Nubank | An Introduction

I’d like to pose a bit of an unconventional company for consideration (i.e., non-SaaS, non-US based). I’ll start with a high-level overview, and we can dive deeper depending on the interest received.


Nubank is a digital bank based out of Brazil. It was founded by Colombian-born David Velez, a Stanford-educated former venture capitalist who was frustrated with the highly-monopolistic retail banking landscape in Brazil. Nubank IPO’d in December 2021 at a market cap of ~$50B. Some of its investors include Berkshire Hathaway, Sequoia Capital, and Founders Fund.

Its key differentiation has been democratizing easy access to financial services via their “NuConta” account, which allows consumers to quickly open an account, away from the red tape that used to be typical for basic retail banking activities. More recently, they have expanded their product line to insurance, investing, and credit. They have also increased their presence beyond Brazil, notably to Colombia and Mexico.

Latest Financial Results

  • Revenue growth of 172% YoY, reaching $1.3B FXN (neutralizing exchange rates)
  • Gross margin of 33% (decline from 47% YoY as they enter the credit business)
  • Net profit of $7.8M (up from -$34M loss this time last year)
  • Net interest margins increased 11% YoY
  • Delinquency rates of 4.2% (up from 2.3% last year)

Latest Operational Results

  • Customer growth of 46% YoY, reaching 70M
  • Deposits increased 73% FXN YoY to $14B
  • Purchase volume growth of 75% YoY to $21B
  • 25% loan-to-deposit ratio
  • DAU/MAU (Daily Active Users as a proportion of Monthly Active Users): 51.9%, up from 47.9% in Q3’21

Product Development

Nubank recently launched Open Finance (Sept’22), which is a series of APIs that connect with a user’s other financial services provides in order to aggregate them in Nubank. Nubank indicated that >3M users provided consent to use Open Finance. Not only will this lead to higher user engagement, but Nubank will be able to tailor cross-selling. In addition to Open Finance, Nubank is launching many other products, including personal loans, retail investing (fixed income, crypto, etc.)

Global Expansion

Nubank is continuing its rapid expansion into Mexico and Colombia after a successful trial period in 2021-22. While one-third of Brazil’s adult population is now a Nubank customer, Nubank has only reached 2.2% and 0.5% of the Mexican and Colombian market, respectively.

In Mexico, Nubank recently received approval from Mexico’s Banking & Securities Commission to accept customer deposits, issue debit card, and personal loans. Meanwhile Nubank secured a loan from the International Finance Corporation (World Bank’s financial institution) to continue expanding in Colombia, where it has already issued >400k credit cards in less than a year.


There are lots of additional data points on their latest earnings presentation, and this is certainly a difficult company to follow. But with continued revenue, geographic, and product line expansion as it starts flirting with profitability, it seems a worthwhile consideration fitting many of the requirements of this board. Looking forward to anyone’s thoughts, and to Nubank’s Q4 earnings release on Tuesday!

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Brief summary of Nubank’s Q4 earnings below. If this is not deemed to be appropriate / popular for the board, I will refrain from posting about them again.

Key Results

  • Revenue growth of 112% YoY reaching $1.5B. However, important to realize that its QoQ annualizes to 52% as the business scales. For perspective, 2022 revenue was 3x higher than in 2021 and almost 7x higher than in 2022

  • *Gross profit growth of 137% YoY reaching $578M, and a gross profit margin of 40%, up from 36% a year ago

  • Net income of $58M, up from -$71M this time last year

  • Customer growth of 38% YoY, reaching 74M+ customers; 82% which are monthly active customers (up from 76% this time last year)

  • Net interest margin reached 13.5% (up from 9.7% in Q4’22)

Its product expansion continues maturing, while it reached 44% of market penetration in Brazil, 3% in Mexico, and 2% in Colombia (percentage of adults with a Nu account open)

I am most impressed by the engagement that they are driving with their existing customer base

I highly recommend those interested to scroll through their investor presentation:

Key Quotes

  • We adapted our strategy to deliver on what has been promised in what lies ahead of us for 2023. First, in late 2021, no one expected the sharp increase in policy rates that skyrocketed to almost 14% in Brazil. To mitigate this, we launched Money Boxes, and six months later, we lowered our cost of funding to 78% of the CDI from about 100%. Second, with a tougher environment for asset quality in Brazil, we became more restrictive in originating personal loans, while repricing our products and building resilience within our portfolios. Third, we doubled down on smart efficiency, moves to foster profitability and showcase the operating leverage of our model

  • Our revenue in 2022 was nearly 3x higher than in 2021 and almost 7x higher than in 2020

  • We have 44% of the adult population of Brazil as a customer, a very meaningful population…but a very small market share on a lot of products. In credit card we have something around 13%, on personal loans about 3%. So we get to grow within our customer base, cherry-picking the best customers

  • We expect our operating leverage to continue to be captured as our scale increases, although there might be seasonal variations affecting this number. In the fourth quarter, in particular, our platform benefited from stronger purchase volumes and deposit inflows.



Nubank reported earnings last week – a few highlights below.

Conference call transcript link is here, and earnings presentation link is here.


  • Revenue growth of 87% YoY, reaching $1.62B
    • Monthly revenue p/customer increased from $6.4 to $8.4, while cost to serve remined flat at $0.8
  • Gross profit rose 124% YoY, reaching $651M
  • Net income rose from -$30M to $142M YoY
  • Deposits grew 34% YoY to $15.8B


  • Customer count grew by 33% YoY , surpassing 79M
    • Surpassed 500k open checking account a week after opening in Mexico
  • Customer engagement (monthly active customers) increased from 78% to 82% YoY
  • Reached 46% of customer penetration in Brazil (% of adults with a Nu account open) – only 3% and 2% in Mexico and Colombia, respectively
    • Keep in mind that cross-selling continues to improve in Brazil, 46% does not represent market saturation



I was also holding off on posting it here, because I’m not sure it fits this board’s criteria (…it’s not SaaS/subscription plus it’s not based in USA).

But otherwise the metrics look mighty fine to me.

Operating leverage is their secret sauce, as described here:

Here is a another good writeup:

Lots of durable growth ahead imo.
Buffett is in for an average of over $9/share, but you can buy for less than $7