July 25, 2021

Brexit has not reduced London’s dominance over European start-ups

Ten years after the launch of his start-up, Kristo Käärmann continues to wear a simple T-shirt, the mandatory uniform of the tech world, but he is now a billionaire. The Estonian founder of Wise, a British international money transfer company, announced on Thursday (June 17th) the initial public offering of his company.

At the last fundraising, in spring 2020, it was valued at 5 billion dollars (4.2 billion euros). Today, the British press speculates on a valuation of 9 billion pounds sterling (10.5 billion euros). For him, the British capital has always been the natural place for this type of “fintech”. “London is a great place to go public or raise funds. Our investors are international, they know London and its rules, are comfortable here… ”

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In 2011, Mr Käärmann, an Estonian living in London, wanted to send money to his country, but was annoyed at the slow transfer times and the exorbitant price of commissions. He co-founded Wise. Today, the company employs 2,400 people, of which nearly 400 are in London, and transferred £ 54 billion for 6 million customers in 2020. Its turnover reaches £ 421 million, with a net profit of 30.9 million pounds.

New record amounts raised every year

Brexit? At most, this raised concern, just after the referendum of June 2016. “This raised two questions: one on regulation, the other on access to the handof work “, explains Mr. Käärmann. For regulation, Wise had to apply for a license in Belgium to be present within the European Union. “But we ask for three or four licenses a year around the world, and we know how to do it. “ A few dozen hires were made in Belgium, but, at the scale of Wise’s growth, it was a detail. As for the European employees present in London, they did not flee en masse.

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Mr. Käärmann’s story is no exception. In 2020, the United Kingdom largely remained the leading country in Europe in terms of fundraising in the new technologies sector. According to the KPMG firm, $ 16.4 billion of venture capital has been invested in the country, against $ 7.2 billion in Germany, $ 6.9 billion in France and $ 5.9 billion for the Nordic countries as a whole. . Year after year, new record amounts have been raised. The official exit from the single European market on 1is January did not change anything: the first quarter was yet another record, with $ 7.1 billion in venture capital. “Brexit hardly seems to have had an impact on investor appetite”, says Bina Mehta of KPMG.

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