Written by: Sleepy.txt
In 2017, Black Ant Capital made its first investment in Pop Mart and continued to increase its investment in the following years. In December 2020, Pop Mart was listed in Hong Kong, with its market value exceeding HK$100 billion on its first day of trading. Black Ant Capital achieved a return of over 100 times its initial investment, becoming a classic case study in China's consumer investment sector.
In 2010, Sequoia Capital China invested in Meituan, and after multiple rounds of follow-on investment, ultimately reaped a return of over 100 times when Meituan went public. This investment made Sequoia China one of the most successful institutions in the history of Chinese internet investment.
In the world of venture capital, a 10x return is considered excellent, and a 100x return is legendary.
However, in Europe, one venture capital firm earned a return of nearly 1,400 times on a single investment.
This institution is called Balderton Capital. In 2015, they led the seed round of Revolut, the "European Alipay," investing £1 million. Over the next 10 years, they continued to participate in multiple rounds, with a total investment of approximately £3 million.
In 11 years, Revolut has grown from a grassroots project rejected by Y Combinator into a fintech giant valued at $75 billion, known as Europe's most valuable fintech company. Today, Revolut has over 65 million users worldwide, annual revenue exceeding $4 billion, annual profit exceeding $1 billion, and processes billions of dollars in transactions daily.
In 2025, Balderton Capital cashed out approximately $2 billion by continuously selling off portions of its Revolut stake. The remaining shares they held, based on the latest valuation, are still worth over $4 billion. This means that Balderton's total return on Revolut exceeded $6 billion, nearly 1400 times its initial investment.
Even more impressive is the fact that Balderton Capital Fund V, the fund that holds shares in Revolut and was established in 2014, had a total fundraising size of only $305 million. In 2025, this fund returned more than 20 times its initial investment to investors by selling a portion of its Revolut shares. This means that even if all other investments in this fund were to go to zero, its return would still far exceed the average of 3 to 5 times that of top-performing funds in the industry.
This story illustrates the essence of venture capital. In a business world where certainty has long since vanished, how do we confront uncertainty? When everyone sees the risks, where do opportunities lie hidden?
People from two worlds
The story begins with the meeting of two very different people in early 2015.
The first person was Nikolay Storonsky, a Russian whose very being exuded restlessness. His father was a high-ranking executive at Gazprom, and his family was well-off.
He holds dual master's degrees in physics from the Moscow Institute of Physics and Technology and economics from the New Economic Institute. He is also a sports fanatic, a former national swimming champion, and passionate about boxing and surfing.
In 2006, he moved to London and became a derivatives trader at Lehman Brothers, dealing with billions of dollars in transactions daily. After Lehman Brothers collapsed in 2008, he moved to Credit Suisse. His frequent global travels resulted in thousands of dollars in exchange rate losses each year. He felt this was unreasonable and unfair.
So he approached Vlad Yatsenko, a software engineer who had worked at Credit Suisse and Deutsche Bank for 10 years, and decided to solve the problem himself.
In 2014, they founded Revolut at the Level 39 incubator in London's Canary Wharf. Storonski invested his entire savings, £300,000, betting his future on it.
The second person he was about to meet, Tim Bunting, came from another world.
In 2007, 43-year-old Bunting decided to leave Goldman Sachs.
He worked at Goldman Sachs for 18 years, rising through the ranks to become Global Head of Equity Capital Markets and International Vice Chairman, and was a partner at Goldman Sachs. He stood at the pinnacle of the world of certainty, where every transaction is backed by precise models, every decision is supported by massive amounts of data, risks are quantified, and the future is predicted.
But he chose to leave and jump into a completely different world—venture capital.
He joined Balderton Capital. The essence of venture capital is finding possibilities amidst uncertainty. There are no perfect models, only vague foresight and judgment of people.
When they met in February 2015, Revolut was in dire straits. Their product demo wasn't working properly and they had just been rejected by Y Combinator, Silicon Valley's most prestigious incubator. In any normal investment decision-making process, this would have been an immediate rejection.
But Bunting saw something different.
He later recalled that in Stollensky's eyes he saw an ambition and drive to overturn the entire European banking industry. At the same time, he saw composure and reliability in his technical partner, Yachenko.
One understands finance, the other understands technology; one is driven, the other is determined—this is the perfect founder combination.
Great investors see opportunities when everyone else sees risks. Consensus often only brings mediocre returns; only non-consensus can potentially generate excess returns.
In July 2015, Balderton officially led Revolut's seed round, investing £1 million, valuing the company at £6.7 million post-investment.
However, are excellent founders and courageous investors enough? Is there an even greater force driving a miracle of 1400 times return?
Favorable timing, advantageous location, and harmonious relationships
Revolut's success is due to a confluence of favorable timing, location, and people.
First, there was the aftershock of the 2008 financial crisis, which nearly destroyed public trust in traditional banks.
According to a Eurobarometer survey, public trust in banks in Europe plummeted to an all-time low after the crisis. Banks themselves were also mired in difficulties, with profitability falling sharply. Data shows that the average return on equity (ROE) of European banks crashed from about 11% before the crisis to around 4%-5% around 2015, far lower than their American counterparts.
In an effort to survive, banks began massive layoffs. From 2012 to 2015, European banks closed over 10,000 branches and laid off tens of thousands of employees. This led to a sharp decline in the quality of banking services, resulting in a terrible customer experience and creating a huge market vacuum for new challengers.
At the same time, the wave of technology is reshaping the market. In 2015, smartphone penetration in Europe began to increase significantly, and the adoption of mobile banking also grew rapidly. The shift of financial services from offline branches to mobile apps has become an irreversible trend.
The regulatory impetus came at just the right time. In late 2015, the EU passed the second version of the Payment Services Directive (PSD2). The core of this legislation was "open banking," which broke banks' monopoly on customer data, allowing third-party fintech companies to access user bank account data with user authorization and provide innovative financial services. This paved the way for the development of the entire fintech industry.
A new generation of consumers is also growing rapidly. As digital natives, they strongly dislike the cumbersome processes and poor experience of traditional banks. A 2015 survey showed that 80% of consumers under the age of 45 believed they should be able to complete any financial transaction through a mobile app.
The fragmented nature of the European market itself has also become a driving force for Revolut. Europe consists of dozens of countries, languages, and currencies, and the inconvenience and high costs of cross-border transactions have always been a major pain point.
It was against this backdrop that, around 2015, the European fintech arena erupted with activity. Germany's N26, the UK's Monzo and Starling, and TransferWise (now Wise), focusing on cross-border remittances, emerged almost simultaneously. Each carved out its own niche: N26 emphasized design, while Monzo stressed social interaction. The industry consensus at the time was to conquer one market or product category at a time.
But Revolut was an outlier from the very beginning.
Its core insight was that banking could be built like a global software product, full-stack and borderless from day one. While competitors were still meticulously cultivating a particular experimental field, Revolut was already expanding globally. This bold strategy, which seemed highly controversial at the time, ultimately allowed it to leave all its rivals behind.
However, the journey from a grand vision to a great company is fraught with peril, and Revolut's path was far from smooth.
Running wild amidst controversy
One of Revolut's core values is "Never Settle." This value is deeply ingrained in the company's DNA, driving it to thrive amidst controversy for the past 11 years.
This insatiable desire is first and foremost reflected in the speed of product expansion.
Revolut officially launched its product in July 2015, processing over $500 million in transactions in its first year. By the end of 2016, it had over 300,000 users and processed nearly £1 billion in transactions. In November 2017, Revolut announced that it had surpassed 1 million users, reaching this milestone in just over two years.
Stollensky's motto is "the faster you release and iterate, the more chances you have to win." After launching its core product, the low-fee currency exchange card, Revolut quickly introduced many new features: cryptocurrency trading in 2017, followed by stock trading, savings vaults, budgeting tools, insurance, P2P payments, business accounts... It has transformed itself into an all-encompassing financial super app, while its competitors are still carefully guarding their own little piece of the pie.
This aggressive expansion strategy resulted in phenomenal growth. In 2017, Revolut's user base tripled, and revenue nearly quintupled. In 2018, user numbers grew from 1.5 million to 3.5 million, and revenue increased by 354%. By April 2018, Revolut had completed a $250 million Series C funding round, reaching a post-money valuation of $1.7 billion, officially becoming a unicorn.
Revolut is able to launch new features quickly because they have adopted a VC-like product strategy internally.
They don't blindly believe in elitist "top-level design." Internally, they typically have numerous new products and features being tested simultaneously. However, only a small fraction of these eventually "graduate" and become actual business lines. Those that don't get off the ground are cut, while those that successfully validate their features receive double the company's resource investment.
Today, none of Revolut's core revenue-generating products have come from top-level strategic planning; they have all grown from this culture of internal competition and trial and error.
But this also came at a huge cost. In those 11 years, Revolut faced at least three life-or-death tests.
The first test comes from trust.
In 2016, the company needed more funds for expansion, but traditional financing channels were not working smoothly. Stollensky proposed a bold idea: to raise funds from the public through the crowdfunding platform Crowdcube. This was an unconventional move at the time, and many investors opposed it.
But Balderton overruled the objections and supported the decision. They believed it not only solved the funding problem but also served as an excellent marketing opportunity to test public trust in Revolut. Ultimately, 433 ordinary people participated in the crowdfunding campaign, investing an average of approximately £2,152 each. They believed in Revolut's vision and voted for the startup with their own money.
And now, these early backers have reaped astonishing returns. The price of an iPhone back then, 10 years later, has become a down payment for a house in suburban London. The initial investment of £2,152 is now worth over £380,000, a return of more than 170 times.
The second test comes from culture.
In February 2019, Wired magazine published a bombshell report exposing serious problems with Revolut's corporate culture. The report accused the company of using any means necessary to achieve growth, relentlessly exploiting its employees, and leading to an extremely high employee turnover rate. The company was immediately plunged into a major public relations crisis.
At this time, Revolut was in a period of rapid growth. In 2019, the company's user base surpassed 10 million, and it began expanding into Australia and Singapore. However, the outbreak of this crisis severely damaged the company's reputation.
As a board member, Balderton immediately engaged in in-depth discussions with Stromsky. He shared his experience managing a team of thousands at Goldman Sachs, helping Stromsky realize that as the company grew, it needed to establish a more mature and human-centered management system. With Balderton's assistance, Revolut brought in more experienced managers and began systematically improving its corporate culture.
The third test comes from compliance.
Revolut applied for a banking license from the UK Financial Conduct Authority (FCA) starting in 2021, but was denied approval for three full years. The regulator raised serious questions about its anti-money laundering system and corporate governance. This was a fatal blow for a fintech company.
While awaiting its UK license, Revolut did not halt its expansion. In 2020, the company completed a $580 million Series D funding round, reaching 14.5 million users and entering the US and Japanese markets. In 2021, the company completed an $800 million Series E funding round, reaching a valuation of $33 billion. By 2022, the number of users had grown to 26 million.
At a crucial moment, Bunting again leveraged his industry network. He personally invited Martin Gilbert, a titan of the British investment world and chairman of Aberdeen Standard Investments, to become Revolut's chairman. This move greatly enhanced the regulators' trust in Revolut. In July 2024, Revolut finally obtained the coveted UK banking license.
Alongside obtaining its UK license, Revolut also delivered impressive results. In 2024, the company surpassed 50 million users, achieved annual revenue of $4 billion (a 72% increase), and broke the $1 billion mark for the first time in annual profit, processing over $1 trillion in customer transactions. The company became the most downloaded financial application in 19 countries.
Throughout these 11 years of trials and tribulations, Balderton Capital has remained steadfastly behind Revolut. Balderton has served on Revolut's board of directors, providing indispensable support at every crucial juncture in Revolut's development and consistently participating in each subsequent funding round.
The "American Dream" of European VCs
Revolut's phenomenal success brought Balderton, which had long remained behind the scenes, into the spotlight. The underlying logic behind this London-based VC's ability to capture miracles is not due to mere luck, but rather to the bloodline flowing through its veins belonging to the Silicon Valley powerhouse Benchmark Capital.
In 1999, Benchmark's partners decided to establish a European branch, Benchmark Capital Europe, in London. They brought not only capital but also a unique organizational structure—the Equal Partnership.
In traditional venture capital funds, a few general partners typically hold the majority of power and profits, while other partners occupy a relatively minor position. This pyramid structure easily leads to internal competition and conflicts of interest.
The equal partnership model is entirely different. At Balderton, all partners own the company equally, have an equal voice in all decisions, and receive the same financial rewards regardless of who finds or leads the deal. This system ensures a high degree of alignment of interests among all partners, enabling them to work together like a pack of wolves.
The advantages of this system were fully demonstrated in the process of investing in Revolut.
First and foremost was better due diligence. When Bunting first met Stromsky, while he was an expert in financial markets, he didn't fully understand the underlying technology. So, he immediately brought in Suranga Chandratillake, a partner with an engineering background, to help with the evaluation. There was no fear of competing for credit; the partners shared a common goal: to invest in the best companies.
Secondly, because the interests of all partners are completely aligned, they are able to make the most beneficial decisions from the company's perspective. Balderton has consistently provided unwavering support to Revolut during its multiple funding rounds, never hesitating due to internal conflicts of interest.
Finally, there is more comprehensive post-investment support. Startups encounter different problems at different stages. An equal partnership system means that entrepreneurs can access the resources of the entire partner team at any time.
In 2007, the European team spun off from Benchmark and officially changed its name to Balderton Capital, after the street where their first office was located. The core principle of equal partnership was also fully preserved and became key to Balderton's success in the competitive European VC landscape.
However, a good system cannot guarantee the success of every investment. In the world of venture capital, what ultimately determines success or failure?
Power Law
Simply put, this rule is an extreme version of the Pareto principle.
In the world of venture capital, this means that a small portion of investments will contribute the vast majority of the fund's returns. The vast majority of investments, however, ultimately result in mediocrity or even total loss.
According to PitchBook data, the top 10% of investments in the venture capital industry contribute 60% to 80% of the industry's returns. A VC's daily work involves searching for that 1% of potential among countless seemingly unpromising projects. They need to cast a wide net, but even more importantly, they need to make significant bets on the very few projects with the potential to become super winners at crucial moments.
In its 25-year history, Balderton Capital has invested in over 275 companies, including star performers like Darktrace, Depop, and GoCardless. Without Revolut, Balderton might still be a good European VC, but it certainly wouldn't be the legendary company it is today.
This also determines that venture capital is essentially a game of non-consensus. If a project's prospects have become a consensus among everyone, its valuation will inevitably rise, and its future return potential will be extremely limited. Only those non-consensus projects that are not favored in the early stages and are full of controversy have the potential to bring disruptive excess returns.
For venture capitalists, success isn't a matter of hit rate, but rather the magnitude of the return. Investing in nine wrong projects isn't a big deal; as long as you invest in just one that can yield 1000 times the return, you'll be set for life. This sounds like gambling, but top VCs use a rigorous philosophy and discipline to increase their chances of winning.
So, is there a formula that can be replicated behind this miracle of 1400 times return?
Formula for a thousandfold return
Excess returns = (Non-consensus founders x Structural epochal opportunities) ^ Patience to navigate cycles
First, he is the founder of non-consensus.
In the world of venture capital, judging people is always paramount. This is especially true in the seed round, when the product, market, and data don't yet exist; the founder is practically the only criterion for evaluation.
A top founder must be a paranoid optimist who has unrealistic fantasies about the future but is also able to solve immediate problems in a down-to-earth manner.
Secondly, there was the structural opportunity presented by the times. Revolut's success was inseparable from the unique historical window of opportunity in Europe in 2015: the aftermath of the financial crisis, the widespread adoption of mobile internet, the liberalization of regulatory policies, and the generational shift in consumer behavior. Great companies are companies of their time. They are able to keenly capture structural changes and, through their products and services, become synonymous with those changes.
Finally, and most importantly, is the patience to navigate through cycles. From 2015 to 2026, Revolut has faced numerous challenges, including cultural crises, regulatory difficulties, and market competition.
Over the past 11 years, Balderton has remained a staunch supporter, not only consistently investing but also providing invaluable advice and resources at crucial moments. This patience in holding long-term and weathering challenges alongside the founders is essential for achieving above-average returns.
In the world of capital, time is both the best friend and the worst enemy. Only those investors who can resist short-term temptations and adhere to long-term value can ultimately reap the rewards of time's compounding effect.
Turning £1 million into $6 billion is not just a wealth myth, but a story about insight, courage, and patience. It tells us that in this rapidly changing era, true opportunities always reside with those who can see the times, embrace change, and are willing to navigate cycles with great entrepreneurs—long-term thinkers.
