The SoFi Cross-Buy Engine Fuels Amazing Growth

In its annual customer survey, Forbes has ranked SoFi the number one bank in America, and it achieved that by encouraging customers to ask for more. Last quarter, nearly half of its products were opened by repeat customers. That's 43% who came back on their own to expand their relationships. No one really had to sell them. Most traditional banks and credit unions are still doing the asking.

15 years ago, SoFi was a student loan company offering a single product for one type of customer. Today, it has a national bank charter to hold and fund loans internally. SoFi knows exactly how much of this growth comes from people it already has. Unfortunately, most financial institutions that I know have never measured this on their own.

SoFi actually started with the worst possible product for building a relationship. It started with a loan. A loan is something customers usually get and forget. They receive the money, they leave, and they never connect with the financial institution again.

I asked Kelli Keough about this. She runs Spend, Invest, Protect and Save at SoFi, and she explained it really clearly. She said when a customer starts with lending, sometimes a loan is a low engagement product. They come, you take your application, they may never even open up the app again. They just have it, they get the money, and they go.

This puts SoFi in a real tough spot. The product that initially attracted the people was the one least likely to keep them. Many other financial institutions operate similarly and never advance. Think about your own lending relationships. How many of those borrowers ever come back for anything else?

So, how do you sell a second product to someone who never opens the app? Most banks will answer that question with a big marketing campaign or a direct marketing campaign. SoFi actually answered it years earlier with a decision almost no one else made. Before it had members and customers, it bought the factory.

In 2020, SoFi acquired Galileo, the company that operates the payment and card infrastructure behind their banking app. Two years later, it purchased Technisys, a modern core system that quickly builds and configures new products. Most financial institutions I know rent that technology from a vendor, and meaningful changes can take months or longer. SoFi actually owns that.

Derek White used to lead Galileo, and he presented this in an interview I did with him at the Financial Brand Forum a couple of years ago. He explained the experience above the glass is more important than the technology and environment below it. They focus on who the end human user is. Above the glass is a person looking at the screen. Below the glass is everything that enables what they see. SoFi owns what's below the glass. So when a customer reaches for that next product, the shelf is already prepared for them.

Now I know the objection, because I hear it every time SoFi comes up. SoFi only expands because it offers incentives like high savings rates, cashback, and pricing that no regular financial institution can compete with. A traditional financial institution can't buy growth like that. That's fair.

The charter is where the money comes from. In early 2022, SoFi bought a small bank, Golden Pacific, and earned a national bank charter. That allowed member deposits to fund its loans directly, which is the cheapest form of funding a loan can obtain. The deposits lower the cost of funding, and everyday money movement, such as the checking account, the card swipes, the direct deposit, is what creates the attention, and that attention is where the next product shows up. The high savings rate buys SoFi all that, and it pays for itself many times over.

A traditional financial institution already has that charter. It has the deposits and the customers with multiple accounts. You acquired that capability decades ago. SoFi spent a decade and a lot of money reaching the place that you're already at. The key difference is what you do once you're there.

So if the charter's the engine, and the daily attention is the fuel, the real question is what changes inside the company when every product is designed to make the member want the next one?

As I mentioned, I asked a person at SoFi who handles exactly that. Kelli Keough from SoFi has a PhD in psychology, and she talks about banking the way a behavioral scientist would. When I asked her what SoFi does differently, she framed it in terms of who does the choosing. She told me they refer to expanding relationships as cross buy rather than cross sell. She believes her members should genuinely want the next product or service. So SoFi provides options, shows them what they can do, and then lets the customer make their own decisions rather than pushing something on them.

That's not cross sell, that's cross buy. And the difference is who is initiating the second sale. Every bank in America talks about wanting to cross sell. It's part of every strategic plan. We push the second product, set the quota, and train the branch and other people to ask. SoFi flips the script so the customer pulls the next product because the last one earned it. And you earned that by showing up useful every day.

This is how Kelli's team decides what to build. So how do you design something that's right for your customers? Kelli said that SoFi starts with design first, and then they ask themselves where in SoFi do they already have this capability and how they can get to market as quickly as possible. That's the factory talking. Her team can ask where they already have this because they own what sits below the glass.

Last October, Kelli said about a third of new products came from existing customers. This spring, SoFi reported that that number had grown to 43%, and that number is still climbing. And it's about to get sharper.

Today, SoFi Coach services insights and options for the member, highlighting maybe idle cash and the next smart move they should make. The next step is closing the gap between the insight and the action, helping the member understand the move, weigh the options, and complete it without leaving the app. Whoever earns that moment gets the first shot at the next decision the customer makes.

SoFi built a bank that its customers come back to on their own. The customer opens up one product, then reaches for the next on their own time, and no one has to place a call. Last quarter, return traffic made up 43% of all products opened. Customers drove those sales. The entire company is designed to secure the next visit. It can do that because it controls above and below the glass: the factory below that built the next product, and the design above that makes a person want it. They earn that reach with daily attention. And the loan most banks offer is the one product that earns nothing.

You already possess the components that contribute to SoFi's success. So what are the three things you can do with them?

First, find your cross buy number. What percentage of products that you sold last quarter went to existing customers? SoFi is at 43% and climbing. If you don't know your number, that's a key missing insight.

Second, identify the one product your customers use every day and highlight it. It's almost never the loan. The product they interact with daily is what gives you the opportunity to offer the next one.

Third, place the next product where the customer is already paying attention. Review the last campaign you sent to your best customer and see if it appeared inside something they already use, or showed up cold asking for attention. The first option gains reach. The second option results in a delete.

SoFi spent a decade assembling two advantages. First, the bank relationship: the charter, the deposits, the customers with more than one product. Second, they built the infrastructure that most financial institutions still rent and don't call it their own. Many community financial institutions already have the first. Few have built the experience around it.

At SoFi, the member reaches first. At most financial institutions, the bank is still doing the reaching. Look at your own financial institution and ask what it will build around: your products, or the one human being who's holding the glass.