Growth = Product ( Design X Engineering) ^ Marketing


Growth = Product ( Design X Engineering) ^ Marketing

UXDX Community: London 2018

As Head of Growth/Engagement at Revolut, Val focuses on Product growth on their growth through product. Revolut launched July 1st 2015. Their total investment to date: $330M. They have 350+ employees, 1,900,000+ users, 25,000+ registered businesses

I'm doing the growth and product. So I just talk you through a bit of what Revolut is.

We started basically like in July 2015, and since then we became the fastest-growing company in Europe. So we just raised 250 million for close to two billion valuation. So basically, it took us roughly two years to actually hit one million users. Now we basically doubled that figure in the last six months. How it works is also with daily active users. We have a core focus right now to actually get people to use Revolut more on a daily basis. So every feature we release is currently triggered on this. So we are close to reaching one million monthly active users the way we define an active user, someone that actually makes the transaction. So we don't really care if you open the app, we don't really care if you, I don't know, do whatever you want with Revolut unless you actually make a transaction, because that's the way we see that you are really active with our product.

The second thing is, as you can see, is like a transaction volume goes massively up because people start using your product more and more, and we are as mature as a business and add a full service to Revolut. So the way we started was basically our founder found a flaw in the system, which was basically that currency exchange was very expensive. So if you went, for example, to the U.S., let's say you gambled and you wanted to spend £5000, basically, the currency conversion already swallowed around eight percent of your money. And so basically, Nick was a trader back then, and he knew that basically exchanging money doesn't cost anything big banks, and that's how basically Revolut was created. And since then, we went from like a pure travel code to actually start disrupting the whole financial industry and added multiple products like cryptocurrency exchange, better savings accounts, we’re going to launch a wealth platform with zero interest trading, zero-commission trading.

So currently we're close to 1.7 billion monthly transaction volume. I think the target is around three to four billion monthly at the end of the year, and that's probably the most interesting part for all of you. So I think like most hyper-growth companies, there's one thing very different to traditional start-ups. So basically, the way we see growth, it's mostly product-related. It's not really marketing or for any of the traditional challenges. So the way we look at Revolut is that anything is basically if it's big opportunities and you can also look at like other start-ups like Airbnb or Uber, Palantir or whoever is in the market. Usually, the way you start thinking about something is actually that you need to identify opportunities. You need to understand really big, big problems in the world. To give you an example a really good source for business ideas is the YCombinator start-up request. So every year to publish a new list of start-ups or requests of ideas that someone should solve what they identify as big, big problems. And basically, you can just go through the list and choose any topic. And start a start-up and you will get probably very big traction. To give you examples of what Revolut is, one thing we've figured is that people have a very hard time actually saving money. I think in the US is over 90 percent that doesn't have more than $1000 in their savings accounts, which is ridiculous, especially based on the salaries that some people are on there. Second thing is, for example, cryptocurrencies was a massive hype at the end of last year. And what a lot of people underestimated is that it was very hard actually to buy crypto for it, was very complicated and complex because it was basically built by engineers for engineers. And then suddenly it became very mainstream, and a lot of people didn't know how to get verified for certain exchange markets, how to actually buy crypto, how the whole wallet and IDs and so on works. But there are also other topics. For example, there's still no global medical ID in the world. So I'm from Austria. My whole medical record is in Austria. So when I moved to the UK was basically erased just back to zero. And there's actually no reason for this. It's something that actually Apple is trying to solve.

Mass transportation is another one. Probably you heard about. It's Tesla, it's actually the Boring company. So they are trying to, basically, to try to disrupt like public transport, especially in LA it is a massive problem with car transportation, and it's just not feasible. So they're thinking about new solutions like the Hyperloop, or I think you have these new buses that can go over cars and stuff like this. And so but essentially you can just figure out any big problem, any like waste, health, education and how you actually solve the problem. Go to the next one.

The second thing is basically everything we do, we try to be better than anyone in the market, so we dig deep to the root cause of every problem. A good example is international money transfer. So a couple of years ago, like it was very expensive and slow to actually move money around the globe and to actually propose a solution for this you really need to understand the market, you need to understand the problem, you need to understand regulations, laws, etc. So it's not just like, Oh, I have a cool idea, let's fix it and build something cool. It's actually like we've probably spent 70 or 80 percent of our time just on the problem. Just try and do to know better than anybody else in the market how to solve that thing. So, for example, if for international money transfers to the core issue, why it's slow and expensive to move money from Europe, let's say to the US, is that usually, you go through a central bank. So for example, if you transfer money, there's a central bank that guarantees both banks that the transfers, actually the money flow is actually happening. And why is this important? Because when you move money like the transfer itself, it's basically instant. So like bank A says, I transfer this money to Bank B, then Bank B basically has a deficit because the money didn't arrive yet. But if the customer actually withdraws the money, basically the bank has the risk that they actually lose money. So in order to prevent this, like the central bank guarantees both parties that you can trust each other. And that's why it actually is quite fast. The issue is like worldwide, there's no central bank. So if you move money across the globe, there's nobody that actually guarantees that this money flow actually will happen. And that's why there is a lot of lending, borrowing and in transparent practices.

The other thing is basically to solve this problem is you need to understand like regulations in each market. How the whole financial landscape works, why nobody actually has to solve or solve the debt because banks make a lot of money on this and also because of like in that case, it's like banks usually they didn't have like global networks. So the whole data infrastructure was like, this is split up between different data centres and they weren't really connected. So even if I, let's say, have Santander, who operates in a lot of different countries worldwide, like their companies don't speak to each other, they don't have access to the data, and that's why they can't do this fast and free money transfers.

So the next one is basically, if you actually at the stage where you figured out what is the opportunity, what is the problem, then you need to come up with the solution. Something I learned quite earlier. So like, you should always build products at 100x better. Nobody cares about products that are 5x better, 10x better, 20x better because the issue is that customers usually overvalue what they already have by 10x. They think is way cooler than it actually is. And the other issue is like a company always overthinks the value that the new product is created. So actually, to make a big difference, you need to create a way better product. A really good example is RobinHood in the US. Previously, it cost a lot of money to actually trade stocks. And so what they did was basically to make it completely free, and that's basically something that didn't exist on the whole market, and that's why they have this massive growth opportunity. So some tip that we basically usually use is if you identify a big opportunity and understand the problem, we usually copy a competitor and completely undercut the market. A good example is, for example, Amplitude and Mixpanel. Mixpanel was the big, big guy on the market. They dominated the whole landscape and an amplitude came basically copied the product and made it for free, so completely killed the business model for Mixpanel. And nowadays, Amplitude is way bigger than Mixpanel because Mixpanel can't compete with it. It's in our example, it’s like TransferWise. Basically, we have the same product that's TransferWise, which is offered for free. So in a way, they can't compete with us because we're doing the same thing. And once you have to pay for it and once you get it for free.

The fourth thing is basically, that's actually when growth starts. Everything you do, you should think about, like how you can spread it to users. So if we take it as a given, you build something that actually is very valuable that people like and that it's way better than what exists in the market. How do you actually spread it across the globe? So basically at that scale and that growth of companies like Uber, Facebook, Airbnb, you can only reach that scale if you actually leverage a network. So there are actually two networks in the world that are kind of free, which one of them is basically the user's network, like your friends, family and so on. The second one is partnerships. So for example, if we work together with Uber, we basically can leverage Uber's network like their user base, and you can do this with promotion codes, strategic partnerships and different ways. Some common suggestions for hacking growth are that there's usually a waiting list. So something that we do, RobinHood does, Monza does. It's basically that you force people to invite someone else. I'm personally not a big fan because I don't think it actually works. So you've got a lot of shitty quality trafficking and then you have to fix it at a later stage. The second thing is feature unlock. That's something that if you have something that a lot of people want, for example, a crypto exchange, you can basically ask people to give you something in return. Something that also works at big companies is referral systems. So usually and the last thing is partnerships. What I would mention for these three things is that you should always consider activation like you should basically, all these systems should always be linked to what you consider an activated user. So it doesn't matter much if you have a lot of signups if people don't actually use your product or don't understand it.

So let's say if I just care about signups, what happens is like, let's say in this example, we asked you to invite three friends. If we don't care about the activation person, I can just go to my mom and say, Hey, can you sign up? It takes two minutes, and then it basically means like, I got my invite, but a company got a user that doesn't want the product, and it's probably, I don't know, unsubscribing very soon and deleting this account again. So in that sense, what you usually see with referral programs is that the company wants you to do a certain action. Let's say Airbnb gives you a lot of credit if you refer someone, but they actually want that person to make their first booking. So you don't get any money unless the person makes a booking above a certain value. And the reason for that is if the person makes the booking is probably 80 - 90 percent chance that that user actually sticks and will use Airbnb also in the future.

That's one thing I noticed is probably most people don't understand how it works but don't consider it all. It's like basic engagement. It's pretty cool to build, very fancy UI’s to build products like the backend, frontend, the marketing. But the most important part is actually to think about the whole user journey. It's like the easiest example is actually probably Instagram. So who has Instagram? So the way they hacked it is basically people. Like it's just a natural feeling is going to have some sort of feedback, kind of like the feedback to the speakers. So basically, if you upload a picture, you do it because you want to get like you want to have your friends to tell you, like, Oh, you're great. You look great. It's an amazing holiday or whatever. The thing is like because of all this mass communication nowadays and all this noise people don't really talk, but actually like double-tapping a picture, just giving a like, there's not a lot of work. So basically, Instagram, for example, used this to actually get you to post more and more. So whenever you upload something, they have an algorithm that gives you a certain amount of minimum likes just to have this. This feeling of like, I'm actually pretty cool. So even if you're a complete nerd, if you don't have many friends or whatsoever, there's always a way to get likes and then you feel like that's a really important person. And that's actually just that's designed like in that way, it's basically like Instagram, actually the way to push it, the way they think about that whole journey. It's not just like you uploading a picture is also like displaying it to the right people at the right time. Basically, they want to guarantee you a certain amount of likes, and they adjust the algorithm to give you that certain amount of likes because if you don't get these likes, you will stop using it. And it's the same with re-engagement. I don't know if you noticed, but if you don't post an Instagram or don't actually open Instagram for a while, they send you messages about who actually join Instagram, friends from Facebook, friends of your contacts. And you just do this to get you back into the app and upload a picture again and go through the whole loop. So, usually, the way you should structure this like feature option, it's basically automated triggers that get people to actually use in your feature or product. That could be anything from like, let's say we want to have people to save money so we could set up an automated trigger after the first exchange, after the first card payment or after they did more than five transactions last month, something that is very frequent and engagement is usually like, so you're using this product, but you need to get feedback like if you, for example, if you're saving towards your goal, what's your progress? Something that actually makes you happy and feel accomplished. And the third one is basically for whatever reason, if you stop using a feature, you need to find ways to get people back to use it.

And then that's basically like, that's like the last bit, the last one percent is actually when you have everything ready like you need to be asked and answered at big times. So the way we do it is usually we have these different channels, which is basically modifications like email and push us, blog website and media PR. And what we usually do is we have, for example, with let's say Crypto is a good example. We had around, I think, 250 media outlets lined up when we launched. So it was everything from the New York Times, NBC to the smaller crypto sites. There was just one bit and we had basically added a website, we added a blog. We had social media where we have like currently having all together, like two hundred thousand followers. And then we also stream it out to the existing user base. And basically, the bigger you get, the more reach you actually generate for this. So then it's like to go back to the crypto examples because the way we designed the virality into the product like that announcement basically pushed the whole thing because people invited more friends and then it just went completely viral. That's basically my presentation because I thought it's probably most useful if you ask me questions.