20VC Revolut Founder Nikolay Storonsky on His Leadership Style and Relationship To Ambition, His Biggest Lessons From Scaling Revolut Globally; What Worked, What Did Not & Why Speed of Product Shipment is The Most Important Thing



In a conversation with Harry Stebbings on "20vc," Nikolai Storonsky, the founder and CEO of Revolut, discusses his journey from a frustrated bank employee to revolutionizing the neo banking industry with one of the fastest-growing fintech companies. Storonsky, who raised over $905 million and scaled the company to over 2000 employees across four continents, credits his resilience and focus to his years as a derivatives trader. He emphasizes the importance of competitive drive, quantifiable goals, and rapid product innovation in achieving business success. The discussion also touches on Revolut's global expansion, balancing growth with profitability, and maintaining agility in the face of regulatory challenges. Storonsky's leadership style has evolved to empower his team while keeping a close eye on metrics and progress, and he aspires for Revolut to be a top player in every market it enters.

Summary Notes

Introduction to Revolut and Nikolai Storonsky

  • Revolut is described as the financial super app of the next decade and one of the world's fastest-growing fintechs.
  • Nikolai Storonsky is the founder and CEO of Revolut, which offers personal to business banking solutions.
  • Revolut has raised over $905 million from investors like Ribbon Index, DST, Balderton, and Bond Capital.
  • The company has scaled to over 2000 employees across four continents.
  • Before founding Revolut, Nikolai worked as a derivatives trader at Lehman Brothers and Credit Suisse.

"So with that, I'm thrilled to welcome Nikolai Storonsky, founder and CEO at Revolut, offering everything from personal to business banking, providing a better way to manage your money."

The quote introduces Nikolai Storonsky and Revolut, highlighting the company's broad banking services and its significance in the financial technology sector.

Nikolai's Transition from Banking to Entrepreneurship

  • Nikolai's frustration with traditional banking structures and management led him to resign and start Revolut.
  • His experience in banking was the catalyst for founding Revolut, with the aim to create a better banking system.

"I just got pissed off with banking structures, with banking managers more and more and more. And at a certain point, I decided, you know what? I can do better than them. And I resigned and started my own company."

This quote explains Nikolai's motivation behind creating Revolut, which was rooted in his dissatisfaction with the existing banking system and his confidence in building something superior.

Lessons from Derivatives Trading

  • Nikolai's derivatives trading experience taught him to be thick-skinned, especially when facing significant financial losses.
  • He learned to become extremely focused and able to quickly understand complex matters.
  • His trading background made him model-driven and numbers-driven, moving away from relying on intuition.

"So I think there was lesson number one and training number one. Number two, I guess it was extremely focused because a lot of people are, well, at least in my experience, they can't focus very fast, right? And they can't switch their attention."

The quote summarizes the first two lessons Nikolai learned from derivatives trading: becoming thick-skinned and developing an acute focus that allows for rapid understanding of complex issues.

Competitive Nature and Entrepreneurship

  • Nikolai's background as a competitive swimmer is seen as analogous to the competitive nature of entrepreneurship.
  • He observes that most successful entrepreneurs he knows are extremely competitive, suggesting it's a characteristic inherent to many entrepreneurs.

"I think it's very important, right. If I look at all my friends who are entrepreneurs, they're all extremely competitive people, right? And I think it's kind of a character thing and people probably either born with it or not, right?"

This quote reflects on the importance of competitiveness in entrepreneurship, implying that it may be an innate trait in successful entrepreneurs.

Leadership Style

  • Nikolai's current leadership style involves setting quantifiable goals for his team and allowing them the freedom to achieve these goals.
  • He conducts weekly business reviews and one-on-ones to monitor progress.
  • If goals are not met or metrics are not moving, he investigates to identify whether the issue lies with leadership or external factors.

"Well, today I just give people goals. I always quantify goals so they are measurable and then I let them reach these goals as simple."

The quote outlines Nikolai's leadership approach, emphasizing goal-setting and autonomy for his team members, with intervention as needed to address any issues or lack of progress.

Goal Setting and Management

  • Harry Stebings discusses the challenge of setting ambitious goals that are also realistic to prevent disappointment.
  • Nikolai Storonsky emphasizes the importance of being realistic when setting goals and having a track record for achieving them.
  • Storonsky suggests using a playbook or template to estimate the resources and time needed to achieve a goal, adjusting it based on the individual's skill set and seniority.

"You need to have a track record of achieving goals to be able to evaluate how difficult this particular goal right in your head."

This quote highlights the necessity of past experiences in setting achievable goals, indicating that one's history of success informs their ability to gauge future goal difficulty.

Ambition and Personal Drive

  • Storonsky's ambition is described as significantly greater than that of others by Martin Mino.
  • Ambition, according to Storonsky, is subjective and should be based on interesting and increasingly complex goals.
  • He compares ambition to a professional hiker aiming for Everest, suggesting that what may seem ambitious to many is attainable for those with experience.

"For me it's interesting to reach. Just to give you maybe example, a comparison, right? If you're a professional hiker, right? And then you climb very tall mountains, obviously if you want to go to Everest, for majority of people it's just too ambitious. But if you've done it before, a bit in less tall mountains, it's interesting."

Storonsky's quote illustrates that ambition is relative to one's experience, and goals that seem ambitious to some may be compelling challenges to others.

Handling Self-Doubt

  • Storonsky shares his approach to maintaining calm and dealing with self-doubt, drawing from his experience in derivatives trading.
  • He believes that difficult phases in life are temporary and trusts that they will eventually conclude.

"But the good thing is when you go through bad, rocky path of your life is sooner or later it will end."

The quote conveys Storonsky's optimistic outlook on overcoming challenges, emphasizing the impermanence of difficult times.

Speed of Product Shipment

  • The conversation shifts to the importance of product innovation and the speed of product shipment.
  • Storonsky identifies speed and quality of product development as the company's secret weapon against competitors.

"It's our secret weapon, right? It's how we compete with other companies because ultimately all the businesses, what they do, they give products to people."

This quote explains the strategic advantage of rapid product development in staying ahead of competitors in the marketplace.

Product Development and Prioritization

  • Storonsky describes the evolution from an entrepreneurial approach to a more scientific method in determining which products to develop next.
  • The current approach involves research, assessing global trends, and prioritizing based on resources, infrastructure, and customer needs.

"Now it's a bit more sophisticated based on our internal ideas, priorities, plus what's going on in the world."

The quote summarizes the shift towards a data-driven and strategic approach to product development, considering both internal and external factors.

Team Structure for Innovation

  • Teams within the company are structured to be self-sufficient in product development, with goals and KPIs cascading from the company level to departments and teams.
  • Performance is measured based on the achievement of these goals and KPIs.

"And then the performance is linked to what they achieved as a team."

Storonsky's quote underlines the alignment of individual and team performance with broader organizational goals, fostering accountability and direction.

Geographic Expansion

  • The discussion moves to the company's global aspirations and the strategy behind its geographic expansion.
  • Storonsky reveals the goal of building a global bank and the methodical addition of new countries each year based on established playbooks.

"We want to build a global bank. And obviously, sooner or later someone would do it and we want it to be us."

This quote captures the company's ambitious vision for international growth and the proactive steps taken to realize it.

US Expansion Strategy

  • The conversation touches on the company's US expansion and the challenges faced with launching during the Covid-19 pandemic.
  • Despite the timing, the decision was made to proceed with the launch to honor the team's hard work.

"Well, us worked on the country for two years, and then when we were ready to launch Covid hit, we still decided to go on with a launch because our team works very hard and it's live already for eight or nine months."

The quote reflects the company's commitment to its expansion plans and the determination to push through unexpected challenges.

Product Launch in New Markets

  • Revolut launched a limited product in the US, missing trading and other products available in Europe.
  • They plan to add all existing products to the US market once they obtain a trading license.

"Initially, we launched a very, I would say limited product compared to what we have in Europe because we don't have trading, we don't have other products there. But as soon as we get trading license, we'll add all the products that we have on the revolut for us market."

This quote explains Revolut's initial strategy for entering the US market with a limited product offering and their intention to expand the product line upon obtaining the necessary licenses.

Cost and Timeframe of Market Expansion

  • Launching and scaling in a new market can take up to two years.
  • Budgeting $10 to $20 million is advised for capitalizing the entity, hiring a team, and scaling in the market.
  • Growth can be significant with zero marketing initially, but additional marketing can help outgrow local competitors.

"Well, basically you should budget in up to two years. That's reality. [...] I would budget ten to $20 million while properly capitalizing entity in the market and hiring team and making sure country scales."

Nikolai Storonsky outlines the expected timeframe and financial investment required to launch and scale a new market effectively.

Challenges of Entering New Markets

  • Launching in a new market is complex due to regulatory requirements and numerous product offerings.
  • A company may need multiple licenses and separate entities, along with configuring centralized systems for each local market.
  • There are many moving parts that need to be synchronized, contributing to the time it takes to establish a new market presence.

"Well, it's quite complex to launch, right, because we're in a regulated industry. [...] Basically it's a huge project, right?"

Nikolai Storonsky describes the complexities and challenges of launching financial services in a new market, emphasizing the project's scale and regulatory hurdles.

Learning from WeChat and WhatsApp

  • WeChat's product ecosystem and engagement levels are considered ahead of the planet.
  • Less strict regulation in China allowed WeChat to frequently launch unregulated products.
  • The recent regulatory changes might impact WeChat's ability to launch products at the same pace.

"WeChat, I think is ahead of the whole planet in terms of number of their products, their ecosystem, their engagement, and then the reality where they were able to achieve it."

Nikolai Storonsky expresses admiration for WeChat's product development and ecosystem, attributing their success partly to a less stringent regulatory environment.

Balancing Growth and Profitability

  • Revolut aims to grow as fast as possible while remaining profitable.
  • Profits are reinvested in growth, but not to the extent of operating at a loss.
  • Growth and profitability are not just about adjusting marketing spend; it also involves optimizing costs and revenues, product prioritization, and expansion strategies.

"We want to grow as fast as possible and remain profitable. [...] So our view is we optimize as much as possible gross profit."

Nikolai Storonsky explains Revolut's philosophy of maximizing growth while maintaining profitability through careful optimization of costs and revenues.

Daily Operations and Management

  • Running a global financial super app involves standardized processes and regular business reviews.
  • Each department presents weekly updates on KPIs, roadmaps, risk indicators, audit findings, and other metrics.
  • Product reviews are conducted weekly to assess new designs and iterate based on feedback.

"Yes, it's very playbooked. [...] So that's what we call business review. [...] So the designers and owners, they listen to feedback on the product, and then we repeat it again every week."

Nikolai Storonsky details the structured approach to managing Revolut's operations, highlighting the importance of regular reviews and feedback loops for continuous improvement.

Personal Relationship with Money

  • Nikolai Storonsky has never focused on money for its own sake; instead, he views it as a tool for business growth.
  • His background in trading treated money as a score or P&L, not as a personal asset.
  • Money is primarily seen as a means to hire talent and invest in marketing.

"To be honest, all my life, I never thought about money. [...] But the money is a score or your PNL, right."

This quote reveals Nikolai Storonsky's perspective on money, emphasizing its instrumental role in achieving business objectives rather than personal wealth accumulation.

Reading Preferences and Book Insights

  • Nikolai Storonsky appreciates concise information and believes books often dilute valuable ideas across too many pages.
  • He found value in Ray Dalio's principles before they were published as a book due to their brevity and density of ideas.

"I liked radialio principles, actually, before they became a book, because I remember on their"

Nikolai Storonsky reflects on his preference for succinct, dense information, using Ray Dalio's principles as an example of valuable content before it was expanded into a lengthy book.

Bridgewater's Principles

  • The original PDF of Bridgewater's principles is preferred over the polished book version.
  • The PDF was concise, dense, and unpolished, which was seen as a positive aspect.

"There was simple pdf of 50 pages. And that's the book I liked because it was only 50 pages. It was so dense and it was not polished, right."

The quote highlights the speaker's preference for the original, unrefined version of Bridgewater's principles, emphasizing the value found in its brevity and density.

Shift in Consumer Financial Ownership

  • The shift in consumer financial ownership is seen as fundamental, not a bubble.
  • Traditional yield-generating deposits are no longer as profitable.
  • Access to financial assets has become more accessible through simple apps.
  • Consumer behavior has shifted towards trading due to low or negative interest rates on deposits.
  • Trading has become a new form of entertainment and engagement for many people.

"I think it's fundamental shift, right? Because reality, if you think of what happened before, you had yield generating deposits, right."

This quote expresses the belief that the change in consumer financial behavior represents a fundamental shift, driven by the changes in the profitability of traditional banking and the accessibility of financial trading platforms.

Maintaining Composure and High Energy

  • High energy levels contribute to remaining calm under pressure.
  • Staying calm is key to making the best decisions during crises.
  • Emotional responses often lead to poor decision-making, so it's important to manage one's energy and emotions effectively.

"And I try to keep energy level very high. And as a result, if you have a very high energy level, well, you remain calm."

The speaker explains that maintaining a high energy level helps in staying calm, which is crucial for sound decision-making, especially in adverse situations.

Traits for Future Generations

  • Competitiveness is seen as a driver for self-improvement.
  • Curiosity about the world and technology is valued.
  • The desire to build and leave a legacy is considered fundamental.

"I think it helps to be a bit competitive because it drives you."

This quote underscores the importance of competitiveness as a motivating factor that pushes individuals to become better versions of themselves.

Admiration for Elon Musk

  • Elon Musk is admired for going against the crowd and being opinionated.
  • The speaker appreciates Musk's willingness to express his views despite societal polarization.

"I obviously like Elon Musk, but the thing I like about him, not because he know great companies, but that he goes against the crowd."

The speaker expresses admiration for Elon Musk's character, particularly his readiness to share his opinions publicly, which many people avoid doing in today's polarized society.

Protecting Valuable Team Members

  • The speaker is cautious about revealing the best board members to avoid them being poached by others.
  • The approach to team member recognition is protective and strategic.

"I have quite a few, but I won't tell because I'm afraid other people might try to steal them."

The speaker indicates that they value their board members highly and are protective of them, suggesting the competitive nature of retaining top talent.

Future Goals for Revolut

  • The goal is to make Revolut a global business.
  • Aspiration to be either the number one or number two financial service provider in every country they operate in.

"So I want to be a global business and to be either number one or number two in every single country where we're in."

The quote outlines the speaker's ambitious goals for Revolut's expansion and market dominance over the next five years.

Appreciation for the Interview

  • The host expresses gratitude for the guest's flexibility and insights during the interview.
  • The guest is thanked for deviating from the scheduled plan and providing a valuable conversation.

"I mean, I really so enjoyed that discussion with Nick. I want to say huge thank you."

This quote reflects the host's appreciation for the guest's contribution to the podcast and the enjoyable discussion that took place.

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