In Good Company with Nicolai Tangen - HIGHLIGHTS: David Vélez - CEO of Nubank

Episode Date: October 10, 2025

We've curated a special 10-minute version of the podcast for those in a hurry.   Here you can listen to the full episode: https://podcasts.apple.com/no/podcast/david-v%C3%A9lez-building-nubank-transforming-banking-across/id1614211565?i=1000730718547&l=nbHow does one company redefine banking for millions? Nicolai Tangen speaks with David Vélez, founder and CEO of Nubank, one of the world's largest digital banks serving 120 million customers across Brazil, Mexico, and Colombia. They explore David's remarkable entrepreneurial journey and his mission to revolutionize Latin American banking, the strategy behind Nubank's iconic purple branding, and how the company built such incredible customer loyalty that millions joined waiting lists for their products. David shares his philosophy on customer obsession, the challenges of scaling from startup to major financial institution, and his view on the massive global opportunity as financial services continues to digitalize worldwide. With Nubankvalued as one of the most valuable banks in the region, this anti-bank is reshaping financial services. Tune in for an inspiring conversation!In Good Company is hosted by Nicolai Tangen, CEO of Norges Bank Investment Management. New full episodes every Wednesday, and don't miss our Highlight episodes every Friday.  The production team for this episode includes Isabelle Karlsson and PLAN-B's Niklas Figenschau Johansen, Sebastian Langvik-Hansen and Pål Huuse. Background research was conducted by Isabelle Karlsson. Watch the episode on YouTube: Norges Bank Investment Management - YouTubeWant to learn more about the fund? The fund | Norges Bank Investment Management (nbim.no)Follow Nicolai Tangen on LinkedIn: Nicolai Tangen | LinkedInFollow NBIM on LinkedIn: Norges Bank Investment Management: Administrator for bedriftsside | LinkedInFollow NBIM on Instagram: Explore Norges Bank Investment Management on Instagram Hosted on Acast. See acast.com/privacy for more information.

Hi, everybody. Tune in to this short version of the podcast, which we do every Friday for the long version. Tune in on Wednesdays. Hi, everyone. I'm Nicola Tangen, the CEO of the Norwegian Soan Wealth Fund. And today I'm joined by a true fintech pioneer who has transformed banking in Latin America. David Veles is the co-founder and CEO of New Bank, one of the world's largest digital banks, serving something like nearly 120 million customers in Brazil, Mexico, and Kroof.

Colombia. And under David's leadership, Newbank has grown from a startup to one of the most valuable banks in the region. So, David, a warm welcome. Thank you, Nikolai. It's a pleasure to be here with you. Now, take us back to the beginning. How did your upbringing shape what you're doing now? Sure. So I don't come from a family of bankers at all, but I do come from a family of entrepreneurs. I'm originally from Colombia. Grew up in a family where my dad had 11 siblings. My dad had my mom had five. And they were all microentrepreneurs still had their own business, my dad as well. So what did you guys talk about around the dinner table? Yeah. So the understanding was that you had to go and build your own thing. And if you were about

to get a job or you were going to try to manage something that was Luke up for. on what was calling the family, the DNA in the family was starting your own thing and solving a bunch of problems. So you decide, okay, now I'm just going to go for it. I'm going to start a bank. What do you do? Who do you call? What do you think? What do you just, what kind of stuff do you have to do? Yeah. So I had spent a lot of time looking at financial services as an investor and I had realized how amazing, how interesting and attractive this industry was from a business model perspective. When you look at Brazil, Mexico, Colombia, and frankly, almost all countries, the biggest companies are banks, especially countries that don't have technology, large technology companies now, as you will look at the U.S.

But in Brazil, the five biggest companies are banks. In Mexico, the same, but you look at Africa, you look at emerging markets, it's always banks having significant market cap. And then you look at the market structure and you realize that four or five banks generally have 80 to 85 percent market share. And so it's an oligopoly that then generally always means bad products or quality products, as I say it says for consumers, lack of access, very high interest rate, very high fees, and a significant percentage of the population left out. So without offending the Brazilian banks too much, how bad were they?

they're pretty bad in the 2012. I remember we looked at this list of the top 10 most hated companies in Brazil and the top five were banks and the second five were telecom companies. Now that's not the case. I think we like to think that because of the significant competition we brought to the market. Now banks are actually very well placed in that list. And that has been an enormous impact that we've been able to create through bringing more competition. But at that time, it was an only goal.

that hadn't really seen competition for a very long time. But it's pretty incredible that an anti-bank manages to get 60% of the adult population in Brazil as customers. I mean, it's just like incredible. How is it possible to go from zero to 60% of a country? Yeah. I mean, I think what was amazing is it was all word of mouth, barely driven or customer acquisition cost has been $2,3 over 12 years, getting to over 120 million customers. I think ultimately what we were able to do is we found actually. clear consumer pain. We were able to identify that consumers were readier than everybody

expected to embrace a new products and services. The fact that it was fully digitally in the moment that the entire economy was digitalizing, that every consumer was getting a smartphone in their hand helped a lot. So we got the timing just right of this, of writing the entire wave towards smartphone penetration. And we were were able to create a product that really talk to consumers, use the right language, communicated almost like a friend, like the best friend of consumers versus the experience that banks out of prisoners. And the fact that we had a fully digital business model meant we don't need to charge all

those fees or cost structure is 20x more efficient than banks. So we don't charge all those fees. We charge no fees. We have lower interest rates. So ultimately it's a better, it's a superior value proposition for consumers. I also heard that, for instance, you apologize to your customers because you had overcharged them. That's a great story, yeah. I mean, we...

Well, it's true, no? It's true. It is true. And it's a story that we tell our employees or tell our friends. Our number one mission as a company, or number one cultural values, we want customers to love us fanatically. We think that in the long run, consumer love is correlated with value of the company, with financial returns. in the short term, that might not be correlated, but in the long run, those two things go in the same direction. And the story you're mentioning is,

one day, there was a bug in our system and we stopped reminding customers to pay on time, and so they overpaid a couple of days of late interest. And it was very easy for our team to know what we needed to do. We had to put back those emails reminding customers to pay on time, but then also go back to the customers that we had forgotten to remind them, give them their money back, and apologize for not having,

remind them to pay on time. And if you think about it, well, then, yeah, we're making less money in the short term, and that's true. But in the long run, what is the value as a customer if somebody proactively tells you, sorry we didn't remind you several times to pay on time and here's your money back, without you even noticing it? That's kind of ultimately the bet of the companies, that we think that those type of experiences will drive long-term value creation

and loyalty with consumers for a very long time. So now you have the purple card. You've conquered Brazil with the card. what do you do then? So just how do you think about more products, more geographies? Just what's going through your mind here? Right. So the angle was always to build a fully digital bank.

It was not a digital credit card. The issue, though, is we had to create this tactical plan where we would launch credit card, we would figure out how to fund that credit card growth and in parallel try to get a banking license. getting a bank in license was very hard in Brazil. It took us over four years to get one, just to give you one data point of how protected this market was. Brazil is only one of the few countries in the world where it's in the constitution of the country

that foreigners cannot invest in banks. So it required a special presidential exception to get a foreign to have a bank. And that happened. Obviously, there were some foreign banks operating in Brazil. But for us as a startup, it took us four years to navigate the entire political environment to ultimately get to get that presidential decree,

get the banking license, and then launch a savings product. And our savings product was very simple. We paid 100% yield to any consumer deposit. And we gave real-time-free payments, transfers between accounts. It was amazing how it again, that simple design created a huge viral growth in the market and allowed us to go from something like 50 million customers at that point to 60, 70, 80 million customers in about two, three years,

becoming today the largest bank account in the country and the largest primary bank account. So once we have savings and credit, then we've been growing in two vectors. The first one has been more products. We've launched consumer loans, an investment platform, crypto, insurance, and now we're expanding also to small businesses. And the second vector has been internationalizing. to Mexico and Colombia, and for now, we're very focused on these three countries. This is a model that requires a lot of focus and requires to go very, very deep

in the countries that we operate with licenses with credit. How big is New Bank in 20 years? You know, I think it's 10 to 100 exercise that we have right now. Financial Services is the biggest segment of the world economy today. It's over $8 trillion of profit, and still 99% is still dominated by banks with branches. Even though there's been a huge amount of progress in technology and there is crypto and there is stable coins and everybody talk about these technologies, most banking today is still done in banks that are using physical cash and banking branches.

And you still have 3 billion people outside the banking system in emerging markets. You still have 3, 4 billion people that are completely left out. of the banking market, they don't have access to credit, they're not investing, they're not buying crypto products, they're not even in the formal economy. So this is, this is today the early, early, early minutes of the game. And the bet is that in 20 years, this entire market will digitalize and they'll be digitally native, technology companies dominating a lot of these markets. And we think we are extremely well positioned to take a very significant percentage of this market. What keeps you going?

I think of this purpose. It's been exciting to build this story for 12 years, but I think the challenge of now taking this to more countries is going to be really exciting. For me personally, the fact that there are so few, maybe really very few Latin American companies or Brazilian companies playing at the world stage, and that we have the opportunity to be one of the few ones ever gets me really exciting and the possibility to show that we can play at a world class in competing with some of these bigger companies around the world. It gets me very exciting.

And the innovation aspect of it is this question around financial inclusion advice and how we can use our product and our people and culture to reinvent an entire market. The challenge and difficulty of that is something that gets me going every single day. You know,