One insight I have spent some time thinking recently is the new Nubank's Mastercard Black, aka Nubank UV.
I don't know how familiar you're with Nubank (latest Founder's Field Guide is a must), but until recently, they didn't have a product for the high end of the market. That meant that people like me that was first banked by Nubank, when does climb the social ladder, may become greedy and churn for high-end neobanks (C6 has just bought by JPM and BTG Pactual is going all in). I personally didn't churn due to customer experience, but others' CAC can make you greedy. Currently, all high-end neobanks (XP, BTG and C6) offer 1% cashback in all your expenses reinvested at Brazilian LIBOR at their Mastercard Black offerings.
The problem for Nubank is that they'll need to fight the race to the bottom fight of CAC to offer feature parity. Generally, Nubank never does CAC, their customer obsession is enough to attract clients through WoM. The clever solution: Nubank UV 1% cashback will pay 200% LIBOR, but it stops to yield 200% to 100% LIBOR if you touch the money. In other words: Nubank now has non-cash CAC.
200% LIBOR forever is a lot, just far in the curve you find that. I wondered a lot why is that.
The bet is somewhat bold, but my guess is that Nubank's ROIC is far higher than than 200% LIBOR. Nubank's bet here is that because they if have the best ROIC of neobanks, no-one will be able to have feature parity.
For me, I plan to make compound interest do its magic.
One insight I have spent some time thinking recently is the new Nubank's Mastercard Black, aka Nubank UV.
I don't know how familiar you're with Nubank (latest Founder's Field Guide is a must), but until recently, they didn't have a product for the high end of the market. That meant that people like me that was first banked by Nubank, when does climb the social ladder, may become greedy and churn for high-end neobanks (C6 has just bought by JPM and BTG Pactual is going all in). I personally didn't churn due to customer experience, but others' CAC can make you greedy. Currently, all high-end neobanks (XP, BTG and C6) offer 1% cashback in all your expenses reinvested at Brazilian LIBOR at their Mastercard Black offerings.
The problem for Nubank is that they'll need to fight the race to the bottom fight of CAC to offer feature parity. Generally, Nubank never does CAC, their customer obsession is enough to attract clients through WoM. The clever solution: Nubank UV 1% cashback will pay 200% LIBOR, but it stops to yield 200% to 100% LIBOR if you touch the money. In other words: Nubank now has non-cash CAC.
200% LIBOR forever is a lot, just far in the curve you find that. I wondered a lot why is that.
The bet is somewhat bold, but my guess is that Nubank's ROIC is far higher than than 200% LIBOR. Nubank's bet here is that because they if have the best ROIC of neobanks, no-one will be able to have feature parity.
For me, I plan to make compound interest do its magic.