TransferWise, which is a London based international money transfer service, has recently disclosed that they received $292 million in its second round of funding which means that the total valuation of the company has reached the $3.5 billion mark. This figure is more than double the valuation which TransferWise achieved in the latter part 2017 when the company received $280 million in its Series E round of funding.
The secondary round of funding received by TransferWise was led by venture capital firms Lone Pine Capital, Lead Edge Capital, and Vitruvian Partners.
Initial backers Andreessen Horowitz and Baillie Gifford also expanded their investments in TransferWise, while fresh investment also came from funds that are managed by BlackRock.
Taavet Hinrikus, who is the chairman and co-founder of TransferWise stated that their latest round of funding was oversubscribed. The arbitrary figure of $292 million was simply achieved by the presence of liquidity that existing shareholders were willing to make available for the company, and this figure is nowhere near the upper level of interest behind the company.
Taavet also stated that existing institutional investors are not exiting during this round of funding as both Andreessen Horowitz and Baillie Gifford are actually doubling down their investments.
All of these revelations suggest that potential for TransferWise to go public anytime soon can be ruled out, something that the chairman of the company does not refute. The company is not suffering from any liquidity issues as it continues to grow fast and break into new markets, so the co-founder doesn’t see the point of going public as of now.
Taavet Hinrikus also states that the regulatory climate is now changing in favor of TransferWise. In 2018, the EU voted to mandate a resolution that outlaws the exchange rate mark-ups on international payments through various Cross-Border Payments Regulations, a ruling that the London based company has been lobbying for many years now. Even Australia is also considering similar regulatory measures which follow an inquiry into the issue by the Australian Competition and Consumer Commission.
TransferWise says that it now serves 5 million customers worldwide, and the company processes £4 billion every month. Every year the company estimates that it saves customers around £1 billion in extra bank fees. The service is currently supporting 1,600 currency routes, and it is available in 49 currencies worldwide.
TransferWise employs more than 1,600 people across 12 global offices and the company has plans to hire 750 more people with the next 1 year. Audited financials for fiscal year ending March 2018 revealed that TransferWise witnessed a 77% revenue growth to £117 million and a net profit of £6.2 million after tax was deducted.