15 million customers later, Revolut is making its way to becoming the Amazon of banking.
What is Revolut? It’s a fintech company that started out as a multi-currency prepaid card targeted for travellers, but have since evolved to be much more than that, with a full range of banking solutions. It now has solutions for stocks and crypto investing, savings, rewards and much more.
Let’s find out what sets them apart to try to achieve this ambitious goal.
The beginning
Founder profile
Nikolay Storonsky was born in 1984 in a small town in Russia. He grew up involved in sport activities and attended the Moscow Institute of Physics and Technology, where he earned a Master of Sciences in General and Applied Physics. He also earned a Master of Applied Economics and Finance at New Economic School.
After finishing university, he joined Lehman Brothers in 2006 working as an equity derivatives trader. He left the company in 2008 and went to work with Credit Suisse until 2013.
Creating Revolut
"What happens in Vegas, stays in Vegas."
The idea for Revolut came to Nikolay when he travelled abroad to Las Vegas and spent $12.000. After returning, he realised there were also $2.000 in hidden fees from the bank account. Later, he faced the same issue when sending money abroad.
So he started working on a transparent way to exchange currencies and at interbank rate. For more than one year, he and Vladyslav Yatsenko - Revolut's CTO - self-funded the company until its official launch in March 2015.
Since the beginning, they always had big ambitions for the company: “As a solution, I tried to find a multi-currency card and was later told it wasn’t possible. But I was determined to make it work. The reality of what we’re trying to achieve is to build a ten times better financial services company that is ten times cheaper as well,” Nikolay explained.
Within one month of launching, they had 6.000 pre-product subscribers, with zero spent on marketing. In that time period, they processed more than $200.000 in transactions in private beta, while growing 30% a week. Three months later, they had 46.000 customers and processed more than 100 million dollars in transactions.
With this fast traction, they were able to raise an initial seed round of 3.4 million dollars from European VCs. The company slogan was "Personal money cloud" and their initial focus was on instant exchange of currencies at interbank rate and ability to send any currency for free to friends through social networks.
Scaling up - Beyond banking
Culture change
As the company grew, new challenges started appearing.
Nikolay is a firm believer of success and hard work be directly correlated. In fact, not only did he work for very long hours, but he only hired people who were willing to work hard and tirelessly to scale the company at a blitzscaling level. As a result, the employees were expected to work 13 hours daily.
The company faced harsh criticism for this and had to adapt its culture as it matured. While it started by prioritizing expansion at all costs, which resulted in a toxic workplace and high employee turnover, they evolved to focus on responsible growth.
“Now we’re different, the culture is not the same as it was,” Storonsky said. “I guess when we grow to 5,000 people, the culture will change again, because it’s impossible to have the same culture for 20 people as for 5,000.”
Customer first
They have always a customer-first approach in everything they do. In 2017 raised a 66 million dollars Series B round. In addition, the company wanted to also raise 5 million dollars from a crowdfunding campaign, to allow Revolut customers to invest in the company. They met the crowdfunding target in less than 24 hours and had more than 40.000 people interested in the investment opportunity. One important aspect is that the investment conditions for the crowdfunding investors were the same as the VC investors, a condition requested by Revolut.
This approach is also present in the way they implement new solutions. Also in 2017, after being highly requested by the customers, they launched the ability to do crypto trading inside the app in a simple and easy way. Other solutions were later implemented based on the customers feedback, such as stock trading, savings vaults and more.
Creating an ecossystem
Although they started with a niche solution, their aspirations are much bigger than that. This has been reflected on their change of slogan in 2018 to "Beyond Banking", which reflects their big ambitions.
They are heavily inspired by Amazon, that started initially by selling books and now is a marketplace for everything. Revolut wants to become the Amazon of banking and more, and is already working on that, with solutions like stocks and crypto trading, savings, budgeting tools, airport lounge access, rewards and more.
However, their work is nowhere near the stagnant stage. In fact, they believe they are still in their infancy, with much more still needed to be done. While they have amassed a large following in Europe, their US market is still developing as well as in other countries.
Perfecting company values
To have a high performance company, you need to have a high performance team that is aligned to reach a common goal. This is reflected on the company values, which serves as a guideline for the DNA of the company. And Revolut's values are definitely aligned with its ambitions, as well as their way of operating.
Here are 4 sentences from the company’s culture page that are correlated with its success:
We always dive deep into details until we understand reality. We always ask: “Is that true?” and “why?” to get to the root cause. - They implement the 5 Whys methodology from the Toyota Production System, that believes that by asking why 5 times whenever finding a problem, they will find what is the real root cause of the problem.
We always start with a problem definition. We always ask: “What is the exact problem that you are trying to solve?” - So many companies fail because they start by finding a solution, and then they scramble to find the problem it is trying to address. By focusing on having a clear defined problem, they are more capable of finding a solution.
We build minimum lovable products (MLPs), not minimum viable products (MVPs). - While a MVP focuses on building a product as fast as possible and test it in the market - basically with just the bare minimum features -, the MLP takes a bit more thought and care into refining the product to delight the customer.
We love solving problems in a simple and elegant way while taking care of every small detail. - As Leonardo da Vinci said: Simplicity is the ultimate sophistication. The most successful products are the ones who are capable of addressing complex problems in simple ways.
While Revolut is not perfect and still has a lot to improve, it's impossible to not look back and admire the speed and efficiency at which they've been able to move and change the industry. Their core qualities as a group and management team should be a reference to other companies and there are learnings that can be made and implemented in all industries.
3 articles to read
Revolut Pitch Deck for Seed Round
The pitch deck they used for their Seed round. Very interesting to see how their business model has evolved since then and how the company has matured in so little time.
Inside Revolut's bid to be the Amazon of banking, and the lessons it's learned from breakneck growth
An article from CNBC showcasing the success and challenges the company has faced until now and what's next for them.
Revolut's Nikolay Storonsky Is Building The Amazon Of Banking
A 2018 article from Forbes that shows that this ambition has been long in the making and what are the company plans to achieve global scale success.
2 videos to watch
A 2015 video presentation of the company. "We want to replace banks. As simple as that."
What I Have Learned in Scaling a Fintech Business So Quickly
Learning from Nikolay about scaling the company to 1 million users in just over two years.
1 podcast to hear
The Next Stage podcast by Web Summit - In conversation with Revolut's Nikolay Storonsky on Stitcher
An interview to Nikolay during Web Summit 2019, where he discussed about the future of digital banking and finance.
Quotes to remember
“If you have brilliant people around you, it doesn’t matter what kind of business you run, doesn’t matter what kind of products… you will always succeed, because you can always change direction.”
“The reality is what we're trying to achieve is [to] build a 10x better financial services company that is 10x cheaper as well. The only way to do it is not building only one product, but building a platform with a lot of products on top of it.”
“Yes, I still see us as being a challenger. So far, I believe that we have only taken Revolut from 0 to 1. Now we are planning to go from 1 to 100. Looking forward, we are taking what we have learnt in Europe and replicating it across the world.”
Main learnings
Start in a niche and build an ecosystem around it - Revolut started by solving a problem that its founder had and many more faced. However, that problem was still just a niche and to scale up it needed to go beyond that. The most successful companies in the world are the ones who are able to build ecosystems around their solutions.
Adapt the company culture as it grows - As a company scales, there are many structural and operating challenges. You cannot expect it to be the same with 10 employees as it is with 1000 and requires clearer definition and implementation of the vision and values of the company.
Challenge the status quo - Revolut did what everyone else around them said was impossible to do. The same happened with several other successful companies: they would hear that what they were aiming to achieve could not be done. The most stagnant industries are the ones who are poised to get disruptive innovation.
Hear your customers - Not only is it a way to make your customers feel valued and heard, it's also a tool to explore new opportunities that aren't just benefiting a couple of customers but instead most of them. This is why Revolut implemented the crypto trading tool, which was highly requested by the customers and is now one of their most used solutions.
Work hard(er) - You won't be successful by just sitting in the couch waiting for the results to appear. That's why they implement a get --it done attitude, they know that if they don't move fast enough, other competitors will surpass them. The only way to stay away is to work harder and think deeper than your competition.