Nubank

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CTW.1122.NuBank

Latin America is notorious for a lack of financial access, especially among lower-income groups. Founder David Vélez wanted Nubank to be an “anti-bank,” eliminating barriers such as credit card fees and excessive paperwork. Today, it claims more than 70 million customers across Brazil, Mexico, and Colombia; its once-neglected customer base delivered $1.7 billion in revenue to Nubank in 2021.

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Nubank (NU): Company Profile, Stock Price, News, Rankings | Fortune

Cristina Junqueira discusses her company’s potential growth.

Nubank CEO: ‘There’s so much opportunity’ for fintech in Latin America

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Nubank CEO on fintech in Latin America


Nubank CEO: ‘There’s so much opportunity’ for fintech in Latin America


you mentioned latin America, you are operating in a few countries. Now, obviously you're native brazil, but also in Colombia and Mexico. Are you setting your sights on any other countries in the area soon? There's so much opportunity in the region. We like to say that the combination of great population, horrible customer experience or a lot of customer pain in very big spreads or you know, high fees is unmatched ng when you look worldwide, like there's no place that is better suited uh, in terms of having a great opportunity for fintech companies to tackle. Um, having said that we have replaced pretty awful with Mexico and Colombia, we would love to go to other countries. But for now, like when we look into 2021 2022 there's still a lot of room for us to really scale operation Mexico and Colombia has just begun. Although we're seeing a lot of early traction customers are very excited about finally having an alternative in those countries to, um, but we got to make sure that we're well positioned to deliver on their expectations before we venture into another country.

Hello everyone, thanks for coming. Hello. Thanks for having me. Thanks for comming Christina. Yeah my pleasure. And I hear your husband, and your daughter are also in the auadience too. Right there [ LAUGH ] Hi. The cutest little girl in the audience that's my daugher. Yeah. [ LAUGH ] Your welcme. So You also have an interesting story. And I want to get to your family life, which is super interesting, but you were just telling me that the way that you founded the company, you didn't actually know your cofounder founders from college or anything like that, how did you get involved in Nubank? What attracted you to the opportunity? I guess, to make a very long story short, I worked for one of the incumbent banks, the largest incumbent bank in Brazil for five Five years. And I was just done making rich people richer. I saw no purpose in what I was doing. I was trying to make a lot of changes to make consumers lives better and failing miserably at it. And at some point, i was like, you know what? I'm done. Any consigning with the time that my partner the David, who's our CEO, he was. You know, kicking off the business, he had this vision, he had this thesis around financial services, but he didn't know the industry. So he was looking for partners, you know, to get it off the ground. And I was just in the right place at the right time. So it was really like one of those serendipity moments, you know. That we ran into each other. I had the excuse that he needed, who had the vision of something that he really wanted to be part of. So it kinda worked out. Yeah, you've also been fundraising a new bank lately, you now have, the company now has an evaluation of more than $ 10 billion. And I think you're the only company in the world with more than $ 10 billion evaluation with a female founder. It's pretty impressive. What was the fund raising process like I mean what was it like going into those meetings, seeking funding. Tell us a little bit about that. Sure it's been a journey we've raised over seven rounds of funding at this stage. Almost a billion dollars in funding at this stage And it had different flavors as the company evolved, but the rental that you know was really challenging for me was our first one or series A, which I raised when I was pregnant with Ellis with my first daughter So I actually flew to California from Brazil, seven months pregnant, to pitch to this multiple rooms full of VC investors. You can imagine, the type of reaction that I got, the nicest ones were things like I've never seen a pregnant woman pitch. It was pretty nice actually, closed around that You know, very close to the day she was born my partner took the you know, the papers for me to sign at the hospital [ LAUGH ] so it was pretty intense Yeah, did you feel i mean they've never seen a pregnant woman pitch and we know y'all know the statistics about how few venture dollars women actually receive, how did you overcome that or did you feel like you had to Yeah, for sure. We just had to, but I was very lucky because my partner, the visa, our CEO, he came from the venture capital industry. So he knew a lot about how investors, think about companies how, what type of things they assess, what type of things they value. So, that kind of helped us tailor pitch and of course for me to do my part on that for sure. So that we could get the better odds, but it kind of worked out. I gotta say we were lucky. And of course based on merit we were able to pick the investors that we wanted to have with us that were more aligned with our long term vision every step of the way. So yeah, happy to hear. Did you have a comeback ready or anything what when they would comment on your pregnancy? I know you're pregnant. Now. Again, congratulations Thank you. But is there some something you've gotten used to saying to kind of Get people over that hurdle of. yes, you're a female founder and you will you're a mother too. It was weird because that time I was just trying to make sure people wouldn't notice [ LAUGH ] I was pregnant, which was hard because I got pretty big that she was a big baby. [ LAUGH ] So, I just wanted them to feel that it didn't matter, that I was in, this was my company, it was my life's project. And I was willing to do whatever it took to get it off the ground, and to do what my customers needed me to do, or my shareholders needed me to do. So Yeah, the stage. My point was to get them distracted with the business. [ LAUGH ] Well yeah it seems like you've been able to do that pretty successfully. New Bank is now the largest digital banking startup in the world. I'm curious, the US, Europe also have a lot of digital banks It's, kind of, a hot trend right now. But, you have more than 12 million customers. You've taken off much faster. Yeah. Than many of those. What do you think has made the difference. Why the, be able to, take off so much quicker? I think it's a combination [ UNKNOWN ] of several factors. When you look into Latin America, the incomes are so bad. As bad as they are. I mean, I know banks are loved anywhere but they're specially hated there. You have no idea. If you Google, I hate banks in Brazil, in Portuguese, you're gonna get Pages of pages of pages ->> [ LAUGH ] of people people spilling their hate all over the internet for the banks. So people have been accustomed to that case of abuse of being overcharged, of having horrible products, and a horrible experience and pain. Some of the highest interest rates in the world. Some of the highest fees in the In the world, so I guess what we saw was a lot of pain, just consumer pain in people that were ready for an alternative. I used to tell my partners that you know, they better watch out because we're going to have to spend a ton of money marketing because people hate banks, etc. And what happened was by the time we got the first customers. People are actually asking us, begging us please, to let their friends and family be our customers, you know, so they were firing customers to us for free. So most of our growth like over 80 % of our growth so far has been strictly organic. Just people reaching out to us wanting to be our customers finally ready for an alternative that wasn't incumbents. So I guess a combination of, really bad experience large markets, of course. So when you think about Brazil alone is 210 million people 60 million of them unbanked. So of course a huge opportunity but also a lot of pain. Yeah. I'm gonna come to the audience for questions in just a minute, so get your questions ready, raise your hands and they'll come to you with a paddle. But Christina, so far you've been just in Latin America. You've started to expand from Brazil into Argentina and Mexico. Do you think your model could work in North America or maybe beyond the Americas too? Listen, I think everywhere in the world, the banking industry is being disrupted, right like are seeing challenges everywhere. For us, like from our perspective is just a matter of sequencing and prioritizing. When we look at Latin America we see much more pain as I've mentioned, as bad as they could be in Canada or the US or in Europe. They're not as expensive like spreads are under high or fees aren't super high. So we do see more opportunity in Latin America, but it's not like the model would work. You've mentioned a lot of startups are, having great impact in Europe? A lot of new banks are rising here in North America as well. I think the point is, they just don't have that much fat to go into, to compete also on price. That's my feeling. But I think, consumers are ready for A digital alternative for to do everything from their mobile phones and not ever have to go to a branch in their lives anymore all over the world. That's not going away. Yeah, and you offer a 6 % savings rate. Which I think in the US, 3 % is unheard of. Is that something that could potentially affect? I mean, in the US we actually have the Fed is lowering rates. Is that something that could be affected by monetary policy around the world? Or in Brazil that's actually sustainable? Well, it has been affected. When we started the business, the risk free rate, which is what we were offered, was 15 %. Rates have significantly gone down just because of improvements on the macroeconomic fundamentals there. So, there is a trend of lowering interest rates but I think our point is just to capture efficiencies and pass that on to customers whether that's in higher yields or lower interest rates or lower fees. Yeah, question over here, please, and tell us who you are. Hi. Hi. Marcia Moffett with Blackrock. One thing, so I was just looking on your website while you were speaking. I mean, I was glad to see you had a non- Portuguese version of the site since we don't speak Portuguese. [ LAUGH ] We're very international. One thing I'm always curious about with small companies, so you start off with a vision, you're in a particular niche. How do you stay true to your roots and what you want to accomplish as you grow and become bigger. Because right now you're the disruptor. And you have that The challenges of a disruptor but you also have the opportunities as a disruptor. So as you go forward and maybe it's too early in your company's life to be thinking this way, but how are you going to how are you going to stay true to your values and what you're seeking to accomplish as a company? Listen, that's a great question and something that we will obsess over. You know what my founders and I We've always like one of our values. We have five core values in the company and one of them is like, stay hungry and challenge the status quo. What we don't want is people resting on their laurels and just believing, we're done. We got this big valuation and we're now in four countries. And, you know, we have over 2, 000 employees, so we're good and we can behave, just like they can come in town. So, It's something it's a culture push that we make every day like through our leadership, through our actions through the way that we make decisions to make sure that people stay hungry. We've borrowed some things from Amazon like that they want concepts like we keep repeating that so that people can understand. Though it's always the beginning. There's so much opportunity, even as you know we're serving now close to 15 million customers which is you know huge but we're like well there's another hundred you know, in Latin America alone that we could get to. So when you take things into perspective, you can, depending on how you frame it, you can always see yourself as a beginner you know and have the beginner's mindset, that challenging. That's what we're trying to do. That's the plan, to conquer Latin America first and then potentially see about other markets. Listen, we see a lot of opportunity in Latin America. When you multiply the size of the population versus the spread versus the customer [ UNKNOWN ], this is the biggest opportunity in the world, even Asia when you compare them So for sure it's more interesting here, but it's always a problem about privatization, you know ?. Yeah, were there any other questions ?. Here I've got more if you guys don't over there. Yeah, please tell us who you are. Hello. My name is Nadia Tada. I was wondering what's the biggest challenge you're facing right now ?. It's always people, always people. Listen, we have over 2, 000 employees as I've mentioned. We have a fairly diverse team. One of our core values is also we build strong, diverse teams. We have over 40 % of women at our bank, which is amazing. If you think about financial services and technologies it's unheard of. We also have over 30 % of our staff identifies as LGBT, which is also unheard of. So we do have a lot of diversity but still like to grow at the pace that we wanted to we would need a lot more people. We are our biggest bottleneck is in capitalism regulation is in consumers isn't it just people who just being able to grow the team at the high bar that we have in terms of talent across the regions that we want to serve. So for sure like that has always been and will continue to be the biggest challenge. That's why diversity so important Yeah i wanted to ask you speaking of technology one of the biggest trends in fintech over the past few years has been blockchain technology and cryptocurrency. Is that something that you've looked at or that you have interest you might be interested in using in your business I think for now like we're curiously Watching what's going to happen with crypto because the blockchain itself as a technology has so much potential, but as far as the use cases go, we haven't seen something that has truly solved a need even when you think about Bitcoin has been used mostly for speculation as well as some [ BLANK_AUDIO ] Shady businesses. So we're kind of cautiously watching the the use cases and applications, even when there's something that really, is meaningful for our consumer. Sure, we could get into that too. But right now you feel it doesn't it doesn't add a lot of efficiencies. It's about the consumer. I don't see a real problem that consumers have that that technology will solve yet. What are the biggest consumer problems that you're trying to solve? So for us it has been about sure high spreads and high fees for sure but also horrible customer service. And we have an amazing team that we called expers that offer the best experience when people need service and they reach out to us across all our channels. Our NPS is close to 90 which is amazing. Like if you think about big tech companies The benchmark worldwide is 60 to 70. Like when you get to 90 just people just really love us so we're solving for just offering them the experience that they deserve. You know in treating them as humans and you know just figuring out finances so that they don't have to worry about that and not be held hostages of you know the incumbents anymore. Just. Grab back the control of their financial lives. Yeah, just less than a minute left. Do you have any final thoughts about what banks can learn from you? Or what message should banks and other fintechs take away in terms of where finance is going? I always tell people, it's about solving customer pain and real problems, right? In my business, often innovation Is mistaken Bye You know we're working on this dream that will make payments or this bracelet or this like new shiny thing. And I tell people like how many customers are losing their sleep tonight because they don't have a ring that makes payments like zero tell you like zero people are losing their sleep tonight. [ LAUGH ] But many of them are losing their sleep because tomorrow they're gonna have to go to a branch to figure out like some fee that they were overcharged for, They have no business being deducted out of their account. So those things matter, the pain matters. So just focus on that solve those problems. Great. Well, we're so glad you could join us here. Thank you so much. Thank you .>> [ APPLAUSE ] [ BLANK_AUDIO ]

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