20Growth: How Revolut Acquired Their First 10M Users: Tips, Tactics and Strategies From the Revolut Product & Growth Playbook with Val Scholz, Former Head of Growth @ Revolut

23:28So if you just sell early enough, everybody, or nearly everyone is happy. You know, the difference is like, if you look at really like companies that really nailed product market fit, but it's like, ok, me and I with chat should be WhatsApp, Instagram, Facebook. 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're very unique insights. They know something that just other people haven't seen yet or known yet. For example, Nick case is the basically that there's no fee on FX, which is basically what you need to understand, you know, okay, people travel all the time, people send money all the time, right?

24:09So why does everybody pay 789 % on this? And I think it's similar if you look at probably Apple, you know, that had unique insights around like electronics and like how people use these computers. 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 were either to complicate a foot audience or they couldn't do it. So if we agree then that it should be post -product market fit because you expect it to grow when you have it.

24:44What's the right profile then? That you're an advisor advising me a founder, 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 hasn't been ahead of growth before and scale them into that role? Should I go for a head of growth? What should that profile be? I personally always believe it's better to have someone that grows with the company. They're rough diamonds, but they're ambitious, they're hardworking, they want to prove themselves. To be honest, there's not many growth people that want to do it again. I think it's just like, why is that?

25:14Just because it's too hard. I think it's just super stressful. What's the most stressful thing about being a head of growth? You need to kid every week metrics. I mean, it's quite like black and white, right? Either the company is growing or it's not. It doesn't really matter why it's not growing. But it needs to grow. When we chatted, you said that most companies kind of fail hiring. I didn't want to touch on this because this is a universal process that every founder has to go through. Why do you think most founders or companies fail hiring? Probably two things like, A, you don't test people for enough.

25:46So you made it maybe have a conversation. You don't dig deep into, like, let's say they talk about a certain project or past incident, but you don't ask follow -up questions. really to understand context, right? Like, did they contribute towards it or did they lead it? Can they explain in detail what was the problem or not? So thinking of the best founders, they really dig deep and understanding like, okay, what really happened to a belief that that person actually made that impact, to the understanding of the make that impact. And then the second thing, which is essentially, if you look at sports, for example, you know, Michael Jordan, Christiana Ronaldo, Kobe Bryant, you don't have to motivate these people.

26:23Doesn't matter what they will do, they will always be the best. It's just their attitude, it's their mindset, right? And I think, you know, like you want to see the same thing and the people you hire, you want people that are hungry, people that are passionate. What do you think, Ravoli, De Boa, when it came to hiring? I think that was the main thing. I mean, I think we mentioned before, like, Alan or Chad, I think myself, I think Nick basically looked for very young people, very driven people, very smart people. There was basically the main requirements, right? The thinking was kind of like, you know, we can teach people skills, we can't teach them the right behaviors or attitudes or mindset.

27:00So either you wanted or you don't. What was the biggest mistake you think that you made in the hiring? Assuming too much. I mean, it sounds a bit harsh, but like, for example, not checking whether people want to work hard. You talk about it, but not directly asking like, hey, do you work weekends? Do you work evenings? people try to be too nice or maybe politically right? For those that don't and don't want to, do you think they admit it? 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. I think it also gives the other person an opportunity to see whether it's the right thing for them.

27:35It's a bit like dating, right? Like me at that point, I wanted to prove myself. For me it was like, hey, I want to learn, I want to join a small company, it should become the next, I don't know, Facebook. I just wanted to see what's different. And so for me it was like, hey, yeah, I want to work weekends. I want to work long evenings. I really want to learn Did you find the majority of people said yes, I do want to work weekends in evenings in interviews? Yeah, no, but we probably didn't hire them. Do you think it's a game which is meeting as many people as possible? Part of it. But how do you do sourcing?

28:03I suck at hiring while honestly. How do you do sourcing? You probably have a gut feeling of what you're looking for. Maybe a bench mug of companies you find really attractive. Let's say operations, right? Okay, Uber has really excellent operations. So you would try to find people, okay, maybe people that work two years, one year at Uber, people that maybe want to do the next step. You can target these people on LinkedIn, and then essentially it's just basically message everyone, the basic effects that criteria. You didn't use recruiters? No, we used tech. We used recruiters to schedule calls, close contracts, but like sourcing, screen calls, CV screening was usually done by hiring managers.

28:41Anything on CVs you'd be like, look for or be wary of. If people don't use metrics, so if you can't clearly see what the impact of someone was, if people use vanity metrics, for example, a marketing manager, a head of marketing that basically says, a managed 30 million budget, it's like, okay, maybe you generated one dollar revenue, maybe 100 million, I mean, how does it matter? First, I was trying to, like, looking for red flags or looking for the attributes we're looking for. We wanted to see that people learn very fast and learn faster than the average person. For example, I went to uni but I dropped out.

29:15But like I still was kind of like you know, progressing very quickly in my career. 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? You can use benchmarks, so for example uni, top uni, if you go to LSE, Stanford, Harvard, you pre -vetted, so you're quite smart, you're probably quite ambitious. So if you did the uni like in minimum term, plus I don't know, work to the tier one company, you're probably fit to bill. So that's one way to attract these people. The 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, there's something different about you.

29:52Because other people, when somebody works as a product manager for let's say ten years, you ask yourself, okay, why I do not a director, why I do not leading a team. So we use these proxies to basically guess whether you know, it's the right fit or not. Typically in growth, we didn't look for people that studied marketing or stuff like that. What did you look for? Computer science. Did you do take home tasks in the interview process? What are some lessons on that? Because that's an interesting element. You want to make them as hard as possible and as close to reality as possible. Are they on your company?

30:24So they're on Ravlet. What we typically did was we took a past problem that was really hard to solve. We basically messed up the data of it. So essentially A, we couldn't use it, but B also let our clients didn't have our data. And then essentially you would try to see how to solve it. So for example, it revolved like if you wanted to become a product manager or operations person, you had to analyze I think a million data sets and figure out like what's the problem in onboarding. It took us three months to solve the problem. So it was a good test to see, you know. And so you give it to them and you give them the hardest possible.

31:01I doubt any of them solve it. Correct? Not completely. I mean, that's not the point. What are we looking for from it? You want to look for the people who have a structured approach at solving problems. 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 things about like, okay, what could be the root cause, how can I get insults about that? Ultimately, you want someone that has an approach on how to solve an identifier problem. 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.

31:38If someone maybe just solved it in the past but has no clue about how to do it again, it's a bit useless. How quickly do you know if you've made a good hire or bad hire? I think you have a gut feeling pretty quickly. Probably a few days. Majority of people after week, you're basically like, okay, that's not gonna work. Do you get rid of them for the first two weeks? I usually try to make it work for like three, four weeks, but if I can't make it work after four weeks, yes. What were the signs that it wasn't working? I guess it's because either people didn't clearly listen or pay attention, so they didn't fully understand what you expect of them, when you give them feedback, for example, or give them a task.

32:16And then ultimately as a result, didn't really progress quickly or learn quickly. 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 like two months he will be there. I think you'll find because it will take you longer to hire replacement but if you feel like you know you give him a lot of feedback and it's just not getting better. It's not going to get better than in two months or three months right. So that's kind of like what I'm looking for. Do you think he had a good culture? It depends how you define a good culture. I think What a lot of people forget is that revenue is like that company that is 0 .01%.

32:52It's like a SpaceX, a Facebook, a matter. I think all these companies are very similar. Even if you look at something like sports, top clubs like Real Madrid or Bayern Munich or Manchester City, they just expect more of you. It's a more cut -through environment like either you perform or you out. There's a reason why they are like the lead clubs. I think it's similar in startups, right? If you like Facebook in the early days Apple Microsoft you have to win It's the mentality of the founder. 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 necessarily bad or that in general They wouldn't be successful somewhere else.

33:38It just means in that environment. They're not a good fit What are your biggest lessons on how to train people effectively? It's hard to do well. It sounds very counter -intuitive, but essentially spending more time with them. So I have like, all I can say is a good friend now. He was the lead product designer at my team at Revalid. Very creative designer, but like very unstructured, unfocused. And so Revalid expected you like every week you need to show progress. So every week we have a design sync with Nick. You just had to show like, hey, we're making progress, right? like that's basically what he worked on the whole week and all like basically like he he spent so much time just optimizing one screen.

34:18So basically we had 20, 30 variations of one screen but we didn't have like a user journey. So when we had the review there wasn't much progress to be seen right we didn't really understand how the solution would solve the problem of the customer then the second week happened right same problem and I was like okay this is not going to work you know I need new user flows in like maximum two, three weeks because otherwise like engineering doesn't have anything to do. Ultimately I have a choice right I can try to do it on my own but it's probably putting more load on me it's not a system and solution or I need to try to make it work with him right and so basically what we did was like I had four catch -ups a day so you had to give me an update every two hours and you got tasks and what he needs to change in the next two hours.

34:59After three weeks it was just I don't know he somehow he figured it out and he knew kind of like what do you expect of him which then essentially we could also just have once so a week a catch up about what's going on in product design. How important do you think it is to have their reviews? You said that about design reviews but in growth maybe in particular how do you think about growth reviews? Sinking is a team on progress. How often what should be involved? You need a feedback cycle right you need to kind of see like okay I try A is it good is bad what's good what's bad what could improve I think the more frequent you have these things the better Because essentially you learn faster imagine like every cycle every time you get feedback is a cycle every time You basically complete a cycle you learn so the more cycles you have the faster you learn and so often what manages to is basically Performance review every three months, right?

35:54It'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. I think once a week was kind of like what we found optimal to move really fast but equally like for the whole team. Yes, so we had like in every function, we had once a week an update. And so for example, is Nick there and everyone? Not in everyone, but like Nick for example had 70, 80, one on one a week. So basically every product team sync, Nick was in it.

36:31Every design team sync, Nick was in it. Did that make it better or was? I think it's the reason why there's so many talented people coming out of revenue. Why? Because they benefit from everything. It all works with Nick intensely. I mean, it's kind of like his way of thinking. Imagine you're spending every week with Elon Musk half an hour. And every week you get feedback from Elon Musk about, you know, what you could do better, right? How he thinks, how he sees things, you know, what you didn't consider, what you could do better, you know, obviously, you know, you're gonna learn a lot from that.

37:04Does he lead to affair? He read a book called Principles, which he really likes. And now he's at it on the show. He said, he goes, I got PDF. Quicker than book. Yeah, it was more direct, I guess. I would have a social link, but I think they're like, P .D. of Dadalun book. I mean, he comes from a scientific background, so he ultimately believes in truth. I'm one thing that Rydalius says in the book is that 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, and really get results. And so I think what Nick created was ultimately like an environment where truth matters.

37:44I could go always to Nick and basically 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 ultimately yes There's probably some element of fear but maybe that you put on yourself because you might might feel okay You're not good enough or other people smarter than you or you know, you're not prepared enough or Ultimately people don't want to be wrong. So there was always this element of like okay Maybe I didn't think about something maybe I forgot something maybe I'm missing something right which keeps people a bit on the toes or it's the main reason why I've ever built such an amazing company went because it didn't really matter like you know whose ideas it is.

38:25Ultimately it mattered like what's the best we can do right? What breaks would scale out 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 everything? Rebuild everything in -house every few months. For example, I went there when we were like 80 people. I left when it was 2 ,500. That's 2 ,500 years. My team went from two people to over 150 in like nine months. Everything breaks. The way you communicate doesn't work anymore. The way you... We couldn't upgrade to a bigger database anymore, right? Basically Google didn't have bigger databases.

39:04So we had to split the databases and sync them somehow. 7 ,800 million transactions that we processed in one single month at the end before I left. And we were just growing every month with hundreds of millions of new transactions. It was just mad. When we did referrals, for example, when we launched it, we went from 15 ,000 new users a day. And we only launched the one market... 15 ,000 new users a day. Yeah. When we launched it, we went to one market Romania from 2000. And after three days, we went 64 ,000. Just in Romania, we just launched a more 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 just with referrals Yeah, and so basically what happened was like sunny KYC times right went from three minutes to a minute right to suddenly like Two weeks customer support waiting lines went from I don't know 10 minutes to four weeks So you know that's 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 intern in the company with rapid pace.

40:07There was always a big thing. I remember Tom at Monzo being on the show and he was like, the big thing everyone said was, huh, but you'll never be able to be the primary bank account. And that was always the thing. Like, oh, Ravolude or Monzo, it's great. But like, I'll never be the primary bank account. When and how do you feel you cried in that? I mean, I use it as my main bank account. So, I read it for like seven, eight years. But did that impact your product marketing? I think that was the interesting thing like we never thought about it that way right from the early days It was always like we don't want to build a bank.

40:37I mean we even had on a 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 for 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 helped us to basically build something that the competition like Montzua and 26 never done. We've mentioned data so many times, so final topic before I go quick fire.

41:12But you've said before that there's conventional wisdom around data strategy. What is the conventional wisdom? And how do you think about it? I think typical companies use event -driven data infrastructure, mixed panel amplitude. Didn't really change for like probably 15, 20 years, which usually creates most of the issues in a company. I actually think that if you look at Uber, Airbnb, matter, they don't use events, or at least not in the early days. We didn't use events that were relevant. I think the problem is often that engineering doesn't really have access to data, doesn't use data much.

41:45There may be a bit scared of the topic. Traditionally, data people weren't very technical. Usually, companies that had a data team had data analysts, not data scientists or the data engineering. And then essentially like product managers or business people wanted certain insights So people went to mixed panel went to amplitude because it was easy right just one line of code I think they're over the years with people still work 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 some people churn never come back right you have payment issues So you should generate revenue you don't right because some weird authorization issue in Brazil, you have different campaigns that cost you different money, and so you want to understand which campaign actually generates how much revenue, like how efficient are they?

42:32So how do you connect suddenly like Google Analytics data with Striped data and like mixed panel 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 the details to like a third party tour. What happens if they get hacked? I think for us it was like, 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.

43:04And so basically what we started doing is like combining the various data sources in a centralized data warehouse, connecting everything through a user ID, 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? What was the single Basker's decision you made? I think it was a Monday afternoon, Chad, me and Tom and I think Alan basically set up a referral campaign, wrote an email and enabled free cards to revalid customers and that generated like 180 ,000 signups in a week.

43:42And I think back then, Revalid grew around 10 ,000 signups a week. What was the worst growth decision you made? 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, the people can pay someone that's not on Revolute. Didn't do anything. I want to do a quick fight. So I say short statement and then you give me your thoughts. So that sound okay. Yeah. So what's the most common irreversible mistake you see founders make? They can't do hands off. They don't use their product on a daily basis. It's stormishing. What's the most dangerous myth floating around about growth?

44:19It's really hard to build a product -led business if you start with paid marketing. How does growth change in the world of ALA? I think in the short term, you get spammed even more automated partnerships managers. Our bound becomes infinite. Yeah, I mean, we are looking into like, automating partnership managers. Negotiations. And because suddenly you can scale it up to million partnerships managers. I think more spamming, I think at some point probably goes back to first principles that cool really offers value and what's all called traditional ways to reach people. What would you like to change about the world of growth?

44:54Getting found as to build better products or generally building better products. I think it's really hard to sell a product that doesn't really add value to people. Do you think revenue is a better product than monze? Yeah. Why? I think Monzus is just a more modern bank. Revolute is a financial ecosystem. If you think about it, you have 50 million B2C customers. I don't know how many million businesses. So suddenly you can just stay in the revolute world. No more visa, no more master card. Something completely new. What was the biggest lesson from working with Neck? That you can be very creative, very analytical, and very logical at the same time.

45:34What was the hardest thing about working at Everlet? To put it as Nick put it, we're like special forces. We go in, we don't fuck up. 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, not good, if a screenshot somewhere is missing, not good, if a FQ is missing, everything had to be kind of like Apple, You know, everything had to be perfectly executed at all times. What if you changed your mind on the last 12 months? 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.

46:19At 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 autonomous AI agents and like all kinds of weird things, right? But 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 Tesla's robots and I think post dynamics and these robots basically can speak to you like a human They can do tasks like a human Do you really need to go in that virtual world anymore? Does it become more like a star wars where you know you interact with the virtual world in a physical world?

46:57What are the biggest lessons from being an underdog? You know, you advise Kettle today. It's against 800 pound gorilla that is Canva, which has an 800 pound gorilla, which is Adobe. What are the biggest lessons in that experience? The bigger you get, the easier you get disrupted. 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 now it is 3 billion, something like that. They don't even go after that market, because it's just not big enough. But it also allows you to basically get disrupted from that market than a bigger market and then a slightly bigger market.

47:31I 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. Probably the easy way to see this you want to go in a market where you don't have competition. So if you think about Revolute against Montserrat like the markets we grew the fastest when it wasn't the UK. It was Ireland, it was Romania, it was Poland.

48:04While we still competed here and there with different banks, we went in a lot of markets where we just didn't have competition, which allowed us to raise more money, build better products, hire more people. There's always 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 to grow through that, right, rather than where everybody else goes. Final one for you, when you look across the landscape, say, which company grows strategy have you been most impressed by?

48:40The most impressive thing I've seen was new bank. I mean they have like a 90 % retention rate, like over 24 months, it's ridiculous. It's like they just figured out something in the Brazilian market that just it's magic It's basically from what I understood is in Brazil because of the financial crisis They made it illegal to not allow installment payments when you pay for it's a laptop or a 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 an installments because why not?

49:20There'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 it took the money to basically lend it to others. The product, I mean, it's so sticky, it's insane. You know, they didn't have competition, I think they have like a hundred million active users nowadays. I think going back to your point on composition is like... were competing against legacy Brazilian banks, which had incredible fees. We thought off the instructions were high, I mean, that's what insane.

49:53And so the combination of product innovation, which is super cool, I didn't actually know that. Combined with the low composition, that's a very good one. Yeah, I mean, also the finance is so impressive. I mean, I think they made nearly a billion profit last year or something. It's just, and I mean, they're growing like hell. I mean, revenue is growing fast, but New Bank is growing even faster. Foul, I've loved doing this. Thank you so much for joining me. Thank you so much for letting me just paparewa with questions and this has been fantastic. Awesome, thank you so much for having me. I absolutely love doing that.

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