We asked Marcos Jarne, general counsel at Nubank and the winner of the Rising Star award at the 2018 Global Counsel Awards, his opinion on what it takes to be a successful in-house counsel, the best way to advise senior leadership and what winning the award meant to him.
Describe your current role (responsibilities, size of team, structure).
As general counsel of Nubank, I am responsible for the oversight of all internal legal affairs, including strategic legal advice in many areas of law, advice on business and product developments, as well as interface with regulators.
Currently, the legal team has five people and expanding. It’s a lean and efficient team, especially taking into consideration that Nubank is among the leading fintechs in Latin America having started operating only four years ago with investment from prominent venture capital fund Sequoia Capital. Our culture is extremely strong and it’s a huge asset. Things move in at hyperspeed. We have to make sure all teams, legal and others, are on board with our culture and breathe it every single day. And since culture plays a key role, finding the right people and training them in this mindset is a major investment as we scale.
What led you to a career in-house?
I believe it was a natural process. I began my career almost 15 years ago working at law firms and later moved to a family office with investments in different jurisdictions, including listed companies, and which also has a private equity/venture capital arm. Then in 2015 I welcomed the opportunity to start the legal department here at Nubank from scratch. It made sense to move into the operation and get even closer to the business where new ideas and products are born, brainstormed and then implemented.
In your current role, what is the most challenging situation that you have faced? What are the most significant challenges that in-house lawyers are likely to face over the next few years?
Technology has made significant changes in many areas of our society over the last years, including in the financial markets worldwide. In this scenario, Brazil also issued a new regulatory framework for the payment industry in 2013/2014 to welcome innovation. Since then, new rules are routinely issued, mainly by the Brazilian Monetary Council and Central Bank.
To participate in these discussions and interact with regulators has been one of the great challenges I have experienced here at Nubank.
People always talk about the innovation that Nubank has brought to the market in terms of UX, design and customer experience. But being able to do all of those things in a fast-paced way while complying with Brazilian regulation also demands an innovative approach that has, in certain ways, also helped the Brazilian authorities to keep fostering competition and boosted the entry of new players in the market.
In terms of challenges for in-house lawyers in the coming years, these new technologies and innovations are already resulting in key discussions in areas such as cybersecurity, and these are likely to expand. In the years to come the Internet of Things and artificial intelligence will become even more challenging and relevant topics.
Are there particular types of legal issues that you routinely refer to outside counsel? And what kind of matters do you tend to handle in-house?
At Nubank we deal with most matters in-house: corporate matters, most regulatory matters, certain intellectual property discussions as well as contracts, ranging from simple to very complex ones.
We refer to outside counsel issues that require special expertise such as tax matters, or issues where today it does not make sense for us to create a specific internal team, such as litigation. Law firms have teams fully dedicated to different areas of law and which follow the market and precedents closely. Knowing the right balance of when and if to refer to outside counsel is smart and efficient (in terms of costs, head count need and the expertise required internally on a daily basis). We also use outside counsel to complement the work of our in-house team in relation to one-off projects which may involve, for instance, laws of other jurisdictions such as equity raises or the structuring of a credit facility.
What do you consider to be the essential qualities for a successful in-house lawyer?
In order to succeed as an in-house lawyer, I would highlight six essential and interconnected qualities: business awareness; good communication skills; objectivity; good risk assessment skills; a sharp sense of urgency; and a good sense of creativity.
Understanding the business and its products deeply plays a key role. This differentiates in-house counsel from external counsel. In a time and in a business where things move really fast, this makes a huge difference. But having business awareness is not enough if you cannot assess information and risks and then communicate clearly to others in the company. That’s why communication skills are key – you have to know when to say, what to say and how to say it. A pinch of creativity adds great value, especially when you are in a disruptive tech business.
What’s important for in-house counsel to consider when advising senior leadership?
As a pre-step, you have to understand the business and the economic rationale behind a certain project or decision. If you don’t have all the information (and often you don’t), you have to ask for it right away. This can take just a few minutes and save you a lot of work. At Nubank this sometimes happens just as a standing hallway meeting. Surprisingly, just by asking key questions at the beginning you are already helping senior leadership in the decision process and where to focus. The whole process becomes much easier when all stakeholders understand – clearly and right at the beginning – the why and the what components of a project.
In this sense, advising senior leadership has much to do with the essential qualities of an in-house counsel that I mentioned earlier – that is, things move fast and people do not have a lot of time available, especially in a fast-paced technology business. So you have to be able to communicate very objectively. And I mean, extremely objectively: few words and a clear recommendation (and not lots of options) while laying out the pros and cons.
How does the legal department contribute to your company’s growth?
Intensively. There has been a big change in the role of general counsel and in-house lawyers in recent years. In the past, it was a more limited role. The modern role of in-house counsel is to partner with the business, to understand the pain points and to assist with practical and viable solutions – similar and just as important as the finance team of a company, for instance, which is also a key supporting area.
The legal team helps the company and different stakeholders to plan well for new projects, to react efficiently to new matters and to streamline interactions internally or with external partners. Even a small matter can later have a bigger impact on a product or the company. In parallel, all of this helps, in a certain way, to reduce anxiety internally within the company.
A good and efficient legal team knows how to master the balance of its partner-guardian role, and this ultimately contributes to company’s growth, generating more income and fewer liabilities and inefficiencies.
With regard to your industry, are there any significant developments worth highlighting?
Yes, the Brazilian financial market has undergone a lot of improvement in recent years to foster innovation and competition. The Central Bank of Brazil, for instance, has played a key role in understanding this new scenario, talking to different players in the market (including new entrants) and promoting the benefits for the ecosystem and, ultimately, customers and society in general.
There has also been a very recent development in getting a Brazilian General Data Protection Regulation (GDPR) approved, which in certain ways will embrace some of the concepts of the recently approved EU GDPR.
If not a lawyer, what would you be?
Probably something related to business or marketing. But deep down, a DJ! I like music a lot; rock and especially electronic music. Music helps me at work to focus and concentrate, but also serves as a hobby to switch off from work and to keep a balanced work-personal life.
What did winning a Global Counsel Award mean to you?
It’s not easy to be a lawyer, especially working in-house. It’s even more challenging at a fintech company and in a highly regulated market such as the financial market. It was a great surprise and a great honour to be recognised by others as being in the right path and see how technology and innovation can positively impact the legal community.
The purpose of the Global Counsel Awards is to identify those in-house counsel, both teams and individuals that excel in their specific roles. The primary aim is to reward lawyers for demonstrable achievements across the full spectrum of in-house responsibility, not simply those who have acted on high-profile transactions.