Running late, but need to visit the bank? Don’t stress, all you need is a phone!

With the dynamic and fast-paced reality of today, all of us have been juggling errands to the best of our abilities. But, being only human, something important might be left out.

Simplifying everyday errands can mean the world to us, regular people. So, buckle up, we’re about to learn a thing or two about a leader in digital banking, the German-based neobank - N26.

N26 is one of the pioneers in the mobile banking business. Two lifelong buddies, Max and Valentin, came across the idea to create an online banking solution without a physical branch network. Max and Valentin imagined a hassle-free banking experience, and that’s exactly what they accomplished.

Stick around a see how two young, people shifted the way of banking, making it big in the world of digital banking.

Chasing Dreams

Maximilian “Max” Tayenthal enjoyed the many perks of a regular childhood. Spending most of his playdays outside, Max was growing more and more interested in all things that surrounded him.

As years went by, young Max enrolled at the WU Vienna in 1996, dedicating his time to acquire a master’s degree in business. Being highly ambitious and eager to soak in as much knowledge as possible, Max continued his education at the University of Vienna, earning himself another master’s degree, this time, in law.

Valentin Stalf was another regular kid growing up in Vienna, Austria. Spending his pastime exploring computer technologies, it was only logical that young Valentin would embark on an educational adventure revolving around computer science. Fast-forward to the days of higher education, Valentin enrolled at the University of St. Gallen, earning himself a bachelor's and master's degree in business administration and management. He is now a member of the Vienna University of Economics and Business's advisory board of professors and administrators.

Jumping to adulthood, Max garnered a lot of experience working for CMS, and Booz & Company, where he held several consulting and finance positions. Max is a member of the Chartered Financial Analyst (CFA) Institute.

Despite living in Berlin, Max finds time to pursue his other love outside of personal finance: skiing in the Alps.

Being longtime buddies, Max and Valentin spent a lot of time together, mostly skiing. Discussing different topics, both of them came to the conclusion that the banking industry needs to undergo some changes, mainly in its accessibility.

Brainstorming long and hard, Valentin and Max joined forces and co-founded in 2013. At the time, they both had the same goal in mind: to create a bank that people all around the globe want to use.

As a resident entrepreneur at Rocket Internet before co-founding N26, Valentin worked with companies that were in the early stages of development. A number of mobile payments businesses, such as Payleven and Paymill GmbH, benefited from his assistance. Being quite versatile, Valentin has also done strategy consulting, and collaborating with the financial services industry.

The Future Is Bright and Lucrative

The inspiration for the name of this company is taken from the 26 tiny cubes in a full Rubik's Cube and to the first office space located at "Unter den Linden 26".

Making its first steps in Germany and Austria on January 1, 2015, N26 was launched with a Wirecard backdrop as Number26 before spreading to other European countries in December of that year.

Valentin and Max’s company had a very good head start, thanks to good marketing and the awesome and easy-to-use software they put out. Two years after its creation, N26 assembled a whopping 5 million European customers. Having found out the formula for success, N26’s appetites grew, positioning its focus on the markets in UK and US.

Max and Valentin got their first round of financing from Axel Springer Plug and Play Accelerator, a German pre-seed business accelerator based in Berlin. The business received a €25,000 seed investment in 2013, and during the following seed financing round in June 2014, it received a $2 million investment from two partner investors.

Number26 got €700,000 in financing from the Investitionsbank Berlin for the development of technologies for the automated identification of attempted fraud. As of July 2016, Number26 obtained a complete banking license and expanded the service to an investment product, and at the same time, the neobank rebranded to N26.

Today, N26 offers its services to 7 million clients in Europe and the United States. It anticipates processing $90 billion in transaction volume this year. The firm just obtained a banking license in Brazil, and a team of 40 people has already been assembled in Sao Paulo to begin operations. N26 plans to make its app available to the general public sometime next year.

N26 currently enjoys enough "financial freedom" to prep for an initial public offering, and the company expects to be "structurally IPO-ready" over the next 12 to 18 months, according to the company's representatives.

However, N26 is still operating under a loss since 2019, but founder Max says that the company is not under any pressure from its investors to start making a profit any time soon.

It’s All About Digital Banking

All of N26's clients get a free basic current account, as well as a MasterCard Debit card and a Maestro card in certain regions. Customer overdrafts and investment packages are also available upon request. You may pay a monthly subscription to access more N26 features with the N26 You or N26 Metal premium accounts.

N26's identity verification partner, IDnow, offers a video chat option for completing the account opening procedure. The only way for non-passport and ID cardholders to verify their identity online is to go to a Postident-supported German post office.

With N26 Metal, a World Elite Mastercard made of metal is also available, which contains numerous insurance advantages and, in contrast to the regular Debit Mastercard, allows free cash transfers in foreign currencies.

Also, using N26 Credit, you may borrow between € 1,000 and € 25,000 over the course of 1 to 5 years. To submit an application, you must do it inside the app.

Jumping Over Hurdles

Growing a company isn’t all rainbows and roses, especially in the banking business. There will be some ups and downs for sure, that’s how companies grow.

Following an investigation conducted by various German media stating that it was easy to establish an N26 account with false identification papers, the neobank has been under German financial regulatory authority since 2018. And in June 2021, the bank was fined 4.25 million euros by BaFin for flaws in its anti-bleaching system. At least 50 transactions that occurred between 2019 and 2020 were flagged as suspicious.

In order to get access to N26 users' accounts, Vincent Haupert, a computer science research fellow at the University of Erlangen-Nuremberg, in December 2016 pointed to some flaws in the system. N26 had been made aware of the vulnerabilities by Haupert as early as September of last year. When the problems were first discovered, N26 stated that everything had been rectified, and said that no one's account had been hacked.

All in all, given the cut-throat nature of the banking sector, such controversies are pretty minor. Almost every financial service business has had to overcome some obstacles on its way to success.

The Only Way Is Digital

At present time, the seat of the company is located in Berlin, Germany. N26 holds offices in Berlin, New York, Barcelona, Vienna, and Sao Paulo with around 1,500 employees. N26 Bank GmbH owns assets that total $130.93 million worth, while N26 GmbH is valued at $24.24 million. Currently, there are 8 board members and advisors at N26, including Marcus Mosen. According to N26, there are now 28 employee profiles working for the company, including the company's CEO and founder, Valentin Stalf, and Max Tayenthal as the current co-CEO & co-founder.

To sum it all up, Max and Valentin have succeeded in building a trustworthy, mobile bank that is very easy to use and navigate through. N26’s team of employees has managed so far to adapt to the harsh banking environment, and evolve together with the finance sector.

No matter if you are a student or a family person, in the hustle and bustle of today, digital platforms are the new normal. It’s pretty safe to say that this neobank, N26, is a perfect fit for everyone, bringing banking services right under your fingertips.