Data Driven Growth at TransferWise

Data Driven
Growth.
Using data to power the growth of a
Mission Driven Startup

@nilanp @balazsbarn
I am
Vadym
Product Engineer
at TransferWise

@nilanp
How does money moves
around the world ?

@nilanp
We keep it in a bank
account

@nilanp
1. Progress
2. Culture
3. Marketing

@nilanp @balazsbarn
TransferWise…
a Mission Driven
Startup ?

@nilanp
TransferWise was started
to solve a problem
@nilanp@nilanp

@nilanp
In our case a personal pain point helped to see
an epidemic dysfunction in the entire industry,
which lacked any natural force of
improvement or move towards resolution.
— Kristo Käärmann & Taavet Hinrikus@nilanp

@nilanp @cataflu
A Mission Driven Startup =
A catalyst for achieving
a change in the world
@nilanp

@nilanp @balazsbarn
1. Progress

@nilanp @cataflu
£0.1 Million ➤ £1 Billion ➤ £1.5 Billion

@nilanp @cataflu
60 ➤ 940 TransferWisers
we are more than doubling in size every year

@nilanp @cataflu
Evangelism is the biggest
driver of growth

@nilanp @balazsbarn
Why do people recommend our
product ?

@nilanp
Would you recommend us to
your friends?
1 2 3 4 5 6 7 8 9 10
Detractors Neutral
Promoter
s

@nilanp
Would you recommend us to
your friends?
1 2 3 4 5 6 7 8 9 10
Detractors Neutral
Promoter
s
Tota
l
Promoters -
Detractors
= NPS

@nilanp
NPS IS the north star
KPI for growth

@nilanp
If promoters >
detractors you WILL
grow

It works !
(But barely)
It works with
no significant
issues !

It works !
(But barely)
It works with
no significant
issues !
It works. Wow
that was slick

It works !
(But barely)
It works with
no significant
issues !
It works. Wow
that was slick
You’ve just blown
my socks off that
was incredible

@nilanp @balazsbarn
RATIONalRational Emotional

@nilanp @balazsbarn
RATIONalProduct Cause

@nilanp @balazsbarn
RATIONal
Speed
Price
Convenience
Coverage
Cause

@nilanp @balazsbarn
To achieve advocacy your product needs
to be an order of magnitude better than
the alternative

@nilanp @balazsbarn
But don’t do this as “growth hack”
do it because the world deserves it

@nilanp @balazsbarn
Money without borders.
Instant, convenient, transparent
and eventually free
We’re powering money for people and businesses:
to pay, to get paid, to spend, in any currency,
wherever you are, whatever you’re doing

@nilanp @balazsbarn
So…
10x product
+ Cause driven marketing
= Explosive Word of Mouth growth
@nilanp @cataflu

@nilanp @balazsbarn
ONE question:

@nilanp @balazsbarn
So how you do build a 10x product ?

@nilanp
Autonomous
independent teams that focus
on KPIs that make a difference
to customers and drive growth
@nilanp

@nilanp
Autonomous
independent teams that focus
on KPIs that make a difference
to customers and drive growth
@nilanp
Currencies OperationsVerificationConversion Experience ViralityMarketing
Regulated
and
available
Instantly
and almost
zero cost
IdentityOnboarding Worry Evangelism
Problem
awareness

Where actually regional
team comes?

How to know what actually
matters to the customer?

Enginee
rs
Product
Manage
rs Data
Scientis
ts
Complia
nce +
Banking
Design
Support
+
Operatio
ns
Work within teams:
To help teams understand the
impact of their actions
• Build underlying data infra
• Eval impact of AB tests
• Analyse, identify and
prioritise opportunities
• Build product
X Tell the team what to do
next

Build something that does
not exist today

@balazsbarn@nilanp
I am
Balazs Barna
Product Engineer
at TransferWise

@balazsbarn@nilanp
Evolution of the delivery estimator

@balazsbarn@nilanp
Statistical model

@balazsbarn@nilanp
Statistical model
Rule based engine

@balazsbarn@nilanp
Statistical model
Rule based engine
Controlling speed

@balazsbarn@nilanp
10x cheaper product
to move money across borders.

@balazsbarn@nilanp
Oh, and one more thing!

@balazsbarn@nilanp
We are also faster.
WE ARE ALSO FASTER!

@balazsbarn@nilanp
GBP to EUR SPEED

@balazsbarn@nilanp
What is the TransferWise way?

@balazsbarn@nilanp
SIMPLE.
EASY TO IMPLEMENT.

@balazsbarn@nilanp
SIMPLE.
EASY TO IMPLEMENT.
BRINGS CUSTOMER VALUE.

@balazsbarn@nilanp
We don't need a perfect
solution.

@balazsbarn@nilanp
What is a transfer?

@balazsbarn@nilanp
Let's find similar ones in the
past, and see how fast we were.

@balazsbarn@nilanp
Let's find similar ones in the past, and
see how fast we were.
Pick the 60th
percentile.

@balazsbarn@nilanp
Each end-to-end estimate is the sum of independently calculated component estimates:
Estimate each step of the lifecycle
Got the
money!
(2h)
Money is on
it's way!
(1h)
Money
arrived!
(2h)
+ + +
KYC done!
(15 min)
+
Total estimated delivery time:
6 hours 15 minutes
Converted
the money!
(1h)

@balazsbarn@nilanp
Why the 60th percentile?
Why the 60th
percentile?
We moved from the 95th
percentile to
provide more accurate
rather than safer
estimations to match the
main happy path
payments.

@balazsbarn@nilanp
MISSION ACCOMPLISHED
We achieved something that brings value to all
of our customers.

@balazsbarn@nilanp
2016 Q4:
Speed team in Budapest
inherits the estimator

@balazsbarn@nilanp
What does speed mean to our
customers?

@balazsbarn@nilanp
#WHEREISMYMONEY?

@balazsbarn@nilanp
Slower transfer means more contacts

@balazsbarn@nilanp
Bad estimate results in
contract rate 10x

@nilanp @balazsbarn
RATIONal
Contacts cost
money.
Charge
as little as
possible.

@balazsbarn@nilanp
SPEED & ESTIMATION ACCURACY
MATTERS TO OUR CUSTOMERS

@balazsbarn@nilanp
Learning by doing.

@balazsbarn@nilanp
Learning by doing.
Bug fixes.

@balazsbarn@nilanp
Learning by doing.
Bug fixes.
Investigating bad estimates.

@balazsbarn@nilanp
Learning by doing.
Bug fixes.
Investigating bad estimates.
Super hard without a database.

@balazsbarn@nilanp
We built our own database.

@balazsbarn@nilanp
Saved every estimate.

@balazsbarn@nilanp
Saved the transfer.

@balazsbarn@nilanp
Saved the transfer.
Easy to compare actual vs estimated.

@balazsbarn@nilanp
THE ESTIMATOR HAS OBVIOUS
LIMITATIONS
The estimations are poor, when we don't have sufficient
data.

@balazsbarn@nilanp
Card payment is introduced for
Hungary, and the estimates are
very pessimistic.

@balazsbarn@nilanp
We don't have sufficient data
on card payments to estimate!

@balazsbarn@nilanp
If the customer pays by card, we
know it's going to take X
seconds to receive the money.

@balazsbarn@nilanp
No need to rely on statistics!

@balazsbarn@nilanp
Let's create a rule based engine!

@balazsbarn@nilanp
If we have an applicable rule for
a transfer, we don't rely on
statistics.

@balazsbarn@nilanp
TransferWise supports 700 routes.

@balazsbarn@nilanp
Most rules are currency specific.

@balazsbarn@nilanp
Most rules are currency specific.
Our team can't do it alone.

@balazsbarn@nilanp
Easy to use microservice &
framework.

@balazsbarn@nilanp
Easy to use microservice &
framework.
Any team can implement their own
rules in fifteen minutes.

@balazsbarn@nilanp
Estimation accuracy
improved by 30%.

@balazsbarn@nilanp
If we just keep doing what we
are doing...
That's pretty good.

@balazsbarn@nilanp
are doing...
That's pretty good.
If we just keep fixing routes, we
are going to be awesome!

@balazsbarn@nilanp
are doing...
That's pretty good.
If we just keep fixing routes, we
are going to awesome!

@balazsbarn@nilanp
LET'S TAKE A STEP BACK

@nilanp @balazsbarn
RATIONal
OUR PRICING IS
CONSISTENT
AND
10X BETTER
OUR SPEED
IS AN
ESTIMATE

@balazsbarn@nilanp
WE NEED TO CONTROL SPEED

@balazsbarn@nilanp
HOW CAN WE DO THAT?

@balazsbarn@nilanp
Instead of estimating, we target
Got the
money!
(2h)
Money is on
it's way!
(1h)
Money
arrived!
(2h)
+ + +
KYC done!
(15 min)
+
Targeted delivery time:
6 hours 15 minutes
Converted
the money!
(1h)

@balazsbarn@nilanp
When we offer a speed to a
customer, it has to be based on a
plan.

@balazsbarn@nilanp
This is
where the
magic
happens

@balazsbarn@nilanp
Money movement between
two countries is never equal.

@balazsbarn@nilanp
More money will move from the
US to Japan than the opposite.

@balazsbarn@nilanp
We have to provide liquidity!

@balazsbarn@nilanp
We have to provide liquidity!
Cool, what's the easiest way
around this?

@balazsbarn@nilanp
KEEP A LOT OF MONEY THERE

@balazsbarn@nilanp
Liquidity need can be
predicted for lower amounts.

@balazsbarn@nilanp
What if we get a 500 000 USD
transfer?

@balazsbarn@nilanp
What if we get a 500 000 USD
transfer?
If we payout right away, other
customers will have to wait.

@balazsbarn@nilanp
Estimator talks to
liquidity-service.

@balazsbarn@nilanp
Estimator: When will you get the money, my friend?
Liquidity: 4 PM Today.
Estimator: Have the money by 4. I'm going tell the
customer.

@balazsbarn@nilanp
Now, we know when the payout
will happen, before we gave a
promise.

@balazsbarn@nilanp
The estimator became the
orchestrator of TransferWise.

@balazsbarn@nilanp
It negotiates with all the components,
and creates a plan before giving a
promise.

@balazsbarn@nilanp
Start with something simple and
learn on the job.

@balazsbarn@nilanp
Think about debugging & monitoring.

@balazsbarn@nilanp
Think about debugging & monitoring.
(Think one more time).

@balazsbarn@nilanp
Data analysis can lead to take
baby steps & miss the game
changer.

@balazsbarn@nilanp
Be ready to change everything.

Thank you.
@nilanp
@balazsbarn

Data Driven Growth at TransferWise

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