I recently sat down with the co-Founder and co-CEO of the award-winning budget planning app, Qapital. Katherine Salisbury and her partner George Friedman designed the app when their bank couldn’t provide them with the joint financial resources they needed as a growing family. Qapital combines behavioral science and the power of automation to help individuals and couples alike find money happiness, and reach their financial goals.
I’m so excited to talk with Katherine and learn more about her thoughts on how we can make saving feel more like shopping, how to reduce money tension in a relationship, what it’s like to be in business with your partner, and how to navigate the emotions of being an entrepreneur. I start our conversation by asking her to share the story behind Qapital.
“George and I met in New York,” begins Katherine. “He’s Swedish, and I’m American, and we were living in New York. I was working as a lawyer and then at a bank. And George is a frugal Swede who asked me, where is all your money going? I would respond by saying I only have so many units of good behavior in one day. And by the time I get to the end of my day, I would hop in a taxi and order sushi. And that’s where my money went. But I knew he was right. And I thought maybe I could find a way to engage with my money differently. I started naming my long-term or short-term savings goals ‘trip to Kenya’ or a piano. And so, when I’d walk home from work, open the refrigerator, and make myself dinner, it would be like I was ‘buying’ a piece of my goal. I would go in and actually move money I would have spent going out into that savings account. And it felt like a shopping experience instead of a good behavior experience. That was really the starting point. We said this is working for me, could we create an app like this that would work for other people as well? And that was the original product. Since then, we help people with their whole paycheck, the same experience if you need to invest or save for retirement.”
I think that’s fascinating. And if it’s anything like what happens in my house, you’re opening the fridge, and there’s nothing that you really want to eat. So, it’s tempting to go on an app and order food. But Katherine found a way to say okay, I’m going to make something out of the fridge and move the money into my savings account that has a better name, like “trip to Kenya.” So, it’s a shift mentally. I ask Katherine what other services Qapital provides to individuals or couples that aren’t available in a traditional bank.
Katherine explains that it was hard for her to share financial decisions with George, particularly as their life became more complicated with kids, more costs, and less time.
“We wanted to get more aligned,” Katherine says. “Take this summer, for example. Are we going on trips? What are we spending on summer camps? We can create an experience where I’ll make a sailing trip goal. I’ll put the parameters in, like how much it’s going to cost, when we need the money, and how much of our paycheck will go towards it. And then I’ll add that every time we walk 10,000 steps, we each put a little more money towards it. I then send it to George, and he can agree and say yes, let’s do this or he can talk to me in the comment section and say I think we could do this for cheaper. Once we agree on how much the trip will cost, we queue up our paychecks. And as soon as our paychecks hit, the percentage of savings goes into that account. So, when it’s time to book the trip, the money’s there, and we can see it. We have a dashboard where I can see my whole financial universe, he can see his whole financial universe, and we can see the parts that are overlapping. I get to decide exactly how much to show him and how much to keep private. And we can align our goals. And then we can see that we’re filling up the accounts for those goals. So that’s Dream Team, one of the new features we’re super excited about.”
I ask Katherine how important clear communication around money is for a couple, and she jokes that it is so challenging that they had to build an app for it! And shares that it’s not just for things like deciding on a summer camp for kids, but knowing how much it’s going to cost.
“If we talk about something like that on date night, it’s probably not the best use of a date night because it defeats the purpose,” Katherine shares. “With Qapital, the timing of the conversation changes, and it is really nice to be able to do it asynchronously. You can comment within the app as opposed to having to talk about it when we’re brushing our teeth. But it’s also nice to memorialize how much we agreed on and then have the goal. It is clear communication, and it’s just like managing people in the company. A clear definition of the specifics makes the stress go away, in a way.”
I ask Katherine to share more about the actual process of building an app and if it was easier or more challenging than she expected.
“We got lucky,” Katherine says. “George had moved back to Sweden to work for one of the best digital banking platforms and rebuilt the product with a group here. And then, when that project was done, they all came to our living room. And we said, what are we going to do with this amazing talent? So, we got a good head start. Coming up with what app we should be building was a little bit harder than actually building it. But I wasn’t the one writing the code. So, the team we had and still have is just amazing.”
A big topic right now in business, especially with a lot of my clients, is retaining talent. Katherine just shared that the team that helped them build this app is still with the company, so I ask how they’ve been able to retain this talent. She believes it’s partly due to the culture at Qapital.
“We recently asked a candidate why they wanted to interview with us, and it was because they had heard it’s such a kind group of people,” says Katherine. “So, I think the temperament of the team is important. Sweden’s a really interesting place because there is no hierarchy here. And there’s a lot to that. We treat developers and designers like you treat talent, as an agent. You want to create a good space for them to feel like they can do their thing and bring their talent to work every day. The word engineer is almost misleading because we’re talking about true artists. Sweden is a much calmer place to live and raise a family because you don’t have the same pressures or stresses. College is paid for, childcare is paid for, and summer vacation is five weeks long. So, people can kind of calm down and settle into a job. I think there’s a lot of pressure in the states to be getting some equity and moving on and getting some equity and moving on.”
I ask Katherine if transitioning from New York to Sweden was difficult as a professional. She confirms that the Swedish vs. New York corporate culture is one of the biggest differences she’s ever encountered. And that it took time for her to get used to it. She also says while it may be hard to understand taking five weeks off in the summer, the studies show that people get more creative and that it works. “Both systems work well,” says Katherine. “And both have their pros and cons. But they’re very different.”
I ask Katherine what other challenges she has faced as she built her business. She explains that this was the first time doing it, so one of the challenges was learning and making mistakes in front of everyone. “But at the same time, there’s just no better way to learn something than for it to really be mattering and pulling the levers,” Katherine shares. “I mean, something, in theory, is just so different in practice. So, that’s been fun. And probably why I love this job the most is because when you get to show up every day and build something, that’s when you bump into learning all the time.”
I ask Katherine how she stays focused and committed to her goals, despite all the learning, which other people might perceive as a setback.
“I think of it as no matter what happened today, I got smarter than I was yesterday,” Katherine says. “So, even in the really tough periods, you think well, how can you be really good if you haven’t been through something like this? That’s my mentality. The harder the day you figure out, the better I get.”
I’m curious if Katherine has always had that mentality or if she developed it as a business owner and app creator.
“I think it was when I was running the soccer agency that I developed that mentality,” Katherine reflects. “It was really hard all the time. And I would just think, well, at least I made some progress. And so, I got into the habit because that was the only way to comfort myself in those early days.”
I love the simplicity of saying, at least I’m smarter than I was yesterday and going into a business or a project with the expectation that you’re not going to have it all figured out until you start putting something into practice.
“Yes,” says Katherine. “And it’s easier in your earlier days because when you throw something out there into the world, you have fewer people see it, giving you feedback. So, if you asked our team, maybe I’m not as willing to throw some product out there right now because we have 2 million customers, and they love us. And we have $10 million transacted on the platform every day, and we’ve had $3 billion total, so now we have a reputation to uphold. It triggers loss aversion because we’ve built real trust and a real relationship with our users. So, I do think it’s harder for a company at our stage to just kind of iterate and throw things out there the same way that maybe when we were a free app with a much simpler product, we could just roll it out and say, what do you guys think of it? And get the feedback and start iterating.”
I ask Katherine to share some of the things she and her team did to grow Qapital to the level it is today. She shares that sometimes you just feel lucky.
“I just read the book Pachinko, which is all about the combination of luck, skill, and everything in life,” Katherine says. “And I kept thinking about Qapital as I was reading it. I thought, there’s a lot of luck here. But we had a freelancer rule that also resonated with people. If you’re a freelancer, we automatically put money towards your tax account every time a deposit hits your account. And people really loved that. And it started to spread on blogs and so forth. I think over 80% of our users came through word of mouth, PR, referrals, and that sort of thing. So, some features just offered a differentiated solution to solving a pain point. And that has kept us focused on product, maybe to a fault. So, rather than taking a pain point solution and figuring out how to market it on Facebook or whatever, we just kept building product, hoping for those moments regularly where people say, this is really special, I have to tell my friends.”
It’s refreshing to hear Katherine say that a good old-fashioned referral can really work. I ask her to share more about working with George and going from partners to business partners.
“Well, we started a soccer agency before Qapital together,” Katherine says. “So, we already went through some growing pains with that, and we took on different roles. I have a pretty significant handicap, so I can’t do a whole lot of typing or anything like that. I do mostly by talking, and George can do a lot more of the computer work. So, there was some natural delegation there. I was also having four babies during this time. I never took parental leave, but there are just certain roles that we spun out for each other based on what we thought it would be like to have a baby. But the biggest part about running a company together is we’re on the same wavelength. So, when it’s been a great day, we both had a great day. And when it’s been a really scary day, we both had a really scary day. That, to me, is irreplaceable. I would hate to do this alone with a partner saying, why are you on your phone? Because I’m pretty good about that. So, if I am on my phone, it’s probably because I need to be. And George gets that. So, that’s huge to just be on that same wavelength.”
Katherine brings up an interesting point. Because I know my husband and I can be on different wavelengths at different times. And as a business owner, it’s not always a great day. I talk to my other entrepreneur friends about this a lot. We’re on this roller coaster where one day you’re like, this is the best thing I’ve ever done, and I can never imagine doing anything else. And then the next day, or even the next hour, you’re thinking, I am going to crawl in a hole and never come back out. And I hope no one finds me. I ask Katherine if she has any solutions or strategies for those down days.
“I normally get a down day when I feel like things are just not working,” shares Katherine. “And George often says, it’s hard for everyone, Katherine. My bad days tend to come from something different than what drives him nuts. And he’s found a really good thing to say to me at those moments, which is it’s hard for everyone. That normally gives me some perspective. And then for George, whenever he has frustration, I normally say something like, we’re learning. It was a hard day, but you can’t be amazing entrepreneurs if you don’t have tons of hard days. So, that’s what we got today. We got to be a little bit better at being entrepreneurs. It helps to have our things that we say to each other.”
I think that’s the job we signed up for as entrepreneurs. We’re going to have some hard days, which will be different from corporate hard days. I love that Katherine and George have figured out how to communicate with one another and boost each other up.
“Yes,” Katherine agrees. “We’re both also big on asking, did you get sleep? Because when you have those extreme highs that turn into extreme lows, and you add sleep deprivation into it because you’re working too hard, or you have small children, it just adds some fuel to the fire.”
Speaking of the miracle of sleep, I ask Katherine how she manages running a company and four children. She shares it has been harder as they get older because they need more care, and things matter more. But motherhood comes with training wheels, she shares, because you can learn in the early years and get better as your children grow. Another way to manage it is to have help. In their home, Katherine and George have help to take things off of their plate, like laundry, grocery shopping, and walking the dog.
I ask Katherine to share one piece of advice for couples wanting to get more clarity on their finances or working towards a financial goal together.
“One of the things that I wish someone had said to George and me earlier is neither of you are wrong on how you want to approach your financial life,” says Katherine. “You don’t have a crystal ball. We don’t know if we will live to be 130 or 60. We don’t know what’s coming. How much you plan for the future or live in the moment seems to cause tension in couples. How much risk you take is similar to that, so have respect for each other. Because probably some of it is how much you want to live in the moment and how much you want to make sure you’re ready for retirement or an inevitable bad day. There’s so much out there that tells you you should be putting this much towards retirement; you should be paying off your student loans as fast as possible, but I feel like when people take the shoulds out of it, the plans get customized for your actual goals and risk tolerance. It starts to take much of the tension out of the conversation.”
Anytime we’re going after a big goal, if we can take the ‘shoulds’ out of it, we will tend to have more success and find more joy on the journey of achieving that goal.
With that goal achievers, keep celebrating your weekly wins, noting your lessons learned, and identifying your priorities for next week so you can consistently pursue progress in the direction of your goals.