Four years ago, our team flew to Tallinn, Estonia to visit Wise (then called TransferWise), an international payments company with a mission to provide a fast, affordable, and transparent way to send money abroad. We spent the entire day with the executive team and came away especially impressed with the founders Kristo Käärmann and Taavet Hinrikus. They had a clear mission to build money without borders – disrupting the existing banking system by creating new infrastructure to power the movement of money around the globe. The entire team in Estonia was passionate, hard-working, customer-centric and dedicated to the company’s mission.
As we sat down for dinner on our first night with the team, the server brought out a loaf of dark brown bread. It was incredible! It tasted like nothing we had ever eaten. It was a bit like rye bread, but darker, denser with an earthy and slightly sour flavor – accentuated with the perfect amount of butter. Amazed, we turned to Kristo and Taavet and said, “This is fantastic! What do you call it?” Expecting a long, exotic description, Kristo instead turned to us and deadpanned, “We call it…bread.”
And that’s when we learned that in Estonia, some things are just better. The normal bread (called leib in Estonian) that you get at any restaurant, is the most delicious bread that you will ever eat. The attention-to-detail, innovation, and love combine to form a product with amazing results. Similarly, Wise has built a way to send money around the world that far surpasses the competition. Yes, it is “bread” (it sends and converts money from one currency to another), but it’s so much more. Because Wise reimagined and built its own infrastructure over 10 years ago, its prices are on average up to eight times cheaper than leading UK banks. It’s also faster, delivering 38% of transfers instantly and 83% in less than one day. And best of all, Wise is transparent – showing the fees it charges, while competitive banks often hide the true costs of moving money by giving poor exchange rates to consumers and businesses.
With a superior product, Wise has scaled rapidly, growing volumes from about £10bn four years ago to over £54bn in its last fiscal year. The company has expanded from its core Wise Transfer product by launching Wise Account, a way to add, hold, and receive money in different currencies with current deposits of over £3.7 billion, Wise Business, now serving over 300,000 companies, and Wise Platform, a service for banks and financial institutions to run on Wise infrastructure. Kristo and Taavet have also hired a talented team of executives to support their mission including phenomenal leaders like Matt Briers, Nilan Peiris, Harsh Sinha, Ben Steyn, Andrei Dubonossov, Dean Nash, Cian Weeresinghe, Rahel Tänavsuu, and Diana Avila.
Wise also hasn’t stopped innovating. Today, Wise becomes the first company to go public through a direct listing on the London Stock Exchange. In contrast to a traditional IPO, the direct listing is fairer, cheaper, and more transparent (just like Wise!). We couldn’t be prouder of Kristo, Taavet, and the entire Wise team who allowed us to join them on this incredible journey that is still just getting started.
Aitäh (thank you!)
The IVP Team
PS – Here’s a link to our original investment blog post in 2017, Nothing to Hide. We made our second Estonian investment in Veriff earlier this year.
PPS – If you have 32 hours, here’s how you can bake Estonian bread.
Special thank you to IVP team members who worked with Wise over the years, including Jules Maltz, Michael Miao, Roseanne Wincek, Army Tunjaicon, Sandy Miller, Eric Liaw, and Gina Bauman (who was born in Estonia!).