Inside Revolut’s growth engine: A conversation with Index Ventures partner Martin Mignot

Revolut is one of the most remarkable FinTech stories of the past decade. With over 50 million customers and $4 billion in revenue, the company has already outscaled many traditional banks, and it’s still just getting started.

To understand what’s behind that growth, I sat down with Martin Mignot, a partner at Index Ventures. Index backed Revolut at seed more than 10 years ago and remains one of its largest shareholders. The firm has also invested in other European FinTech leaders like Adyen and Wise.

In this conversation, Martin shares why predictability is Revolut’s superpower, how much headroom there still is for growth, and why he believes it’s one of the best businesses Index has ever invested in.

Revolut posted $4bn in revenue and $1.4bn in profit last year. What’s the untold story here?

Revolut served 52.5 million customers last year, more than HSBC. And bigger than Chime, which is their US equivalent. That kind of scale is impressive on its own, but what’s really exceptional is the quality of their revenue growth: it’s both highly diversified and highly predictable.

From the get go, Nik focused on “building the machine that builds the machine,” and, as a result, they’ve built a core growth engine that can very precisely control based on CAC, ARPU, and ROI per cohort and per channel. They benefit from their aggressive multi-product strategy, which generates balanced sources of revenue—premium subscription, FX, interchange, trading commissions, and net interest income, for both business and consumers, reducing the risk inherent to many FinTechs that tend to be overly reliant on one single source of income. There will always be some volatility linked to trading/crypto activity and interest rates, which are largely out of their control, but the core is an incredibly well-oiled machine. 

This is now Revolut’s fourth year of profitability. Because they aren’t reliant on external capital, and because their user acquisition machine is so efficient, it creates a flywheel where they acquire users cheaply, those users love the product and refer others, and the company can reinvest profits to keep growing both their product portfolio and their user base, more than any competitor can. 

Revolut is obviously growing fast, but how much headroom is there to increase ARPU?

A lot. Revolut’s ARPU is still low at around 1/20th of HSBC’s and 30% below Nubank’s, mainly because it’s not the primary account for most users yet. That’s a big focus for the team, and they’re already making progress on that front.

There are really two ways to grow ARPU. One is by adding products that make sense for people. Revolut has been multi-product since day one. They started with FX and quickly branched out into investing, crypto, savings, payments, and so on. Lending is the obvious area where there is still a lot of room to grow. 

The second, and more impactful, I would argue, is getting users to treat Revolut as their main bank account. So when your employer asks for an IBAN to pay your salary, you give them your Revolut one. Getting there has taken time, in particular because they’ve had to work with local regulators to issue IBANs in each country. But as more users make the switch, ARPU will climb higher, and the gap with traditional banks will continue to close.

What do most companies get wrong about expanding to new markets? Why has Revolut succeeded where others have failed?

A lot of European and even global companies think sequentially. They start in one market, then move to another, and then another. That’s really hard to do. You’re basically starting a new company each time.

From the beginning, Nik’s vision was to build the first truly global money app. He never thought of the UK as separate from Germany or France or the US. Their approach was to launch in as many markets as possible, see where things were working, and double down there. Early on, the US wasn’t performing well for a variety of reasons, whereas they did well in places like Poland, Portugal, and Ireland.

If you think sequentially, you’d never launch in Portugal before the US. But if you think globally, you go everywhere you can, and then reinvest where there’s traction. That way, cash flow from high-performing markets can fund expansion into ones that need more capital, compliance work, or local licensing.

You’ve said Revolut is big on “building the machine that builds the machine.” What do you mean by that?

They’ve built the organization in a very data-driven way, all the way from hiring to target-setting and even comms. Every single function is broken down into very detailed, measurable outcomes. Their board packs are the most data-rich I’ve ever seen.  I highly recommend folks to read their amazing playbook about how they manage performance, for example, to get a sense of what it means in practice. The beauty of that is it removes a lot of the politics, reduces the need for layers of middle management, and allows them to move fast and make decisions quickly.

They also have this incredible culture of experimentation. At any given time, they’re working on 20-25 new products. There’s no emotional attachment or preconceptions. They have an idea, test it over 18-24 months, and see what the data says. If it works, they double down. If it doesn't, they cut it off. That scientific method of building and scaling has allowed them to keep taking risks and finding new products to keep growing.

What impact has European FinTech talent had on Revolut’s success?

It’s been huge. When you’re acquiring millions of users a month, you need people who’ve been there before. But I’d argue it goes beyond FinTech. If you take Antoine Le Nel, their CMO, for example, he applied what he learnt in gaming at King, one of the largest and most sophisticated performance advertisers in the world, to Revolut, with extraordinary results. The European ecosystem has matured to the point where you can find all these executives who’ve scaled global giants like King, Adyen, Spotify, Wise, and more.

I would also say, don’t underestimate the power of the EU. Passporting means you can offer financial services across all member countries with relative ease. That’s a massive advantage that should be emulated in as many sectors as possible. Give European entrepreneurs a big enough market to play with, and they’ll build companies that rival or even outscale their US counterparts.

What does the future hold for Revolut?

We’ve been investors in Revolut for over 10 years. And I can easily say, if you look at the numbers, the revenue, the scale, the growth rate, the profitability, the predictability, this is one of the best businesses we’ve ever invested in. And the addressable market is as close to infinite as it gets.

What’s exciting is how much room there still is to grow. Nik’s stated goal is to reach 100 million daily active users and be number one in 100 countries. They already have over 50 million users, and they’re making progress in markets like Mexico and India, as well as the US. Revolut Business is also a big part of the story, accounting for around 15% of total revenue and positioning them as one of the largest B2B digital banking players in Europe.

There’s no physical law that says they can’t get to 500 million users someday. If you 10x users and 10x ARPU, that’s a 100x revenue opportunity. It sounds wild, but when you look at what they’ve already done, it’s not out of reach.