Finance

Wise co-founder cashes in £81.5m stake to fund new tech bets

Wise executive chairman Taavet Hinrikus has sold off a hefty £81.5m chunk of his personal stake in the fintech company in order to finance his growing pool of startup investments.

Hinrikus, a co-founder of the London-listed money transfer business formerly known as TransferWise, completed a sale of around 10 million Class A shares at a value of 815p per share, the firm said on 22 October.

The deal, which priced shares roughly 4% below their previous closing price, valued the sold stake at £81.5m. Wise shares fell around 5% in early trading on 22 October as the size of the sale emerged.

Acting via his private investment business OÜ Notorious, Hinrikus also plans to take out a loan with Goldman Sachs in which around 40 million shares will be pledged as security. At the same discount, the value of that security would be worth £326m.

READ Fintech frenzy to stall as talent war and Europe’s IPO slowdown hurts startups

Wise said it understands the Estonian entrepreneur intends to use the proceeds from the sale and the loan to invest in European technology startups.

Hinrikus is a prominent angel investor in the City and Europe, having backed over 100 companies including Robinhood competitor Lightyear, AI firm Onfido and payments firm Primer.

An early Skype employee, Wise said Hinrikus retains a stake of around 90 million Class A shares in the business, worth approximately £733.5m. OÜ Notorious also holds 54m Class B shares in Wise, which offer superior voting rights in the company.

An earlier 21 October announcement by Wise indicated that Hinrikus could sell a further million shares in the business, taking the total transaction up to 11 million shares. However, a spokesperson told Financial News that the entrepreneur is now unlikely to sell more than the 10 million shares already offloaded.

READ Behind the deal: How Wise’s listing took UK markets by storm

Wise’s debut on the London Stock Exchange earlier this year was one of the few tech success stories on public markets in 2021, reaching a market capitalisation of £8bn on its first day of trading.

It has not fared as well since then, having fallen back to around the same price as its debut this month after hitting an all-time high of 1,176p per share in late September.

The sale comes as Wise said on 20 October its revenue had risen by 25% to £132.8m in the second quarter, boosted by a 36% surge in money transfer volumes.

Almost four million people used Wise to send £18bn in the three months to the end of September, up from £13.2bn a year earlier.

To contact the author of this story with feedback or news, email Emily Nicolle

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