David Velez on Why Winners Think They're Still Losing

The Interview Question No One Can Game

Most venture capital firms start candidate interviews with the youngest analyst and work upward. Sequoia did the opposite with David Velez. Doug Leone, the firm's managing partner, conducted the first interview himself. Not five minutes on background and credentials, but an hour drilling into questions Velez had never encountered in any professional setting: "Tell me about your dad. What does he do? How's your mom? How's your relationship with your mother? Is she pretty strict?"

Velez left the Sequoia office, walked to his car, turned the ignition, and found an email from Mike Moritz already waiting. Doug had taken one minute to loop in Moritz, who immediately wanted to meet. The entire choreography telegraphed something Velez would later import wholesale into Nubank's culture: intensity without waste, hierarchy inverted to signal priority.

There's no way to game those questions. There's not a right answer. But somehow Doug has developed an entire philosophy around what different answers to those questions actually mean and how those questions will lead you into the right kind of answer.

— David Velez

That philosophy became Velez's. Today, when he interviews candidates at Nubank, he skips the CV entirely. "My interviews today are not interviews about career experience. They're all about character traits. I don't really want to spend time asking you about what school did you go to. It's about what's really driving that person." He learned from Leone that the single most valuable superpower in business—whether you're investing or operating—is reading people. Not markets, not code, not unit economics. People.

Hire the Spiky, Not the Smooth

Velez didn't just absorb Leone's interview tactics. He absorbed a contrarian hiring heuristic that runs counter to how most organizations scale. "There are certain type of people that have very strong strengths in certain areas and also very strong weaknesses in certain areas," Velez explains. "Valuing those type of people over the people that are simply just good at everything has been a really interesting insight."

This is the opposite of what risk-averse HR departments optimize for. Most companies hire for well-roundedness, minimizing downside. Velez hires for spike, accepting the weakness as the price of the strength. "I'd rather have the people that have the incredible strengths and the weaknesses than the people that are okay in just certain areas. Those tend to be, if you manage them adequately, much more powerful type of hires."

The approach demands active management. You can't hire someone with glaring weaknesses and then ignore them. But the upside is asymmetric. Mediocre-at-everything employees produce mediocre-at-everything companies. Brilliant-and-broken employees, managed well, produce Nubank.

Partnership Means the Intern Speaks First

Velez joined Sequoia as an intern while still enrolled at Stanford Business School. His routine was absurd: wake at 4 a.m., prospect Brazilian companies until 8 a.m., attend classes, return to the office at 2 p.m., work until 8 p.m., then do homework. On Tuesdays, Doug Leone would pick him up at 3 p.m.—"like Dad was picking me up from school"—drive to San Francisco Airport, and fly 14 hours to São Paulo on Leone's plane. They'd meet seven companies on Wednesday, sign term sheets, and fly back so Velez could make his Thursday 8 a.m. class.

What mattered more than the mileage was the meeting choreography. Velez sat in Sequoia's investment committee meetings next to Leone. And Leone asked him: "What do you think, David, of this investment?" The first time, Velez froze. He hadn't prepared to speak. The second time, he came ready. That expectation—that the most junior person in the room would be asked for a point of view—became the template for Nubank's culture.

That level of treating me like partnership, of having a seat on the table, I think was ultimately what pushed me to get a level of motivation that I hadn't felt anywhere else in any previous career that I had. That was a foundational insight around the culture that we have today where we want to treat everybody as a partner.

— David Velez

At Nubank, everyone from the youngest engineer to the data analyst gets asked what they think. "Everybody needs to feel that they have a seat at the table," Velez says. "That ultimately means skin in the game and we want to prepare people. And that motivates the right type of people." It's expensive in meeting time. It's worth it in ownership mentality.

The Rejection That Launched Nubank

In October 2012, the day before his birthday, Velez was preparing a big trip. Doug Leone was coming to Brazil with several Sequoia partners. Then Leone called. "No BS, no time for chitchat. He straight up said, we had a conversation and we had decided there won't be any office in Latin America."

Velez had spent 18 months building what would become Sequoia Brazil. He'd rented an office. He'd started interviewing team members. And now, in a single sentence, the project was dead. "It was a big bucket of ice water at that moment," Velez recalls. But after he digested it, he agreed with the reasoning. Sequoia had spent those 18 months looking at Latin American startups and found very little that excited them. The region was 16 hours from San Francisco. The entrepreneurs were building clones of Silicon Valley products, not solving the region's biggest problems. "They were not really shooting that high."

I was so appreciative of Doug of just give it to me straight. No, ah, let's think about it. Let's wait another month. Let's wait 6 months. I think most people would want to kind of like sugarcoat it. By him just gave it to me straight, made it very clear, crystal clear to me what I needed to do.

— David Velez

Velez had two options: move to California and join Sequoia's growth fund, or pursue what he'd wanted to do for 15 years—start a business. Leone's bluntness made the decision easy. Velez chose to start Nubank. The lesson wasn't just about clarity in bad news. It was about recognizing when conventional wisdom is a trap. Latin American entrepreneurs were avoiding the hardest, most regulated, most incumbent-dominated sector: financial services. Velez ran straight at it.

Why Half of Brazil Means You're Losing

Nubank now serves close to 50% of Brazil's adult population. It's the primary bank account for nearly 30% of adult Brazilians. These are numbers that would make any founder in any market declare total victory. Velez recoils at the suggestion. "I don't think we've won. And the first thing I want to leave very clear is I get nervous when anybody says we are the winner. We still have so much to prove."

His sports metaphor is telling: "We're still very much playing the first minute of the first half of the game." The other 50% of Brazil that doesn't use Nubank isn't a rounding error. It's a diagnosis of product gaps. High-income consumers find the product incomplete. Customers over 60 find it too complex. Serving half the population at scale reveals the edges where the product fails.

By the point where you get to a certain size, your product is good for certain subsegments, but then your product is really bad for our subsegment. So as we get to half of the population, then there are the high-income consumer in Brazil that looks at our product and says, "You know what? There are some things that I like, but you're missing a lot of different products."

— David Velez

The real goal, Velez says, is "n equals 1"—a product fully customized to each individual customer. That's not a feature roadmap. It's a decades-long vision where AI becomes "the bank and the banker in every pocket." The smartphone was the bank in every pocket. AI is the banker. Velez is building for that future, not optimizing for the present. "We're building a company for decades. We're running a marathon, not a sprint."

LATAM's Liquidity Problem Is a LATAM Ambition Problem

When asked why Nubank succeeded where so many other Latin American fintechs stalled, Velez reframes the question. The problem wasn't capital or liquidity. Brazil had 45 IPOs in 2007–08. By 2018–19, exits in the $300 million to $1 billion range were common. Visa acquired the fintech Prismo for over a billion dollars. The Bovespa provided liquidity. New York IPOs opened up for larger market caps. M&A was active.

The real problem was entrepreneur ambition. "Entrepreneurs were not looking at solving the main issues. The entrepreneurs were looking at solving the California engineer issue. 'I want somebody to bring the food to my house.' That's not really the issue in Latin America. There are bigger issues." Financial access. Healthcare. Education. The biggest market cap opportunities in the region were still controlled by century-old incumbents. In the NASDAQ, 25–30% of companies didn't exist 20 or 30 years ago. In Brazil and Mexico's exchanges, the top companies are the same ones from 100 years ago.

Velez saw that gap and ran at financial services despite everyone telling him it was impossible. "Conventional wisdom when we started was, impossible. You're going to get crushed. You can't compete with the biggest companies in Latin America. The big banks will crush you." They didn't. And now Velez believes the cultural barrier has been broken for others. "The opportunity for disruption in a lot of these markets exists today. The culture has changed, the capital exists. You'll see them over the next 5 to 10 years."