The Twenty Minute VCdLocal CEO Sebastian Kanovich: The $8BN Company You Might Not Know | 20VC #926
CHAPTERS
- 0:00 – 1:17
From a Montevideo dinner party to dLocal CEO: an accidental start in payments
Sebastián shares how meeting a future co-founder at his mother-in-law’s birthday party led him from trading stocks at Santander into building dLocal. He frames payments as an “onion” with endless layers, explaining why the learning curve never really ends.
- •Joined dLocal by chance after a personal connection
- •Background in economics and capital markets, not payments
- •Payments as a deep, layered domain that keeps surprising you
- •Ten-year journey with constant discovery and iteration
- 1:17 – 2:20
Luck vs. skill: manufacturing your own luck through intensity and refusal to lose
The conversation explores how luck created the opening, but relentless effort compounded it into a decade-long outcome. Sebastián links competitiveness—especially hating to lose—to the behaviors that increase the probability of success.
- •Luck matters, but only creates the initial opportunity surface
- •Hard work and persistence as the compounding factor
- •Emotional drive: suffering when losing as a performance engine
- •Takeaway: show up (literally) to increase luck exposure
- 2:20 – 3:25
What “high performance” looks like: energy, ownership, and shipping solutions
Sebastián defines high performance as a felt quality: people who bring energy, focus on solutions, and take ownership end-to-end. He contrasts operators who deliver with those who only present plans and decks.
- •High performers add energy rather than draining it
- •Solution orientation in fast-growth chaos
- •Ownership mentality: “It’s on me” with clear timelines
- •Teams of high performers self-identify gaps quickly
- 3:25 – 4:29
Letting people fail—without tolerating paralysis: fast decision loops and transparent feedback
They dig into the balance between giving space to learn and preventing avoidable damage. Sebastián emphasizes transparency in feedback, intolerance for inaction, and a culture of making decisions quickly and correcting them just as fast.
- •Be explicit with feedback so people know where they stand
- •Differentiate ‘wrong decision’ from ‘no decision’
- •Reward ownership and learning cycles after mistakes
- •Cultural norm: act fast, fix fast, keep iterating
- 4:29 – 7:21
Speed of execution—and when it backfires: don’t fall in love with your decisions
Sebastián argues that in the early days speed is everything because it accelerates learning, especially in unfamiliar markets. When speed causes mistakes, the bigger danger is ego-driven doubling down rather than owning the error and reversing course.
- •Speed creates feedback and learning in unknown territory
- •As the company grows, mistakes must be reversible and compliant
- •Key failure mode: emotional attachment to a bad call
- •Principle: own mistakes early and avoid sunk-cost escalation
- 7:21 – 8:16
Hiring mistakes and the ‘logo trap’: matching the person to the situation
Hiring is a common area where speed can lead to missteps, especially when leaders overvalue big-company credentials. Sebastián explains how he shifted from optimizing for impressive CVs and presentations to assessing fit for the specific context and job to be done.
- •Common founder mistake: hiring for logos and titles
- •No single hire “fixes everything”—teams solve together
- •Often the best solution is already inside the current team
- •Modern approach: evaluate person + situation fit
- 8:16 – 11:38
Focus as a company superpower: customer-led prioritization over internal roadmaps
With many countries and enterprise customers, focus becomes existential. Sebastián describes dLocal’s “cheat code”: let customer signals drive priorities and product strategy, including major expansions like payouts, fraud, and issuing.
- •Primary prioritization input: direct customer demand
- •Avoid building roadmaps in a vacuum
- •Customer requests shaped product expansion (e.g., payouts)
- •If it won’t impact customers, it’s likely not the priority
- 11:38 – 13:31
The painful lesson that unlocked ambition: the failed 2019 investor process and thinking too small
Sebastián recounts a formative mistake: running an investor process while not dreaming big enough, rooted in a ‘Uruguay companies don’t scale’ mindset. Bringing in General Atlantic shifted their horizon toward building for decades and validated dLocal’s potential.
- •2019 process failed—and revealed limited ambition
- •Founders underestimated how far they could go from Uruguay
- •General Atlantic validation created a ‘before/after’ moment
- •Shift to long-term thinking: building a 100-year company
- 13:31 – 14:28
Why fundraising ‘processes’ can be harmful—and what good investors actually add
Sebastián explains why structured processes can attract misaligned investors, over-index on valuation, and reduce founder intuition. He then outlines the real value of strong investors: external validation, network access, tooling, and playbooks—especially for bootstrapped teams.
- •Top investors may avoid auction-style processes
- •Banker-led dynamics can crowd out management voice and gut feel
- •Bootstrapping is ‘hard mode’ due to limited network/tooling
- •Great investors provide validation, intros, and scaling guidance
- 14:28 – 17:56
Bootstrapping reality and preserving frugality: learning to listen while keeping the DNA
They discuss why dLocal bootstrapped early (lack of alternatives) and how profitability shaped culture. Sebastián describes the tension of adopting investor-informed best practices while protecting frugality, humility, and customer obsession.
- •Bootstrapping wasn’t a strategy—it was the only path available
- •Profitability and customer funding shaped a frugal culture
- •Post-investment: learn from new vantage points without losing DNA
- •Keep founder-level customer commitment (pick up phone, fly out)
- 17:56 – 20:53
Breadth vs. depth in emerging markets: choosing high-friction countries as the wedge
Harry challenges dLocal’s geographic approach; Sebastián reframes it as selective depth in difficult markets rather than superficial breadth. The strategy is to solve the hardest, most locally complex countries that create durable barriers to entry and high customer value through multi-market simplicity.
- •35 countries is selective in payments; many claim 190+
- •Merchants value one partner across multiple hard markets
- •Pattern: expand, then deepen once operationally ready
- •High-friction markets create strong moats and customer value
- 20:53 – 23:18
Making global expansion work with people: blending HQ culture with local expertise (China case study)
Sebastián explains why expansion fails if you rely only on HQ transplants or only on local hires. Using China as an example, he shows how dLocal learned to integrate locals with core-team culture carriers and encouraged cross-country transfers to build “bridges” inside the org.
- •Expansion requires both cultural continuity and local depth
- •Early China effort failed when local hires became isolated satellites
- •Leaders moved on-site to integrate teams and reset approach
- •Cross-border transfers help teams understand both sides and collaborate
- 23:18 – 29:33
Lean teams, remote leadership, and CEO insecurity: staying hungry while scaling
Sebastián defends small teams as a driver of ownership and coherence, especially in a distributed business. He then opens up about leadership insecurities—constant discomfort, learning in public-company mode, and personal discomfort with spotlight and public speaking.
- •Small teams increase ownership and reduce coordination drag
- •Remote-first reality matches a globally distributed business
- •Insecurity as a healthy forcing function to keep improving
- •Personal challenge: spotlight/public speaking limits company visibility
- 29:33 – 34:34
IPO decision and life as a public company: trust, transparency, and quarterly gravity
Sebastián describes how the IPO became possible quickly after bringing in GA and why going public signaled “big leagues” credibility to a trust-based payments ecosystem. He shares what surprised him in the IPO mechanics and what fundamentally changes post-IPO—especially quarter-driven narratives and ‘tone’ versus pure metrics.
- •IPO was driven by market window and investor guidance
- •Strategic benefits: visibility, trust, transparency for stakeholders
- •Surprises: role of banks, number of advisors, project orchestration
- •Public-company shift: quarterly mindset and narrative/tone impact
- 34:34 – 39:57
Scaling realities and the meaning of winning: what breaks first, low-ego roles, and no hype
They cover what gets easier (tools, reputation) and harder (culture retention) as companies scale, plus the recurring pattern of functions breaking at each new size. Sebastián explains managing stage-fit through a low-ego culture, rejects believing the hype, and defines winning as fulfilling commitments with shared values.
- •As you scale: more tools and reputation, but culture is harder to preserve
- •Org functions break in stages (sales, finance, HR) and require iteration
- •Low-ego approach: titles are temporary stewardship, not identity
- •Winning = leaving nothing undone; brief celebration then back to the grind
- 39:57 – 44:50
Rapid-fire closer: favorite book, interview style, admired CEOs, Uruguay founder advice, and dLocal’s next 5 years
In quick-fire, Sebastián shares the book that shaped his identity, his preference for non-traditional interviews, and what he’d do if he ran another company. He closes with advice to Uruguayan founders to dream bigger and outlines dLocal’s ambition to become the financial services provider for emerging markets with more countries and products.
- •Favorite book: ‘Steppenwolf’ and embracing multiple identities
- •Interview approach: “What else should I know?” to prompt openness
- •Admiration for Adyen; curiosity about being an NBA GM
- •Advice: founders from Uruguay can build global winners—go get it
- •Five-year vision: expand markets and products (pay-ins, payouts, issuing)
