London-based TransferWise has followed up on the $1.3 million it raised in April 2012 by adding $6 million of development capital.
Taavet Hinrikus, who was employee number one at internet communications company Skype, co-founded TransferWise in 2011 to make money transfers in British Pounds and Euros. It now has 33 members of staff and handles Euro, Pound, US Dollar, Polish Zloty and Danish, Swedish and Norwegian Krone transactions.
New backer Valar Ventures was set up by Peter Thiel, who co-founded PayPal and was the first outside investor in Facebook.
Thiel comments, ‘Innovation in the banking industry typically involves rent-seeking or unsound derivatives, which offer marginal benefits to consumers.
‘TransferWise demonstrates true innovation in banking by enabling its users to retain their wealth across borders.’
Thiel is part of a group of entrepreneurs, including Max Levchin, called the ‘PayPal Mafia‘ who set up PayPal in the 1990s and then went on to found a number of other technology companies and begin their own investment activities. Thiel’s $500,000 early investment in Facebook was reported to have netted him a $1 billion exit when the social network went public.
As well as securing backing from Valar Ventures and Theil, TranferWise has also secured return investment from SV Angel. The Tech City technology firm now has an investor pool which includes Levchin, IA Ventures, Index Ventures, TAG (Robin Klein and Saul Klein), Seedcamp, Betfair’s former CEO David Yu and the owner of Monde, Xavier Neil.
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Hinrikus adds, ‘We’re delighted to have Peter Thiel as an investor. He really understands how to bring innovation into the banking sector – which is exactly what we’re doing at TransferWise.
‘His investment will help accelerate our expansion plans. This year we’re aiming to add a dozen new currencies and launch the site in new markets including Germany, Spain, France and Italy.
Joanna Shields, Tech City CEO and UK business ambassador for digital industries, says, ‘TransferWise is a shining example of the successful businesses that make Tech City a thriving ecosystem.
‘London has a real strength in financial services and technology, with many companies like TransferWise transforming financial services for consumers, for the better.’
