Georgie Smallwood ‘N26 – Building the financial foundations of the future of neo-banking’

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Gerry:    Hello, my name is Gerry Scullion and welcome to Bringing Design Closer, which is part of the This is HCD Network.  I’m a service design practitioner and trainer based in Dublin City, Ireland. Bringing design into organisations is hardly ever straightforward, it comes with its own unique set of problems.  In Bringing Design Closer, the podcast, we discuss with thought leaders around the world what has worked for them in enabling design revolutions to occur. Today in the show, we caught up with Georgie Smallwood, CPO at N26, the Berlin-based challenger bank, on a mission to become the world’s first global bank.  

Now, I caught up with Georgie while at Leading the Product conference in Stockholm and had a brilliant time speaking about all things Finn Tech, product and service design.  In this episode, we chat really openly about the role design plays at N26 and the challenges they face ads they scale. Founded only in 2013, they had the luxury of a really progressive and futurist mindset of not just improving their service, but the constant pressure of adapting to meet the needs of their customer.  

For regular listeners of the show, we return to the roots of a regular topic of trust, and we explore what this means to both Georgie and N26, and how even at the macular level of design, it’s being considered at N26.  Anyway, let’s just get straight to it. Georgie Smallwood, a very warm welcome to Bringing Design Closer.

Georgie:    Thanks, Gerry, it’s great to be here.  

Gerry:    Delighted to have you.  Today, we’ve been catching up about a lot of stuff, mainly about design and your role as CPO at N26, the biggest challenger bank in Europe.  Is that right?

Georgie:    That’s correct.  

Gerry:    Let’s start off.  You’re an Australian, you can hear that voice straight away, so all the Australian listeners will be roaring, and they’ll be all cheering for an Aussy in Berlin and in Germany in the challenger banks.  Let’s start off. Tell us a little bit about yourself and how you got to be in your role at N26?

Georgie:    Sure.  I am a Melbourne girl, definitely a Melbourne girl at heart, as well.  Grew up, went to Melbourne girls’ college.

Gerry:    Big up to the Melbourne Girls’ college.  

Georgie:    Big up.  I was really lucky early in my career.  Did a couple of random things. Then I fell into a role at realestate.com.au in 2008.  That was right in the crux of the global financial crisis, which was a cash cos for REA.  

Gerry:    Yes, post the iPhone, though.  

Georgie:    Yes, but people were trying to sell their houses.  It was great from a classifieds perspective and a depth perspective.  Not for a good reason but try and see a silver lining. We had gone public by then.  We were a publicly listed company. Just scaling astronomically. Then I joined the media team.  I was 24. I was a media coordinator. I think the media team was writing about ten million a year at that time and there were six of us.  

Gerry:    From REA, you went onto…?

Georgie:    I had a couple of jump-arounds, actually.  I left REA after five years, I then went back three months’ later because they asked my husband and I to move to Asia to work on the Hong Kong business and also to setup the Chinese business for them.  

Gerry:    You’ve got a massive background and experience.  We spoke earlier about roles in Finn Tech and consulting and stuff.  Now, you’re in Berlin, tell us a little bit about what your role is in N26?  

Georgie:    My role is, I look after the design team, the product team, and the portfolio team globally.  At the moment, we’re about 65. I work really closely with the CTO and the engineering side of the business.  We really set the strategy for what we’re going to be doing for the next year, two years, as far as N26 is concerned.  

Gerry:    A global bank, talk to me.  I’ve never heard anyone at a global bank.  Surely, that’s not straightforward.

Georgie:    No, there’s a reason why you haven’t heard of them before because they’re really hard.  It’s interesting because we’re a bank and a tech platform, which sometimes can be some days we’re more bank and some days we’re more tech.  

Gerry:    Depending on who’s in the room.  

Georgie:    Right and depending on what’s going on at the time.  From a tech perspective, we have a really modern tech stack, which means that we can move fast.  We’re in hyper growth. We’re 2.5 million users around the world. I think we’re in 27 countries.  It’s just going ballistic.

Gerry:    That’s incredible.  That scale in three years.  Three years, 27 countries.

Georgie:    Yes.  

Gerry:    What’s the benefit of having a global bank, though

Georgie:    I think from a product perspective, the way that we look at things is, we’re building products for humans.  Humans are global. What we know from user research is that the problems that people have with finance and what they feel about financial products is very similar all over the world.  It doesn’t matter if you’re in Sweden or if you’re in South Africa, or you’re in Australia, those problems are the same. People feel confused and they lack confidence in what’s going on.  They want it to be easier and simpler, but they don’t know how.

Gerry:    What makes N26 different to your traditional bank?  

Georgie:    What I like about N26 and why I joined is that they’re not trying to put a traditional bank into an app, which I think a lot of people are doing.  It’s easy to make the traditional bank digital. What’s really difficult and what we spend a lot of time doing is thinking about the problems that people have today and solving them for today and tomorrow.  A good example, sharing.

Gerry:    Sharing money?  Sharing anything?  

Georgie:    Sharing anything.  This is a super emotional and important topic to people.  Sharing a bank account with someone is a highly emotive decision to make.  We should treat it as such. Interestingly, sharing with a bank account capacity has traditionally been this joint account concept.  How archaic is that, right? A man and a woman get married.

Gerry:    Or a man and a man.  

Georgie:    Well, traditionally, it’s not been.  I guarantee you there are countries where a man and a man can’t get…

Gerry:    Absolutely, I’m probably showing my naivety here.  

Georgie:    I think we need to bring these solutions to the 21st century.  Also, it’s not just about a man and a man, a woman a woman, a man and a woman, but what about if you’re not married?  What about if you have six housemates? Or you’re going travelling for two years with three friends. Those are the people you want to share the bank account with.  I think it’s naïve to think that sharing is restricted to one-to-one, or even just that single use case.

Really, if you think about sharing, what we want to do is, make sure that sharing is flexible.  This is where the tech platform mindset comes in, rather than the bank mindset. We try and take the problem.  The problem is, I want to share my money with someone, or I want someone or multiple people to have access to my money.  The problem isn’t, I want a joint bank account. A joint bank account is the solution.

Gerry:    Absolutely, I hear that.  

Georgie:    I think that’s really what makes us different, is the way that we think about things, and because we apply that really product and tech-driven mindset to solving these things, we get a very different outcome than a traditional banking institution would get.  

Gerry:    Would it be fair to say; it’s how you approach problem-solving?  

Georgie:    Absolutely.  

Gerry:    That’s a summary.  It’s the mindset and the DNA level.  

Georgie:    Yes, because it’s questioning, right?  We want to know why. Why is that a problem for you?  Why is it important to you?

Gerry:    I’d love to dive into your methods and your processes of what’s going on and how your teams are structured.  Say, a problem like sharing, without going into too much detail, maybe, maybe not, that’s something you’ve looked at in N26, how do you tackle that problem?

Georgie:    This is an interesting one.  We don’t have sharing currently at the moment, we’re building it.  This is a big thing, the regulatory compliance aspect of sharing, the legal compliance, the power of attorney, it’s extensive.  We need to make sure we cover off all of those areas, because if we don’t, there’s no point building something that’s cool and flexible.  At the very baseline of everything that we do is making sure that the user trusts us and should trust us.

Gerry:    Yes, and it’s compliant.  

Georgie:    Absolutely.  We take that responsibility very seriously.  When it comes to products like sharing, there’s quite a lot of due diligence to be done around that area, then once we understand the area that we’re trying to work in, then we move into ideation and trying to problem-solve around different ways that we could do this.  From a design point of view, what does that look like? How do we integrate it? There is a big element of understanding the requirements. Also, going back to your global bank concept, those requirements are different.

Gerry:    In every country.  

Georgie:    Yes, in the EU, to the UK, to the U.S., and we need to take those into account, as well.  We try to build things, build it for today, but design it so that tomorrow, if we go into South America next year, or this year, then we need to make sure that sharing is going to work there, as well.  

Gerry:    Absolutely, yes.  The feature is agnostic to the country.  I want to chat to you a little bit more about designing for trust.  Trust is a huge part of the banking concept, of the banking model, we touched on it over lunch today a little bit more about how trust has changed, and it’s morphed into something different.  How prevalent is designing for trust in a new bank, with a new model, and a new approach?

Georgie:    It’s the only essential thing.  

Gerry:    How have you gone about building trust with people?  I guess you’re starting a new banking relationship with somebody, being N26, how do you build that trust?  What are the things you need to be aware of to do?

Georgie:    One of the things that we did really early on was we picked a problem, and to solve that problem.  We’re three years old and we’re solving it problem by problem by problem. We’re not as extensive as a traditional bank would be.  We don’t have 57 different products that you can pick. Also, because it’s quite a lot of work to build products that people can trust, as well.  Especially if you want it to scale across as many countries and people as we have.

Gerry:    You say no a lot?  

Georgie:    Yes, we say no a lot.  Say, when we started, we picked one problem, and one big problem in Europe was that people couldn’t sign up to a bank account.  People were moving countries, they didn’t have a credit score, they didn’t have a fixed address yet, they were staying at a mates’ house.  They couldn’t get paid by their new job until they had a bank account. There’s this chicken and egg scenario. I can’t get paid, so I can’t put the deposit down on my flat, but I can’t get a bank account because I don’t have an address.  This was a big problem. This is really the first problem that we solved.

By taking the onboarding journey fully digital and really taking the person’s passport and ID and making sure we touched base from a fraud perspective with the credit provider and there were no crosses against people’s names, making sure that we did our KYC process really extensively.  There’s a lot of backend stuff that we do that no one knows about, but from a users’ perspective, they can sign up to N26 in either minutes. When someone has that experience and you solve something that’s so important to them, that’s a very good beginning to building a relationship of trust.  

Gerry:    Yes.  That’s an amazing case study.  Just drilling down into the macro of solving those problems, what does your team structure look like at N26?  You’ve got Georgie at the top. Hello.

Georgie:    Hey, crazy Australian.  

Gerry:    Georgie, I went to Melbourne girls’ school.  

Georgie:    As I said before, I run design, portfolio, and product.  Portfolio is a new thing that we introduced about eight months ago.  

Gerry:    Experimentation and…?

Georgie:    Yes, we had so many big cross-functional projects that we were introducing to the organisation.  We only have two or three people in that team, but they are really essential in making sure that, for instance, when we launch into the States, there are work packages in every single product team and every single platform team.  Making sure that that is coordinated and that we stay on track as far as our goals are concerned. The design team, we have product design and we have brand design, as well.

Gerry:    Christian…

Georgie:    Christian Harling leads that.  He’s phenomenal.

Gerry:    He was at the Service Design Days last year.  

Georgie:    Yes, ex-IDO, ex-Copenhagen Institute of Design.  

Gerry:    I’ve only heard good things about Christian.  

Georgie:    That’s amazing.  I’m very lucky to have talented people like that.  In the product organisation, it’s an everchanging thing.  It’s interesting, I was looking at some of the presentations that I’ve seen in the last couple of weeks.  I’m always nervous to stand up there and say, “This is our structure, and this is great” because to be honest, it’s constantly changing.  We’re constantly tweaking it and making sure we’re addressing the needs properly and if we need a new team because something has become a focus that we want to work on over the next six to twelve months, then we build that team up.  

As we onboard, we’re growing incredibly fast.  We onboard about 50 engineers a month, which has its own challenges, but it also gives us an incredible opportunity, as long as we do it right.  We need to give people focus and point them in the right direction and give them the clarity that they need to run really fast. If we don’t give them that clarity, then we just end up with 50 new engineers.  

Gerry:    Yes, absolutely.  Engineers aside, looking at the design function, what kinds of skills are you looking for?  You’re not designing for now; you’re designing for the future? What skills do you look for and what are you going after in the market?  

Georgie:    We want designers that are freethinkers and who really want to push the boundaries as far as just take it that one step further.  We’re not scared to do something that our customers haven’t actually told us that they need. I think that when you’re working in a space like this and you have been a pioneer organisation, you need to constantly push the boundaries.  Users don’t always know what they want next. A good example, four years ago, if you asked anyone if they were ever going to tap a card to pay for a coffee, they would have said that’s ridiculous, that’s not safe, no one is going to do that.  

Gerry:    Let alone on your phone.  

Georgie:    Let alone on your phone or your watch.  I’d have no idea what’s going to happen in the next two years.  Those things, you couldn’t predict them. You couldn’t do user research and say, do you know what someone said, I would really love to tap my phone against a tap device.  

Gerry:    It’s funny.  I remember years ago when I was doing work for a bank in Australia, we did some early CCD customer centric research.  Some of the stuff that came back was, it was being videoed and we were watching the videos back. One of the guys was up the coast, I’m doing my level best not to do my Australian impression here.  He was like, “Yes, that bank, they’re the ones that have the little chip. Yes, my wife uses them. The chip on the back of the phone. You can pay for it with your phone.

It never works, but if it did work.  Man…” He was saying it would be amazing.  That bank is so innovative, but it didn’t work.  I guess what I’m trying to ask is, the whole risk when you’re releasing stuff.  How hard is it to restrain yourself from releasing stuff, just to be seen, so to give that impression that we’re being innovative, as opposed to delivering real value?  How do you tackle that?

Georgie:    I think, maybe I’m bias, but I think it’s a little different for us because we don’t ship innovative products.  Our products are innovative.

Gerry:    Come on now.  

Georgie:    I love that.  Someone’s going to quote me one day and I’m going to think, “I sound like such a tool.”

Gerry:    That sounds like a Tweet.  

Georgie:    Let me put it on a slide.  When we think about innovation, I guarantee you I’ve never said to my team, “We need to be more innovative.” It’s in our DNA how we think about it.  We don’t ever think, let’s build a joint account. We always think about the problem. The concept of shipping and innovative product and it not resonating doesn’t happen because when we ship to spaces, for instance, which is a sub account, by all intents and purposes.  In a traditional bank, you have multiple accounts and you put different money for different things in different accounts. When we did the user research, we found that wasn’t what was important to people, they just wanted a contextual place for what they were thinking about.  

Gerry:    The outcome would have been reassurance and certainty for the future.  

Georgie:    Absolutely and knowing that if they’re saving for their holiday in Bali, they’re 20 percent off their goal.  Yes, I remember I didn’t put that money in the account last month, I should put double in this month to stay on track for what I wanted to achieve.  

Gerry:    I guess that goes back to building trust.  

Georgie:    Absolutely.  

Gerry:    It’s got your back.  

Georgie:    Exactly.  Also, with the trust part is that you are in control of it.  With Spaces for us, you can click a plus button, and you’ve got a sub account in an instant.  

Gerry:    That’s also going back to one of my earlier points, is it safe to say control in giving the customer, or I don’t like using the word user, give them control, is that one of the principles at N26?  

Georgie:    Yes, we call it self-orientation.  

Gerry:    Self-orientation.  Okay.

Georgie:    I think that it’s the only way to build trust, true trust.  It’s about – and we spoke about this earlier – trust is trust.  It’s not different when you’re going on a date, or meeting a new friend, or getting a new bank.  It’s the same. The best dates go well when you feel like you were yourself, and you were confident, the person turned up on time, they were you they said they were.  You were you. From a technology perspective and a platform perspective, if a platform can allow you to setup your world the way you need it to be setup, then that creates a lot of trust.  As long as it works.

Gerry:    Yes, as long as it works, and as long as it creates a good fit, so it morphs into their life as opposed to asking the user or the customer to work around their constructs.  

Georgie:    Absolutely.  

Gerry:    That’s really interesting.  When we were chatting earlier, we were mentioning about the huge growth spike that you just entered into in the last three to four months.  To give it context for the listenership, it was one million users four months ago, and now it’s at what, 2.4 million?

Georgie:    Yes, well, it was one million in August last year, and we hit 2.4 at Christmas, and now I think we’re about 2.6.  Three years to get a million and then four months to get the second million.

Gerry:    When this podcast goes out, you’ll probably have about ten million because… you know?  

Georgie:    I don’t know, I’m not sure I’m ready for that.  

Gerry:    How are you handling that scale?  What have you had to do differently?  

Georgie:    Everything.  I think that’s the biggest challenge.  As the customers scale, which is fantastic, which means that our product is resonating and people are really enjoying what we’re doing, which is fantastic feedback.  Everything scales.

Gerry:    You’ve got new users.  

Georgie:    CS scales.  The hits on the transactor scale.  Our platform needs to scale.

Gerry:    The bottom line.  

Georgie:    The bottom-line scales.  The cost scale. The people need to scale up because there’s a lot more customers to service now.

Gerry:    Yes, those customers to service now is what I’m really interested in.  I spoke a little bit more about my attempt to get an N26 and it failed, but we’re going to chat more about the early adopters who would have adopted N26 and then it morphs into the mums-and-pops.  It’s built the trust in the market. The early adopters have told their parents that N26 is so much cooler, you can do this. How are you designing for those new waves of new types of customers? Or maybe the older generation who are not so tech-savvy, how are catering to those?  

Georgie:    One of the things that is great for those customers with N26 is that we have a very clean product at the moment.  We have an account. We have certain features that you can do on that account, it’s not too complicated. It’s very easy to use.  The things that happen when your userbase change, and there are a couple of different ways that it changes. It’s from early adopter to the more normal type of customer, so someone who makes a more rational decision, that’s a great bank account, it solves a problem that I have, I’m going to get that.  Not, this is the cool new app, I’d love to sign up.

There are those two types of customers.  Then there’s also as we go into different markets.  We were a European bank, in 24 European markets. Then we entered into the UK, which is a very different market.  The Europe market is more traditional, there aren’t as many competitors in the space. There are still some very strong competitors like Revolute and other things like Clana, so people are used to digital.  In the UK, people have Revolute, N26, and Monzo, all on their iPhone all at the same time.

Gerry:    Yes, and Clana.  

Georgie:    Yes, and Clana, absolutely.  And Santander and something else.  Then really the game changes because in Europe, we’ve provided the right solution for them and they love it, so they move everything into N26.  In the UK and in the U.S., I would imagine this is only going to be enhanced, it’s really what transactions do they do with what product?

Gerry:    Yes, that’s true.  You’re competing for the sale.  

Georgie:    You’re totally competing for the sale.  I think then that’s where what matters to each company really comes into effect.  What are you for? What do you stand for? What do you want to do? I think we’re very clear that we want to be the everyday bank.  We’re not thinking about crypto. We’re not thinking about anything on that extreme side of things, which probably would play to our early adopter market.  

Gerry:    With all those new other financial apps, like Revolute and so forth, you’re competing for that sale, that interaction, that touch point for services and term.  How do you avoid the sameness? There’s a liquid expectation there across those ecosystems. You might be competing with an Air B&B in terms of experiences, how do you avoid that?  

Georgie:    It’s about having a really strong company purpose.  It’s interesting, a couple of months ago a journalist asked me what I thought about other companies copying products and the reality is, if we’re all talking to our users, we all know what the problems are.  There are going to be some fundamental similarities. If you’re very clear on what your company’s purpose is, then you stick to your company’s purpose and really what our competitors are doing, if they’re providing similar solutions, and we can solve more problems for people, that’s fantastic.  At N26, we’re really about solving the daily problems that a user has. Those are things like we send a push notification for every transaction that you get.

Gerry:    Yes, it was really interesting.  Georgie, we were chatting earlier on today at lunch, the notification screen that Georgia had on her phone, it was like an activity feed or purchases.  I’m not saying you’re a constant shopper, but there were definitely a lot of transactions today. It was really interesting. You made a really interesting point around the speed of that notification getting delivered to the user and how it increases certainty.  Then suddenly the device and the notification mechanism becomes a source of truth. You gave an instance of when you made a purchase at a shop and you finish the story.

Georgie:    Yes, you’re at the point of sale and Apple Pay or you use your N26 card.  I got a notification before the terminal says it’s been approved.

Gerry:    Yes, which his phenomenal.  

Georgie:    It’s fantastic.  Also, it’s come in really handy.  It’s not something I ever knew that I wanted or needed.  In fact, if you asked me if I wanted a notification for all of my transactions, I would say, that just sounds like noise.  

Gerry:    In that instance, you said to be that at some point at store had said, “That didn’t go through.” You were like…

Georgie:    Well, no, it has.  

Gerry:    You showed them the notification.  What may have been perceived? If that would have gone through user testing and they were like, we’re going to send you a notification for every purchase you make, users would be like, I don’t want that.  

Georgie:    Yes, I turn notifications off.  

Gerry:    Yes, they would say that.  In this instance, you’ve turned a negative into positive.  A neggy into a posy, as the Aussies would say.

Georgie:    Yes.  We shorten everything.  I think that what it does or what it did for me and certainly for a large portion of our customers, is it’s a new trust point.  It’s not something that I thought would enhance my trust of the product, but it did. That’s the pioneer level.

Gerry:    Really interesting stuff.  Georgie, we’re coming to the end of the conversation, as I mentioned to you, I’ve got three questions that I always ask our guests.  The first one is, what is the one thing you wish you were able to banish from the industry? Not the financial industry, more like the design and product industry?  

Georgie:    I really don’t like this concept of someone has all the answers.  One of the things moving into the CPO role was really interesting for me was, people often come to me with a question and they expect me to have the answer.  I think I’ve almost overstrained myself because of what I said before, but I would much rather have a discussion. I think as an industry; we need to be more open and transparent.  We’re very closed. It’s a very competitive space. There’s lot of VC money on the line a lot of the time. We can help each other.

I’ve had some fantastic conversations in the last couple of weeks with CPOs of other organisations.  Some have been very open to discuss challenges that we’re having as an organisation. We’re all the same.  We’re all trying to grow really fast. If we’re successful, we’re trying to grow even faster. These aren’t commercially confident conversations; they’re just how do you tackle this?  Every time I’ve had a conversation with someone who’s been open to it, we’ve both learned from it. By sharing different things, you say, that’s a good idea, maybe I can try that, or maybe I could tweak it and try it a different way.  I would like to be more open as an industry.

Gerry:    Okay, that’s good.  The next question is, what is the one professional skill that you wish you were better at?  

Georgie:    I wish that the polish came, sometimes I wish I could be more polished or professional.  Then at the same time, that is not me. I think that one of the things when I realised that the way for me to succeed or to do what I want to do with my career is to just embrace who I am, even though sometimes I do wish my eyebrows were plucked a bit more smoothly or something like that.  I’m me and I think that I can add an enormous amount to this industry. I can do it as me. I don’t need to be anything else.

Gerry:    Excellent.  It’s a great message for everyone.  The last question is, what is the message you like to give to emerging design and product talent for the future?  

Georgie:    Get as much experience as you can.  

Gerry:    In what?  

Georgie:    In anything.  

Gerry:    In anything.  

Georgie:    In anything.  Try different things.  Push the boundaries. If you’re stuck, go travelling.  Try and get as many different life experiences, career experiences, you don’t need to quit your job to do this.  You can say, hey, if you’re a designer and you want to move into product, ask if you can do some of the backlog writing for the design stuff that you’re working on.  If you’re a product owner and you want to be a software guy, just ask for some more stuff. Take it on and do it after hours and get as many experiences you can. Especially for product, right, those experiences are the richness that make you a better product manager in the end.  

Gerry:    And a more interesting person.  

Georgie:    Absolutely.  

Gerry:    Which is the same for service design and UX and all types of design.  Just to chime in there, as well. Be an interesting person. Georgie. It was fantastic speaking with you.  Thank you so much.

Georgie:    You’re welcome.  It was an absolute pleasure.  

Gerry:    There you have it.  Thanks for listening to Bringing Design Closer.  If you want to learn more about the other shows on the This is HCD Network, feel free to visit thisishcd.com, where you can also sign up to our newsletter or join our Slack channel, where you can connect with other human-centred design practitioners around the world.  Thanks for listening and see you next time.

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