American Dream or American Debt

Sangram Vajre has quickly built a reputation as one of the leading minds in B2B marketing. Before co-founding Terminus, a SaaS platform for account-based marketing, Sangram led the marketing team at Salesforce Pardot. He has spoken on the topic of marketing technology around the world and is the mastermind behind #FlipMyFunnel. Sangram’s path to success hasn’t been easy, however – he immigrated to the US at the age of 25, with no credit and $350 dollars in his pocket. In this episode, Eric and Sangram discuss Sangram’s financial journey in the US, as well as how the ‘immigrant mentality’ has helped Sangram to lead several successful businesses.

sangram_vajre

Sangram Vajre is the co-founder and Chief Evangelist at Terminus, a SaaS platform for account-based marketing. Prior to that, he led the marketing team at Pardot through its acquisition by ExactTarget and then Salesforce. He’s the author of “Account-Based Marketing For Dummies” and is the mastermind behind #FlipMyFunnel. Follow him on Twitter @SangramVajre.

Eric: 00:04 Welcome to the Finance Frontier. I’m your host Eric Hathaway. This is part four of our five part series on financial inclusion. Today I have the pleasure of speaking with Sangram Vajre, who’s the co-founder and chief evangelist at Terminus, which is a SaaS platform for account based marketing. Prior to this, he led the marketing team at Pardot through it’s acquisition by ExactTarget and then finally Salesforce. Sangram has spoken on the topic of marketing technology around the world, and has built a reputation as one of the leading minds in B2B marketing. But today, we’re going to be talking about something a little more personal, his immigration to the US.

Eric: 00:40 While many of us might not think about it, one of the challenges of immigrating to the US is that our credit system does not recognize financial history from outside the country. This leaves a huge population of folks in the US who have to start over from a credit perspective. Sangram, welcome and thank you for being here today. Let’s kick off at kind of the beginning of your immigration story, by giving us an idea of the challenges that you were up against from a financial perspective when you decided to come to the US.

Sangram: 01:07 Thank you so much for having me on the show and touching on such a personal and deep topic. I get to talk about all kinds of things around marketing and entrepreneurship and all that, but this obviously deeply personal and something that I think most people, to your point, take for granted. Which is something I definitely don’t. So again, thank you for the opportunity to share some of it.

Sangram: 01:33 For me I think it was a really interesting time. My brother was in the states, I was just graduating at that time, and he said, “Why don’t you go do your masters? Because America is an incredibly amazing place, you’ll learn a lot, and within two years when the economy is back up you can make a decision on where you want to go.” Most challenging for me was, given that I came from such a modest family, it was like how am I going to financially afford a full tuition for my masters program. I remember at that time we took a loan for about $5000 from an Indian bank that would cover only the first semester.

Sangram: 02:16 After that, my brother said, “Hey look, I’ll cover for your admission fees, so whatever we have to do that for that early on, the application fees, and then here’s your $5000 for the first semester.” Then, after that you’re on on your own, so you’ve got to figure out how you’re going to pay for the rest of the three semesters once you get there. That’s pretty much the leap of faith that I had when I came here.

Eric: 02:40 When you showed up. You got on a plane, you showed up, I believe, I read a couple articles that you have done in the past and you’d mentioned that you had $350 in your pocket. You show up in America, you’ve got your first semester of tuition paid for. Give us an idea of what happens. Did you try to get loans, did you try to talk to some banks, did you try to open a checking or savings account? What happened during that first year you were here?

Sangram: 03:06 The first year that I was here, I remember pretty much the very first week I was knowing that okay, this semester is about to open. It didn’t even start, but I knew I needed to get some sort of assistance-ship to start paying for my living expenses. Because, that’s didn’t cover a lot of that, 350 bucks wouldn’t have gone too far. Then, during that time I have to also figure out a way to, for my second and the other two semesters. There was a lot for me to just think about beyond completing the masters program, because that wasn’t even coming to my mind. Like, we’ll get to it when the school starts, but until then I need to figure out how I’m going to survive.

Sangram: 03:50 A checking account wasn’t an option for me in the very early, like I think almost for the first six, eight months, because there wasn’t anything for me to put in there in the checking account. Also, I wasn’t a citizen, so it took me about six to eight months to build up some amount of money to open a checking account, which was with Bank of America at that time. I’m still a Bank of America customer. That happened at that time, but I remember like the very first week I was looking for an apprenticeship across many different functions. I remember this lady coming up and sharing with me, I was asking for any apprenticeship and she’s like, “Well, I’m not the smartest pencil in the box.” in a very amazing Southern accent, and I had no idea what she meant, and I started looking for pencils and a box.

Sangram: 04:44 She’s like, “No, that’s not what I meant, it’s a phrase.” I’m like, “Well, I don’t know what that means.” Coming back, my friends who were there longer, they’re like, “Man, you are in so deep trouble.” They literally gave me this VHS files at that time, in 2002, of Friends, and Everybody Loves Raymond, and Seinfeld, and said, “Watch it.” I think that’s where I first binge watched anything. I watched it for like eight hours, or 10 hours, or two days of different times like day and night.

Sangram: 05:14 I’m like, “Okay, I get now all these phrases that now most people use very commonly.” That was very interesting and frightening, because I couldn’t even communicate much less try to open a credit card account with all that information. Then, within that, I remember just having maybe 700 or $1000 spending limit, which means that wasn’t really a whole lot to even begin with. But, that really is where I started off.

Eric: 05:40 You had mentioned developing a relationship, opening an account with Bank of America, and I think you mentioned you’re still with them. Is there something behind that hey, this bank helped me so I’m going to stick with them mentality that’s kept you with them?

Sangram: 05:57 Frankly, no. I feel like there was a period of time where I felt like that was a, you know, like your first date, you never forget that. I felt like that was part of it, is like my first chance, my first job. Those things you never forget, since my first bank account was at Bank of America. I think for a few years I definitely wanted to keep as long as I could, but later on I think it just, it is hard to switch. I think the part of switching, then I have to reconnect all of my bank information with other, a newer bank to my current cards, to all these things. I think the cost of switch, of cost meaning purely time, is way higher than any of the benefits that once or twice I explored.

Sangram: 06:43 I may be unique at this point, but I’m not sure if I really, really am, because if it’s not costing me anything to have a bank account and if the bank account, all it does is really keeps the money and connects with all these different things, that’s all I use it for. Then, I think that bank does a really good job. I don’t know what else any other bank could actually do that would offset that ease and convenience and simplicity.

Eric: 07:08 Yeah, that’s a great point.

Eric: 07:20 When you opened that first credit card account did you apply for multiple, or did you just apply for that one?

Sangram: 07:26 I think at that time I applied for American Express. I think we had no idea, like I had no idea especially at that time of oh, you know, your credit history, you shouldn’t be applying to multiple different accounts. I think I applied for about 20 different credit cards at that time, because I thought whoa, this is great. I just get credit cards and then it will allow me to spend, because I didn’t have full citizenship until that point, so I knew that I had to borrow money from somewhere if I don’t get it. I was just trying to figure out who’s going to give me the most credit, not knowing the more I actually open credit cards the less value, or the more dinged I will get on credit history. It was all news to me, but at that time I think I applied for like about 20, 30 different cards.

Sangram: 08:12 I think the majority of them got declined, and then I finally got something from American Express. That’s where I started.

Eric: 08:21 One of the things that we have been talking to our listeners about, and especially in the financial inclusion space, is some of the difficulties obviously in getting access to credit products such as credit cards, bank accounts. But, also the expense. Were you aware of that, was the education that was given out there enough for you to have an understanding of the cost and the difficulties in that?

Sangram: 08:45 I don’t think there was any education per se. Internally I think it was more of like, “Hey, I got a credit card, that’s awesome.” I personally was never coached on like hey you should consider this, understand this. Fees was not even part of my vocabulary at that time.

Eric: 09:05 Moving forward a couple years. You get your masters. You get out. I believe your first job in one article I read was with Deloitte. What was happening a couple years down the road, and did it become easier or was it still difficult even during that period of time now that you’ve got a full-time job and you’re working and having income.

Sangram: 09:25 I remember, as soon as I got a job and man, my first job, I think I made $34K or something like that. I remember as soon as that happened that, the floodgates opened up from credit perspective. All of the sudden I would start getting letters in the mail from a lot of different credit card companies saying that hey, we have 5000, 10,000, and 15,000 dollar credit, which was very interesting to me because I obviously cannot afford to spend that much money with the salary I made.

Sangram: 10:00 I think I started to learn because I started to then start paying attention to okay, I’m now graduated. I do have some amount of debt, and I do now need to pay that off. I’m like, look wait a minute, that’s way more than I actually borrowed, what happened here. For the first time I really started to look at my existing payments to see how I can pay off and then I realized, well this is cumulative. Like, I think one case I was paying like 28% or 32% or so interest rate. I think that was a big eye opener for me, because I saw the horror of having that just for a couple of years, even as a student with a very limited kind of power of spending.

Eric: 10:55 As we’re looking at this sort of area, especially from unbanked an under-banked. There is about 75 million, so almost a quarter of the population of the US is unbanked or not getting access to typical financial products¹. There’s almost 10 million immigrants that are having that same struggle². As you have gone through your path, both on an individual basis and a business, is that something that you have paid attention to? Or, was that something that was sort of sidelined to you. That didn’t really sort of resonate?

Sangram: 11:33 I think that’s one of the areas that does make me wonder and think about, is that was is it that I can do to help address some of the challenges that I faced, or at least educate other people about it. This is why I think it’s super interesting to be on your podcast, because I feel like that’s one way to do it. I feel like this, I look at this almost like a curve if you will. When I came to the states in 2002 I think the credit was still kind of light for early stage, but then as the economy started to boom it really went up, the curve. All of the sudden I remember getting this 20,000 plus credit card that I could spend on any given day. Which was just insane and crazy.

Sangram: 12:16 You just spend more and then you get more into debt, and then there you go. Transitioning into now where I think, when I talk to students who are immigrating and coming in here, I feel like they are more easily getting access to money and capital. But, there is still no education around what they, why this is important or how should they manage the finances. They literally come in, get their credit cards, start spending, and feel like they have, they are now reaching their American dream. Without really knowing that they’re really building is an American debt that’s not helping them climb up where they want to be, and it’s a very slippery slope.

Eric: 13:01 Have you kept in touch I guess with your family and friends back in that part of the world, and have you seen a development or tract that piece of financial inclusion back in India at all?

Sangram: 13:18 I talk about this with my friends. I feel like it has largely it has to do with the economy. I feel like when the economy is good, as it is right now, at this very moment when we’re doing this podcast, I feel like people have access to a ton of money in many different ways. Now of course, people who are extremely poor I think they would challenge that, and rightly so. But, for the most part, if you are in a, if you have an idea, if you have something that you want to do, I feel like money is available. From institutions, from banks and stuff, and more fluidly than ever before that I’ve seen in the last 20 years or so. Even in India or in Africa or all these countries.

Sangram: 14:05 As a matter of fact, their growth rate is higher in many cases than a lot of the developed countries, just because of how the population is and how much money and explosion of ideas is happening there. What’s interesting to me of that is also that they’re almost 10, 15 years behind understanding how to use it. For example, I know that all my life when I was in India we never had a credit card. We didn’t even have a card, right. That wasn’t a concept ever, it was all cash. You always have cash in your pocket, you go and by every and anything in cash. You buy a house in cash, right. That pretty much is how I grew up, how I know my parents grew up, and their parents grew up.

Sangram: 14:49 Credit card or access to capital to do something was almost a foreign thing from a middle class family perspective. What I feel I’m seeing right now in developing countries is there’s more capital available. People are starting to just jump on it, and almost leapfrog the whole process of going through the pain that I think most people in developed countries went through, and have more capital access to it. They’re going to find, they’re very quickly going to find themselves into a situation where they had, if and when the economy kind of tanks a little bit, they’re all going to find themselves that they have overshot. They have overspent, and they have over borrowed in all these cases.

Sangram: 15:31 I worry about that, especially when I talk to my friends and family out there.

Eric: 15:35 Yeah. It’s a fascinating point, and it will be interesting to see. Sometimes, you know, there’s always the good and the bad with modern technology.

Eric: 15:43 One of the things you’ve mentioned in the past is the immigrant mindset, and how that has sort of helped you be successful. How has all of that helped you become the success that you’ve become?

Sangram: 16:06 Well, that’s very kind of you to say, you know, success, because I think success is a super relative term to a lot of people. Although I do feel that I am super fortunate to have done some of the things that I have been able to do, and I’m grateful that I truly do believe that there is no bigger and better place than America to do that. Because it is truly, at least where what I see and how I see it, and if I can be an example for others, it’s truly a land of opportunities. I think I’m a living example of that.

Sangram: 16:40 With that said, I feel like, you know, the fact that when, just thinking about even for me I get chills when I think about this fact. Is the fact, leaving a country and coming to another country with no more than 350 bucks in your pocket. Not knowing if you will be able to pay for beyond the first semester. Not knowing if you could actually have a place to live in this country, or in this foreign land to you at that point. Also not truly fully understanding the cultural things that you have to learn to keep up with certain things to even be part of something as big as this, I feel creates, puts you in a position where you have to accept and learn to accept failures.

Sangram: 17:33 I think that is a super important thing that I feel every entrepreneur has to go through, and every leadership role has to go through. Is to accept that you’re going to fail, and it is okay to fail. I think that kind of knowledge, that kind of push, really made me recognize that I one, have to be very grateful for the opportunity I have, and that grateful thing should never go away. Two is that I have to do these things and it is not anybody else’s responsibility to do it for me.

Sangram: 18:06 It creates a sense of urgency, it creates a sense of pride on those things. It also creates the sense of humility, because you know you don’t have a whole bunch of things to fall on. I see a lot of people give up too easy, too quickly, too early. I think that mindset, or that process that I went through for the first four, five years, really enabled me to know that well, if I can do that. If I can live and survive on 350 bucks for two and a half years, and then get a job, and then do all these things, then I can do anything. That just put me in those situation that I didn’t think I had it, I didn’t know I could do it, but I didn’t have an option. I feel like I’m now truly enjoying the fruits of some of the work that I’ve put in for the last 16 or so years, and I think I’m just getting started.

Eric: 19:04 Sangram, I want to wrap things up here, and I really appreciate you taking the time. Hoping continued success.

Sangram: 19:11 Well, thank you Eric, I appreciate it.

Eric: 19:16 Thanks for listening to the Finance Frontier. I’m your host Eric Hathaway, and until next time subscribe on your favorite podcast app.

[1] The World Bank. (2018, April 19). Financial Inclusion on the Rise, But Gaps Remain, Global Findex Database Shows. Retrieved September 17, 2018, from http://www.worldbank.org/en/news/press-release/2018/04/19/financial-inclusion-on-the-rise-but-gaps-remain-global-findex-database-shows

[2] Wisniewski, M. (2018, February 09). Fintechs Find Another Untapped Market: New Immigrants Needing Credit. American Banker. Retrieved September 12, 2018, from https://www.americanbanker.com/news/fintechs-find-another-untapped-market-new-immigrants-needing-credit

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