Interview with Paul Pester, Chair at Tandem Bank

Paul Pester has spent around 25 years establishing and leading some of the most innovative and well-established consumer financial services businesses in the UK and abroad. He currently holds various positions as Chair, Non-Executive Director, Board Adviser, or investor in several disruptive financial services companies. Among his executive roles, Paul was the inaugural Group Chief Executive Officer at Virgin Money, launching the business in the UK and Australia, before becoming the Managing Director of Consumer Banking & Payments at Lloyds Banking Group. As CEO of TSB Banking Group for seven years, Paul spearheaded the creation and launch of the business, its £1.4 billion IPO on the London Stock Exchange in 2014, and its subsequent sale to Spanish banking group, Sabadell, for £1.7 billion in mid-2015. More recently, Paul founded, built, and sold Loop, a FinTech popular among Gen Z and Millennial users.

Can you recommend one book, one podcast, and one online course for entrepreneurs?

When it comes to recommending content to others, I almost always list the book Please Understand Me by David Keirsey. The book takes a close look at personality types and can help people better understand why and how they respond to specific situations the way that they do. I think this is especially important for business leaders who are engaging with people from all walks of life on a regular basis because understanding what drives people or how they may interact can improve communication and even business outcomes.

What would you say are the top 3 skills needed to be a successful entrepreneur, and why?

I believe successful entrepreneurs need to have an inquisitive personality so that they can identify the key drivers behind trends and decisions as well as identify areas for improvement. I also think that absolute staying power and being steadfast when building a business or product even when the going gets tough is critical for entrepreneurs to have when starting out. Finally, I believe that leaders can only achieve so much by themselves and so it is important for an entrepreneur to have the insight to attract and retain top talent to surround themselves with.

What is your favorite quote?

My favorite quote is by George Bernard Shaw: “The reasonable man adapts himself to the world; the unreasonable one persists in trying to adapt the world to himself. Therefore, all progress depends on the unreasonable man.” To me, this means that humanity cannot move forward unless so-called unreasonable people start to question the world around them to create actual progress. I also want to underscore that while the quote refers to man, I read that as mankind because people from all backgrounds and identities can set out to be unreasonable people and make a difference to the world around them.

If you only had $1000 dollars to start a new business, knowing everything you know now, how would you spend it? 

It can be great to get started from scratch with a small amount of capital, but I believe that most business ventures can excel more quickly with investors and stakeholders on board. I would use the funds to create pitch materials and a case study for how the business would operate and what problem it would solve for customers. From there, I would create videos and start sharing them with my network in order to drive attention and fundraising efforts to get the new business idea up off the ground.

What helps you stay driven and motivated to keep going in your business?

Fear of failure is a major motivator in my life, and while that can sound negative, I also find that it helps to make life a bit more fun in a unique way. Failure is always defined differently by different people. For me, it’s about giving myself a challenge and standing up to my insecurities. I dislike the idea of setting out to achieve something and not being able to accomplish it unless I have given that idea one hundred percent of my effort.

How do you personally overcome fear?

While fear of failure is always lurking, I think that leaders can face these fears down, in part, by surrounding themselves with other highly motivated individual contributors. Creative, innovative, forward-looking businesses tend to attract interesting and dynamic people and it can be a personal driver to work with these people. This drive can help with overcoming fear by banding together and factually approaching difficult situations or decisions with less stress.

Tell us a little bit about your background and how you started your company?

I have over 25 years of experience founding and innovating businesses in the consumer financial services industry. I have also served as a consultant and non-executive director for a number of organizations, helping them scale, digitise, internationalise, and raise funds. This included the founding, and eventual successful exit, of Loop from March 2021 to April 2023. Loop was unique in that it established a money-sharing network for consumers using a wide range of UK banks. Loop started from an idea that stemmed from a conversation I had with my niece during the pandemic. We were discussing the challenges that younger consumers had borrowing from banks and whether it would be a viable solution to empower them to connect with friends and raise funds from their closer network of friends and family instead. The result was a full-fledged platform that made these transactions reliable and safe without the application actually requiring access to the user’s money.

What valuable advice would you give new entrepreneurs starting out?

I recommend that new entrepreneurs take a critical eye to any endeavor they start out with: they have to be able to identify clearly what problem they’re fixing for their eventual customers – and why a customer would pay for that. You are going to know your business concept, operations, and viability best, and so these leaders also need to be the ones looking for pitfalls. This can help you address issues before they arise, troubleshoot customer issues, and plan appropriately for the future. It also helps in driving clear, concise framing of use cases and problems so that you can be crystal clear on not just what but also why you think a change needs to be made (or not).

What is your definition of success? 

I think that for a person to be successful at whatever they are pursuing, they will need to deal with their own insecurities and personal demons. This can yield the most positive outcomes for entrepreneurs, leaders, and individual contributors because it helps them learn to be the best version of themselves. By doing this, you can more clearly understand what success means in the grand scheme of your life. And that, in its turn, can lead to truer definitions and attainment of sincere happiness while pursuing specific goals.

Who should we interview next and why?

I would recommend interviewing a member of the Buddhist faith system and ask them to share how they see the world. In my experience, they often see happiness from a different perspective, and this can help shed light on not only how to achieve satisfaction but also more accurately define what happiness and success are for a person. I have also found that these individuals have a unique take on what truly matters in life, and this can help entrepreneurs and business leaders balance out their own perspectives on commercial and corporate success and goal setting.

What are you learning now? Why is that important?

I find generative AI and its implications for the “traditional” financial services industry – especially when combined with open banking – to be completely fascinating. I have been working at better understanding the structure of the code that builds the AI. Earlier in my career, when I was working as an academic, I wrote quite a bit of software code. Seeing how the industry has evolved and how generative AI leads to machine intelligence is staggering to me.

If you started your business again, what things would you do differently?

I have held a number of different roles and spearheaded a variety of business ventures throughout my career. While I experienced my ups and my downs like any entrepreneur, I don’t think that I would do anything particularly differently. Instead, I would continue to keep a positive attitude as I work toward my next goal or business venture and focus on staying intellectually curious and optimistic. In general, I have found this to lead to success and growth both personally and professionally.

What were the top three mistakes you made starting your business, and what did you learn from them? (Most Important to readers)

Admittedly, starting out with a new business venture, for either a new or established company, can be very daunting. However, I made the mistake in my career once of not believing in a groundbreaking concept that took quite a while for consumers to catch on to. In the end, we closed out that business unit only for the market to catch on just six months later. I learned from this that it is a mistake to give up on an idea you believe in, to not hold your nerve in the face of opposition, and to not face fears of failure head on.

Follow Paul Pester on LinkedIn.