Nik Storonsky, Revolut's cofounder and CEO, says the pandemic cut travel and restaurant spending by 60 to 70% while stock and crypto interest surged.
Revolut's payments share of revenue fell from over 70% before COVID to under 30%, as trading and super app products took over.
Storonsky says Revolut will seek banking licences in almost every country it operates in because merging its technology with legacy bank compliance proved nearly impossible.
Revolut's CEO on building a super app that outlasted COVID
Revolut is turning a cheap foreign-exchange account into a full financial super app for consumers and businesses. Its pandemic experience shows the bet. Payments revenue collapsed, trading and crypto filled the gap, and banking licences plus tight costs give it room to expand into the US.
Takeaways
Revolut grew from a travel-money fix into a super app. Storonsky started with a global account for sending and spending at interbank rates, after bank commissions annoyed him. Over five years it became a super app offering everyday financial products, free or far cheaper than banks and brokers.
Revolut is pursuing banking licences almost everywhere. Early launches used bank partnerships or lighter licences. Merging Revolut's technology with legacy bank compliance systems proved nearly impossible, so it now seeks full licences in nearly every market. Storonsky says a licence improves monetisation and allows deposit insurance.
The pandemic shifted revenue from payments to trading. Travel, restaurant and bus spending fell 60 to 70%, while stock trading interest doubled or tripled and crypto interest rose three to five times. Payments went from over 70% of revenue to under 30%.
Crypto is large on Revolut and mostly separate from stocks. Crypto balances run about double stock balances. Storonsky estimates 80% of crypto traders trade only crypto and 20% trade both. Revolut plans crypto deposits and withdrawals with its wallets, plus interest on crypto deposits.
A 40% revenue drop taught cost discipline. Revenues fell 40% as COVID hit, forcing fast cost cuts. Storonsky says staying tight on costs pays. Trading infrastructure is different, since surges reach 10 to 20 times normal load and overpaying for cloud capacity makes sense.
Business accounts and merchant ads extend the ecosystem. Businesses can open an account online in five minutes and get multi-currency accounts, payments and acquiring in one place. Planned merchant ads would match offers to customers with similar transactions, which Storonsky says beats Google and Facebook targeting.
The US push starts with expats. Revolut is building a US product to match its European one and will first target expats, whom Storonsky puts at 40 to 45m people. It has applied for a US bank licence, according to Pompliano.
New products Revolut described
Social trading lets users follow top traders' portfolios.
Stock trading avoids commissions and currency conversion fees, which Storonsky says cost at least half a percent and sometimes 1% at traditional brokers. US stocks are live and European stocks are coming.
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On this episode 2
Show 1
A travel marketplace sells hotels and stays at Booking.com and Expedia prices with 10% cashback.
Salary advance lets users withdraw part of their pay early, in proportion to accrued days. It is sold to employers as a benefit, not as credit, and currently works as risk mitigation.