Sep 16, 2022 · 44m · news
dLocal CEO Sebastian Kanovich: The $8BN Company You Might Not Know | 20VC #926 · 20VC with Harry Stebbings
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gold bands on the timeline = statements, start to end. Hover to read, click to jump. CC turns on captions
In this 20VC episode, host Harry Stebbings interviews dLocal CEO Sebastian Kanovich, tracking how he accidentally rose to lead the company and scaled it into an $8 billion global fintech powerhouse. The discussion covers dLocal's customer-driven roadmap, high-friction market expansion, and the low-ego, frugal culture that powers its distributed operations.
How this conversation actually went
Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. Harry holds 25.7% of the talking time here. How this is scored →
Harry as informed peer 3.3 Guest teaching 3.1 Guest disagreement 0.9 Harry pushing back 2.2
speaking balance: gold is Harry, purple is the guest (3 minute bins)
Sharpest disagreement ▶ 10:14 Premise rejection on customer guidance
Sebastian explicitly rejects Harry's premise that customer requests lead companies astray, stating he cannot recall a single instance where customer demands led dLocal to the wrong place.
Hardest push from Harry ▶ 9:52 Challenge on customer roadmap prioritizationHarry forcefully pushes back on Sebastian's strategy of letting customers dictate products, citing how loud super-users often skew priorities away from the broader customer base.
Biggest teaching moment ▶ 18:32 Reframing payments market densitySebastian educates Harry on global payments mechanics, pointing out that operating in 35 markets over seven years represents extreme geographic focus compared to global platforms claiming coverage in 190 countries.
Harry holds his own ▶ 9:52 Invoking SaaS/enterprise roadmap pitfallsHarry brings sharp domain insight into product management by pointing out the vocal minority trap that frequently derails growing enterprise software startups.
the scores for every segment, with the reasoning behind each
| Chapter | Topic | Harry as informed peer | Guest teaching | Guest disagreement | Harry pushing back | Why |
|---|---|---|---|---|---|---|
| Becoming CEO of dLocal by Chance | 2 | 1 | 0 | 1 | Harry begins with warm intro questions about Sebastian's path to CEO and asks how he weighs luck versus skill. Sebastian explains his accidental entry into payments and his hyper-competitive nature. The tone is highly collaborative and conversational. | |
| Tolerable Mistakes and the Velocity of Execution | 3 | 2 | 1 | 2 | Harry probes on organizational velocity and shares a personal story of making a fast investment mistake to prompt Sebastian on speed-driven errors. Sebastian outlines his view on owning mistakes and avoiding sunk cost fallacies. | |
| Customer-Driven Prioritization and Strategic Focus | 5 | 4 | 2 | 5 | Harry challenges Sebastian's customer-led framework by citing the classic enterprise product trap where vocal power users distort roadmaps. Sebastian holds his ground, arguing that enterprise clients like Uber and Airbnb give clear, aligned market signals. | |
| The Painful Lesson of Uruguay's Ambition | 4 | 4 | 2 | 3 | Sebastian shares a painful lesson about a failed 2019 investment process and why running banker-led fundraising processes is harmful. Harry aligns strongly with this view, expressing his mutual disdain for banker processes. | |
| Bootstrapping dLocal and Retaining Frugality | 3 | 4 | 1 | 2 | Harry inquires how dLocal preserved frugal bootstrapping habits after taking on large secondary funding. Sebastian describes the friction between investor desires for rapid spending and maintaining operational discipline. | |
| Global Expansion Strategy in High-Friction Markets | 4 | 5 | 2 | 4 | Harry questions dLocal's strategy of expanding across 35 countries, framing it as wide rather than deep. Sebastian corrects the framing, explaining that 35 countries in global enterprise payments is actually selective and deep compared to competitors claiming 190. | |
| Building Bridges with Global Teams and the China Journey | 3 | 3 | 0 | 1 | Harry asks how to balance ex-pat core team members versus local hires when entering diverse markets. Sebastian uses dLocal's expansion in China to illustrate how hybrid cultural bridges are required. | |
| The Leverage of Small, Distributed Teams | 3 | 2 | 0 | 1 | Harry highlights dLocal's lean headcount of 650 relative to its multi-billion valuation and admits his own leadership insecurities regarding remote team culture. Sebastian shares his views on keeping low-ego, lean teams. | |
| Navigating the 2021 IPO and the Public Markets | 3 | 3 | 0 | 1 | Harry asks about dLocal's 2021 IPO transition and public market dynamics. Sebastian explains the unexpected complexity of managing investment banks and compliance advisors while sticking to tight timelines. |
Statements from this episode (24)
Kanovich: The payments industry is an onion with endless layers of complexity
“The good things about payments is that it's like a, it's like an onion. You keep peeling it and you're thinking, now we understand it. And then you realize that there are more and more layers.”
Kanovich: High performance means taking ownership and executing, not presenting PowerPoints
“Not only that they sign up PowerPoint or a presentation of how the solution should look, that's not high performance. And I'm totally against that. It's people that say it's on me. I'm going to fix it. This is how it's going to look. This is the time it's goin…”
Kanovich: Underperformers are immediately obvious to everyone on high-performing teams
“And the reality is that the easiest way to spotting high performance is when you have a team of high performance, when someone's not up to par, you can tell right away. You can ask anyone on the team and they can tell you right away, someone it's not carrying …”
Stebbings: Speed of execution is the clearest indicator of startup success
“The speed of execution is one of the clearest signs that I see in companies that I invest in that work well.”
Kanovich: Doubling down on bad decisions due to ego is fatal
“It's not typically the first mistake. It's when you fall in love with that decision and you want to keep doubling down on it because either ego or you get too emotional, emotionally, Embedded in that decision.”
Kanovich: Requests from Airbnb and Uber drove dLocal's expansion into payouts
“Airbnb came to us and Uber came to us and say, we want to do the opposite flow. We want to do payouts. Great. That's our product strategy. We are now going to do payouts.”
Kanovich: dLocal went public primarily to build credibility with enterprise clients
“We went public. We went public. We was, we felt that we wanted to be better perceived by our customers. We wanted to give them an additional level of comfort.”
Kanovich: dLocal was completely bootstrapped from 2016 to 2019
“We have bootstrapped the local from 2016 to 2019.”
Kanovich: Running formal fundraising processes is a very bad idea for startups
“First of all, you don't run processes. Very bad idea. That's something I learned.”
Kanovich: dLocal was already profitable when it raised from General Atlantic
“We were profitable, so we didn't need the money. And it was our first ever outside investor.”
Kanovich: dLocal closed its funding independently after abandoning a formal process
“We ended up closing around three months after the process independently on our own.”
Kanovich: dLocal would have raised VC earlier if he knew investor value
“If I would have known a little bit earlier, what good investors would have brought to the table, probably I would have done it or would have tried to do it a few years earlier, because you really see a different world out there.”
Kanovich: Disagreements with investors centered on maintaining dLocal's frugal culture
“Most of my disagreements with our investors were more in the direction of, we want to keep our culture. We want to be frugal. We want to be humble. We want to build it block by block.”
Kanovich: Building in high-friction emerging markets creates a huge competitive moat
“If it was so hard on us, it would be hard on everyone. That's a huge barrier to entry.”
Kanovich: Geographic expansion requires balancing core company culture with local hires
“The reality is somewhere in the middle. You need To bring your culture to the new place, because if not, you don't have a way of cooperating with the rest of the company, but you need local people. Otherwise it's absolutely impossible.”
Kanovich: Western tech leaders are blind to Chinese companies' emerging market ambition
“The level of innovation, the level of hard work, the ambition I saw there was mind blowing, and I was blind to it up until one year before, and I think many of us are blind, so the level of ambition that Chinese companies have in emerging markets, it's undenia…”
Kanovich: dLocal prefers small teams and will not significantly expand headcount
“We don't want many more people. We like small teams. I'm a big, big, big believer in small teams.”
Kanovich: A higher CEO profile would have made dLocal's journey easier
“If I would have a higher profile, probably our life would be a little bit easier, but I don't feel secure enough to do it.”
Stebbings: Public visibility and politicization are the top challenges for modern leaders
“I think the hard thing now is actually being public is part of the job, actually. Do you know what I mean? And that's a big change that we've seen. That and the politicization of leadership, I think, is the biggest challenges that, that leaders face today.”
Kanovich: dLocal is one of the few tech companies trading above IPO price
“We are very proud today to be one of the very few IPOs that are ahead of its IPO price. We've done very well so far in the public markets.”
Kanovich: Truly great companies are ultimately built in the public markets
“Whether you like it or not, you can delay it, but over time, great, great, great companies are built in the public markets.”
Kanovich: The investment banking business model for IPOs is ripe for disruption
“And it's a business that I think it's, it has some sort of potential for disruption.”