TransferWise co-founders Taavet Hinrikus and Kristo Kaarmann.
TransferWise, the money transfer business that Western Union acquires, is worth $ 3.5 billion after a new investment round, making it Europe's most valuable financial technology start-up.
By lowering fees and adding a clever online platform that allows consumers to exchange money worldwide and track their transfers, the London-based company is pursuing a modern approach to a business dominated by giants such as Western Union and MoneyGram ,
The company is pushing for more transparency regarding the fees banks and money exchange services charge their customers for transferring money abroad.
"Eight years ago, we had a dream, and in a sense, the whole world was against us," said TransferWise co-founder and chairperson Taavet Hinrikus in an interview. "And we have managed to build the business step by step and also to change the environment around us so that it is much more consumer-friendly."
TransferWise adds no fresh cash to the investment, but donates employees, and early investors have the opportunity to sell some of their $ 292 million secondary interest in a secondary business.
European private equity group Vitruvian Partners and US investment firms Lone Pine Capital and Lead Edge Capital bought shares from existing investors, while early investors Andreessen Horowitz and Baillie Gifford increased their holdings in the company. Funds managed by BlackRock also contributed to the round.
"We have been a profitable company for two years, we have a significant amount of cash on our balance sheet," said Hinrikus. "The company does not need cash."
TransferWise reported a net profit of £ 6.2 million ($ 7.9 million) for the fiscal year ended in March 2018, while annual sales nearly doubled to £ 117 million. The company claims to have 10,000 new business customers per month and now has 5 million customers handling 4 billion GBP monthly transactions.
With the recent fundraising campaign, TransferWise is the most valuable fintech start-up in Europe and currently outperforms it. The British digital lender OakNorth, which last had a value of 2.8 billion US dollars.
Hinrikus said the company was in no hurry to go public.
"Although we believe that eventually we will become a public company, it does not help us what we want to do in the next few years," he said.
Currently the company is focusing on growth. TransferWise currently has more than 1,600 employees worldwide and will hire 750 more in the next 12 months, said Hinrikus.
WATCH: How TransferWise Integrates Its Product Into Bank Apps