0:00
Some people focus on conversion rate, like, "I'm going to make this really, really slick." And that's cool.
Search this video
0:03
You get a bit more growth.
0:03
But to get to recommendation, you're going to blow your user socks off.
0:07
You have to give them an experience they didn't know was previously possible.
0:12
And when you are in that place of doing something that no one has ever done before, that's when you get it.
0:23
Welcome to Lenny's Podcast, where I interview world-class product leaders and growth experts to learn from their hard won experiences building and growing today's most successful products.
0:31
Today my guest is Nilan Peiris.
0:31
Nilan is chief product Officer at Wise, where he has been for over 11 years, basically from the beginning of the journey.
0:36
If you're not familiar with Wise, you should be.
0:40
They make it incredibly easy and cheap to send money internationally.
0:44
I am a regular user and customer, and because the product is so great, they've grown primarily through word of mouth.
0:50
About 70% of their growth comes through word of mouth.
0:54
And in our conversation, Nilan breaks down exactly how they made word of mouth so successful for their product.
1:00
I don't know any founder who wouldn't wish to have more word of mouth growth, and Nilan's advice is the most tactical, and useful advice I've ever heard for how to actually drive your word of mouth growth.
1:09
I am really excited for you to hear this episode, and to learn from Nilan.
1:14
And so with that, I bring you Nilan Peiris, after a short word from our sponsors.
1:20
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3:18
Nilan, thank you so much for being here. Welcome to the podcast.
3:29
Thanks for having me, Lenny.
3:33
So you're chief product officer at Wise, which I don't know if you knew this, but I'm a very happy weekly active user of.
3:38
To give folks a little bit of context on Wise, could you just explain, what does Wise do?
3:44
And also share maybe a few stats to give people a sense of the scale that Wise has reached at this point.
3:49
We're looking to solve the problems associated with cross-border money movement, which is that moving money across border is pretty slow.
4:00
It's actually really expensive, and it can be really hard to do.
4:00
We solve it with three products, our money transfer product, which is what we started with, our account, which would be like, think of trying to solve the problems of international banking with our account for people, and for businesses.
4:17
And then finally we've also got an enterprise product where we take the underlying infrastructure that's powered those products that we've built, and embed them in the banks, and products that people use every day, and then zooming into the numbers.
4:31
So, we've got to come a little way on the journey.
4:38
So today we're now moving about $12 billion a month, growing between 30 to 40% year on year. We take about 0.
4:47
65% on average across all our routes as price, and we've been profitable for about more than four years now, with 20% EBITDA margins.
5:05
But probably the stat I'm most proud of, and the hardest thing to make happen out of all of that was we acquired 70% of the users that found out about Wise last month through word of mouth.
5:19
So, contextually, we have 16 million customers, and we're acquiring about a million a quarter, about 10 million actives, and yes, so out of a million that joined Wise the first time, 700,000 found out about Wise from a friend.
5:32
There's a couple stats there that really stand out to me.
5:38
One is you're gaining a million new users a quarter, which is insane.
5:38
Just like a million new people joining Wise every quarter.
5:44
That's an astounding number.
5:44
The other number is what you just shared around word of mouth, that basically more than two thirds of people are discovering Wise and joining Wise through word of mouth. Mouth.
5:54
I want to spend the bulk of our conversation on this topic of word of mouth.
5:58
I think it's extremely rare how you've been able to increase word of mouth, and just how much of your growth comes through word of mouth.
6:08
You've essentially developed a system for how to drive word of mouth, and how to basically structure your team, your goals, your priorities and things like that in order to lean into this growth channel.
6:17
And so, I just have a million questions around how you think about word of mouth, and the first is just, how do you measure word of mouth?
6:21
How do you know that say, 70% of your growth is coming through word of mouth?
6:27
We ask customers, is the short answer.
6:27
So, we have an attribution model, as you can imagine, and we've had one from the early days, and it overlays all the referrer data and cookie data you have on visits comes to the website.
6:36
So you kind of know that.
6:45
And then you obviously have the soundtrack stuff, and we sample, and ask customers a set of questions on this, and then overlay that onto the...
6:51
What turns up in your web tracking as direct traffic to give us a sense of how big that word of mouth number is, and that's what gets us back to the 70% stat.
7:02
And very practically, how do you actually ask people?
7:08
Is there a little pop-up on the website?
7:09
It's actually integrated into the flow.
7:09
So when we built it originally, we thought it's quite cool, marketing and acquiring customers is part of the product, and we should actually stitch that into the experience seamlessly so that we're able to do this more effectively going forward.
7:26
That's actually, at Airbnb, exactly how the team did that, to understand what percentage of growth was word of mouth.
7:30
It's just a little interstitial popup when you visit say, airbnb.
7:33
com, "How'd you hear about us?"
7:33
You think there's some fancy ways to understand the stuff, but it's just like, just ask people, they'll tell you how they heard about it. Yeah. Awesome.
7:40
Okay, so just to kind of dig into the meat of it, what has been the biggest shift in helping you significantly grow word of mouth, and make it such a huge lever of growth for Wise?
7:50
Yeah, before I launch into this, let's just also take a step back, and why even focus on this?
7:55
So in the early days, when I met the founders, Kristo and Tyler.
8:02
It was quite funny, I got introed to them when they were just the founders, and without a team really, and with the beginnings of a product, and they said, "Nilan, you've got to meet these guys, they've got a great product, they just don't have any customers."
8:13
And I sat there with them, and we kind of launched the first Google ads, and in the early days you try everything, hoping that something works.
8:27
But taking a step back, think of money as the ultimate commodity.
8:36
It's pretty hard to build an expensive business that moves your money somewhere, and it costs a lot, so there's less of it afterwards.
8:45
So building a brand led money transfer business, the brand's got to be pretty damn good, right?
8:52
You're going to feel pretty special afterwards, in order to have less money afterwards.
9:00
So what we're looking for always, but what channels out there are super scalable, and can reach our entire audience, but have an incredibly low distribution cost.
9:10
So, that's one thing that led us to word of mouth and the other bit, when we get on to talk about marketing later, the other challenge with marketing which is unique is because we are lower price, but a superior product, we have less margin to spend on marketing than others in certain paid channels.
9:24
So that's another reason why marketing is inherently hard.
9:30
Our marketing team does amazing work at Wise, in order to work within those constraints.
9:35
But back to your question, which was like, what's the biggest thing we've done to shift word of mouth.
9:42
When I joined Wise, and started wrangling with word of mouth, I spent a bunch of time with friends of mine in the US and around the world, Andrew Chen, some of the other growth gurus, this is going back 10, 12 years.
9:56
It's like what mouths, who's done it? What's the system? What do you measure?
10:01
There wasn't really anything out there.
10:01
So we kind of had to figure our way out.
10:01
So, first step was asking it, and the second step was kind of figure out how do you know what's driving it?
10:15
And the best proxy we found for this was something that most people have heard of, that we actually used quite a lot is net promoter score.
10:22
So from the very early days we'd start asking customers, and you probably have seen this survey, "Would you recommend Wise to a friend?"
10:34
Never seen that ever in my life.
10:34
Never been asked that question. Exactly.
10:39
There's [inaudible 00:10:41] you said.
10:39
And then in the end you've got the scale, zero to 10, and the theory is nine to 10 there are promoters, and zero to seven are detractors.
10:47
Zero to six, detractors, and seven to eight are kind of neutral on your product.
10:54
The intriguing bet was when we overlaid this...
10:54
So we have word of mouth, it's about 50 odd percent, and then we have a referral program.
11:02
When we overlay the referral data over the NPS survey data, we saw something really interesting.
11:08
There's very low invite rates at one to six, and not just invite, conversion rates of users that joined for invites.
11:22
But when we've got people from sixes to this seven and eight group, they doubled the number of people they told.
11:27
Eight to nine, they doubled again, and nine to 10, they doubled again.
11:27
So, this is pretty crazy when you see it for the first time.
11:36
I'm going to get back to your question in a sec, but it's quite core buildup to it, because when you are a product manager, like you've been in your career, one of your jobs is to figure out what metric are you going to optimize for?
11:48
What are you going to try to get the business to ground behind?
11:53
And if you optimize for something like conversion, rate and you move conversion rate with 10%, you kind of get this one-off hit.
11:58
But if you move the NPS from 30% to 50%, you increase the viral coefficient of your customer base.
12:07
So every customer that goes through tells X many more.
12:12
When you model this through, the ROI on NPS increases is absolutely huge.
12:20
So, it's got to say, "Okay, this is the thing to zoom in on, so how to move it?"
12:27
So, then the second magic of NPS is you get the numbers, but you also get the comments underneath it.
12:32
I remember in the first year we built the NPS survey, and we emailed out every week all the comments to the whole company, which was pretty small, and we kept doing that, I think up till about three or four years, everyone got the NPS comments.
12:51
And when you read the comments, and now obviously we've got all kinds of fancy models sitting on top of these things, customers kept telling us the same things, "Make it faster, make it cheaper, make it easier to use."
13:01
Do you know at the beginning, when I said, "Price, speed, ease of use," we kind of figured this out by thinking hard about this question.
13:14
How do we make this product so good that people will use, it but they'll recommend it?
13:19
And customers were pretty clear, the ones that were evangelical, is the word we use, are the ones that had a much...
13:25
Had this cheaper experience, the ones that were talking about it had a fast experience.
13:28
So it's about price, about speed, it's about ease of use.
13:33
And when you generalize and take a step back, and look at consumer product companies, they have these product pillars they call it, and they usually have KPIs around them.
13:37
The second insight we got, found, is when we entered markets, like when we entered the US for the first time, if we entered with a product that was priced at say 5.
13:50
9%, and the alternative was six, customers would use us, but they wouldn't talk about us.
13:57
We only got the advocacy when we were eight to 10 times cheaper.
14:04
That's when people started talking about it.
14:11
Let me actually interrupt you here a bit, just to kind of set a little frame around this, because this is extremely interesting, and I think people may miss, I think, some of the really interesting insights here.
14:19
What I'm hearing is essentially there's this clear sense that you had to grow through word of mouth because of the business model.
14:24
You didn't make a lot of money per user, and you didn't have a lot of money to spend thus, to help grow.
14:28
So essentially it's like.
14:31
"How do we grow the word of mouth?"
14:31
And then it's, "Okay, what do we need to convince people to share this product?"
14:36
And used NPS, which I think a lot of people use, and also a lot of people probably know, "Let's make our product more awesome so that people talk about it."
14:47
Those are kind of like, "Oh yeah, of course."
14:47
But I think what I'm hearing is that you did that's really unique, is one, you found this huge delta between these detractors, and even seven or...
14:57
I guess it was six and below, and then seven or eight, and then nine, 10 kept kind of doubling.
15:03
So one is just this focus on, how do we get someone from there to there?
15:07
Two is this really big focus on the comments of the NPS survey, not just like, "Oh we have this percentage of detractors."
15:13
And then also I love how you just create these pillars, essentially, of like, "We're going to work on these three things.
15:19
These are the three levers to help grow word of mouth for this product."
15:21
Does that sound about right? That all makes sense.
15:25
Obviously at the time, it is also way more chaotic. Yeah.
15:32
So, at the beginning, everyone thinks it's 20 different things, and then over time, slowly, you understand that it's these things again and again.
15:40
And a lot of building a successful businesses kind of building conviction that these are the things that matter.
15:45
So, now I'd say price, speed, ease of use, it sounds...
15:45
Like, but yeah, go back to seven, eight years.
15:50
But we were arguing with each other around what, "Is it trust? Is it this? Is it this?"
15:54
Trying to get clear on what are the things we missed there.
15:58
That would be useful actually to know.
15:58
It sounds like, of course, it's going to be price and speed, but what are the things you kind of realize you don't need to focus on as much, based on these surveys?
16:07
Oh, wow, that's a really hard one.
16:07
So, then the challenge, is as you know, everything is important. Yeah. Yeah?
16:17
And that things that we use...
16:19
We have a bucket called convenience.
16:19
And inside the convenience bucket, there are many, many things hiding in there.
16:24
And actually, you can measure this on contact rate, conversion rate, whatever, many different ways, and get many slightly different answers.
16:37
So, I think I've learned there isn't...
16:37
I haven't got a good answer on things we haven't- Well, as you said, trust, which is interesting.
16:41
Obviously trust matters, but maybe it sounds like- Trust certainly matters.
16:46
Yeah, trust's a good one.
16:47
Let's talk about that one bit.
16:47
I'll talk to you through the trust problem.
16:52
So I ran into the trust problem hardest in marketing.
16:52
So, just imagine, you just started out, you've got a money transfer company, it's good, your product's really good, it's really cheap.
17:04
So, you put an ad out, and it says, "Move money with Wise, and really cheaply," is anyone going to click that? People did, right?
17:14
Is anyone going to use it? Yeah, people did use it.
17:20
And you did work all the usual trust elements.
17:20
But the bit I found that really helped, the way I got my head around this, was what people trust is their friends.
17:34
And this really was way stronger a trust signal than anything I could put on a landing page.
17:39
And even when people came in through marketing, they'd been told.
17:39
So marketing can aid recall, and all kinds of things, because people are told by their friends.
17:45
They'd have a use case later on, then Google, and like, "Ah, I remember, this guy used this."
17:48
And we do definitely get users, especially today as we've got a larger brand, through marketing direct.
17:57
But trust in isolation is a really hard problem to solve.
17:57
You need to get under the skin of what it means.
18:02
People don't think my money is safe.
18:02
"I don't know if this company is reputable," to unpick each of these problems and figure out systemically how to solve them.
18:10
And we've done this to some extent, but really there's a massive shortcut, which is if you deliver your customers a good experience, then figure out, how do you make it so good they'll recommend it?
18:20
Then that kind of shortcut a lot of really hard trust problems.
18:27
What did you find most helped increase trust in that way?
18:27
Is it just get more people using it and then they'll share with their friends, or is there something you did there to...
18:35
No, it was literally get more people using it, and they'll share with their friends.
18:40
There's obviously a bunch of learnings we've had around what specific trust sentiments matter, especially geographically, but less powerful in the macro than get more people to use it.
18:51
So coming back to that, and I'd love to get your thoughts on this one.
18:55
So, as you said, lots of people go up to NPS, and they kind of heard people talk about it, heard people talk about recommendations.
19:00
So my learning on this is you've got to work really hard to get recommendation.
19:09
So, to get a nine or a 10, so our NPS is 70%, so it's really, really high.
19:09
So it's kind of higher than the iPhone, and Google search.
19:18
So really, really high, so off the scale high.
19:25
And when we launch a market, or at the beginning it was much lower, so 20s and 30s.
19:25
So instead it in context, like banks and financial services NPS is -30.
19:31
So, most people don't recommend banks.
19:38
So it's like, comes from a low base.
19:38
But, what I've found is when you build a product, most founders, and most teams kind of stop when it works.
19:47
As their next step, some people focus on conversion rate like, "I'm going to make this really, really slick," and that's cool, you get a bit more growth.
20:00
But to get to recommendation, you're going to blow your users' socks off, and the phrase we use is, you have to give them an experience they didn't know was previously possible.
20:13
And when you are in that place of doing something that no one has ever done before, that's where you get it.
20:20
So the bar is all the way up there.
20:27
And to put that in context, that means figuring out how to move money instantly.
20:27
That means figuring out how to drop the price all the way from six all the way down to 0. 35.
20:32
And that's because there are systemic infrastructure issues in moving money around the world, which some people haven't solved before.
20:42
And these problems are just really hard to solve.
20:47
They take years to solve, but they have huge kind of returns when you do it.
20:51
I love that just as a framework, is how do...
20:51
We need to blow our users' socks off.
20:51
And again, it just comes back to how you can get people to want to share this product, and drive word of mouth, blow their socks off.
20:59
I want to dig into how you actually just figured out what these attributes are.
21:04
Obviously you talked about this NPS survey highlighting things.
21:09
How did you decide it was instant money movement, and some of the other things?
21:09
Is it just basically looking at these survey results, and picking the things that come up most often?
21:20
Yeah, it was talking to customers, and looking at the survey results, and then through that, in many different ways, price will come up, speed will come up, ease of use will come up, and they kind of aggregate up to that.
21:29
I think a lot of people listening are still going to be this like, "Okay, we're just going to make our product awesome, and it's going to grow."
21:37
And in a sense, yeah, in another sense what you're sharing is essentially kind of a really simple framework for how to actually do that.
21:44
To kind of go a little deeper there, when you see other people trying to drive word of mouth, trying to drive virality, is there anything you think people often do wrong?
21:53
Is there other missteps you've taken in trying to drive word of mouth?
21:59
It's this thing around growth rate.
21:59
So, especially product net growth, which is what we're talking about.
22:04
So you can imagine, we're going to open a new market to Indonesia, and the fastest way to do it is to take...
22:10
Someone else has figured out how to move to Indonesia.
22:10
We take that infrastructure, and we'll plug it into Wise, You know what?
22:16
We can do this, we'll get some users.
22:20
But it doesn't grow like a hockey stick.
22:20
It doesn't grow like a hockey stick because we haven't fundamentally changed the problems in moving money internationally.
22:24
So, got this mantra, you've got to build a 10x better product than what's there.
22:33
And if it's 10x product better, basically it doesn't exist already.
22:39
So if you're plugging in something else, that's kind of a misstep.
22:43
So it comes from a very logical place, how do I get users quickly?
22:47
I can take a shortcut in doing this, but that, you kind of realize is wasted effort.
22:52
So the step then becomes this much harder question of these types of questions.
22:52
Like what is the theoretical minimum cost for moving money into a market?
22:59
What is the theoretical maximum speed?
23:06
Not just make it instant, make it cheap, but what actually is the lowest it could possibly be?
23:13
And instead of incrementally going, doing a jump to make it a little better, a little better, a little better, you can never get there.
23:17
How do we take two years, and end up there? I love that.
23:23
It's something that I talk about a lot.
23:23
Something I learned at Airbnb is this idea of working backwards from the ideal, instead of working forwards from how do we iterate and make this better, and better, and better.
23:33
It's like, okay, if we could start again, and we could create the ideal experience, what would that look like?
23:38
And then work backwards from what would it take to get there?
23:42
And what's an example of that at Airbnb?
23:42
What was an ideal that you guys went for and then built?
23:46
The ideal was, there's this whole process where the founders hired this storyboard artist from Pixar to draw out the ideal experience of a host and a guest.
24:00
So, there's these storyboards sitting in the office.
24:00
I think there's 12 kind of...
24:03
They call them key frames of, it's just like the booking experience being really seamless, arriving in the home, and being really amazed.
24:09
Going out and finding things to do.
24:13
So, this became essentially the vision of the company is let's make each of these frames, these key moments of a journey for hosting a guest as incredible as possible.
24:18
That was one, and that became essentially the strategy for a few years is just make each of these frames awesome.
24:29
And then there was another project that they were working on around booking at Airbnb.
24:32
I don't know if you remember this, if you used Airbnb much, but most of Airbnb back in the day was you request to book with a host, you're like, "Hey, can I stay in your home?" Yeah.
24:41
And turned out 50% of the time the guest was ignored, or rejected, and the host was just like, "Nah, no thank you."
24:45
Now, over 80% as far as I know of bookings are instant bookings, where you just book and it's done, just like every other place you book online.
24:56
And so that was a huge transition that I worked on, and that came from, if we were to start Airbnb again today, or if someone were to disrupt Airbnb, what would it look like?
25:05
And obviously it'd be you just book.
25:05
You're not sitting around hoping someone is cool with you.
25:09
So, that came from that idea of just like, what would be the ideal Airbnb experience?
25:15
That is incredibly inspiring.
25:15
I'll try and share a couple of stories, analogies from Wise.
25:24
I'll talk about two things.
25:24
Let's talk about price first.
25:24
So, it's a good question.
25:24
So, Moneytrans has been around since the [inaudible 00:25:32].
25:29
How does a few people get together?
25:35
And it's evolved towards moving trillions around the world, and generally retail consumers paying about six to 7% around the world to do it.
25:42
How do a small team in Europe start out and figure out how to move it? We launched at 0.
25:48
5%, and now we're down to about 0. 35%. So what changed?
25:57
Yeah, I was going to ask, how did you do that?
25:57
That sounds like everyone would want to do that.
25:59
Yeah, so let's try to unpick it a little bit.
25:59
So, first question you'd ask is, "I know what you're doing, you're losing money on every transfer."
26:08
It's like, "Especially what you're doing," but we've been profitable for five years.
26:08
And one of the magical things here was we're actually profitable in every transaction.
26:14
So it's probably about four or five years ago, I led this project to start to pull together our pricing.
26:29
So, every month you get bills, and they turn up in your P&L, but every single bill we got, we allocated the cost back to the customer, or the transaction that generated it.
26:40
And then we add our margin on top, and that's our price.
26:48
And when you look at this and you analyze it, you'll find obviously there are 20% of customers generating 80% of the costs.
26:54
And what you do is you get those 20%, you give them a raise, because they should cover their costs, and you drop the price to everyone else.
27:03
And then the team works really hard on reducing these costs down, and then you move into a different segment in the market as the price costs come down.
27:09
Does that make sense, Lenny? Yeah.
27:13
Essentially charge the heavier users more to counteract less frequent users.
27:19
And essentially that drives word of mouth.
27:19
Totally, but it's down to this level of, if an Australian customer calls up asking, "Where is my transfer?"
27:26
That cost of that call gets allocated back to the AUD/GBP route.
27:31
If a Brazilian business needs like 20 documents in order to be verified before we can give them an account, the cost of verifying check those customers goes back there, so that at a very atomic level starts happening.
27:43
So yeah, as you said, the more expensive customers end up paying what they cost.
27:48
And it sounds like the more expensive markets.
27:54
Indeed, and the more expensive, systemically expensive markets. But let's get to that. So, what are the costs?
27:59
So if you look at our P&L, there's just three costs at transaction level.
27:59
You've got people costs, you've got the cost of risk, realized risk, and then you've got partner fees.
28:15
And so if you've got this mission of moving the world's money for almost nothing, or zero, as close to zero as you can, you've got to invest as much of your cashflow in engineering to try to engineer away these three problems.
28:25
So just to take them through briefly a bit, and remember, we're trying to do this 10 times better than anyone else.
28:31
So how do you really change the experience on each of them?
28:35
I'll cover a couple with you.
28:35
So let's do the risk one first.
28:42
There's two risks we have.
28:42
We have have FX risk, you come to Wise you see your rate, and then you may send us the money a little later.
28:47
If you're moving a million dollars, you can't usually move it instantly.
28:53
It might take you two to three days to move it.
28:53
The rate's locked, could move against us, we'd lose some money.
28:58
So that cost, if you look back, so we've halved that cost over the last few years, and you can imagine through understanding the bits of the product, they generate exposure, and limiting it, and a bunch of algorithms behind that.
29:16
But the more inspiring stuff is the people costs, and the partner costs, go through each of these one at a time.
29:23
So the people costs are our customer service team, operations teams.
29:27
But I like to think of that as the cost of poor quality.
29:27
So you bring up customer support if the products are clear, you hire lots of people in the back office.
29:35
If you haven't automated it.
29:39
We get like 20% improvement year on year as we're doing that.
29:39
But come back to your question, how do you step change that?
29:45
How do you do a 10x better experience?
29:48
I'll share with you a story from Singapore. It's quite a fun one.
29:53
Because we went to Singapore about six, seven years ago, and [inaudible 00:29:58], we asked for a license.
29:57
We had 20,000 people on the wait list, or so, saying, "Wise, please come to Singapore."
30:03
And we went there, we asked the regular, "Hey, can you give us a license?"
30:03
They gave us the license, but they said, "You have to physically meet every single customer." Great. Face-to-face.
30:14
And this happens, this is...
30:18
Remember, they're banks that people use.
30:18
So people go into banks usually, and you get face-to-face verified when you open a bank account.
30:25
We're like, "You don't need to do this in Australia, in the UK, in other countries around the world."
30:31
They're like, "In Singapore, for your license, you need to do this."
30:34
So we actually sent a small team out to Singapore, and we opened an office through [inaudible 00:30:43], and customers...
30:42
You went through this really slick flow, and then you got invited in to come see the team. Amazing.
30:50
And customers hated it, and it was really expensive, obviously. Yeah.
30:56
But the magic was we got the customers not to complain to us, but to complain to the government.
31:00
And it took a year of lobbying, and a year of building, doing something unscalable effectively, before we got the world's first EKYC license in Singapore.
31:12
So you could take a selfie, picture of your ID, and then you could get verified.
31:18
And that's what I call a 10x better experience than anyone else in the market, and that led to advocacy and word of mouth off the back of it.
31:27
And that loop of getting your customers to help was also one of the learnings of word of mouth.
31:35
Was the product team involved?
31:35
Were you involved in that on the ground stuff?
31:38
Or was it like [inaudible 00:31:40]? Yeah, yeah.
31:38
Generally when we go [inaudible 00:31:43], we're running cross-functional teams, but this is a verification team.
31:46
The team actually would verify the docs when you sent it to us.
31:46
They went out to Singapore, verified them onsite, face-to-face.
31:50
So the fun bit here is why would customers help a company?
31:59
And this is one of the other learnings on word of mouth.
31:59
The way I think about this is that there are the rational reasons why people recommend, which we've covered.
32:06
But there's these emotional ones as well.
32:11
Softer ones people would call brand.
32:11
I prefer to call it on the mission.
32:19
So we do our mission, which is to make the world's money move instantly at the touch of a button, for almost nothing.
32:24
It was a very personal thing, it was like an internal company thing, to think our customers cared about it.
32:29
And then we rebranded like eight, nine years ago, our first rebrand, and we wrote our mission and sent it to our customers.
32:41
We got more new customers from that email being forwarded around than any other kind of marketing.
32:47
And I show this when I talk at conferences.
32:47
This email broke all the rules of marketing.
32:51
It didn't have a call to action, it didn't have a button to sign up, it didn't have anything in it, but people just forwarded it around saying, "You should check out Wise."
32:59
And it's not all the customer base, but there was a proportion of the customer base that this resonated in.
33:03
And I think it's the authenticity within which they could see that we were genuinely trying to....
33:12
Trying to bring the prices down was a scheme to help us grow faster, which is kind of where it started out, was actually genuinely because founders, they were really upset about how much it cost to money.
33:24
They found good ways to solve that problem, and they're still really passionate about solving that problem.
33:31
And they could see that authenticity flows through the whole company, because we got a...
33:31
When you look at Wise, we're full of people on visas, and immigrants, and people that have worked, and live around the world, and struggled with this problem, and are passionate about solving it.
33:43
And so they wanted to help us solve it.
33:43
So the second part of this word of mouth engine is for us, we managed to get this mission thing to work.
33:52
So somehow we emotionally connect our cause, and then I see going, taking a step back, getting 10x better on price is through our customers helping us do it, which gets us even cheaper, which then brings more customers, that then creates this flywheel that's spins around.
34:10
What a flywheel you guys have built.
34:10
This reminds me of a lot of different things.
34:10
One is you talked about how there's the reality of the things people need, and then there's this soft, fuzzy stuff that's harder to quantify.
34:21
I actually is the framework just like that on that product I talked about of instant booking.
34:24
I kind of built a roadmap around the reality of what people actually need in order to feel comfortable, guests booking instantly.
34:29
And then I call it the perception, what are their fears about letting guests book instantly?
34:34
And there's a lot of work to just convince them, you think you're going to get all these guests that are really scary or whatever, but in reality it never happens.
34:44
It's really rare something bad happens, and if it does, we're going to cover it.
34:49
So, I think that's a really cool framework when you're trying to get people to adopt something, is think about what do they actually need?
34:53
And then how do you convince them of the things that are just in their head?
34:56
And it sounds like the win there was kind of this sharing your mission and your values as a business.
35:05
Yeah, it just sounds, again very tweedy, right?
35:05
Tweedy, like sounds very corporate, sounds like it's never going to work, but I think it's also...
35:09
I mean, Airbnb, the authenticity is there.
35:13
People are passionate about making that experience work for both sides of the marketplace. It's kind of clear.
35:17
So, I'm kind of taking a step back, personally very passionate about customer-led growth, and how that turns into shareholder value.
35:31
So, taking a step back, where every business I've ever worked in, it's always got these two lists, a list of things to do for your customers, and then it's got a list of things to do to make money.
35:44
And you generally do everything you need to do to make money, and you do two things with the customer list, and you go, "Customer led business."
35:48
And then, neat thing about wise, and I'm pretty sure you'll see the same thing on Airbnb is, we just had one list, which is this list of things that you need to do to make customers happy, and it's prioritized by impact on the really hard things.
36:02
And if you do these really hard things, they have an incredible impact for customers, but hence on your growth, and on your shareholder value.
36:11
That is really interesting.
36:11
Airbnb is not quite like that.
36:11
It's actually become more like that with a lot of just like, "Let's build awesome products and not focus on experiments as much."
36:21
So that's really interesting that prioritization basically at Wise came from, "What are people telling us?"
36:24
I guess let me ask actually, how did you know what the impact would be on customers? How did you decide?
36:28
Is it frequency of how often people request it?
36:28
Is it, "We need to lower the cost, and so we're just going to prioritize the things that will lower prices most?"
36:35
Definitely on the journey at the beginning, you are into split testing, right?
36:39
Let's try to take apart a split test on price.
36:39
So, you've systemically dropped the cost.
36:45
Imagine we drop the cost.
36:45
The question is, do we drop the price?
36:50
Do we pass that all on to customers?
36:50
And do we keep some of it?
36:55
And split testing on the price thing, if the split test is going to mean you end up with more revenue, it means you drop the price by 10%, and there happened to be that day, more than 10% more customers in the market who, they saw the price at one pound, but they see the price at 90p, at 10% lower, and they're like, "I wasn't going to shift at buy at one pound but I'm going to buy it 90p."
37:21
So this is pretty hard to do this.
37:28
This word around conviction is one I use a lot, where you build this conviction that price is what matters.
37:33
And through this incremental split test, you will take a long time to go there, but at some point you kind of go, "Actually I've got enough conviction."
37:41
So there's one kind of strategic bet at the heart of Wise.
37:41
That is if we have the lowest cost platform, and it's really fast, and really high quality, the world's volume will switch to us.
37:54
And just marginally getting there step by step by step, and trying to track the incremental return is actually slower.
37:58
And there's a point that comes that you go, "I feel really comfortable investing in price.
38:02
I feel comfortable investing in speed, because I know it's going to pay back, and not necessarily this month, but eventually it will, and I need to make gains on all three levers in order to get there." Does that make sense? Yeah, absolutely.
38:13
So essentially, in that track of work, instead of everything that you did to reduce price, there wasn't an experiment to see, "What impact does this have on growth, or revenue?"
38:24
Instead, it's just, "We know reducing price is going to help us grow, and so we're just going to track how much we're cutting price."
38:29
And that's essentially the goals, I imagine, were just cut the price by some amount, find a way to make it this much cheaper every, say, quarter, or year. Yeah, that's it. You got it.
38:37
And that conviction is core.
38:37
That extends to our product management approach on the UX.
38:45
So this is a great line for use internally, I'm sure you've heard it, "You can't split test your way to love."
38:51
So, this experiment led product management approach, where you throw a bunch of things on the wall, and then you kind of see what sticks, and generally we don't advocate this.
39:04
Obviously there's a bit of it that happens, but generally don't advocate it.
39:09
Mainly because engineering is expensive, and you can actually figure out what matters to customers through other means.
39:16
Some of the techniques we've talked, and build it.
39:21
There's a story I like to share.
39:21
I had a product manager join our refer a friend team, viral growth team, and invite team, and after a quarter, I said, "So what are you going to build?"
39:35
And he's like, "I'm going to test everything.
39:35
I'm going to test the landing page, I'm going to test the subject line, I'm going to test the program so I don't know yet till run through all the tests, then I'm going to come back and tell you what I'm going to build."
39:49
I said, "You're not going to do this.
39:49
I'm going to give you three weeks and you're going to pick one thing to change, but you're going to go talk to people, and get quantitative insights, and build your own gut feel around what matters, and then launch it, and submit, test it, and see if it works."
40:04
But this thing of building conviction on what matters, and I watch how teams slowly build this and you need the data there to make sure it doesn't become a hubris, right?
40:13
That enables you to make much bigger changes than just experimenting away, and it forces you to get clear on what actually is the problem to solve here, and how do I solve it really, really well?
40:24
Does that make sense, Lenny, Do you disagree?
40:24
It's a bit provocative there.
40:24
Some people are pretty strong in the expert led approach.
40:28
No, there's many ways to do it.
40:28
There's no right way, and it's working.
40:32
So I'm not going to argue.
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42:00
So, what I'm hearing essentially, the experimentation culture at Wise is instead of just run, test everything that you're thinking about, throw out a bunch of ideas and see how they go, it's more, "Let's just decide we believe in this idea, and let's go bigger there, and run an experiment. Maybe not even."
42:14
Is that roughly how you think about it? Yeah, yeah, yeah, yeah.
42:18
And is that something that you've seen yourself in practice elsewhere?
42:23
It's interesting how many parallels there are to Airbnb, because this is what Airbnb is doing now.
42:27
There's been a shift recently, where instead of everything is very data experiment driven, it's very just like, "Let's build really great products that the founders are really excited about, and that the execs are hearing from people.
42:37
Let's just build things that are awesome and launch them, and we believe things will grow."
42:41
And Airbnb is doing great.
42:46
Yeah, the challenge of this is because it does become this risk thing of where it's like, okay, it's someone's opinion, so I think it's X, right?
42:54
And everyone thinks they're kind of Steve Jobs type thing. Yeah. That's right.
43:01
You have some way of using data to get this conviction, and show why this is what we should do, but try to learn how to build that faster CME, slight difference.
43:07
So, it's less product managers or me saying, "Hey guys, I think it's X."
43:15
It's generally data driven, and qualitative insights driven as well.
43:20
Personally, I would always index towards running experiments just to put this out there, but I think in this case, it makes sense, where you just know, "We need to do these three things, just make it cheaper, make it faster."
43:29
You don't need to AB test every idea there.
43:35
Probably the main downside of not testing everything is you may be hurting things along the way, and you may not know it.
43:40
I mean, yeah, so we definitely do... So you're right.
43:44
But there's a very different thing to when you look at the...
43:44
From a sample size perspective, you want to do a beta, and understand the negative impact.
43:50
It's a holdout group that's smaller, than a test to get a significance.
43:55
It's quite define the criteria to know whether something is breaking, is generally a different thing to say, is this a material result in a test? Yeah.
44:09
And along those lines, the other benefit of experimentation is you know the impact.
44:09
And so, team members can understand, "Here's what I did this quarter, this year."
44:13
How do you think about just like performance reviews, and people's impact, and that kind of thing? Yeah, that's a good one.
44:21
This one is definitely an ongoing debate.
44:21
So, I generally ask teams what's their impact?
44:26
So, every quarter, every team, what...
44:26
[inaudible 00:44:29] or Kristo will ask, "What did you ship?"
44:29
And I generally ask, "How many people used it?
44:29
What was the impact on volume?" Et cetera.
44:33
And we have analyst teams that can answer this either with pre-post analysis, all kinds of techniques, or all through split tests.
44:39
We generally have this, the debate is where the analysis slows us down, and we wouldn't make a decision off the back of the analysis.
44:53
And then, this generally is what you said, where the team needs a validation, mainly for themselves, and maybe a little performance, but not too much.
45:05
And so, there were ways in which you can maybe get some read on it that isn't quite as strong as a split test, which we'd use in these things.
45:10
It's more just getting some...
45:16
You can understand that people worried when you do split tests that slow down the release of something, but in order to get impact, if you know you're not going to roll it back, then okay, you should just roll it out, and try to reduce the need for that validation.
45:30
I think that there's an interesting correlation between products that grow through word of mouth, and less need to experiment with everything.
45:35
Airbnb is also actually 70% of growth is word of mouth from the last stat that I heard.
45:42
And then you think about all these social consumer apps, they mostly grow through people sharing with their friends, and a lot of them come from just the founder's intuition of what a great product's going to be.
45:52
I think about Snapchat, and the recent mobile social apps.
45:57
And so I think maybe there's something there about just as a founder, trusting your gut more often.
46:04
But then it becomes difficult as you grow.
46:04
You have to delegate, and then you have to trust people on your team making the right decisions.
46:09
I guess, is there anything there that you've learned about just trusting individual product teams to make decisions that you can't for sure know are positive or negative without running experiments?
46:23
So, as I say, almost everything we do, we have some way of understanding the impact. So, that's always there.
46:28
We definitely have things where the team does something where Kristo or I will say, "This is just crazy.
46:37
There's no way they're going to use this."
46:37
And then we have a culture where people are encouraged to do these things, if they believe in it.
46:48
Is there an example of that? Yeah, a couple.
46:48
So the one [inaudible 00:46:52] that my head of SEO always talks about is a currency converter.
46:52
So, the Wise homepage is a pretty good currency converter.
47:00
It's got a decent one on there.
47:00
There's tons of traffic on currency converter.
47:04
So, if you click Wise link, now it's a little bit hidden on send, it's there. It's pretty cool. Currency converter.
47:08
Oh I see it at the bottom there.
47:08
Yeah, it's like [inaudible 00:47:13].
47:11
But if you Google currency converter, there's tons of traffic, and that converter on the Wise homepage obviously includes our price, and lets you sign up.
47:22
And so, should we build a currency convertor?
47:28
Should we try to capture this traffic?
47:28
Is it more effective to try to push our own product there?
47:33
And you can kind of understand why it was Kristo, actually not me, that was like, "This is a crazy idea."
47:37
And the founder, and the SEO team went out and built it, and it's huge now, in terms of visits.
47:42
I think we've got a currency convertor app out there.
47:42
I think we've got [inaudible 00:47:51] out there, and yeah, people discover wise through that, as an example of off-topic traffic, but that's a good example of one of those things where yeah, the founder said, "No," or, "That's' a bad idea," and we kind of went ahead, and did it anyway. Awesome.
48:06
I'm just thinking about broadly all the things we've been talking about.
48:10
There's a couple of things that were floating around in my head.
48:10
One is, reminds me of Amazon, where Jeff Bezos realized there are things that are going to be always true with Amazon.
48:18
People always want cheaper prices, they want faster shipping.
48:18
And I think there's something else.
48:24
And it feels like you guys found the same sort of thing.
48:24
What are the three things people always want with a money transfer product?
48:28
And let's just make those as incredible as possible, and in your eyes, make them 10 times better than what anyone else has out there. Yeah, totally.
48:40
The business one example is relevant, and use it a lot when we talk to investors in the market, [inaudible 00:48:49] public helps validate this low cost, cutting price story.
48:52
What's interesting is what changed though.
48:52
So we started with transfers, but we got to account, and then we got to enterprise.
48:57
Just what changed was we realized with account, if you just have to move $10, you're not going to download an app and do it.
49:05
If you do it once, you're just going to do it in your bank.
49:10
And so, that was a little bit of the insight behind building the Wise account, and we kind of focused on, there's a real problem with international banking.
49:22
So, really good example is for businesses.
49:22
So if you are a business, say, in...
49:22
Say a business in Europe, you've got a customer in Australia, and you want to get paid, you send them an invoice in Euros, and someday, some money's going to turn up in your account, you're like, "I don't know."
49:36
They paid you an AUD, it got changed by three banks on the way through.
49:42
You don't know what it is.
49:47
What you'd love to do is invoice them in AUD, and get AUD in your bank account.
49:47
You might even have people who need to pay in AUD, so you have to call to keep it there.
49:51
But to get an Australian bank account, I found out, you need to fly to Australia, you need to incorporate a business in Australia, you need to go to a bank with all those papers, and then they will give you an Australian bank account number. Great.
50:06
So with Wise, you can get an Australian bank account number with three clicks.
50:06
Anyone can, and any business can, and you get an Australian balance, and a US, and a UK, and a Swiss bank.
50:16
And this is killer for businesses that receive money internationally.
50:16
And then the next big jump we did, and for consumers, so there are plenty of people, if all your banking is in the US, you probably shouldn't use Wise, but if you're somebody who uses another currency a lot, then you probably should use us as your primary bank.
50:34
There's some people, for example, who live in one country and get paid in another currency, and this is...
50:40
Wise is great as an account for managing that.
50:45
And we found with that, we got about...
50:45
As we launched the account in markets, it was about a 20 to 30% more volume, cross-border volume coming into Wise from that market.
50:52
Just a good example of how, while it's not price, not speed, you could argue is kind of ease of use, but we had to evolve it in order to get to the next tranche of the market.
51:03
Does that make sense, Lenny? Absolutely.
51:07
And it all just comes back from what would be the theoretical ideal situation for people transferring money, say from Australia.
51:12
And what I'm hearing is just find all the little friction points that get in the way.
51:17
In this case you're like, "Okay, we'll create you an Australian bank account, and you don't even worry about it." Yeah, that's exactly it.
51:25
And so now then you have all these other problems, because we've got about $12.
51:30
5 billion in deposits now, which is like a time.
51:30
And the next problem customers are at is, "I want a return."
51:36
And we quite deliberately don't have a banking license.
51:36
You have to figure out, how are we going to solve that?
51:41
We now put customers money in government bonds, US bonds, and when you pay with your card, it dynamically sells those bonds.
51:46
And that's how we give you an interest rate, in roundabout 5% right now, given where bond rates are.
51:57
Yeah, interest rates are quite high, for better or worse.
52:02
Zooming out a little bit, for folks that are starting to...
52:02
Their wheels are turning, they're like, "Okay, I want to think about word of mouth, driving word of mouth.
52:06
I'm going to go look at my survey results.
52:10
I'm going to figure out these pillars that are driving word of mouth.
52:14
I'm going to think about how to make things 10 times better."
52:14
Just broadly, for someone that's starting to approach this, what would you say to them?
52:18
How should they approach this?
52:23
Any major learnings at a higher level, of just how to drive word of mouth for a product?
52:30
I think it just comes back to talking to customers and this is the question we've kept coming back to.
52:35
What would it take to make it 10x better?
52:35
And then you get clear in your head what it would take, and then it's usually the thing that everyone's looked at before and thought, it's the thing that's impossible.
52:46
One more example is on the partner side.
52:46
So, rather than find a cheaper bank for a banking partner, you think, well, the cheapest banking partner is the central bank.
53:01
And imagine you're a startup.
53:01
How the hell do you get a bank account at the central bank?
53:07
But that kind of thinking, and we now have a bank account at the Bank of England, the National Bank of Singapore, Bank of Australia.
53:11
And each of these was as hard as getting that face-to-face verification thing in Singapore.
53:17
It took years of lobbying, and all kinds of stuff, in order to make it happen.
53:22
But it's setting your goal all the way up there.
53:22
That's what enables you to build a 10x better product.
53:27
That's what gets you to the word of mouth.
53:27
So, the first step is getting super clear on what's the problems that my customers are caring about, worrying about?
53:35
And then once you're clear there, as you said, how can I solve that completely, and what's the best it could possibly be?
53:41
And then the hard bit is figuring out how to move that.
53:48
A lot of these things you're talking about are just, they sound like they are either impossible, like no way we're going to achieve that, or really, really hard.
53:51
And a lot of companies, and a lot of founders, teams are just like, "Okay, we're not ever going to create a bank here.
54:01
We're not going to be able to create an Australian bank account for everyone."
54:01
What is it about your culture, or approach to these problems that you think that's unique to Wise that's like, "No, we're going to spend three years figuring this out, because it's that important?"
54:15
I think it's two [inaudible 00:54:17].
54:15
So one is, definitely the founders have this philosophy that unless you're doing something hard and new, it's kind of a waste of time.
54:30
So, I think that also kind of runs through the culture.
54:30
So, it's quite a rude awakening when people join Wise, because they're like, "Okay, I'm going to come, and just play around with a few things."
54:38
You're like, "No, actually, the culture of the product team is we're super incentivized to do the hard things, and that's what's rewarded."
54:43
And that's quite hard to create the air cover.
54:49
You can imagine like then in the early days and months when growth was slow, and people turned on the money taps in marketing, and you're trying to keep focused and plugging your away up these hard things, it's quite hard also to get the management cover in order to let the teams keep doing this.
55:01
And then it's also hard just to turn up to work and really keep...
55:01
You can imagine being in Singapore, verifying customers face-to face, thinking, "This is going nowhere, this is going nowhere, this is going nowhere."
55:11
And then suddenly it changes.
55:11
So that's what progress very much feels like at Wise.
55:16
And we try to recognize that, and create a culture that enables that.
55:21
It feels like there's also just a lot of patience for these things.
55:21
There isn't like, "We need to hit this quarterly goal.
55:24
Why aren't we creating banks in Singapore yet?" Yeah, exactly. Awesome.
55:29
The other kind of metaphor that's rolling around my head is something Seth Godin talks about.
55:32
I don't know if you've heard of this guy, he's a marketing guru, and he has this concept that you want to build something that's remarkable, because if something is remarkable, it'll spread.
55:41
And if you think about the word remarkable, it's something worth remarking about, which essentially is word of mouth. Yeah.
55:49
And so that's his kind of mission and his, I don't know, advice to people is build something remarkable, something people will want to remark about.
55:55
And clearly, you all have been doing that.
55:55
And that's actually a good segue to where I wanted to go, which is around how you structure your team, and how you incentivize the team, organize teams, to achieve all these sorts of things.
56:03
So, maybe just broadly, is there something unique to how you think about work structure, incentives, goals, things like that, in order to achieve these really hard things?
56:17
There's two unique lenses on this.
56:17
One is in the macro-structure and one is in the micro-structure.
56:26
So at the macro level, if you look at actually international banks, they don't really exist.
56:34
I'm not sure if you've moved around between countries, but say you open a bank account with Citibank in the US, and then you go to Citibank in the UK, your Citibank account doesn't exist in the UK.
56:42
You have to go to Citibank in the UK, and open a Citibank account.
56:46
And actually, turns out, with some of these banks, to move money between your bank accounts is an international transfer. It's crazy.
56:50
So, when you take a step back, and look at how the market looks, you have at one end, international banks which are local tech stacks.
56:58
So there's a core banking system in the US, and one in the UK, and one in Europe, say for Citibank, or for HSBC, but they have deep local integrations, so they're directly integrated in the payment system.
57:15
Citibank in the US has got relationships, say, with the Federal Reserve, et cetera.
57:20
Other end of the spectrum you've got something like PayPal.
57:20
So it's a tech company, it's got a single global tech stack.
57:24
It doesn't run a additional version of PayPal in Australia than to the US, but it doesn't have deep connections.
57:29
It hasn't got five central bank accounts, it hasn't got any of that.
57:35
And I'd like to think of in the middle, you've got Wise, where we have a single global tech stack, and we have deep local infrastructure.
57:45
Now, from a technological perspective, just take a step back and think through this.
57:45
This is actually non-trivial to figure out how to design.
57:50
So, let's take something like the onboarding flow.
57:58
So, we have global product teams, one part of product teams called global product teams.
58:02
So we have a single onboarding flow that will give you a Wise account, and it's the same code that runs, whether you are in Brazil, New York, or Australia.
58:17
The regulation in Australia and Brazil is really different, and it isn't black and white in any country.
58:23
So, there's a bunch of...
58:23
You get a bunch of things you just shouldn't do in terms of letting people get so [inaudible 00:58:31] people who shouldn't get access to accounts.
58:31
And then you can need to check these people aren't using it, and different jurisdictions have completely different requirements.
58:35
Example is Japan, you have to take a picture of that front of the ID, the back of the ID, and the side of your ID.
58:44
It's the only country in the world that you have to do this. Wow.
58:47
And imagine you're the product manager for onboarding, and someone tells you, "Design the onboarding flow to give somebody a bank..."
58:53
Just imagine gathering all the requirements from every country in the world, because there's very little similarity.
58:57
You can't just say, "I take the US," and copy it somewhere else.
59:01
It's very, very, very different.
59:01
It'd take forever to try to get that, and then normalize that into the main model, and try to figure out how you're going to structure the data around this.
59:12
So, it then becomes like, what is the organization structure that enables us to discover what the domain model, let's call it that, for the onboarding flow should look like.
59:26
And you end up with a global product team that owns overall KPIs around conversion rate, et cetera.
59:32
And you have local, regional teams that own the conversion rate, and the cost to do KYC for their market, and they contribute to the global product code base.
59:43
So we have weak product ownership, where anyone can make code change, and pull requests, and these guys owning the vision in the center.
59:48
But the only way that vision can evolve is by getting the feedback from these guys in the market, as they're constantly pushing stuff forward.
59:53
And through that process, artifacts start emerging, where other markets are like Japan, and so you start splitting off that, and creating subtypes for it, and slowly the model emerges from there.
1:00:09
And so with this structure, the thing to optimize for is a really hard one.
1:00:09
That problem that every global business has, is how do you get this collaboration to work between the local and the global?
1:00:17
But unlike every other business, most businesses solve this probably as you know, is you usually have the US, and then you have international.
1:00:21
And international is usually a bump site, where everyone's arguing to get their thing prioritized, right? That's right.
1:00:29
Whereas here, you're kind of letting the local teams commit directly to the code base, and then this global team's got this challenge of doing this, and we over time create sub-teams around parts of the regionalization of the structure, around different objects as they emerge.
1:00:42
But that broadly speaking is the first problem, the global problem.
1:00:49
And the other bit with us is this is quite unique to us, because most fintechs out there are usually in one market.
1:00:53
Like you take Robin Hood, it was in the US, it came to the UK, they went back to the US.
1:00:59
You take Monzo, only the UK, N26 only in Europe, Up in Australia, China, and the US.
1:01:06
And that's because their home markets are so big, and one regulator is a ton of work to manage.
1:01:12
And the second complexity we have is we have all of these markets we have to be in, because we're international by default.
1:01:18
So a lot of our thinking is where do we take that, turn that into competitive advantage, and which customer base really needs that?
1:01:27
Which is what zooms us into that positioning on the international account.
1:01:32
It just comes back to again, and again, again and again, doing the hard thing, knocking peoples' socks off, and it feels like that's the formula for Wise.
1:01:41
I think yeah, you more or less got it.
1:01:41
So that's one bit on structure.
1:01:41
So this global local thing, and the second one has been a bit more of a journey.
1:01:45
So when we started early on, we ran in autonomous independent teams, all focused on KPIs, and these KPIs rolled up to make it cheaper, make it faster, make it easier to use.
1:01:59
You can imagine like a KPI tree, and teams around bits of their KPIs, and every quarter they talk through how they move their KPI, et cetera, and this kind of worked.
1:02:08
And the way we ran our planning is, every quarter every team would stand up and talk through its plan, get feedback from other teams, and then move on.
1:02:19
This worked till we got to 30 teams, and then you go from doing this in the afternoon, to doing it in two days and it's just like whoa.
1:02:24
So, we started heading towards the Spotify model, where we group the teams in squads, and into tribes.
1:02:30
Today, I think that autonomy is at the squad level.
1:02:38
So the squads are around products.
1:02:38
So, we'll have a Wise account squad, a business squad, a Wise platform, our enterprise product squad, you'll have a North Am squad that looks after the North American product, and Lat Am squad, et cetera.
1:02:49
And then financial crime fighting, et cetera.
1:02:55
And inside those squads you've got the teams, and the squad...
1:02:59
Imagine you're the director for the Wise account, but you don't have a vision for the account.
1:03:04
You've got to say where it's going.
1:03:04
You've got to keep your teams on track against it.
1:03:07
The teams aren't off doing whatever they want.
1:03:07
They kind of need to be on track, versus the overall vision, and you're accountable for the results of that squad.
1:03:11
And squads are in tribes, the tribe provides overall leadership, and a slight, light touch strategy on the squads.
1:03:22
And that's more or less our structure, and how we've evolved towards it.
1:03:26
Is there anything else along the word of mouth concept that you think would be useful for people to share?
1:03:31
Either how you think about it, team structure, anything else?
1:03:34
There's one tiny bit I'll share, which was around marketing and referral.
1:03:34
This was super interesting for me.
1:03:42
So, we've been running it, like Airbnb, we've been running referral program for now 12 years, and after 12 years, you've kind of tested everything anyway.
1:03:48
And like I said, by this point you have literally tested everything.
1:03:53
So when somebody comes up with something that has a 300% increase, you're like, "Whoa, that's super interesting. What just happened?"
1:04:02
Wow, I'm excited for this.
1:04:02
And yeah, I'll share this one, because it's interesting.
1:04:06
So we run many variants of refer a friend, where you'll get different kinds of benefit.
1:04:11
We tried chocolate, we tried money, we've tried $200, $500, $10, you get some, I get some money, all kinds of things.
1:04:18
More or less headed towards three for $100, generally it's a sweet spot.
1:04:26
Anyway, it's a pretty creative PM there.
1:04:26
And he was again talking to customers, and he spotted this thing, which is pretty cool, which is when you do a transfer with Wise, at the end you get this email, the email says, "Well done."
1:04:40
Then it says, "Your money's there in the other person's account, and you saved $10 on this transfer."
1:04:43
And he got this insight, which was pretty awesome, was he realized that people believed they saved money, but they didn't believe the number.
1:05:01
And he then thought, what would it take to get them to believe the number? That seems right.