.
What encouraged us to take the jump this year was a very prolonged period of rapid growth and, of course, the ability to raise capital on the stock exchange. The IPO helped raise the brand of the company, which further facilitates growth of PensionBee.
How did you find the process?
It’s a gruelling process because the Stock Exchange has high standards for businesses that are listed. From our standpoint, we were happy to demonstrate that we are a good addition to the LSE. I would definitely say that, for any other business considering going down that route, it’s important to bear in mind that it’s a big-time commitment. And it’s also a commitment to being public about what you are doing.
What are the company’s plans now it’s launched on the LSE?
We have a huge market opportunity in front of us, and we’re excited to keep growing as rapidly as we can. We want to reach more and more of our customers, and, of course, to develop our product range and the PensionBee brand.
Do you sometimes feel some businesses raise and raise but would be better off establishing product or service market fit?
Before you raise any round of capital, you should consider what you have achieved from the last round of funding – and I think it’s important to tie fundraisings to specific objectives. In the early stages, establishing product market fit is probably the most important thing that you need to do. You can’t just raise capital forever without establishing product market fit – eventually, the music stops playing. So, the sooner you get that, the better off you are as a business because you, ultimately, create something that is of value to people.
How would you describe yourself as a leader?
I believe I’m honest and transparent. I love engaging with the company and we regroup as a team every morning and have a weekly ‘Town Hall’ show and tell meeting, where often I present to everyone at the company.
In this day and age, where most of us are working in a hybrid fashion, it’s important to continue to create closeness and to make sure that people know what’s going on in the company.
As a leader, I tend to be quite metrics-oriented. I love looking at numbers and understanding why numbers are the way that they are, and what we can do to change them.
What does it mean to you to be mission driven?
Being mission driven is about keeping your priorities straight. The mission of PensionBee is to make pensions simple, and the vision is to live in a world where everyone can look forward to a happy retirement. The commitment to that mission, and that vision drives a lot of what you do, across every department throughout a business.
It has implications for the way that you build your product, and it has implications for the way that you communicate with customers. It also influences the way that you organise customer service and makes a difference to the investment line-up that is available to customers.
Moving onto culture and work, will you be continuing some form of flexible working going forward?
Absolutely. At the very start of the pandemic, we told our team that they can work remotely whenever and forever. It has enabled people to make the decisions that really benefit them and their families. We’ve had team members moving outside of London, we have been able to hire from diverse places across the UK that we wouldn’t have been able to hire from before. There are a lot of benefits to facilitating the ability to work remotely.
How would you describe the culture of the company?
The culture is led by the five values that permeate the way that we behave towards each other. Simplicity is one of the values that we have because we like to be clear and straightforward in the way that we do things.
Honesty is another because we think it’s important to offer products and to behave in a way that is transparent.
Innovation, as you would expect, is one of our important values too. Ultimately, we’re a fast-growing company and that means we are always leading change within the industry. Quality is an important value of ours as we are entrusted with our customers’ money.
Finally, the most unencountered value in financial services is the value of love. And that translates into the compassion we show for our customers and the way our team interacts – we have an amazing culture.
How is PensionBee helping savers drive positive environmental change with their pensions?
I would say the most prominent thing that we have done when it comes to socially responsible investing is our Fossil Fuel Free Plan, which launched at the start of this year, following a huge wave of customer demand to exclude fossil fuel producers from their pensions. It’s one of the first mainstream products of its kind.
For people who want to use their pensions to reflect their values and to have their pensions make change and be a voice in the world, it’s an option that should definitely be considered.
With pensions, your capital is at risk; pensions can go up and down in value and you may get back less than you invest.