Things Nik Says on Podcasts

I think it's more because large and larger portion of the population started using Revolut. So people who got choned because of different reasons, they still hear about it from friends, family, and then they come back.

I see. So you have multiple word-of-mouth kind of shots and goals. Okay, so yeah, I was curious to ask you about AI. How AI-pilled are you in how you run the company?

How has it changed how you hire either at an overall company level or at an individual team level? Like are the eight-person teams, should they now be three-person teams, or can just you have higher aspirations for what an eight-person team can accomplish? I

mean, technically, one person can accomplish much more now. I would even say you don't really need to have separate entrepreneur developers, iOS developers. One front-end developer can do things. You can even have one developer covering front-end, back-end, possibly data science as well. So you can…

But you work in this relatively standardized way of Product bets where you put a small team on something to initially test it. Has the size of that product bet initial team changed? And shouldn't it change, if not?

…people, based on advantages and disadvantages of people. We build all the systems of KPIs, roadmap, processes, hiring, performance management. And now it might be all redundant, right, because of AI in two, three years. So it's kind of, you know, we're all reinventing how the company should work.

How has it changed how you hire either at an overall company level or at an individual team level? Like are the eight-person teams, should they now be three-person teams, or can just you have higher aspirations for what an eight-person team can accomplish? I

But you work in this relatively standardized way of Product bets where you put a small team on something to initially test it. Has the size of that product bet initial team changed? And shouldn't it change, if not?

I mean, not yet, to be honest with you. So we're still operating in the old framework. Isn't

that very old-fashioned of you? Yes,

Well, I think our business model, my personal opinion, is we want to have the least amount of risk. So even if we lend, it won't be a large portion of balance sheet. So at the moment, target state is less than 10%. And then the rest we would securitize.

Why?

But is that because, because I'm always skeptical of multiples-based arguments, because ultimately the business is good or it isn't, and you can educate investors if the business is in fact good. Like when we started Stripe, people thought payments businesses were horrendous and deserving of low…

I think it's more the business itself. So if you look at the credit business in banking and general credit business, so every time when you do a loan or credit card, you need to put provisions against it. And then really amount of these provisions highly depend on the models that you use, on the…

uncertainty. You think fundamentally making your money via credit is this very cyclical profit stream that can be entirely wiped out in a downturn. It's very sensitive to you doing the math right. Whereas the nice thing about subscriptions is ultimately people are paying you this money on a…

…is being pressed in, I think, by investors and generally by lower multiples because, okay, bank can produce a lot of money now from credit portfolio. But look, in two, three years' time, unemployment goes from 3% to 6%. And all profit is gone, right? Plus, they're losing money. So I think this

…thing about subscriptions is ultimately people are paying you this money on a recurring basis. And yeah, in a downturn, maybe some people cancel their subscriptions, but like you can't make negative money on subscriptions. You can only shrink the book slightly. So it's much higher quality. Yeah,

Okay, I want to go back to your product development methodology though. So okay, you're describing the early stages of there's some tops-down product ideas, there's some bottoms-up product ideas. They have to be validated that if it works, it can actually be interesting economically. You have a…

So basically, it's pretty simple, right? So we've got the team, they work on the product for up to 18 months, then hopefully they'll launch the product. They'll work up to

18 months before launching anything?