“It's similar to selling options, right? You collect premium for 10 years and then year number 11 you lose it all.”
Cheeky Pint · Startups & Venture · November 2026
Context
John Collison had argued that subscription revenue is higher quality than lending because credit profits can be wiped out in a downturn. Storonsky agrees and gives this analogy for why Revolut wants to be a subscription business rather than a lender.
Transcript
…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,
exactly. It's similar to selling options, right? You kind of collect premium for 10 years and then year number 11 you lose it all. So that's a problem.
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?
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