Revolut Kitesurfing Founder Rises Fintech Wave to $ 33 Billion Valuation

The first time Revolut became Britain’s most valuable fintech, Nikolay Storonsky was disappointed.

Last year, a fundraising round raised the valuation of his company well ahead of his British counterparts to $ 5.5 billion, but the chief executive “really wanted to get $ 10 billion or more,” according to a person who worked with him on the deal. “Somehow, his opinion was ‘it used to be too cheap…. He has a pretty bullish mindset.’

This week, digital bank Storonsky, co-founder six years ago, took several steps further. A $ 800 million fundraiser donated to Revolut a valuation of $ 33 billion the largest private technology company in British history and one of the largest in the world.

Revolut was hailed by leading figures, including Rishi Sunak, the chancellor of the UK Ministry of Finance, as a “great British fintech success story”, although Storonsky himself did not stay to celebrate.

While the company’s chief financial officer, Mikko Salovaara, announced fundraising to reporters early Thursday morning, its chief executive was already on his way to a rare holiday: kitesurfing in Rhodes.

“Even when it’s very intense, this is their way of staying directly under pressure,” said Martin Mignot, Revolut’s first investor with Index Ventures. “It simply came to our notice then. . . I don’t think he has ever doubted his success. “

Nik is a visionary with a high bar and extraordinary ambition. His management style may not be everyone’s preferred method

The trip talks about the priorities of the 36-year-old former investment banker, who has developed a reputation among colleagues and colleagues as a fierce worker who is obsessed with data and takes a practical approach to building Revolut products, but less interest in the demonstration and business skills of some high-profile tech entrepreneurs.

“I never agreed with the role of CEO as a salesperson, or just with a person with vision,” Storonsky told the Financial Times. “We need to have a vision that we all want to achieve. . .[but]all managers need to know the details. If they don’t, they can’t change the direction of the company, they can’t distinguish what’s good and what’s bad. “

A former equity trader who studied physics and was a competitive swimmer at university, Storonsky founded Revolut with the head of technology, Vlad Yatsenko, in 2015. It was launched in London as a prepaid debit card that offered economic currency for frequent travelers, but has since expanded to more than 30 countries and offers services from commodity trading to corporate banking.

Its long-term ambition is to create a “superapp” that would provide all the financial services a customer might need in one place. This concept showed Storonsky’s “opposite” thinking, Mignot said, at a time when other fintechs were focusing on narrow niches.

“People in Britain are very conservative,” Storonsky said. “People don’t set big, ambitious goals. It is preferred to set moderate goals with a high probability of success. But to be really big, you really have to work hard to achieve huge goals, which seem to be low probability. ”

His drive has been key to attracting investors (he said the last round of fundraising was completed in less than three weeks) and ensured Revolut’s valuation of $ 33 billion.

A former staff member said, “What does Revolut do right now justifies the number? Damn not. But they produce so many new products so quickly… It’s a gamble that Storonsky is a beast that has created this product machine that is it will take over Europe or the world. “

Storonsky said the company outperformed rivals because it “surpassed everyone else.” Still, some critics saw what supporters see as high standards and impulses as an aggressive approach that fostered an exhausting workplace culture, especially in the early days of Revolut.

John Doran, a partner at TCV, who was the lead investor in Revolut’s 2020 fundraiser, said: “Nik is a visionary with a high bar and extraordinary ambition. His management style may not be everyone’s preferred method, but it is based on data, methodical and always fair.

He added that “Nik has grown massively as a leader over the years we have known each other.”

Storonsky has formed an unlikely duo with Martin Gilbert, founder of Aberdeen Asset Management and president of Revolut, whose reputation is Storonsky’s polar opposite: Gilbert is a big city known for hosting whiskey-filled parties at the Davos World Economic Forum .

Storonsky said he appreciated the advice of someone with decades of experience in founding and running a large financial company, in contrast to many “expert” investors in the tech industry who have little real experience in construction companies. Gilbert, meanwhile, said this week that “people misunderstand [Storonsky] quite dramatically ”.

“He has a great sense of humor. . .[and]he is a good listener, which many people do not see. Don’t make the mistake of saying too much – you have the ability to answer a question and then you won’t fill an awkward silence. People confuse this with other traits. “

Storonsky’s reputation for coldness has also, according to some investors and staff, been aggravated by xenophobia: he is a British citizen, but was born in Russia and his father worked for a division of the state-owned company. Gazprom gas.

His Russian ties have caused particular controversy in Lithuania, where Revolut sparked outrage among some politicians after he received his first banking license in 2018.

The company has also been examining whether its rapid growth would be excessive compliance staff keep pace, leading to substantial investments in system strengthening and staffing to reassure regulators and help them obtain new licenses.

This week’s fundraiser pushed Revolut’s valuation to NatWest, one of the UK’s largest street banks, with £ 453 billion in customer deposits, to £ 4.6 billion from Revolut. The comparison led several bankers to call the investment “crazy,” but Storonsky said he was happy that traditional banks continued to doubt the company.

“It makes our way easier if people and banks don’t take us seriously, we can be hidden, steal and move faster. I hope one day they wake up and have no business.

Additional reports by Tim Bradshaw