Financial technology exec hypes consumer-centric approach

Alan Chang, head of Revolut, discussed the strategy of expanding neobank during a webinar with Miami Herbert Business School.

Alan Chang, revenue director of Revolut, a British financial technology company, touted customer focus and the mantra “faster, cheaper, better” as keys to the company’s success as a non-bank that operates exclusively online.

As part of the Knight Venture Leader Series virtual speech on Feb. 15, Chang shared questions and answers with John Quelch, dean of the University of Miami Patty and Alan Herbert Business School, and Robert Gregory, an associate professor of business technology who recently joined the school. .

“It’s all about the product,” Chang said. “Customers come first and then we find out the side of the business, revenue and expenses. Innovation is our business model. ”

The model involves increasing the global customer base and then offering an unlimited range of services at lower prices, which is possible due to the large volume of customers, Chang explained.

As an example, he cited the company’s initial service – a digital platform for exchanging and transferring world currencies without the traditionally high surcharges levied by intermediaries.

“It’s that simple. You enter the amount you want to exchange, and it is done in real time, ”he said. “It’s as easy as sitting in Uber, as easy as any consumer should expect – it’s faster, cheaper, better.”

According to Chang, Revolut was launched in 2015 and now provides services ranging from credit cards to personal loans and hotel accommodation for 18 million customers and 500,000 businesses in 38 countries. He said there are no limits to the company’s capacity to expand.

Quelch has questioned the sustainability of this cross-selling approach and profitability for potential shareholders.

“We can afford to make each product 10 times cheaper. And mathematically, as long as you sell 10 or more, you can get the same profit margin, ”Chang said. “At the expense of the discount you will attract more customers, and the profit per customer may remain the same. And because we make it cheaper and better, we attract more customers. ”

Gregory asked why startups seem to have an advantage over existing firms, especially in a fast-paced global economy.

“It’s all about people, whatever you do,” Chang replied. “We can attract the smartest and most ambitious people because they are the ones who want more responsibility and want to have the most impact,” he added. “By working for a small firm or startup, you get a much better chance of being influenced and taking on more responsibility.”

Although he never received an MBA, Chang said he always wanted to do business and used a “first principles” approach – breaking complex problems to the ground and then rebuilding them from scratch – he learned while studying physics. as a basis for its examination.

Chang noted that universities play an important role in the development of entrepreneurship.

“Entrepreneurship cannot be forced, but it can be promoted by showing it as a possible path,” he said. “In my education there was no encouragement to do business. There is nothing wrong with following the traditional path to business or another field, but universities can better show startups as a possible path or career path. ”

The head of the business said that his company is delving into cryptocurrency and that there are “many opportunities”, although at the moment the system is complex and cumbersome.

“Now it’s a pain, an absolute pain. You have to go through so many steps and pay a lot of fees – worse than in traditional finance, ”Chang said, adding,“ although once you get in there, it’s actually pretty good. ”

Gregory questioned whether the crypto market system would benefit from the back-end revolution, believing that Revolut could provide some remedy.

“That’s how we see it,” Chang said. “In the crypto, the use of infrastructure is not very good. Of course, we see a similar opportunity in the crypt, as in traditional finance.

Leave a Comment