Exchanging one currency for another can be expensive. Banks and currency-exchange kiosks can charge anywhere from 5% to 10% of the total amount you’re looking to send. Money transfer company TransferWise set out to change that. It charges that day’s bank exchange rate, which is the best possible exchange rate at the time of a given transfer. It also tells you exactly how much you’ll pay in fees on every single transfer, which can be as low as 1% of the total, depending on the currency.
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Today more than 4 million customers send over $4 billion each month on the platform, according to the company. It has more than 1,400 employees worldwide. In January the London-based company said it was opening an office in Belgium to avoid any potential impact on its business from Brexit.
TransferWise co-founders Taavet Hinrikus, the first employee at Skype, and Kristo Käärmann, a former management consultant with PriceWaterhouseCoopers, came up with the idea for TransferWise when they tired of the fees they were paying big banks to transfer money between their jobs in Estonia and London.
They were on to something. TransferWise has been growing steadily and became profitable in 2017, even as it seeks to raise another $300 million in a round that would value the company at $4 billion. Its last fundraising round came in 2017, when investors including Old Mutual Global Investors and Silicon Valley venture capital firm IVP contributed $280 million, giving TransferWise a valuation at the time of more than $1.6 billion.