PodcastsThe Twenty Minute VC (20VC): Venture Capital | Startup Funding | The Pitch20VC: Lessons Building Nubank to the Largest Neobank in the World, How AI Changes The Future of Finance, Leadership Lessons from Sequoia's Doug Leone & What European and US Fintech Can Learn From LATAM with David Velez, Founder @ Nubank

20VC: Lessons Building Nubank to the Largest Neobank in the World, How AI Changes The Future of Finance, Leadership Lessons from Sequoia's Doug Leone & What European and US Fintech Can Learn From LATAM with David Velez, Founder @ Nubank
The Twenty Minute VC (20VC): Venture Capital | Startup Funding | The PitchSun Sep 10 2023
David Velez and Nubank:
- 50% of the Brazilian adult population is a customer of Nubank.
- Nubank is the primary bank account for close to 30% of adult Brazilians.
Challenges Faced by Nubank:
- The challenge of building an organization without being familiar with Brazilian banking or speaking Portuguese.
- Overcoming the perception that it was impossible for fintechs to compete against established banks in Brazil.
Lessons from Sequoia's Doug Leone:
- Doug Leone has an uncanny ability to read people and understand their character traits, which influenced David's approach to hiring at Nubank.
- Treating employees as partners and making them feel valued leads to increased motivation.
Opportunities in Latin American Fintech:
- Latin America presents a significant market opportunity with its large population, high smartphone penetration, and complex issues that technology can address (e.g., financial services, healthcare, education).
- Western fintech companies can learn from BRIC economy fintechs about serving emerging markets and addressing specific local needs.
The Impact of AI on Financial Services:
- AI has the potential to transform financial services by changing how products are delivered and improving efficiency.
- It can provide access to better products, offer personalized recommendations, and handle complex tasks such as credit assessment or investment advice.
- Banks may need to maintain neutrality and prioritize consumer satisfaction over their own interests when designing AI algorithms.
Newbank's Strategy for Growth:
- Newbank aims to be the primary banking relationship for its customers rather than just providing ancillary wallet services.
- Expansion beyond financial services into a consumer platform involves offering a broader range of products through partnerships.
Success:
- Definition of success for David Velez is having the journey and adventure of his lifetime.
- Success for him was about the journey, not the destination. Whether they succeeded or failed, as long as they had a great journey and learned from it, it was considered a success.
Philanthropy:
- David thinks about efficient giving versus giving.
- He focuses on maximizing impact per dollar spent in philanthropic endeavors.
- The foundation he created has a strategy focused on areas like education and building leadership to create systemic impact.
- However, he acknowledges the contradiction between creating sophisticated models of impact and the immediate needs of people in Latin America who require assistance with healthcare and food.
Raising children in affluence:
- David wants to ensure that his children don't realize they have wealth and become complacent.
- He believes it's important for them to have some struggle so they can prove themselves and build self-confidence.
- They are given responsibilities such as making their beds, cleaning up after themselves, and doing chores so they understand the value of hard work.
Remote work:
- David is still making up his mind about remote work.
- As Nubank operates globally, he realizes the need to have access to talent beyond Sao Paulo or Mexico City.
- While there are pros to being in an office for faster decision-making and innovation, he understands that requiring everyone to be in the office would mean losing valuable talent.
Dinner guests:
- If he could have dinner with anyone alive or dead, David would choose Steve Jobs, Karl Marx, and Nietzsche.
- He wants to ask Steve Jobs if Apple today reflects what he intended to build originally.
- His conversation with Karl Marx would revolve around whether Marxism turned out as expected in the 20th century and how it affected society.
- Lastly, he finds Nietzsche intellectually stimulating and believes having a conversation with him would be exhilarating.
Importance of experience when building a team:
- David acknowledges the importance of bringing people with more experience sooner than he did at Nubank.
- While he initially sought out individuals without experience who would bring questions, he realizes the value of having people on the team with answers.
Near-death experience for Nubank:
- In 2017, there was a potential crisis for Nubank when the government planned to change the liquidating timeline for credit cards.
- They would need to raise a large amount of money overnight to stay afloat.
- With support from their customers and negotiations with regulators, they were able to overcome this near-death experience.