Lamine Zarrad | StellarFi
LAMINE ZARRAD
Founder & CEO of StellarFi, a company set out to solve one of the biggest economic problems faced by American consumers - access to credit.
What Is StellarFi? Tell Us About What You Do And How It Works.
StellarFi is a credit-building platform and public benefit corporation on a mission to disrupt the U.S. poverty cycle and provide credit access to 132 million Americans with low or no credit.
Members can begin using StellarFi through a tiered monthly subscription, which empowers them to build credit by paying the bills they already have, such as streaming services, rent and phone bills. We report bill payments made through StellarFi’s platform to the three major credit bureaus – Experian®, TransUnion® and Equifax® – building a positive payment history for our members. The website application launched in June 2022, and we are rolling out a mobile app later this year.
I’ve been on a trajectory of creating solutions for larger problems. I went from optimizing logistics at one military base to tackling banking challenges across a whole industry, and now, I want to take on issues facing entire populations and help those whose lives have been impacted by a lack of financial literacy or a string of financial challenges.
What Is Your Background? What Led You To Starting Your Own Company, And How Did You End Up In This Space.
My goal is to leverage technology to help others succeed, but growing up, my goal was about trying to survive. I was born in Baku, the capital of Azerbaijan SSR, which was a former republic of the USSR. When the Soviet Union fell, my family was forced to escape from an ongoing ethnic war on Armenians, which my mother was.
Suddenly, my comfortable childhood was turned into being a refugee with nothing but a bag of clothes. After fleeing to Moscow, eventually making it to the United States and going to school here, I joined the Marine Corps.
On my first deployment to Iraq, my inner entrepreneur really took over. I always noticed inefficiencies and assessed processes, and I would pitch ways to improve infrastructure to the colonel running the base I was on. Thankfully he was very receptive to my ideas and allowed me to help manage logistics for our base of 20,000 personnel. The resourcefulness that I honed as a refugee and immigrant helped me make significant improvements to our infrastructure and logistics during that time.
After the military, I earned a business degree and landed my first job in financial services at Merrill Lynch. I wanted to continue in the financial sector, so I went to grad school to study economic policy and worked for a hedge fund. Then, I accepted a position as a bank examiner in the U.S. Treasury’s Office of the Comptroller of the Currency.
As a regulator, I had a unique, 360-degree view of the banking system and saw that banks, both large and small, were (and still are) profoundly reactive instead of proactive. This prompted my interest in how we could use data-driven technology to help banks make more advantageous decisions and provide better experiences to customers. These experiences led to the birth of my first startup, Tokken. Since then, I’ve founded Joust (acquired by ZenBusiness) and now StellarFi.
What Was The Inspiration Behind The Company Name?
The inspiration is the double entendre of “stellar” credit that signifies financial excellence and illustrates the grandness of our cosmic concept.
What Have Been Both Your Favorite And Least-liked Parts Of Your Entrepreneurial Journey? What Have Been Your Most Challenging And Most Exciting Moments For You And The Company?
My favorite part of the journey is the process of creation. I love synthesizing seemingly unrelated concepts into something completely new and then bringing that idea to life. The least liked experience is having to fire people. I always take it personally.
The most challenging moment for the company and me is always the decision to actually commit to the concept full time because there’s no going back once you head down that road. You either succeed or fail, but either way, you must complete the journey.
What Was The Fundraising Process Like For You? Tell Us About Your Investors And How You Use The Funds You’ve Raised.
In March, StellarFi closed a $7.2M initial funding round. The round was led by Acrew Capital and co-led by Trust Ventures with participation from Accomplice Ventures, Fiat Ventures, Vera Equity, Permit Ventures, Kindergarten Ventures, and angel investors.
Since March, we’ve brought on amazing talent from across the globe and publicly launched the StellarFi credit-building platform. With thousands of members now using the platform, we’re busy improving the current experience and designing valuable features we’re excited to launch later this year.
Who Are Your Co-Founders Or People Who You Work Very Closely With? How Do Their Skills Supplement Yours?
My founding partners are Stacey Tisdale and Angela Yee. Stacey Tisdale is an award-winning TV broadcast financial journalist, financial behavior expert and CEO and co-host of Wealth Wednesdays, a digital financial empowerment platform. Angela Yee is a serial entrepreneur. She co-hosts the nationally syndicated morning show The Breakfast Club and Wealth Wednesdays, and she hosts her own podcast.
Stacey and Angela are both financial literacy advocates and have done great work to inform and empower their communities. StellarFi is a public benefit corporation with a mission to improve the financial well-being of Americans. Stacey and Angela share this vision and they have the tools to speak to the underserved communities we want to reach.
StellarFi Is A Public Benefit Corporation. Tell Us More About This And What It Means In Terms Of Your Company’s Values And Goals.
People deserve more. Anyone who pays rent should have the opportunity to buy a home, and no one should be stuck in a cycle of not being able to get credit because they don’t already have credit, or paying more for things because they have less financial power. That’s what inspired me to found StellarFi as a public benefit corporation. We want to generate new opportunities that anyone can access.
Earlier this year, StellarFi co-hosted its first community-focused financial literacy event with the Alpha Kappa Alpha sorority chapter to promote financial literacy for the BlPOC community. In turn, the city of Bridgeport mayor named April 30, the date of the event, Stellar Credit Day in honor of the event.
This event came on the heels of StellarFi’s “Get Your Bills Paid with Stellar!” $10,000 Sweepstakes to help people pay their bills with sweepstakes prizes totaling nearly $70,000.
StellarFi also partners with Stellar Credit Day keynote speaker Stacey Tisdale, who also is a StellarFi founding partner, and Angela Yee on initiatives including sharing financial literacy best practices through their digital finance empowerment program “Wealth Wednesdays.”
Tell Us About Your Typical Workday Schedule. What Are Your Morning And Evening Routines? What Are Some Tips You Have For Staying Productive?
I really, really dislike routines. But I recognize the value of having some predictability in the day. So I try to have consistency in my daily activities but reserve the right to be flexible in changing and modifying whatever I’m doing.
What Are The Top Qualities or Skills You Believe Entrepreneurs Need In Order To Be Successful? Also, What Advice Do You Have For Entrepreneurs Who Are Just Starting Out?
Resilience (because it’s a freaking grind). Empathy (because you MUST KNOW thy customer and team). Killer Instinct (because you only eat what you kill).
You must ask yourself if there’s something else that you could do for a living, if the answer is yes, then do yourself a huge favor and pursue that other thing. If the answer is: I absolutely can not do anything else but be an entrepreneur then go for it.
What Is One Thing About Building A Business You Did Not Know That You’ve Learned So Far Since Launching StellarFi?
We thought our product was solving a big problem for a small group of people. Instead, we realized we have a mass market solution.
Tell Us A Story Of Something That Happened To You That Taught You An Important Lesson.
Although it’s a funny mistake now, it was terrifying back then. The funniest mistake I made was at my very first significant investor pitch to Wells Fargo. Investor pitches have a specific format with only so much time allotted and specific points to hit, and at this pitch, there were dozens of investors, high-profile people, and a handful of other startups. I had shared my ideas before and spoken to investors and thought I had my pitch down, so I barely spent any time practicing.
When it was time for my pitch, I stepped up on the stage and blanked. I was so nervous. Every second felt like an eternity because I couldn’t push a word out. Words finally started coming out of my mouth and I’m still not quite sure what I said. I said some things about the business and maybe about the business model. After I finished, I sat down next to one of my co-founders and he said “Well, the silver lining here is no one can steal our idea.”
The takeaway from that experience was no matter how good you think you are, practice is essential. Every new experience is unique and requires practice for success. I felt I was experienced in selling my ideas and public speaking, but since then I’ve learned it’s important to prepare.
What Do You Do In Your Free Time?
I spend time with my family, read, exercise, play and try to carve as much time as possible to think.
Who Is Your Role Model?
I don’t have a role model.
What Is Your Favorite Quote And Why Does It Resonate With You?
“Failure is a factor of success” is my mantra.
You have to embrace and anticipate it. No matter how experienced you are, there will be failure and you have to manage it, leverage it, then turn it into success.
How Do You Think Your Industry (Or The World In General) Will Change Post-COVID?
Fintech provides compelling ideas and technologies to emerge that will alter the state of our ever-changing world. Here’s what to watch for:
Accelerated evolution: Because of COVID-19, remote work was an absolute necessity for over two years, and platforms like Zoom and Slack scaled at absurd rates to keep businesses operational. Tech investments were completely recalibrated, with billions in capital going to the digital economy. The lesson from this is to continue our technological and entrepreneurial evolution to better prepare for the unknown and unpredictable tech evolutions, in fintech specifically.
Decentralized trust: For better or for worse, Americans have disassembled their trust in the mega-entities that once dictated our opinions, decisions and ideologies. But, as with anything else, decentralized trust has a silver lining—especially for fintech. Consumers who once feared using a credit card online are now comfortable depositing checks digitally, using apps to transfer money to friends and family and investing in blockchain. In short, decentralized trust has a ripple effect that leads to consumers accessing loans, investment tools and more through fintech that would otherwise be unavailable.
Mass empowerment: There are swaths of the American populace that don’t understand the power of a good credit score—not because they lack financial literacy, but because they’ve never experienced life without good credit. With inadequate credit, consumers pay more for necessities, lack access to credit-based investments like homeownership and education, and endure financial emergencies with no safety net. Poor credit begets poor credit, and the consequences persist from generation to generation. Although Americans are facing immense challenges in a post-COVID world, it has opened the eyes of many to better understand and adopt financially literate practices.
Any Other Thoughts You Want To Share Relating To Current Events, The Economy, Political Climate, Or Any Other Topic?
Inflation is currently at a forty-year high as a recession looms in the near future. Americans don’t have to feel weighed down by a troubled economy and can take straightforward steps to ensure financial stability in the coming months and year:
Get current on your credit card payments
Falling behind on loans and credit card payments can have serious consequences for your credit. Payment history, which represents your track record for repaying your debts, accounts for 35% of your credit score – more than any other credit rating factor. Lenders can only report delinquent accounts to the credit bureaus if they’re more than 30 days overdue, but they may charge penalties if you pay even one day late. Coupled with inflation, those late fees can snowball into a serious deficit in your budget. Automating your payments can help if you simply forget due dates. If you find yourself making late payments because you don’t typically have cash in your account when the bill is due, look for areas to reduce expenses temporarily while you get caught up.
2. Build an emergency savings fund
Saving money is challenging, and unfortunately, building a savings fund becomes even more challenging during an economic downturn. Although it’s tough, focusing on stashing some cash away can keep rising prices and financial emergencies from causing long-term damage. For example, if you need to cover an unexpected repair or medical bill, a savings account helps you avoid going into debt to pay the bill or fall behind on your other expenses.
3. Reduce your spending and expenses
The forces driving inflation are complicated, but the effect is simple: as prices rise, life gets more expensive. Take a look at your accounts to see how your spending has shifted in recent months. If you notice vulnerable areas or your spending is no longer aligned with your financial goals or income, look for ways to cut back. You can’t control the price of gas or food, but you can control how often you drive or eat out, or eliminate unused memberships and subscriptions.
What Does Success Mean To You?
Success = freedom to do most daily things not out of necessity but because you want to do them.
Lamine Zarrad’s Favorites Stack:
Books:
1. What I Learned Losing a Million Dollars, by Brendan Moynihan and Jim Paul
2. Mutual Aid: A Factor of Evolution, by Peter Kropotkin
