Mar 29, 2023, 10:37 AM ETInterview, Fireside Chat

Jag Duggal: How We Scaled Nubank to 80M Users; Google's Brutal Hiring Practices | E995

Jack Borthwick transitioned from a media/ad-tech role in Silicon Valley (Google, Facebook, Quantcast) to become a Product Leader at NewBank in Brazil.
The primary driver for the move was the opportunity to apply his "toolkit" to the bottom half of the global income pyramid, rather than the richest billion people in the West.
Borthwick views FinTech as an industry in its early innings with a 20-year runway, contrasting it with media tech which he considers to have "played itself out."
He cites NewBank's ability to leverage the technology-ready financial sector to disrupt traditional banking in Latin America as a "huge opportunity."

Borthwick reflects that Google's highly credential-driven hiring process (requiring SAT scores, transcripts, and CS degrees) created talent density but also significant blind spots.
He notes that strict credential requirements, such as a Computer Science degree for Product Managers, prevented talent like Instagram co-founder Kevin Systrom from joining Google.
Modern hiring at NewBank prioritizes "drive" (the willingness to enter situations of incompetence and take command) and "clarity" (the ability to articulate a hypothesis simply) over pedigree.
Borthwick admits his confidence in using traditional signals (school, grades, prior companies) has decreased over time, viewing recruiting as becoming more "art" than "science."

Borthwick estimates product management is 90% science and 10% art, with the final 10% (empathy for unmet customer needs) being the decisive factor in winning.
He rejects the "ask customers" method, arguing that teams must observe customer workarounds and interpret needs rather than taking dictation.
He advises product leaders to be a "judge, not a lawyer," maintaining hypotheses but remaining agnostic and unwilling to fall in love with specific solutions.
The "art" of product is defined by identifying the specific, visceral unmet need that creates a "magic" reaction in the customer.

Borthwick identifies "escalation speed" as a key cultural lesson from Facebook, where disagreements must be resolved or escalated within 24-48 hours to prevent stagnation.
NewBank maintains agility by enforcing small team sizes (referencing the "two-pizza" rule) and granting high autonomy to General Managers.
The company operates on a "trust but verify" basis: defaulting to trust once a hire is onboarded but maintaining a high bar for entry where the default assumption is a candidate is "not good enough" until proven otherwise.
Borthwick notes that "bad decisions that can be iterated on" are preferable to "no decisions," as they generate market learning, citing Amazon's "two-way door" concept.

He argues that execution without strategic clarity results in "frenzy, not progress," as teams cannot interpret market signals to iterate correctly.
Strategy must be clear enough to define the target customer; if a product fails, it must be determined if it failed the wrong customers or if the right customers were not served.
Borthwick distinguishes between pre-product market fit and post-product market fit, stating that the latter is where scaling begins and the former is where "customer love" must be built first.
He warns against "dead cat bounces," where large user bases mask poor product-market fit through high acquisition spending, leading to eventual collapse.

NewBank uses "churn" as the ultimate metric for true customer love, as a "leaky bucket" cannot be filled permanently by acquisition alone.
Leading indicators for churn include the "Sean Ellis test" (40%+ saying they would be "very disappointed" without the product) and Net Promoter Score (NPS).
A key North Star metric for NewBank is the percentage of customers for whom NewBank is the "primary banking relationship" (handling the bulk of incoming salary/income).
This primary relationship metric has grown from 10% to over 40% of all consumers in three years, even as the total customer base tripled.
High intensity of engagement (daily active users vs. monthly active users) is tracked as a leading indicator of customer love.

NewBank successfully shifted from a savings-only model to a full transactional banking account by integrating debit cards and the Brazilian PIX real-time payment system.
The launch of a secured credit card product allowed NewBank to serve customers with no credit history, creating a "ladder of opportunity."
Future strategy involves expanding beyond Brazil into Mexico and Colombia, aiming to replicate the success of the Brazilian model in similar markets.
The company utilizes a rough 70-20-10 resource allocation model to balance core product optimization, innovation (fundamentally different solutions), and scaling.
Borthwick notes that high-income product lines in Brazil remain a strategic challenge due to a lack of "fundamental difference" compared to entrenched incumbents.

NewBank CEO David Velez is highlighted for his "weakly held strong opinions," demonstrating a rare willingness to pivot and change his mind without ego.
The company culture prioritizes "safety" in product reviews, allowing teams to show "warts" and struggle without fear of judgment, rather than presenting polished "dog and pony" shows.
Borthwick learned from Facebook that internal collaboration requires clear decision rights; teams can debate fiercely, but a final decision must be made rapidly with clear accountability.
He advises new product leaders to focus on a single priority ("the hill you're going to take") rather than managing multiple competing objectives.

Incumbent Brazilian banks are responding to NewBank's disruption, but Borthwick argues that NewBank has forced the entire industry to raise the quality bar for customers.
Credit is identified as a difficult discipline to master; NewBank's decision to tackle credit early in its history is cited as a foundational differentiator in its DNA.
Spotify is cited as a recent example of a company that successfully evolved its product strategy through mobile, subscriptions, and podcasts while maintaining deep customer focus.
The conversation concludes with the sentiment that in a large organization, the goal is not for individuals to "win" arguments but for the collective entity to "get to be right."