Val Scholz: How Revolut Acquired Their First 10M Users: Tips, Tactics & Strategies | E1168

Val Scholz 0:00 You want to go in a market where you don't have competition, so if you think about Revolut against Monzo, right? Like, the markets we grew the fastest wasn't the UK. It was Ireland, it was Romania, Poland. We went in a lot of markets where we just had... didn't have competition, which allowed us to raise more money, build better products, hire more people. There's always, like, a way you can see the market or you can segment the market, where you basically can build a product where essentially you don't have much competition, where your product is 10x better than the status quo. And I think, you know, the best founders, they find these markets, they find these unique insights.

Harry Stebbings 0:33 Ready to go? Val, this is such a joy to do. I've wanted to make this one happen for a while, so thank you so much for joining me.

Val Scholz 0:51 Thank you so much for having me,

Harry Stebbings 0:53 Not at all. But I want to start, like, growth is a, a weird world, so

Harry Stebbings 0:57 to speak. How did you first make your way into the world of growth?

Val Scholz 1:00 It's actually quite random. So I studied software engineering when I was a kid, selling websites, and it's quite a lot of effort to build for clients, you know, these websi- especially back in the days. That was like 2004. And so a friend of mine basically started, you know, building his own websites, and then essentially made a lot of money. So I was quite curious and interested, like, what he does differently, and he taught me basically the early signs of, like, search engine optimizations. And so then over the years, I basically learned more and more about marketing, which essentially moved me in this, uh, growth role.

Harry Stebbings 1:35 What was the first growth role you had?

Val Scholz 1:37 I mean, there wasn't really growth back then. Um, I was a software engineer at, uh, MindMeister. There wasn't really anyone in the company that knew marketing or SEO, and so essentially, basically, one of my projects was, like, how can you, uh, share mind maps, uh, on external websites and essentially generate traffic? I mean, we... quite a few million people, and I guess, like, that was the first time I really got exposure to, to growth.

Harry Stebbings 2:04 You were then Head of Growth at Revolut-

Val Scholz 2:06 Yeah.

Harry Stebbings 2:06 ... scaling from, like, nought to 10 million in customers. What were the biggest lessons from that journey? That's quite an incredible experience to have.

Val Scholz 2:14 I think what I really, like, learned at Revolut was that it's a lot better to do one thing, but do it really well, than doing 10 or 100 things at the same time.

Harry Stebbings 2:22 What one thing do you think

Harry Stebbings 2:24 you did at Revolut really well?

Val Scholz 2:25 So for example, like, 90% of the, uh, customers, B2C customers, that Revolut ever acquired came through referrals.

Harry Stebbings 2:33 How do you do a referral loop that's so effective (laughs) ?

Val Scholz 2:36 Couple of optimizations. Um, essentially, we thought about, like, okay, if you... Let's say I'm here at the podcast, right? Um, and I want to... You know, I, I love Revolut. It helps me, you know, when I travel, I don't have to overspend, and so I'm basically, like, telling you about the product, right? What you want to achieve is that, uh, while we're talking here, you can actually sign up and make your first payment. For example, I don't know, order something on Deliveroo. And so we optimized the product to basically make sure that enough people can go through that whole journey in less than five minutes, and so essentially, because it's so easy, so quick, we had so many people that just went to their friends, to their family, strangers on the street, that just basically got people into Revolut.

Harry Stebbings 3:22 Do you think people do referral platforms or programs well today? We see so many, "Invite a friend and get 20 pounds." Do people do it well?

Val Scholz 3:31 I don't think so. Um, so the, the interesting thing about referrals is that there isn't really a lot of information on the internet about how it really works, and so it took me about nine months to figure out, you know, how to actually make it work, right? So the common knowledge is like, okay, one person needs to invite more than one person, right? And that gives you an exponential growth. So the, the problem is it, it really depends on how fast that invite happens. So for example, if on average you bring three people in, but it takes three years, it's really slow, the growth, uh, um... yeah, the growth of the company. On the other hand, if you, let's say, get three people in every three minutes, you, you grow a lot faster, right? Um, so one thing we'd done at, at Revolut was essentially engineer how fast or how short it takes for n- new people to invite their peers and their friends, which actually worked really well to a point where we had to cap how many people actually sign up.

Harry Stebbings 4:32 How did you minimize that time from successful onboard to referring a friend? 'Cause you don't want to shove it in someone's face straight away of like, "Hey, Val, you've just signed up. Now refer friends." How did you minimize that time window?

Val Scholz 4:44 I think... I mean, first thing was the onboarding, right? And during onboarding, I mean, in the early days, like, we had maybe an activation rate of, uh... So basically, like, uh, new users that actually make a payment, it was maybe like 30, 35%.

Harry Stebbings 4:56 Mm-hmm.

Val Scholz 4:57 Like, when I left, it was around 90%, so, like, nine out of 10 people actually made a payment.

Harry Stebbings 5:02 What was the reason that they weren't, and what did you change?

Val Scholz 5:05 Essentially (laughs) , I didn't really know how to figure it out, so what I did was I sent an email to 4,000 people and was like, "Hey, why did you stop using Revolut?" Right? And the interesting thing that came back was that the majority of people didn't stop using Revolut, they just didn't have a use case for it yet. 'Cause back in the days, it was known as a travel card.

Harry Stebbings 5:22 Mm-hmm.

Val Scholz 5:22 And so what we realized is, like, people don't see Revolut as an everyday banking card, so we started changing the way we market the product, you know, position it in the market, but also making sure that there's no technical issues. Like, for example, people try to, uh, verify their identity at night and then you use a flash, and so suddenly the software can't detect, uh, your identity card. Or, I don't know, you know, in Italy we had a weird problem. Um, people don't have MasterCards or Visa-... so they can't do an, actually online payments, which we used traditionally to top up your account. But then also, like, Italy is a bit backwards in terms of their banking system, so you couldn't make, uh, international bank transfers from your bank account.

Harry Stebbings 6:06 (sighs)

Val Scholz 6:06 So we had to figure out, uh, basically how we get users to actually get money onto their account.

Harry Stebbings 6:11 Did you have lessons in terms of what referral kind of rewards were attractive to people? Like, does the size of the money matter if it's £10 or £50? D- Does it ... Is a voucher better than cash? Were there any lessons on what is attractive?

Val Scholz 6:26 Uh, yeah. I mean, basically, the more money you pay the more attractive it gets. Um-

Harry Stebbings 6:30 And you really see that clearly?

Val Scholz 6:32 Yeah. You can see that. Uh, the problem is, like, you don't want to have a CPA of, you know, 200, right? (laughs) . It's, um ... So I think back in the days, we had a CPA of around £9.

Harry Stebbings 6:47 Mm-hmm.

Val Scholz 6:48 Which was like, compared to banks that had like 250, it was quite low.

Harry Stebbings 6:52 It's pretty good. And then if you have a 30%, at that time, uh, person who sends their first payment, then you ... Essentially it's actually like a £27 CPA, no, if you think about it? If one in three actually converts to, like, a converted customer-

Val Scholz 7:06 Yeah.

Harry Stebbings 7:06 ... in that respect. It's like a 27%-

Val Scholz 7:08 Also in the early days, we didn't offer any money. So in the early, early days-

Harry Stebbings 7:12 (laughs)

Val Scholz 7:12 ... uh, basically we just gave away a free Revolut card. So it was basically like ... And we were always quite cash stripped at Revolut, right? I mean, basically in banking you need to have a lot of cash actually on payment accounts.

Harry Stebbings 7:23 Yeah.

Val Scholz 7:24 Um, to make sure, like, let's say if customer is going into the negative, that somebody can cover it, or if there's fraud happening. So, like, a lot of the, the fundraising, uh, went directly back into product, engineering, but also, like, uh, in payment platforms. So, like, we always had very aggressive acquisition targets, but we never had really money to spend on things. So we had to become creative and, like, "How can we still give value to people, uh, but still hit our targets?"

Harry Stebbings 7:51 You mentioned there the 30% going to 90%.

Val Scholz 7:54 Yeah.

Harry Stebbings 7:54 And that being, like, because people thought it was travel cards. "Oh, I don't know if I have a use case for it. Maybe I will do in time." How did you change that, but not lose the original customers who liked the travel cards?

Val Scholz 8:06 The interesting thing about Revolut is why it was created in the first place. Nick, uh, was a trader, right? Like, trading millions or hundreds of millions, uh, of currencies. Um, so it's basically like, I don't know, "I need to sell $100 million into Euros," right? And he would trade it for free, um, against other big banks. And when he went to Vegas and took some money to play poker, um, they took away around 10 to 15% because of the currency exchange. And because he was like, "Look, I mean, I trade hundreds of millions of dollars without paying any fees," he was like, "Hey, maybe there's an opportunity," right? So he was a bit pissed about the banks, basically ripped him off, um, and then started Revolut.

Harry Stebbings 8:53 (laughs)

Val Scholz 8:53 And I think, you know, like, this was kind of like, for us, it was kind of like the, the engine that drove the company so fast. Because we, we were always based on a multicurrency product-

Harry Stebbings 9:05 Yeah.

Val Scholz 9:05 ... which allowed us to add cryptocurrencies, um, commodities, but also, like, create new innovative products, like for example you're spending in pounds but saving in Euros.

Harry Stebbings 9:15 Did the new products make your life easier with growth, or harder?

Val Scholz 9:19 Uh-

Harry Stebbings 9:19 'Cause you suddenly have more to sell, different messaging. H- how did it change your role?

Val Scholz 9:24 I think a lot easier, to be fair. I think it's actually the biggest mistake that founders do, that they over-optimize their product. Um, sounds quite counter-intuitive, right? But it's, it's a bit like if ... Let's say you're Apple. Um, there's only so much revenue you can make with an iPhone, because not everybody wants or needs an iPhone. But so now, like, if you have a second product, let's say AirPods, you can sell to one client not just a $1,000 phone, you can also sell $200 earphones, right? And then if you, if they also need a laptop, you can sell it for another 2,000. And I think, you know, like, Revolut was built in a similar way. We basically used free effects as an acquisition driver. I mean, the value proposition of the product was so strong that, like, we didn't really have to pay a lot to get people into our product. Essentially what we needed to do is just accelerate already, um, dynamics that are happening. For example, that friends tell their friends, or making sure that people don't, you know, get somewhere stuck through the software, right? Um, and then basically what we did was, like, a lot of cross-selling. So essentially, okay, you're already in, you use the product. Okay, now you want to buy cryptos. Cool. 3% margin. Um, you wanna buy stocks, you have a spread there. Um, you want ... You need business banking at some point, you make some money there. So, that was always, like, the secret sauce, which I think, you know, like, for a long time competitors couldn't really figure out. I think TransferWise couldn't really figure out, like, how can we give it away for free and still make more money than them?

Harry Stebbings 11:00 Do you think founders wait too long to release a second product?

Val Scholz 11:03 Yeah. I mean, Revolut, if you think about it, like, we ... Nick and Vlad, they launched 2015, uh, June. And then, um, we launched a premium product, basically a paid subscription like a year and a half from there, which basically went through the roof.

Harry Stebbings 11:25 Was that immediately successful?

Val Scholz 11:26 Yeah, it was instant success.

Harry Stebbings 11:28 Why do you think that was?

Val Scholz 11:29 (laughs) . I think people wanted a bank card that actually looked like an iPhone. I think bank cards back in the days, they look quite cheap-

Harry Stebbings 11:39 Yeah.

Val Scholz 11:40 ... and, you know, Revolut made them sexy. So people were actually proud to show off their bank card. I guess it was like a, a ego thing, right? If you go to a bar or restaurant and you pay with the card and then people are like, "Hey, what's this card? How did you get it?" You know? Um, it makes you feel good.

Harry Stebbings 11:56 Yeah, for sure. The metal card, like, everyone loves a metal card.

Val Scholz 11:59 Yeah. I mean, that was amazing, honestly. We didn't expect how much demand was there for that card.

Harry Stebbings 12:04 For the metal card?

Val Scholz 12:05 Yeah. We had like 10,000, uh, cards pre-ordered, and it was literally sold out after an hour (laughs) . And then basically we had like, uh, I think four months of, like, waiting line, where basically every day more people ordered than we could manufacture.

Harry Stebbings 12:19 Wow.

Val Scholz 12:20 ... and it was like... I guess it went really well, but I guess we could have done even more.

Harry Stebbings 12:26 What growth experiments didn't work?

Val Scholz 12:29 I think we tried a lot, right? Some experiments are hard to measure. For example, we went to, um, all the big tech companies, like Google, Uber, uh, in our lunch break, to hand out cards in their cafeteria, and obviously that's, it's hard to measure, like, okay, what's really the long-term impact, right? Um, so I think it was just like we tried a lot of things, and once we saw something works, we just doubled down and just did it until you couldn't do it anymore. So let's say we, we saw, okay, YouTube influencers work really well. Um, we saw a spike in one country. Okay, let's just get every YouTube influencer on the market. And then after a month, there weren't any left, and you basically find the next thing.

Harry Stebbings 13:09 What are some lessons on how to make YouTube influencers successful? Everyone kind of has this idea, "Well, I'm gonna do the influencer strategy." I don't think many people know how, and I think they just have an idea that, "I'm just gonna pay them a wad of cash." Others have the affiliate code.

Val Scholz 13:24 Mm-hmm.

Harry Stebbings 13:24 Any lessons from that?

Val Scholz 13:26 I think growth is actually quite simple. Um, it doesn't really matter which channel you're using, but it's always basic math.

Harry Stebbings 13:33 Hmm.

Val Scholz 13:33 I mean, let's say an influencer. You look at, like, okay, on average, how many views will they generate, uh, per video? So you can expect roughly, like, how many people will see it. And how many people do you think will click through from the video to actually your website or app store? I would, you know, you can take conservative market estimates, like 5% or something, and then essentially how many people actually convert from, you know, checking out your website to actually becoming a user. And after that, it's basically, like, you have your typical rates, like what's your subscription rate? And so you can calculate roughly, like, okay, if I pay that person, like if I want to achieve a CPA of, let's say, $10, like what's the maximum I can offer the influencer to do this? Um, I mean that's basically the starting point, and then essentially what you do is you, um, you test three, four in different niches, and see basically what works.

Harry Stebbings 14:28 Is it quite difficult when you don't know your LTV, your lifetime value?

Val Scholz 14:31 Well, nobody really knows it, um, because, I mean, how do you know-

Harry Stebbings 14:34 This is the challenge and so you don't know the ultimate value of a customer.

Val Scholz 14:37 (laughs) .

Harry Stebbings 14:37 And so it's like, god, your CPA could be one thing, but actually, if they didn't stick around for very long and they churn after a year, it's not nearly... you don't have nearly that CAC elasticity that you would do if they stayed for seven years.

Val Scholz 14:48 I think in- in- initially it's about getting data, right?

Harry Stebbings 14:50 Yeah.

Val Scholz 14:51 Um, so obviously, like, let's say in the first year, you- you- you have no clue, like, how long people stay in five years, right? Because, so I think what you can see is, like, um, you can look at cohorts, so month by month cohorts.

Harry Stebbings 15:05 Mm-hmm.

Val Scholz 15:05 And you can look at the drop off of these cohorts. So let's say people that sign up in January, uh, versus people that sign up in February. How many people come back a month after? So ... and so you can compare it. Do you improve things? Do you make things worse? Um, that's A, and then B is basically, um, do they ever flatten, you know? Because ideally what... for example, Revolut in the early days, you could see, okay, maybe 35% of the people made the first payment in the first month, but then basically it flattened, right? And then I think it settled around 20%.

Harry Stebbings 15:40 Mm-hmm.

Val Scholz 15:40 And so after three, four months it just didn't drop below 20%, so it always stayed there, and then essentially when we started to optimize the product, you actually saw more like a smiley curve.

Harry Stebbings 15:50 Mm-hmm.

Val Scholz 15:50 So it actually increased and- and got higher again. So cohorts that used to be at 20 suddenly were at 30.

Harry Stebbings 15:56 What were the core drivers of that?

Val Scholz 15:57 I think w- we probably had a more broader product portfolio. Um, I think equally we focused more on everyday banking.

Harry Stebbings 16:06 Mm-hmm.

Val Scholz 16:06 So we built a product that was more useful for everyday banking, right? Standing orders, direct debits, budgeting, um, savings accounts, which essentially I guess then the combination of all of them gave people more reasons to stay and use it rather than the NatWest or Barclays card.

Harry Stebbings 16:23 I want to start on, you know, people love to throw around PLG.

Val Scholz 16:26 Mm-hmm.

Harry Stebbings 16:26 It's like, it- it's been the kind of hot word in our industry for years now.

Val Scholz 16:31 Mm-hmm.

Harry Stebbings 16:31 But you said to me before, there's traditional marketing methods that are outdated, uh, and you were brilliant in when we chatted, like just dropping these one-liners that I was like, "Great. Thanks for expanding." Why are traditional marketing methods outdated?

Val Scholz 16:45 I think it's just like, it's just the market is so saturated, over-saturated, um, that it's just... I mean basically traditional marketing means like it's not scalable, right? Like essentially it only scales with human output. So essentially if I want to have twice as many people coming to my website, I need to hire twice as many people. Which becomes, you know, as I, the company grows, it becomes more and more expensive. And then typically teams would get less efficient, so I need even more people. I think, you know, if you look at growth, which is essentially, you know, you- you build software that does marketing for you, uh, it basically scales exponentially. So, um, I need less and less people in the future to get bigger and bigger results.

Harry Stebbings 17:28 Build software that does marketing for you is an interesting way of describing it. Referrals is one. What are other innovative cool methods that you think people should look at instead?

Val Scholz 17:39 For acquisition?

Harry Stebbings 17:40 Yeah.

Val Scholz 17:41 You can do a paid marketing loop. So essentially I think Uber did it quite well, where they offered money or actually like PayPal in the early days, um, you offer m- someone money to sign up and essentially, like, as long as they bring in more money, like the whole loop is working.

Harry Stebbings 17:57 Mm-hmm.

Val Scholz 17:58 We have content acquisition. So for example, YouTube is a great example, right? Like, uh, somebody signs up to YouTube, uploads, um, a video, and then other people are gonna watch it. They share it, I don't know, on other platforms or-

Harry Stebbings 18:11 Did you find paid marketing at Revolut effective?

Val Scholz 18:14 We didn't use it.

Harry Stebbings 18:15 You didn't use it?

Val Scholz 18:16 No.

Harry Stebbings 18:16 Wow. Why?

Val Scholz 18:18 Uh, it's just you don't build anything sustainable. If you turn off the money tomorrow, it's just gone.

Harry Stebbings 18:25 Huh.... okay. (laughs)

Val Scholz 18:28 I mean, you want to, you want to invest in something. For example, if you build search, right? Um, let's say Canva, for example.

Harry Stebbings 18:34 Yeah.

Val Scholz 18:35 It's really hard to get rid of Canva, right? Even if they don't spend anything anymore, even if they don't improve anything anymore. Because, like, for nearly everything you're gonna search around marketing, graphic design, uh, PowerPoint presentations, like, Canva's the number one spot. So I think Canva nowadays is much larger in terms of volume generated to the website than Adobe. So it's really hard to, you know, you know, disrupt them.

Harry Stebbings 18:59 It's the most brilliant SEO play.

Val Scholz 19:01 Yeah. It, I mean, it's amazing, right? And I think it's, it's similar in, in other firms, where, I don't know, let's say WhatsApp or, um, Revolut, in a way. Um, you know, because Revolut is very incentivizing for others to join, because, you know, at some point, it becomes ... You're basically uncool if you don't have Revolut. You get the group pressure to get Revolut. Um, so let's say you go on a, into, I don't know, you play Paddle. One pays for the whole group. If one person doesn't have Revolut, everybody else will push him to get Revolut, because it's more convenient to

Val Scholz 19:36 get paid.

Harry Stebbings 19:36 Any lessons on content marketing as a customer acquisition channel?

Val Scholz 19:40 I think there's two ways to, to make it work. Um, either you have user-generated content, when, let's say, uh, Pinterest, YouTube, uh, you can basically then c- create content or topic clusters, where you basically create hierarchy of, like, how you create dynamic landing pages. So essentially, software creates landing pages that match the keywords that people are searching for.

Harry Stebbings 20:00 Huh.

Val Scholz 20:01 So that's, like, if you have a lot of user-generated content. I think often, nowadays, uh, if you look, for example, at Canva, what they've done is they created content. So they ... You basically have crazy big in-house teams that generate content for you so that you can create these topic clusters. Um, which I think is actually one of the most exciting things that I've learned in the last two years, because I've never seen it before, or probably haven't understood it before.

Harry Stebbings 20:29 In terms of the topic clusters created by internal teams?

Val Scholz 20:31 Yeah.

Harry Stebbings 20:32 Hmm. Is there anything that startup founders can learn from that?

Val Scholz 20:36 I think in the early days, right, people built a, a two-sided marketplace, where essentially you had to control or grow both supply and demand. I think what a lot of companies nowadays do, they control both supply and demand.

Harry Stebbings 20:47 Yeah.

Val Scholz 20:48 So essentially, it, it's a lot easier, because you can just, you know, rather than having to convince people, you know, to basically use your software and be super engaged, you can just pay someone for it. Uh, they ge- generate content for you, and as you build more content, you generate more traffic, which then generates you more revenue. So I think, like, uh, ultimately, like, if y- ... I think what's nowadays happening is that ... Because people understand kinda like the tactics to grow the channels, whether it is SEO, referrals, um, you know, paid. Like, they execute a lot faster, and you basically, like, usually bring things first in-house, because you have more control. And then as you grow, you b- may- maybe, you know, shift it more towards user-generated, so basically you cut your cost.

Harry Stebbings 21:36 When you look across the channels, most founders I speak to have one that really works. They're like, "It's great. We've got ... Yeah, it's working, but we need to diversify and we need to make sure that we're not too concentrated." Do you agree that you need to diversify early, or when you have one working, do you say, "Just double the fuck down. It's hard enough to get one working"?

Val Scholz 21:55 I would double down on the first one.

Harry Stebbings 21:56 And just continue?

Val Scholz 21:58 I mean, I would still do some other channels. You know, it's ... But it's, it depends, it depends on the size of the company, right? I think, uh, a pretty big mistake is to go too early in too many channels.

Harry Stebbings 22:10 Mm-hmm.

Val Scholz 22:11 'Cause you know, like, in the end of today, like, you rely quite heavily on data to understand what works, what doesn't work, and you really need to understand it, right? Because otherwise you can't replicate it. And the problem is, like, the more channels you have, the harder it is to measure directly the impact of a specific channel, because there's obviously, like, you know, a lot of noise coming in.

Harry Stebbings 22:33 Yeah.

Val Scholz 22:33 And then, essentially because you have more noise, your decisions gets worse, and which makes it then a lot harder and slower to actually, you know, really nail one channel. For example, to generate a million new users

Val Scholz 22:43 a month.

Harry Stebbings 22:44 I, I, I totally get you. You said there about, kind of, the importance of getting that early data. I'm always struck on the timing of, like, hiring a growth head-

Val Scholz 22:52 Mm-hmm.

Harry Stebbings 22:52 ... a growth person. In terms of that timing, before we get to the person, I've had people on the show say before, "You need a head of growth to get the data in." And then I've had people say, "That's ridiculous. You hire a head of growth post product market fit, when you have something to scale."

Val Scholz 23:07 Mm-hmm.

Harry Stebbings 23:08 Which side of the table do you sit on, and why?

Val Scholz 23:10 I think a head of growth m- makes sense once you've demonstrated product market fit.

Harry Stebbings 23:15 Do they not help you get the data to get to product market fit?

Val Scholz 23:19 I think it's really hard, because once there's a head of growth, you expect it to grow. And that basically means you need to show month-on-month growth. The problem is if your company didn't have ... I mean, there's obviously a lot of tactics, right? It's one o- other big lesson I learned is like even if you don't have product market fit, you can sell a business for 400 million. You know, because if you're just good enough to generate constantly more traffic, and it's cheaper to, to generate or buy traffic than the money you're making, the business is still growing. It's probably not the best business, because you're losing the customers in six to nine months again. But it's still working, right? So if you just sell early enough, everybody, or nearly everyone is happy.

Harry Stebbings 24:01 (laughs)

Val Scholz 24:01 Uh, I think, you know, the difference is, like if you look at really, like, companies that really nailed product market fit, whether it's like OpenAI with ChatGPT, WhatsApp, Instagram, Facebook. Um, they had very early proper product market fit, and my assumption is that, similar to the story about Nick, is that the best founders, they have a very unique view on the market. They have very unique insights, that they know something that just other people haven't seen yet, or-... known yet. For example, Nick, uh, Nick's case is the-- basically that there's no fee on, uh, FX, which is basically what you needed to understand, you know, okay, people travel all the time, people send money all the time, right? So why does everybody pay 7, 8, 9% on this? Um, and I think it's similar if you look at, um, probably Apple, you know, that had unique insights around, like, electronics, and, like, how people use these computers. Um, I think, you know, Kittl, for example, the founder, like, one of the founders was a graphic designer selling his typefaces. And essentially, what they realized is, like, people didn't want the typefaces, people wanted the assets that they used to market the typefaces. But then the softwares that were in the market, like, they were either too complicated for the audience or they

Val Scholz 25:21 couldn't do it.

Harry Stebbings 25:22 So if we agree then that it should be post product market fit because you-

Val Scholz 25:25 Yeah.

Harry Stebbings 25:25 ... expect it to grow when you have it, what's the right profile then? Like, you're an advisor advising me a founder-

Val Scholz 25:30 Mm-hmm.

Harry Stebbings 25:30 ... an early stage founder who's just got kind of early signs of product market fit, should I go for a super young person who prob- w- hasn't been a head of growth before and scale them into that role? Should I go for a head of growth? Like, what should that profile be?

Val Scholz 25:44 I personally always believe it's better, like, to have someone that grows with the company.

Harry Stebbings 25:48 Mm-hmm.

Val Scholz 25:48 You know, that's... I mean, they're rough diamonds, but they're ambitious, they're hardworking, they wanna prove themselves. To be honest, there's not many growth people that want to do it again. I think it's just like, uh-

Harry Stebbings 26:00 (laughs) Why is that? Just 'cause it's too hard?

Val Scholz 26:02 I think it's just super stressful. I mean, it's basically like-

Harry Stebbings 26:05 What's the most stressful thing about being a head of growth?

Val Scholz 26:07 You need to hit every week metrics. (laughs)

Harry Stebbings 26:11 (laughs)

Val Scholz 26:11 I mean, it's quite, like, uh, black and white, right? Either the company is growing or it's not. It's, it doesn't really matter why it's not growing-

Harry Stebbings 26:17 Uh, yeah, w-

Val Scholz 26:17 ... but it needs to grow.

Harry Stebbings 26:18 When we chatted, you said that most companies kind of fail at hiring. I did wanna touch on this 'cause this is like a universal process that every founder has to go through.

Val Scholz 26:28 Mm-hmm.

Harry Stebbings 26:28 Why do you think most founders or companies fail at hiring?

Val Scholz 26:31 Probably two things, like, A, you don't test people for enough. So, you know, you may t- maybe have a conversation, you don't dig deep into, like, let's say they talk about a certain project or, you know, some past incident, but you don't ask follow-up questions. You really need to understand context, right? Like, did they contribute towards it or did they lead it? Like, can they explain in detail what was the problem or not? So I think, you know, the best founders, they really, like, they really dig deep in understanding, like, "Okay, what really happened? Do I believe that that person actually made that impact? Did they understand enough to make that impact?" And then the second thing, which is, is essentially, if you look at sports, for example, um, you know, Michael Jordan, Cristiano Ronaldo, Kobe Bryant, you don't have to motivate these people. Doesn't matter what they will do, they will always be the best. It's just their attitude, it's their, their mindset, right? The... And I think, you know, like, you want to see the same thing in the people you hire. You want people that are hungry, people that are passionate.

Harry Stebbings 27:33 What do you think Revolut did well when it came to hiring?

Val Scholz 27:35 I think that was the main thing. I mean, uh, I think we mentioned before, like, Alain or Chad, I think myself, I think Nick, Nick basically looked at, or looked for very young people, very driven people, and very smart people. That was basically the main requirements, right? The thinking was kind of like, you know, "We, we can teach people skills. We can't, uh, teach them, uh, the right behaviors or attitudes or mindset." So either you want it, um, or you don't.

Harry Stebbings 28:06 What were the biggest mistakes you think that you made in the hiring?

Val Scholz 28:09 Probably just not, um, assuming too much. Like, basically, (sighs) I mean, it sounds a bit harsh, but, like, for example, not checking whether people want to work hard, right? Like, just, I don't know, you talk about it, but not directly asking like, "Hey, do you work weekends? Do you work evenings?" And so, you know-

Harry Stebbings 28:29 (laughs)

Val Scholz 28:29 ... I think, you know, like, people try to be too nice or maybe politically correct.

Harry Stebbings 28:32 For those that don't and don't want to, do you think they admit it?

Val Scholz 28:36 I think so. I think it's, I mean, if you present it in a way like, "Look, this is the culture of the company, right? So we're looking for these people," um, I think it also gives the, the other person opportunity to see whether it's the right thing for them, right?

Harry Stebbings 28:51 Yeah.

Val Scholz 28:51 It's a bit like dating, right? Like, if, if, I don't know, some people, I don't know, m- me at that point, I wanted to prove myself. For me it was like, "Hey, I wanna learn, I wanna join a small company. It should become the next, I don't know, Facebook." Um, I just wanted to see what's different. And so for me it was like, "Hey, yeah, I wanna work weekends. I wanna work long evenings. I really want to learn." Right?

Harry Stebbings 29:14 Did you find the majority of people said, "Yes, I do want to work weekends and evenings"?

Val Scholz 29:17 In interviews?

Harry Stebbings 29:18 Yeah.

Val Scholz 29:18 No. But, uh, we probably didn't hire them.

Harry Stebbings 29:24 (laughs) Do you think it's a game of just meeting as many people as possible?

Val Scholz 29:27 Part of it.

Harry Stebbings 29:28 How do you do sourcing? Is it-

Val Scholz 29:29 It's a bit like a funnel. Like, you know, you probably have a gut feeling of what you're looking for, right? Like, maybe a benchmark of companies you find really attractive.

Harry Stebbings 29:39 Mm-hmm.

Val Scholz 29:39 So let's say, I don't know, operations, right?

Harry Stebbings 29:42 Mm-hmm.

Val Scholz 29:42 Okay, Uber has really excellent operations, so you would try to find people, okay, maybe people that work two years, one year at Uber, right? People that maybe want to do the next step. Um, you can target these people on LinkedIn. And then essentially it's just you basically message everyone that basically fits that criteria.

Harry Stebbings 30:01 You didn't use recruiters?

Val Scholz 30:02 No, we used tech. We used recruiters to schedule call, close contracts.

Harry Stebbings 30:07 Yeah.

Val Scholz 30:07 But, like, sourcing, um, yeah, screen calls, CV screening was usually done by hiring managers.

Harry Stebbings 30:14 Anything on CVs that you'd be like, "Ah, look for or be wary of"?

Val Scholz 30:19 If people don't use metrics. So if you can't clearly see, um, what the impact of someone was. If people use vanity metrics. For example, a marketing manager or head of marketing that basically says, "I managed a 30 million budget." It's like, "Okay."... maybe you generated one dollar revenue, maybe a hundred million. I mean, how does it matter?

Harry Stebbings 30:38 It's like managers who brag about how much money they manage, you know?

Val Scholz 30:41 Yeah, or, like, somebody, like, "Hey, I had a team of 20 people," and so? (laughs) I mean, what does it mean, you know? For us, it was trying to, like, looking for red flags, um, or looking for the attributes we're looking for. I think, like, seeing that somebody goes to the right unis or... Essentially, I guess, to reframe it, we wanted to see that people learn very fast and learn faster than the average person, so, you know, uh... For example, I went to uni, but I dropped out. But, like, I still was kinda, like, you know, progressing very quickly in my career.

Harry Stebbings 31:16 Again, I'm really using this for myself.

Val Scholz 31:18 Yeah.

Harry Stebbings 31:18 Like, what are the signs that someone is learning quickly, especially when you have a preference for young people where there's just less data points?

Val Scholz 31:25 You can use benchmarks, so for example, unis, top unis. If you go to LSE, Stanford, Harvard, you're probably already... You're pre-vetted.

Harry Stebbings 31:33 Yeah.

Val Scholz 31:33 So you're quite smart, you're probably quite ambitious. So if you did the uni, like, a minimum term, plus, I don't know, worked at a tier-one company, you probably fit the bill. So that's one way to attract these people. Um, second thing is, let's say, if you're looking for someone more senior, like a product director, if you get promoted in two, three years to product director, you probably are... There's something different about you, right? Because other people, when, when somebody works as a product manager for, let's say, 10 years, you ask yourself, "Okay, why they're not a director?" Right? "Why they're not leading a team?" Um, so we use these proxies to basically guess whether, you know, it's the right fit or not. Um, also, like, for example, um, typically in growth, we didn't look for people that studied marketing.

Harry Stebbings 32:18 What did you look for?

Val Scholz 32:19 Computer

Val Scholz 32:20 science.

Harry Stebbings 32:20 Did you do take-home tasks in the interview process? What are some lessons on that? 'Cause that's a interesting element.

Val Scholz 32:27 You want to make them as hard as possible and as close to reality as possible.

Harry Stebbings 32:34 Are they on your company? So they're on Revolut?

Val Scholz 32:36 Yeah, so what we typically did was we took a past problem that it was really hard to solve, um, we basically messed up the data a bit. So essentially, that A, we couldn't use it, but B, also that our clients didn't have our data. And then, essentially, you would try to see how they solve it. So for example, at Revolut, like, if you wanted to become a product manager or operations person, uh, you had to analyze, I think, a million datasets, uh, and figure out, like, what's the problem in onboarding. Uh, it took us three months to solve the problem, um, so it was a good test to see.

Harry Stebbings 33:15 And so you give it to them and you give them the hardest possible. I doubt any of them solve it, correct?

Val Scholz 33:22 Not completely. I mean, that's not the point, uh, but you-

Harry Stebbings 33:24 What are we looking for from it?

Val Scholz 33:26 You want to look for the people who have a structured approach at solving problems. So essentially, realistically speaking, just from analyzing some data, you will never know for sure whether it's the right or wrong path, right? But you want someone that is very structured, like, thinks about, like, "Okay, what could be the root cause? How can I get insights about that?" And, um, ultimately, like, you want someone that has an approach on how to solve and identify a problem. And because then it's rep- you can replicate it, right? Like, it doesn't matter which problem I give you, you can basically use the same approach to solve the problem again. If someone maybe just solved it in the past, but has no clue about, you know, how to do it again, it's a bit useless, uh, yeah, in, in a, in our environment, let's say.

Harry Stebbings 34:12 How quickly do you know if you've made a good hire or a bad hire?

Val Scholz 34:16 I think you have a gut feeling pretty quickly, (laughs) probably a few days. Majority of people after a week, um, you're basically like, "Okay, that's not gonna work."

Harry Stebbings 34:25 Do you, do you get rid in the first two weeks then?

Val Scholz 34:28 I usually try to make it work for, like, three, four weeks.

Harry Stebbings 34:32 Yeah.

Val Scholz 34:32 But if I can't make it work after four weeks, yes.

Harry Stebbings 34:34 What were the signs that it wasn't working?

Val Scholz 34:37 I guess it's because either people didn't clearly listen or pay attention, uh, so they didn't fully understand what you expect of them when you give them feedback, for example, or give them a task. And then, ultimately, as a result, they didn't really progress quickly or learn quickly, so. You know, if you would see, like, okay, maybe the person is not perfect right now, but he's picking up pace really quickly, so in, like, two months, he will be there, I think you're fine, because it will take you longer to hire a replacement.

Harry Stebbings 35:03 Yeah.

Val Scholz 35:04 But if you feel like, you know, you're giving him a lot of feedback and it's just not getting better, you're basically like, "Okay, I mean, it's not gonna get better than in two months or three months," right? So that, that's kinda, like, what

Val Scholz 35:16 I'm looking for.

Harry Stebbings 35:17 Do you think you had a good culture at Revolut?

Val Scholz 35:19 It depends how you define a good culture.

Harry Stebbings 35:21 Mm-hmm.

Val Scholz 35:21 Um, I think what a lot of people forget is that Revolut is like that company that is at the 0.01%. You know, it's like a SpaceX, a Facebook, uh, a Meta. Um, I think all these companies are very similar.

Harry Stebbings 35:38 What do you mean by that?

Val Scholz 35:39 Even if you look at, like, something like sports, right? Like, the top clubs, like Real Madrid or, I don't know, Bayern Munich or, I don't know, Manchester City, they just expect more of you. It's, it's more cut-through environment. Like, either you perform or you're out, because, you know, there's a reason why they are, like, th- the lead clubs. I think it's similar in startups, right? Like, if, if you like, uh, uh, Facebook in the early days, Apple, Microsoft, you have to win, you know? It's the mentality of the founder, it's the... You want to be the fastest-growing company, you want to be the dominant force in your market. So if people, you know, don't fit that environment, if they can't contribute, it's not that people are, like, n- necessarily bad or that in general they wouldn't be successful somewhere else. It just means in that environment, they're not a good fit.

Harry Stebbings 36:32 What are your biggest lessons on how to train people effectively? It's hard to do well.

Val Scholz 36:37 Sounds very counterintuitive, but essentially spending more time with them, (laughs) um...... so (laughs) I have, like, uh, Oleg is now, he's a good friend nowadays. Uh, he was, uh, the lead product designer at my team at Revolut. Very creative designer. Very unstructured, unfocused. And so, Revolut expected you, like, every week, you need to show progress, right? So every week, we have a design sync with Nick, and you just had to show like, "Hey, we're making progress," right? Like, that's basically what you work on the whole week. And Oleg basically, like, he, he spent so much time just optimizing one screen, right? So basically, we had 20, 30 variations of one screen, but we didn't have, like, a user journey. So, when we had the review, um, essentially there wasn't much progress to be seen, right? We didn't really understand how this, you know, how the solution would solve the problem of the customer, and it took him, like ... I mean, in the second, in the second week happened, right, same problem, and I was like, "Okay, this is not gonna work." You know, if, if, you know, I need new user flows in like maximum two, three weeks-

Harry Stebbings 37:45 (laughs)

Val Scholz 37:45 ... because otherwise, like, engineering doesn't have anything to do.

Harry Stebbings 37:48 Dude, I've got 40 of the same screen now. (laughs)

Val Scholz 37:50 (laughs) Yeah, so basically, so basically what I was like, okay, I mean, ultimately I have a choice, right? I can try to do it on my own, um, or I can, you know ... but that's probably putting more load on me, it's not a sustainable solution, or I, I need to try to make it work with him, right? Um, and so basically what we did was, like, I had four catch-ups a day. Um, so he had to give me an update every two hours, and he got tasks on what he needs to change in the next two hours. After three weeks, it was just, I don't know, he, somehow, he figured it out and he knew kinda like what you expect of him. Which then essentially we could also just have once or so- a week, a catch-up, um, about, yeah, what's, what's going on and, and, and product design.

Harry Stebbings 38:36 How important do you think it is to have re- the reviews? You said they're about design reviews, but in, in growth maybe in particular, how do you think about growth reviews, syncing as a-

Val Scholz 38:45 Mm-hmm.

Harry Stebbings 38:46 ... team on progress? How often? What should be involved?

Val Scholz 38:49 I think in the end, like, I think it's, it's you need a feedback cycle, right? You need to kind of s- see like, okay, I try A, is it good? Is it bad? What's good? What's bad? What could I improve? I think the more frequent you have these things, the better, because essentially you learn faster. I mean, it's kinda like imagine like every cycle, every time you get feedback, it's a cycle. Um, every time you basically complete a cycle, you learn. So the more cycles you have, the faster you learn. And so often what managers do is basically a performance review every three months, right? It's not okay. Like, basically that means, like, it's very slow that you develop, because if you do something wrong, if you don't think the right way, you know, if you focus on the wrong things, like, you get feedback after three months. So I think probably doing it daily is too extreme. But, like, I think once a week was kinda like what we found optimal to move really fast, but equally like have time to really work.

Harry Stebbings 39:42 For the whole team?

Val Scholz 39:42 Yeah, so we had, like, in every function, we had once a week an update. And so for example-

Harry Stebbings 39:47 Is Nick there in every one?

Val Scholz 39:48 Not in every one. Um, but like Nick, for example, had 70, 80 one-on-ones a week.

Harry Stebbings 39:55 (laughs)

Val Scholz 39:55 So basically like, uh, every product team sync, Nick was in it. Every design team sync, Nick was in it.

Harry Stebbings 40:03 Did that make it better or worse?

Val Scholz 40:04 I think it's the reason why there's so many talented people coming out of Revolut.

Harry Stebbings 40:09 Why? Because they benefited from his wisdom-

Val Scholz 40:10 They all worked with Nick, you know, quite intensely. I mean, it kinda like it's his way of thinking, right? Then, I mean, it's basically like if you, if- it's kinda like if ... L- imagine you're spending, uh, every week with Elon Musk, half an hour, right? And every week you get feedback from Elon Musk about, uh, you know, what you could do better, right? How he thinks, how he sees things, you know, what you didn't consider, uh, what you could do better, you know? Like obviously, you know, you're gonna learn a lot from that.

Harry Stebbings 40:44 Does he lead through fear?

Val Scholz 40:45 He read a book called Principles, um, which he really likes, uh, apparently.

Harry Stebbings 40:50 I know. He said it on the show.

Val Scholz 40:52 Yeah.

Harry Stebbings 40:52 He said, he goes, "I got PDF quicker than book." (laughs)

Val Scholz 40:56 (laughs) Yeah, it was more direct, I guess. (laughs)

Harry Stebbings 41:00 I thought that was such a Nick thing there, like, "PDF better than book." (laughs)

Val Scholz 41:04 (laughs)

Harry Stebbings 41:04 Nice, Nick.

Val Scholz 41:04 That's true. Um, yeah, I think, I mean, look, um, he believes ... I mean, he comes from a scientific background, so he ultimately believes in truth. And one thing that, uh, Ray Dalio says in the book is that, you know, truth sometimes hurts. But if you find an environment that's more scientific and ultimately truth-seeking, it gives more an environment where you basically thrive, right, and really get results. And so I think what Nick created was ultimately like an environment where truth matters. So I could go always to Nick and basically say, "Look, that's wrong. Here's the data that proves you wrong," right? And he would always listen and consider it, and if he agrees with it or if I give him new data, he would change his mind. So, eh, I think ... so ultimately yes, there's probably some element of fear. Maybe not directly from him but maybe that you put on yourself because you may- might feel, okay, you're not good enough or other people are smarter than you or, you know, you're not prepared enough. I guess ultimately people don't wanna be wrong. So there was always this element of like, okay, maybe I didn't think about something. Maybe, you know, I forgot something. Maybe I'm missing something, right? Um, which keeps people a bit on their toes. But equally I think it also helped or is- is the main reason why Revolut built such an amazing company, right? Built such an amazing product, because it didn't really matter, like, you know, whose ideas it is, um, you know ... ha it ultimately mattered like what's the best

Val Scholz 42:38 we can do?

Harry Stebbings 42:38 What breaks with scale that fast? When you're scaling that fast where it's like, you know, metal cards are going out faster than you can make them literally. What breaks in a company?

Val Scholz 42:49 Everything. (laughs) ... everything. Um, you kinda had to re-- rebuild everything in-house every few months. Like, I mean, for example, um, I went there when we were, like, 80 people. I left when it was two and a half thousand. That's two and a half years. Like, my team went from two people to, uh, over 150 in, like, nine months. Like, e- everything breaks, you know? Like, the way you communicate doesn't work anymore, the way you ... I mean, uh, I don't know. Like, uh, we had, for example, we ran out ... We couldn't upgrade to a bigger database anymore, right? Like, basically, Google didn't have bigger databases, so we had to split the databases and sync them somehow. Um, yeah. I think it's just like ... Uh, I can't remember. Like, was it 7, 800 million transactions that we processed in one single month at the end, before I left?

Harry Stebbings 43:53 (exhales)

Val Scholz 43:53 And which, which is growing every month with hundreds of new, uh, hundreds of millions of new, uh, transactions, you know? It was just mad. When we did referrals, for example, when we launched it, we went from 15,000 new users a day, uh, and we only launched in one market.

Harry Stebbings 44:10 15,000 new users a day?

Val Scholz 44:12 Yeah. But when we launched it, we went to one market, Romania, from 2,000, and after three days, we were on 64,000.

Harry Stebbings 44:19 In Romania?

Val Scholz 44:20 Just in Romania. We just launched in one market because we didn't want to break the whole system. We then had to turn it off because we grew too fast, and suddenly, I was-

Harry Stebbings 44:28 And that was just with referrals?

Val Scholz 44:29 Yeah. And so, basically then, basically what happened was, like, suddenly KYC times, right, went from three minutes to ... Or a minute, right, to suddenly, like, two weeks. Customer support waiting lines went from, I don't know, 10 minutes to four weeks. So, I think that was ... You know, that's what was the challenging part, right? That it's just not one system that you have to scale up. You have to scale up every system internally in the company with rapid pace.

Harry Stebbings 44:59 Was how you grow different in different countries?

Val Scholz 45:03 Um-

Harry Stebbings 45:04 Compare, uh, Germany, France and Spain to, uh, Romania.

Val Scholz 45:08 Not really. I think nowadays, it's probably you need to attract new markets, so probably, you know, they started doing more TV advertising, uh, these sort of things, so you also, you know, attract people in their 50s, 60s, 70s, and so on.

Harry Stebbings 45:21 There was always a big thing. Uh, you know, I remember Tom at Monzo being on the show, and he was like, "The big thing that everyone said was, 'Ha! But you'll never be able to be the primary bank account.'" And that was always the thing. Like, "Oh, Revolut or Monzo, it's great, but, like, it'll never be the primary bank account." When and how do you feel you cracked that?

Val Scholz 45:40 J- I mean, I use it as my main bank account.

Harry Stebbings 45:42 Totally.

Val Scholz 45:43 So already for, like, seven, eight years.

Harry Stebbings 45:45 Did that impact your product marketing?

Val Scholz 45:47 It ... That I used it myself?

Harry Stebbings 45:48 No, that you wanted to be the primary.

Val Scholz 45:52 Um, I think that was the interesting thing. Like, we never thought about it that way, right? Um, I think from the early days, it was always like, "We don't want to build a bank." So, I mean, we even had on our website, right, "Better than a bank account," and bank was crossed out. Like, I think it was always, like, the clear message, like, "Look, banks are broken. Banks rip you off. We don't want to be a bank. We want to rebuild and build something better than before." And I think it ... For a long time, we really wanted to distance ourselves from the entire banking system, right? We didn't want to rip off our customers the same way. We want to build better services, faster services, new innovative products, and I think it, it helped us to basically build something that the competition, like Monzo, N26,

Val Scholz 46:37 never done.

Harry Stebbings 46:38 We've mentioned data so many times-

Val Scholz 46:39 Yeah.

Harry Stebbings 46:39 ... so final topic before a quick fire, but you said before that there's conventional wisdom around data strategy.

Val Scholz 46:45 Mm-hmm.

Harry Stebbings 46:45 What is the conventional wisdom, and how do you think about it?

Val Scholz 46:48 I think typically companies use, um, event-driven, uh, data infrastructure. Mixpanel, Amplitude, didn't really change for, like, probably 15, 20 years, um, which usually creates most of the issues in a company. Um, I actually think that if you look at Uber, Airbnb, Meta, they don't use events, or at least not in the early days. Um, we didn't use events at Revolut. I think the problem is often that engineering doesn't really have access to data or doesn't use data much, so they may be a bit scared of the topic. Um, then the... Traditionally, data people weren't very technical. It was, uh, usually companies that had a data team had data analysts, not data scientists or the data engineering. And then essentially, like, product managers or businesspeople wanted certain insights, so people went to Mixpanel, went to Amplitude because it was easy, right? Just one line of code. I think then over the years, what people still were ... Some companies realized is that actually you don't get a lot of insights because, you know, you have some payment data in Stripe, right? Um, some people churn, never come back, right? You have payment issues. So, even though it, it, it should ... You should generate revenue, you don't, right? Because, I don't know, some weird authorization issue in, I don't know, Brazil. Um, you have different campaigns, right? Um, that, that cost you different money, right? And so you want to understand, okay, which campaign actually generates how much revenue? Like, how efficient are they? So, how do you connect suddenly, like, Google Analytics data with Stripe data and, like, Mixpanel data? And then I think in certain industries, like banking, it gets even harder, right? Because we can't just expose every transaction of a customer and their details to, like, a third-party tool. What happens if they get hacked? I think for us, it was like, okay, every software that's built, and even, like, any third-party software you use, has a database, and the database contains all the valuable information, and that's your source of truth. Because if the database is wrong, I mean, the whole application is wrong.... and so basically what we started doing is, like, combining the various data sources in a centralized data warehouse, um, connecting everything through a user ID, and then had, like, a very, uh, we could then segment the audience the way we wanted. If we wanted to look at only people in Austria at a certain age, we could do this, and we could see how much they cost us, how much money they generate us. What's the unit economics?

Harry Stebbings 49:23 What was the single best growth decision you made?

Val Scholz 49:26 I think the quickest way to get a lot of growth for us was, I think it was a Monday afternoon, um, Chad, me and Tom, and then I think Alan, basically set up a referral campaign, wrote an email, uh, some Ts&Cs, and enabled free cards to Revolut customers. Uh, and that generated, like, 180,000 signups in a week. And I think back then, Revolut grew around 10,000 signups a week.

Harry Stebbings 49:56 What was the worst growth decision you made?

Val Scholz 49:58 For whatever reason, I thought that you can acquire a lot of customers with P2P payments, and so I spent four weeks trying to make it work that people can pay someone that's not on Revolut. Um, I just didn't do anything. (laughs)

Harry Stebbings 50:16 I can see that mindset though, where it's like, it's like the WhatsApp idea, which is like, "Invite them to WhatsApp."

Val Scholz 50:21 Mm-hmm.

Harry Stebbings 50:21 And then it gets that, like, linked message which you send to people and it's like-

Val Scholz 50:24 Yeah, I think people thought it's like fraud or something.

Harry Stebbings 50:26 Yeah.

Val Scholz 50:26 You know, they were like, "Heh? Someone wants to send me money on a random platform?"

Harry Stebbings 50:30 Hmm.

Val Scholz 50:30 "Probably doesn't really work." Yeah.

Harry Stebbings 50:32 Yeah, I get that. Uh, I wanna do a quick-fire.

Harry Stebbings 50:34 So I say-

Val Scholz 50:34 Yeah.

Harry Stebbings 50:34 ... a short statement, and then you give me your thoughts. Does that sound okay?

Val Scholz 50:37 Yeah.

Harry Stebbings 50:38 So what's the most common irreversible mistake you see founders make?

Val Scholz 50:42 They get too hands off. They don't use their product on a daily basis.

Harry Stebbings 50:46 (laughs)

Val Scholz 50:46 Astonishing.

Harry Stebbings 50:47 Uh, what's the most dangerous myth floating around about growth?

Val Scholz 50:51 I don't think you can... It's really hard to build a product-led business if you start with paid marketing.

Harry Stebbings 50:56 Hmm. I totally agree with you there.

Val Scholz 50:58 Yeah.

Harry Stebbings 50:58 Uh, how does growth change in a world of AI?

Val Scholz 51:01 I think in the n- short term, you get spammed even more.

Harry Stebbings 51:06 Yeah.

Val Scholz 51:07 Automated, uh, partnerships managers-

Harry Stebbings 51:10 Outbound becomes infinite.

Val Scholz 51:12 Yeah, I mean, we are thinking, we are looking into, like, um, automating partnership manager-

Harry Stebbings 51:17 Yeah.

Val Scholz 51:17 ... negotiations. Because suddenly you can scale it up to a million partnerships managers. I think more spamming. I think at some point, probably goes back to first principles, like, who really offers value? What's old school traditional ways, kinda like food and noise, to reach people.

Harry Stebbings 51:35 What would you most like to change about the world of growth?

Val Scholz 51:38 Getting founders to build better products, or generally building better products. I think it's... Yeah. I think it's really hard to sell a product that doesn't really add value to people.

Harry Stebbings 51:48 Do you think Revolut was a better product than Monzo?

Val Scholz 51:51 Yeah.

Harry Stebbings 51:52 Why?

Val Scholz 51:53 I think Monzo's just a, it's a, it's a more modern bank. Like, Revolut is a financial ecosystem. I mean, if you think about it, right, like, you have, I don't know, 50 million B2C customers.

Harry Stebbings 52:06 Mm-hmm.

Val Scholz 52:08 Uh, I don't know how many million businesses. So suddenly, you can just stay in the Revolut world. No more Visa, no more MasterCard. It's just something completely new.

Harry Stebbings 52:21 What was the biggest lesson from working with Nick?

Val Scholz 52:24 That he can be very creative, very analytical, and very logical at the same time. (laughs)

Harry Stebbings 52:28 (laughs) What was the hardest thing about working at Revolut?

Val Scholz 52:31 To put it the, as Nick put it, we're like special forces. We go in, we don't fuck up. So it had that mentality that every meeting, every design catch-up, every marketing campaign, essentially anything you do, is perfectly executed at all times, at the maximum speed. So if you have a typo in a design review, if a screenshot somewhere is missing, not good, if the FAQ is missing, you know, like everything had to be, kinda like Apple, you know. Everything had to be perfectly executed at all times.

Harry Stebbings 53:05 What have you changed your mind on in the last 12 months?

Val Scholz 53:07 It's more like a thought experiment, but I'm wondering if, like, there's really, like, the need for the internet the way we know it nowadays in, like, 15 to 20 years. At the moment, you always have a phone or, like, a screen that connects you to a virtual world, right? And in that virtual world, it's going completely crazy. You have, I don't know, crypto, and you have, uh, autonomous AI agents, and, like, all kinds of weird things, right? What happens if, let's say, in a few years, probably four or five years, you will have a lot of robots in the real world. You have, you know, Tesla's robots, and I think Boston Dynamics. These robots basically can speak to you like a human. They can do tasks like a human. Um, do you really need to go in that virtual world anymore? Or does it become more like a Star Wars, where, you know, you interact with the virtual world in a physical world?

Harry Stebbings 54:04 (laughs) That is a change of thought.

Val Scholz 54:06 (laughs)

Harry Stebbings 54:06 Uh, I wasn't expecting that one at all.

Val Scholz 54:07 (laughs)

Harry Stebbings 54:08 Uh, can, can I ask you, what are the biggest lessons from being an underdog? You know, you advised Kittle today.

Val Scholz 54:14 Mm-hmm.

Harry Stebbings 54:15 Uh, it's against the 800-pound gorilla that is Canva, which has an 800-pound gorilla, which is Adobe.

Val Scholz 54:20 Yeah. (laughs)

Harry Stebbings 54:21 What are the biggest, uh, lessons in that experience?

Val Scholz 54:24 I mean, if you're a big company, you can't disor- like, the bigger you get, the easier you get disrupted, right? Um, because essentially, like, let's say a market that's worth 10 million is nothing for a company like Canva that makes, I don't know, I think nowadays three billion?

Harry Stebbings 54:41 Mm-hmm.

Val Scholz 54:41 Something like that. So you know, like, they don't even go after that market, because it's just not big enough, right? So, but it also allows you to basically disrupt-... from that market then, uh, a b- a small- slightly sma- a bigger market, and then a slightly bigger market. I mean, in the end of the day, like, you don't have... You have high conviction that there's need for a software like this, because you already have proof points. You also have a lot of feedback around, you know, what's not so good with the tools, which allows you to navigate through it. But equally, like, it's obviously very hard, because you have a huge competitor that is quite strong at what you do. Um, I think, like, probably the easiest way to see this, you want to go in a market where you don't have competition, so if you think about Revolut, um, against Monzo, right? Like, the markets we grew the fastest wasn't- wasn't the UK. It was Ireland, it was Romania, it was, you know, Poland. So, like, while we still competed here and there with, you know, different banks, we went in a lot of markets where we just h- didn't have competition, which allowed us to raise more money, build better products, hire more people. Um, and I think it's the same, you know... There's always, like, a way you can see the market or you can segment the market, where you basically can build a product where essentially, you don't have much competition, where your product is 10x better than the status quo. And I think, you know, the best founders, they, they find these markets, they find these unique insights, they grow through that, right, rather than where everybody else goes.

Harry Stebbings 56:13 Final one for you. When you look across the landscape today, which company growth strategy have you been most impressed by?

Val Scholz 56:19 The most impressive thing I've seen was Nubank. Like, I mean, they have, like, a 90% retention rate. Like, over 24 months. It's, it's ridiculous. It's like they, they just figured out something in the Brazilian market that just... Yeah, that just... I don't know. It's magic. It's basically, like from what I understood is, um, in Brazil, because of the financial crisis, they made it illegal, um, to not allow installment payments when you pay for, I don't know, let's say, a laptop or food. Because a lot of people are so poor that they wouldn't be able to afford it otherwise. So, essentially, everybody has to offer them, A. B, it was illegal to put interest on it. So, obviously, everybody chose to pay in installments, because why not? Uh, there's no downside. What Nubank did was basically saying, "Okay, we're offering a credit card, so you can pay it with Nubank. You go to the merchant, split it into three payments, but then in Nubank, you can pay it in one go and you get a 5% discount." And then they took the money to basically lend it to others. Their product, I mean, it's, it's so sticky, it's, it's insane, you know. They didn't have competition. I think they have, like, 100 million active users nowadays. It's just crazy.

Harry Stebbings 57:34 I, I think going back to your point on competition, it's like they were competing against legacy Brazilian banks, which had incredible fees. Like, we thought our fee structures-

Val Scholz 57:41 Yeah.

Harry Stebbings 57:41 ... were high. I mean, that's, what, insane.

Val Scholz 57:43 Yeah.

Harry Stebbings 57:43 And so the combination of, like, product innovation there, which is super cool, I didn't actually know that.

Val Scholz 57:47 Yeah.

Harry Stebbings 57:47 Combined with the low competition, um, I- that's a very good one.

Val Scholz 57:52 Yeah. I mean, also the finan- finances are impressive. I mean, I think they made nearly a billion profit last year or something.

Harry Stebbings 57:58 Mm-hmm.

Val Scholz 57:58 It's just ... And I mean, they just, like, they're growing like hell. I mean, Revolut is growing fast, but Nubank is growing even faster. That's ...

Harry Stebbings 58:06 Val, listen, I've loved doing this. Thank you so much for joining me. Thank you so much for letting me just pepper you with questions, and this has been fantastic.

Val Scholz 58:13 Awesome. Thank you so much for having me.