# Constraints taught Revolut to build with fewer resources

Markdown copy of https://realalpha.app/s/constraints-taught-revolut-to-build-with-fewer-resources/ on Real Alpha, the best minutes from long interviews with the people building AI. Cite and link the page, not this copy.

- Speaker: [Nik Storonsky](https://realalpha.app/people/nik-storonsky/) · Nik Storonsky is cofounder and CEO of Revolut. · Co-founded Revolut, the digital bank valued at $115 billion, and founded the QuantumLight venture fund.
- Host: [David Senra](https://realalpha.app/people/david-senra/) · Host, Founders · Has read an entrepreneur's biography every week for Founders since 2016.
- Show: Founders
- Episode: [Competition, Intensity & Building a $115 Billion Global Bank | Nik Storonsky, Revolut](https://realalpha.app/v/hT_MAAwFLIc/), Oct 25, 2026
- Moment: 33:25 to 40:10 of the episode (7 min), playing on https://realalpha.app/s/constraints-taught-revolut-to-build-with-fewer-resources/; the episode from there: https://realalpha.app/v/hT_MAAwFLIc/?t=2005

## Quote

> “You need to find a way to start selling a product cheaply, **build the system**, and then simply feed additional employees into the system so you always have great payback.”
> — [Nik Storonsky](https://realalpha.app/people/nik-storonsky/) at [34:15](https://realalpha.app/v/hT_MAAwFLIc/?t=2055) · Founders

## Takeaways

1. Build a sales system before hiring a large team.
2. Revolut started with negative gross margin and later reached 80%.
3. Regulatory and market constraints forced careful resource use.

## About this segment

Nik Storonsky argues that easy funding can hide weak operating systems, while Europe's constraints forced Revolut to improve its economics. The lesson: build a repeatable, low-cost way to grow before scaling headcount.

From “Competition, Intensity & Building a $115 Billion Global Bank | Nik Storonsky, Revolut”, Oct 25, 2026. [Watch the full episode](https://realalpha.app/v/hT_MAAwFLIc/)

## Transcript

Transcribed by machine (Whisper) from the episode’s audio, so a word may be off here and there.

[33:31](https://realalpha.app/v/hT_MAAwFLIc/?t=2011) Do you see a lot of waste in the American entrepreneurial ecosystem, though? I think there is too much money, right? A lot of founders, they think money is free, which is probably almost free in California because you can raise so much money at ridiculous valuations and then just spend. So I think there is a definite culture of trying to solve problems with money rather than with your brains. Explain to younger entrepreneurs that are going down that path why that's not the right move.

[34:00](https://realalpha.app/v/hT_MAAwFLIc/?t=2040) Well, for example, you're into B2B business, right? And then you kind of, you know, set up a company. You have your first sales, first, say, 1 million ARR. And then you decide to scale it. and then suddenly decide to hire an expensive VP of sales who will hire like 50 salespeople to sell your product. You need to find a way to start selling a product cheaply, build the system, and then simply feed additional employees into the system so you always have great payback.

[34:35](https://realalpha.app/v/hT_MAAwFLIc/?t=2075) Starting big, hiring a very expensive VP of sales who will hire also a very expensive team is wrong decision. Okay, so essentially, like, they remove the constraint from money. Therefore, they're not developing the skill set that constraints make you. If you're going to survive under the constraints, you actually have to be good. You actually have to be talent. You actually have to be resourceful.

[34:53](https://realalpha.app/v/hT_MAAwFLIc/?t=2093) And they're essentially papering that with money. And it might work for the short term, but long term, they're going to get beaten by somebody like you. I mean, if we are in the same... I mean, in many cases in the U.S., it's not that competitive, right? Wait, that's a wild statement. Why would you say in the U.S. it's not that competitive? I feel other people would feel it's the most competitive environment.

[35:11](https://realalpha.app/v/hT_MAAwFLIc/?t=2111) What do you see as a European? I mean, Europe is even less competitive. Yeah, so you're saying it's not China? China is competitive, yeah. So China is 9.6, right? And then even if you are good in Europe or even if you are good in the U.S., I mean, how can you out-compete the people who work 9 to 9, 6 days a week, right? Plus, they have a very good education, technical education, so it's very hard.

[35:33](https://realalpha.app/v/hT_MAAwFLIc/?t=2133) When I started, I started in the co-working space with 140 companies. Within five years' time, only three companies survived. They all worked on the weekends. Within 10 years, only two companies survived out of 140. So I think working on weekends is a must if you want to survive, purely statistically. Okay, so working seven days a week is one thing, but working 9 to 9 or 10 to 10, and what is the actual culture?

[36:00](https://realalpha.app/v/hT_MAAwFLIc/?t=2160) Well, I work like Lash, right? You're the founder. I don't know a single founder that's like, no, I'm on PTO. I understand that. I'm talking about your... Yeah, my direct reports, absolute majority of them, they work like Lash, right? They might be a bit less alignment for direct reports of my direct reports. But still, I think out of all European companies, we're probably one of the hardest working.

[36:26](https://realalpha.app/v/hT_MAAwFLIc/?t=2186) and I think we are also one of the hardest working companies if you include us as well. I want to know what you think the entrepreneurs that have this California tech culture and operating system what do you think they're doing wrong? You said there's just too much money they're not that competitive Everything else seems there there is an ecosystem talent is very good, you go to great universities plus Like a lot of expats coming to study in these universities, people are rather hardworking.

[37:02](https://realalpha.app/v/hT_MAAwFLIc/?t=2222) The culture when there's too much money and then people choose to spend a lot of money on the problems, I think it's wrong culture. Because they're not actually solving the problem, the underlying problem? I think it's just a lot of waste, number one, and then you're not really developing yourself as an entrepreneur. It's so easy to close the problem with the money. If you have unlimited number or unlimited amount of money, I mean, you just, you know, throw money here, here, here, but then you're not prepared for the future.

[37:30](https://realalpha.app/v/hT_MAAwFLIc/?t=2250) For some reason, money can disappear. That's a very interesting take. You're not developing yourself as an entrepreneur. Yeah. Give me examples of how you developed yourself. Well, what we started, if you look at the unit economics of the business, we started with a negative gross margin. And the negative gross margin continued for the next three, four, five years until we optimized it to up to 80% of positive gross margin.

[37:53](https://realalpha.app/v/hT_MAAwFLIc/?t=2273) And then if you look at why is that, right? So in our business, if you look at Europe, everything is extremely kept and regulated compared to US. For example, interchanges, 20 base points versus 100% in US, credit card rates are kept in majority of countries. Credit is very limited, right? You cannot really freely give credit to many people. It's very difficult to effectively set up a bank in Europe, going country by country.

[38:19](https://realalpha.app/v/hT_MAAwFLIc/?t=2299) Because even if you have a bank alliance in Europe, you cannot be a primary bank because Because with regulation, it doesn't allow you to start issuing local accounts unless you stop a local branch of the bank. You have that physical location. I mean, you need to have an office, you need to have local connectivity, local regulation, and so on. So you go country by country, and it takes a lot of time, a lot of resources as well.

[38:43](https://realalpha.app/v/hT_MAAwFLIc/?t=2323) So different languages as well. And you had to do all of this? Yes, plus very tough employment laws in many countries. In the U.S. it's very easy, right? I mean, it's like employment as well. in Europe it's not like that so you need to be very careful how you hire who you hire so all this together is actually a produced environment which is not very profitable and very difficult to build a company then even in that environment we kind of succeeded we succeeded because we spend a lot of time and a lot of energy and a lot of brain power to optimize on every single problem if I would start the same business in Brazil or like in the US or maybe in other countries, in Mexico, certain aspects would be much easier.

[39:28](https://realalpha.app/v/hT_MAAwFLIc/?t=2368) If you look at unit economics, credit is so much easier to give. Interchange is not kept. Technically, this difficult environment in Europe actually taught us how to build business in a very competitive landscape. You see what I mean? Okay, so if you were surviving in this very difficult environment, now you have a skill set that people that did not have to go through that, and now you have to compete head-to-head with them I mean, let's say, like America, they're going to be very hard to compete with.

[39:56](https://realalpha.app/v/hT_MAAwFLIc/?t=2396) You're going to be very hard to compete with because they haven't developed the same skill sets and they didn't go to the other side. I did. Okay, that makes perfect sense. I found one of my all-time favorite quotes when I was reading the book Zero to One. The quote says,