By: Melissa Silmore (TPR'85)

The idea has been bouncing around in his head for days. Growing, crystallizing, and finally taking root. Time to do something. Joshua Reich grabs his laptop and heads into the front room of his Brooklyn brownstone. He settles back into his favorite couch, a cat on either side. It's late, and the house is quiet. Perfect-the 31-year-old works best at night. He begins to compose an email:

To: Shamir and Jerry
Subject: Let's start a retail bank

It's a subject born of frustration. A few weeks before, he'd had trouble getting a handle on his cash flow while using an online money-management tool. "I had no $#@&*$ clue what was going on with my money," says Reich, who is no amateur when it comes to money matters. He has an extensive background in math, statistics, and finance, among other pursuits.

As a youngster in Melbourne, Australia, when not kicking back at the beach, Reich had a "very nerdy childhood, interested in computers, electronics, mathematics, and physics." After high school, though, he followed his ophthalmologist father into medicine, which in Australia can begin when a student enters college. His two sisters also opted for medical careers.

After his first semester, Reich realized he missed mathematics. He changed his major while his parents were on vacation. When they returned, he quickly thought better of it and quietly transferred back. Four years later, after his first surgery rotation, Reich, with his parents' blessing, took a year off to study software engineering. When he returned to med school, he found himself "spending more time playing with computers than actually seeing patients."

That sealed it. Reich left medical school for a full-time job at a technology start-up and pursuit of a degree in math and statistics-simultaneously. The start-up was involved in large-scale data mining, performing quantitative analyses of marketing campaigns; it was seemingly vital information, but Reich soon found that traditional marketing managers weren't all that interested. So, after earning his degree, he decided to jump from marketing to finance. To do that, he quit his job and enrolled at the Tepper School of Business.

Reich studied finance, economics, and accounting at Carnegie Mellon and, in the process, landed a "great-fit" summer internship with Root Markets, an online start-up that matched mortgage borrowers and lenders. When the summer ended, the company pressed him to stay. Reich agreed. For the second time, he completed his degree while working full-time, this time in New York.

The year was 2006, and within the following 12 months, the place to be was anywhere but mortgages. Reich moved on to an equity research group. He loved the traditional finance and heavy emphasis on data, but the 40-year-old company was just too set in its ways for Reich. He missed the challenge of a start-up. He left the firm to dabble in independent data-mining consulting while he pondered what to do next. Not long after that began his frustration with monitoring his personal finances.

"I had a house mortgage, a home equity loan; it wasn't that complicated," he says. In a tweet about the online financial management tool he subscribed to, he wrote: Could someone introduce me to the software developer? I want to punch him. Mulling it over the next two days, he realized he'd been a bit hasty. It wasn't the developer's fault. It was the bank's fault for supplying bad data in the first place. More importantly, Reich was realizing something else. "The only way to get better data from the banks is to be a bank. So how do you become a bank?"

It's a question he passes along in his Let's start a retail bank email to Shamir and Jerry. He types, What would it take to start a really boring, simple bank? A few paragraphs later, he signs off. Following advice he received in a Tepper class-if there's anything important that you don't have to send out that day, sleep on it-Reich decides to wait on the email. He sends it the next day at 9:45 a.m.

(Continued …)

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