Invest Like the Best with Patrick O'Shaughnessy
00:59:26 · David Vélez
[00:59:26] S1: The founder, it's impatient, huge amount of sense of urgency. The founder will want to go run very, very fast, would move fast, extremely fast. The CEO will need to be more patient. The CEO will need to be more systematic in how he makes decisions. We'll have to bring generally much more systems thinking into scaling the organisation. And sometimes those things collude. If you have to be impatient on one end, you have to be patient on the other end, there might be conflicts in that nature. Generally, you would think that CEOs are better managers. Founders don't tend to be good managers. Founders don't have a lot of patience or willingness to do one on ones and sit down and provide coaching to a team. They just want to run. Lot of the time they tend to be much more ICs, individual contributors and managers. CEOs tend to be better managers because you have to build systems. You have to be thinking more from a system perspective. I think the key though, for me has been to realize that the CEO title itself and the founder title, you can redesign in different ways too. And it's being able to do both. It's being able to have a little bit more patient when you need a little bit more patient. But generally, you want to maintain more the founder than the CEO. And I think that's why founder led companies continue to outperform for decades. Because if you have to choose, just choose more the founder than the CEO mode, especially in environments where there are big technology shifts, where a lot of the advantages, the assets of the founder come to bear and are more obvious than necessarily the advantages of the CEO.
01:01:00 · Patrick O'Shaughnessy, David Vélez
[01:01:00] S0: What was your lowest confidence moment personally in the entire history of the business? How'd you get through it? [01:01:06] S1: I think you go through a lot of different phases. And I think scaling a business is hard, especially because you're consistently making decisions about situations that you don't really know. Like for example, I wanted to build a technology company but I was not an engineer myself. So I needed to go and hire great CTOs and build a great technology organization. How did I know how to pick a great CTO at that point, if I didn't have the experience or credit, whether it's a lot of specific to financial services and credit expertise? So there was a lot of questioning inside internally, a lot of the decisions that I made about building the team that made me ask myself the question, do we need to bring somebody with my more experience from a big bank or from a big organization to run the organization? For a period of time, is this imposter syndrome that is asking you make question is like, are you the right driver of the car as the car becomes more complex and goes faster and faster and faster and faster? [01:01:57] S0: What was the most emotional moment in the history of the business for you?
01:01:57 · Patrick O'Shaughnessy, David Vélez
[01:01:57] S0: What was the most emotional moment in the history of the business for you? [01:02:02] S1: Passing a number of different incumbent banks in Brazil was very emotional because for ten years, all we heard again and again and again, especially from the local experts, was that it was impossible to compete with any bank, that we were going to get crushed, that we were going to die, that these were the most trusted brands in the ecosystem, and that we had no shot at being successful. Becoming the largest private bank in the entire country was something incredible. That was emotional in terms of what we were able to achieve from a point of scale. Personally, I was born in Colombia and I had to leave Colombia when I was eight because of all the security situation in Colombia as we grew up and I had to move to Costa Rica. And Colombia was then our country number three. The moment that I was able to launch NewBank in Colombia, which we did in a big event with the president of the country at the same time, was very emotional as well because it was a bit of coming back home and delivering a product and a service that I thought was going to be very great for the country in an environment where I was being receptive by people. And it was video casted and there were a 100,000 people connected to the launch of Noob back in Colombia. And it was very emotional too. Was very exciting. With all this experience
01:02:02 · David Vélez, Patrick O'Shaughnessy
[01:02:02] S1: Passing a number of different incumbent banks in Brazil was very emotional because for ten years, all we heard again and again and again, especially from the local experts, was that it was impossible to compete with any bank, that we were going to get crushed, that we were going to die, that these were the most trusted brands in the ecosystem, and that we had no shot at being successful. Becoming the largest private bank in the entire country was something incredible. That was emotional in terms of what we were able to achieve from a point of scale. Personally, I was born in Colombia and I had to leave Colombia when I was eight because of all the security situation in Colombia as we grew up and I had to move to Costa Rica. And Colombia was then our country number three. The moment that I was able to launch NewBank in Colombia, which we did in a big event with the president of the country at the same time, was very emotional as well because it was a bit of coming back home and delivering a product and a service that I thought was going to be very great for the country in an environment where I was being receptive by people. And it was video casted and there were a 100,000 people connected to the launch of Noob back in Colombia. And it was very emotional too. Was very exciting. With all this experience [01:03:13] S0: now running the business, how would you define great leadership? And I'm especially interested in the subtle points of what defines in your opinion, a great leader.
01:03:22 · David Vélez
[01:03:22] S1: I think first is vision. You have to be able to see something that few people see. A world that is not as obvious right now. I think with the massive information overload that we all live in, it's increasingly harder to have a differentiated point of view about something, about your industry, your company, about how things are going to move. So you have to have some kind of vision about the future that is differentiated. But then you have to be able to sell that vision. And selling is about inspiring people. And a lot of the time that vision will be very hard or almost feel impossible. And the natural reaction of most people when they are presented with an impossible vision is to push back and to declare it non realistic. This phrase, it's not realistic that this is going to happen. What is not realistic? I mean, look at every single meaningful development in the history of the world. At some point, it was defined by somebody to be non realistic. The amount of confidence that a lot of the experts or people use when they say it's not realistic. You have to be able to sell that vision in a way that a lot of people get motivated by that. That drives following and motivation. But then you have to be able to be a good listener and understand that sometimes you're actually going to be wrong. That vision that you have might not be fully complete. There is a mode in which you go against the consensus and you completely declare consensus as wrong. And you are the complete revolutionary. Nothing about the consensus makes any sense. And you will reinvent absolutely everything. That is one mode. The other mode is you're consumed by consensus. You think about progress as being unrealistic and things will be the way they are today. What's hard, I think, a great leader is you navigate in the middle. The consensus exists or status quo exists because you think about it from an evolutionary perspective. The vision of the world competed with our visions of the world and it won. And so the world we see today was superior to our possible wars that happen. And so there are elements of that status quo that exists because of a reason. And so you have to be able to understand what are those elements and they will continue to be here. But also you have to be able to fight that conventional wisdom to see what are the elements will need to be changed.
01:05:41 · David Vélez, Patrick O'Shaughnessy
And I think leadership is about knowing what doesn't have to change and pushing to change the things that have to change. That's a combination of conviction, but also active listening and humility to know that you might not have all the answers and that you're going to need to change your mind actively when you do that. So combining all those different factors, I think is pretty critical for good leadership. [01:06:05] S0: If we think over the next five years for new banks specifically, I'd love you to paint what you think is like the bear case for the business and the case you worry about and are actively making sure it doesn't happen. And then if I think about my rose colored glasses on, like the best possible story for NewBank over the next five years, I'd love to hear the two ends of the spectrum from your perspective.