TransferWise becomes Europe’s most valuable fintech

THE TEA BUILDING, in London’s hip Shoreditch district, used to hold factories making biscuits and bacon. Now it is home to tech startups and media firms. Yet their ideas require space, too. In the outsized lifts, still operated by push buttons as big as traffic lights, a pair of movers have just finished a job. TransferWise, which rents Floor 6, is taking over another level, barely three years after moving in.

On May 22nd the cross-border payments firm, which was founded in 2011, said it had collected $292m in fresh capital. The fundraising round, led by Lead Edge Capital, Lone Pine Capital and Vitruvian Partners, venture-capital firms known for backing tech stars such as Uber, Snap and Spotify, valued it at $3.5bn—a doubling in 18 months. Now Europe’s most valuable private fintech firm, it plans to add 750 staff in the next 12 months to its existing 1,600.

TransferWise allows users to send money along 1,600 currency routes at 15% or less of the fee banks typically charge. Unburdened by old IT systems and focused on moving money, it has automated many of the steps required. It also aggregates transfers and nets them out against payments going the other way, which means it need borrow less currency offshore to meet customers’ requests. And it seeks to build direct relationships with multiple banks, even as those lenders...

via The Economist: Finance and economics Business Feeds

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