The Ledger
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Velez: Complacency allowed emerging markets to surpass US and Europe in fintech
“I think that level of complacency in these industries, in these big countries, has stopped innovation and have permitted that a lot of these emerging markets, these technologies have leapfrog to a place today where, where Brazil, China, India are ahead of U.S.…”
Velez: Spiky hires with obvious flaws outperform well-rounded candidates
“I rather have the people that have the There's incredible strengths in the weaknesses than the people that are okay in just certain areas. Those tend to be, if you manage them adequately, those are much more powerful type of hires.”
Velez: More Nubank-scale tech giants will emerge in LATAM within 10 years
“I do think now that the kind of the setup for more new banks in the region exists. And you'll see them over the next five to 10 years.”
Velez: Single-country startups in Chile or Colombia face severe exit constraints
“I think you run a little bit into more of the liquidity constraints where you see the businesses just building for Chile or building just for Colombia. Those tend to have much much harder exit opportunity. But when you really get Brazil and Mexico, you'll find…”
Velez: Nubank sees path to become largest bank in Brazil, Mexico, Colombia
“When we go to these three countries, Brazil, Mexico, and Colombia, we go after big markets where we see a path to be Probably the largest financial institution in each one of these countries eventually, because we are the primary bank account and we become the…”
Velez: Nubank is the primary bank for nearly 30% of adult Brazilians
“So if we have 50% of the population and 60% of primary bank account, we have already close to, we have the primary bank account for close to 30% of adult Brazilians. Which, by the way, is now the highest among any bank in Brazil. We are now the most often, mos…”
Velez: Nubank's Mexican credit card achieves world-leading 94 NPS
“The highest-rated-NPS consumer product in the world in any category is our purple, is Nubank's purple credit card in Mexico. It's a 94 NPS.”
Velez: Emerging markets' fintech lead will accelerate over next 5-10 years
“And this is just the beginning. You'll see this trend just accelerating, I think, over the next five, 10 years when you start thinking about open banking, when you start thinking about the uses of crypto, when you start thinking about how, what AI could do in …”
Velez: Fintech startups should obtain banking licenses instead of avoiding regulation
“The sense is that in a lot of our geographies, entrepreneurs try to almost do everything except embracing the space, except becoming a bank. Because of some arguments that if you became a bank, then your valuation multiple was going to be lower and you're goin…”
Velez: AI private bankers will disrupt ultra-wealthy management within 10 years
“I think then AI and this vision around AI really private banker could become the catalyst for accelerating the immigration towards a fully digitalized private banker. And at that point, then you really start attacking the one percent. You really start offering…”
Velez: AI will act as a banker in every pocket, democratizing finance
“We think that AI is now the second platform shift that might actually be able to take it to its final conclusion. And so if the smartphone was the bank in every pocket, AI is the bank and the banker in every pocket. And that really is the catalyst to Enable hu…”
Velez: Peak positive market sentiment is the optimal time to go public
“Everything is looking so good. The entire environment is so positive. There is only downside from here, which means this is the perfect time to go public.”
Velez: Nubank will expand beyond Latin America and fintech by 2028
“We would have Become the leading financial institution in Latin America, especially in these three markets. Clearly, we made that, we kind of checked that box. We've gone beyond Latin America. Not sure exactly where, but we've gone beyond in terms of internati…”
Velez: AI private bankers will surpass smartphones for Nubank interactions by 2028
“And on top of that, AI, the AI private banker, the self-driving banker is the leading platform, the leading way where consumers are interacting with us, probably even beyond the smartphone. So I think those are would be, those would be the key pieces of that.”
Velez predicts major neobank consolidation as consumers reduce financial apps
“Customers will have less apps in their phone, not more, and they will not have five banking relationships or 10 banking relationships or five different wallets. So I would expect a significant consolidation of that over the next few years”
Velez: Nubank has no growth limit and can become a global giant
“I honestly think there is no limit. It can be one of the largest companies in the world. I'm very confident with that.”
Velez: 2012 Latin American startups were unambitious Silicon Valley clones
“Why would Sequoia, who had access to best entrepreneurs in the world in Silicon Valley, spend time just going and investing in some of these businesses that in a way were just wanted to be clones of Silicon Valley businesses. They were not really shooting that…”
Velez: LATAM stock exchanges remain dominated by century-old incumbents
“About 25, 30% of companies in the Nasdaq today didn't exist 23 or 30 years ago. If you look at Ivo Vest by Brazil and Mexico, there's still incumbents that existed a hundred years ago. So the opportunity for disruption, a lot of these markets exist today.”
Velez: Nubank is redefining itself into a broad consumer platform
“We're in the early days of using these eighty-five million digitally only consumer base to build a marketplace to go beyond financial services and enable our customers to access non-financial services products. So this is almost a redefine of what Nubank is. M…”
Velez: Diversified portfolios render private banker commissions unnecessary
“Today you don't really need a very sophisticated personal bank to tell you where to invest. If you realize that almost all returns comes from having a very well diversified investment portfolio and fixed income and equities, you should just do that yourself an…”
Velez: Nubank profitably serves $50 loan and $200 investment accounts
“Today we can serve customers that need a 50 dollar loan profitably. We can serve customers that have 200 dollars to invest Profitably.”
Velez: Foundational LLMs like OpenAI are just basic infrastructure
“I see the existing LLMs, the open AI, the Entropic as sort of basic infrastructure.”
Velez: Banks do not need proprietary LLMs to build AI bankers
“So I don't think you need to own the model, but I do think you need to own And be very thoughtful around how do you, what are the incentives and what is the objective function of that algorithm when you start actually programming it.”
Velez: Hire people with questions over experienced industry veterans
“We like to hire people that have this ability, that has more questions than answers, that are able to look at a problem with a bunch of questions versus the traditional experienced persons that have been doing it for 30 years, And therefore I know the answer. …”
Velez: Entering investments via acquisition was Nubank's worst strategic decision
“I think the, perhaps the word decision from a product and kind of strategy perspective has been entering investments. When we enter investments via a big acquisitions, we enter via an acquisition versus organically, and I think we underestimated or I underesti…”
Velez: Nubank will favor organic growth over M&A for the next decade
“I think this means a bias, even a bigger bias to build organically versus an M&A driven strategy as we think about the next five to 10 years of growth in the business.”
Velez: 2017 regulatory change almost forced Nubank to raise 1B reais overnight
“They were gonna do it to two. That meant we were gonna need to raise a billion reais. Overnight. And that was going to be quickly the end.”
Velez: Full-time RTO would cost Nubank top global tech talent
“And so, if we were to say everybody has to be in the office, we would gain a bit in terms of faster decision making, faster ability to innovate. I believe in all the pros of being in the office, but we will lose a lot of the incredible valuable talent that we …”
Velez: Brazilian consumers face 450% APRs and massive banking concentration
“When you go to Brazil and you see customers paying 450% APRs and paying a ton of different fees and waiting four months to open a bank account, or you go to Mexico and you see five banks owning 90% of all the assets of the system, the pain is 10 X where you mi…”
Nubank funded zero-fee products by reallocating marketing budgets from Google and Facebook
“We always, since the beginning said, we'll focus on building the absolutely best product that we can have the best experience and trying to, instead of investing money in marketing and giving that money to Google and Facebook, we'll leave those money in the po…”
Velez: Building tech in LATAM impacts 99% versus 1% in US
“US and Europe is too easy. You're going to work very, very, very hard to make the life of the one percent, five percent better. If you move to Latin America, you're going to work very, very hard to make the life of 99% of the people, 70% better. So, ultimately…”
Velez: Almost 50% of Brazilian adults are Nubank customers
“We're getting to a point where almost 50% of the Brazilian adult population is a customer of Nubank.”
Velez: Nubank's Brazilian market penetration exceeds JPMorgan's in the US
“I don't think JP Morgan can say that about customers of theirs in the US.”
Velez: Sequoia interviews job candidates top-down, starting with firm leadership
“The first thing that came to mind was the first interview was with the head of the firm, not with the youngest analyst. In most firms, you start from the bottom, and then you go up, and Sequoia is the opposite. You go from the top, and then you go down, and yo…”
Velez: Nubank interviews focus entirely on character traits over career experience
“My interviews today are not interviews about career experience. They, all the interviews, when I interview somebody that's a newbie, it's all about character traits.”
Velez: Nubank requires every employee to contribute opinions like a partner
“That was an insight that I took to Novak, and that was a foundational insight around the culture that we have today, where we want to treat everybody as a partner. Everybody needs to feel that they have a seat at the table, the youngest, The oldest, the person…”
Velez: Nubank holds 15% credit card and 5% personal loan market share
“In credit cards, we have about 15% market share, but in personal loans, we have five percent market share. In investments, we have about two percent. In insurance, we have one percent.”
Velez: Under-celebrating success is a feature, not a bug, for urgency
“We under-celebrate. Some people complain that we don't celebrate enough. And they're probably right, but you know what, that's probably a feature at the end of the day, not a bug.”
Velez: Nubank reaches 85 million customers in Latin America
“By now we have one of the largest digitally native consumer platform, consumer basis in Latin America with eighty five million customers.”
Velez: Nubank will not enter e-commerce logistics or direct retail
“We're not the e-commerce. We don't want to be the e-commerce. We don't want to get into logistics, but we are a platform that cross sells all our products to these consumers.”
Velez: Branchless digital banking lowers cost-to-serve by 20x to 50x
“The moment we don't need to put a banking branch in every quarter, the cost to serve a customer goes down by 20 to 50 X. The cost to serve somebody goes close to zero.”
Velez: Codifying values in a culture deck allowed Nubank to scale
“We were very deliberate around the type of people that we attracted, my co-founders, and how we picked them, and how we spent a lot of time trying to find them, the values that we set up, the way we organize ourselves, we put all our values in a culture deck. …”
Velez: Building a bank in Brazil was chosen for its extreme difficulty
“This is the single hardest thing I can possibly imagine myself doing. Building a bank from scratch in Brazil is the hardest thing I can do, and that's why I wanted to do it.”
Velez: Nubank should have hired experienced industry veterans sooner
“Ah, the importance of bringing people with more experience sooner. I was a bit dogmatic in trying to get people that did not have experience, that had the head with full of Questions. It is also important to have head with full, with some answers. So I would h…”
Velez: 15,000 Nubank customers tweeted at Brazil's Central Bank during 2017 crisis
“Monday morning, there were 15,000 customers on Twitter of the Central Bank of Brazil saying, you cannot do this.”
Velez: Public markets offer the best capital access for capital-intensive companies
“This is a capital intensive business. No matter how well we do it, we're gonna need capital and the best way to get access to capital Is in the public market.”
Sequoia Capital spent two years evaluating Brazil before deciding against a fund
“After two years before Sequoia, where we all kind of came to a set conclusion that we didn't want to really start a business in Brazil, which meant I was, Doug wanted me to go back to California and helping them think, invest globally”