Matteo, could you provide some context to the founding story of N26?

N26 started in 2013 and Valentin and Max started it. The whole idea was to provide a pre-paid card for teenagers giving the control, via an app, to their parents. After a year or so, they actually found out, from the clients, that the parents didn’t want to only give the card to their teenagers, but they wanted to use it for themselves, as well. It was much more convenient; it gave more insight to their spending. So they decided to stop and really create something new that was launched in 2015, so that it was really a new way of doing banking, in Europe.

Everything was branchless, with online onboarding and very transparent fees, all basically, wrapped up in a very nice mobile app, which gave that extra user experience, for the clients, which they were missing from the current incumbents, in Germany, at the time.

What exactly was the position in the early days, versus the incumbents?

It really highlighted the differences, in terms of user experience, which was completely digital, instead of going to the branch, and being able to access their funds. Not only that, really being able to understand how you’re spending money. It was one of the first apps with the transaction list done nicely. You could really understand where you were spending money, instead of just having a blank statement saying, payment by card or bank transfer, which is something that still happens, with many incumbents.

The second one was that you can open the account completely online, with a video call. So we were working towards our client’s desires, which is having everything digital. We have already experienced that with travel booking. We don’t want to go to a travel agency, anymore. It was not so obvious, 20 years ago, when the first online travel agencies launched.

The third one is the pricing. It’s very expensive, especially in Germany, to withdraw cash. You have quite a lot of different fees, attached to your bank account. They were coming out in the market, really, with this new proposition – extremely low fees, in fact almost no fees, that, for a certain part of the population, it was a very important issue. That was the position at the beginning. In terms of product, it was a free account. You had a Mastercard and a bank account. Then, as well, there was a premium product, which was priced at €5.90, at the time. It was a black card and, attached to that, you had better benefits, such as foreign exchange fees, when you were withdrawing abroad. Then, the third one was actually for freelancers or self-employed. It was a business account, a business card, which was still free. But you could use it for your business and that was actually an important money factor for the bank, in terms of inter-change fees, which was one of the ways banks earn money, from account spending. For businesses, it is much higher than for personal accounts.

In terms of the core marketing messaging to customers, was it more on the user experience side or on the pricing?

I think it was, actually, both. It really depended on the campaign or the message that we wanted to put over to that target audience. We had different target audiences. There were the innovators, so those that actually found you, the very early digital adopters. For them, it was much more about the experience and even the app, per se. Even priced at €30 a month, which we did not, I’m pretty sure that we could have got some of them, just because of the experience.

Then there are always the money savers. Definitely, for them, you get them through specific channels and price is the most important factor. Even on Facebook, you will have a nice-looking picture, and a written piece, saying zero-euro account, so that becomes the main message. Then the other two were also extremely important. One, was travelers, especially due to the great foreign exchange fees that we were providing to the customers and so it was very attractive for people travelling abroad, particularly from Europe to the UK. The fourth was the experts. In Germany, there are many people who do not speak German, especially in Berlin and it was great to see how many foreigners that were actually creating a community around and physically suggesting, recommending, referring their friends, so that they could, once they came to Berlin or Germany, they could use and bank with a German bank, but that would speak to you in English, instead of German.

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