Dive Brief:
- Prepaid card issuer and branchless bank Green Dot has hired as its new CEO former Netspend chief executive Dan Henry, it announced Wednesday.
- Steve Streit, who founded Green Dot in 1999, stepped down as the company’s CEO in December. Mark Shifke, Green Dot’s CFO, also left the company that month.
- Henry led Netspend, a prepaid debit card company, from 2008 to 2014, guiding it through an initial public offering and later completing an all-cash $1.4 billion sale to payment processing firm TSYS.
Dive Insight:
The leadership transition comes at a critical time for Green Dot. The legacy payment card company’s stock price plummeted by 60% between May and December, according to American Banker. The company lost 300,000 of its 50 million customers in last year’s third quarter as competition with neobanks has intensified, Streit said. And the company said it expects adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) to be about 25% lower this year than what it projected for 2019.
However, Green Dot in October renewed its most valuable prepaid card partnership with Walmart through 2027. About 35% of Green Dot's second-quarter revenue last year came from sales at Walmart’s stores, according to an August securities filing. It also launched a fintech accelerator, TailFin Labs, the majority of which Walmart will own.
Desire for a change of direction became apparent at Green Dot as early as 2016, when an activist investor sought to oust Streit amid a previous drop in value and fierce competition from American Express and others.
"I am honored to join Green Dot and look forward to working with the company’s many talented team members to continue driving the mission of transforming the financial services industry through powerful partnerships and innovative products and services," Henry said in a press release. "I see significant potential to build upon Green Dot’s solid foundation that combines its bank charter with its market-leading Banking as a Service FinTech platform."
Before joining Netspend, Henry co-founded the digital payment company Euronet Worldwide in 1994 with his brother-in-law. Henry served as the firm’s president and CEO through 2006 and was a board member until 2008.
Since May 2018, Henry has worked as chairman of Paysign, a provider of prepaid card programs, digital banking and processing services for corporate, consumer and government applications.
"Dan is a highly regarded leader and accomplished executive with operational expertise and over two decades of deep experience in the FinTech space," Jacobs said. "He is also an innovator who has spearheaded, built and operated two publicly-traded payments companies. The board and management team are confident Dan is the perfect candidate to lead Green Dot into its next chapter."
