TransferWise, the foreign exchange startup founded in 2011 by Estonian duo Kristo Käärmann and Taavet Hinrikus, is expanding.

In a cafe just outside the company’s new offices, near the top of the Tea Building in Shoreditch, London, I meet Hinrikus, fresh from climbing the Matterhorn in Switzerland. TransferWise had outgrown its digs, up the road near Old Street’s Silicon Roundabout, and needs room to expand.



But it wasn’t always clear that that expansion would happen in the UK. TransferWise was one of the loudest voices in Britain’s technology sector campaigning against leaving the EU, with Hinrikus telling the Guardian the month before the vote that “If the UK leaves the EU, we’ll have to consider whether it makes business sense to stay headquartered here. It’s a decision we don’t want to make but one that we’re having to consider.” While its headquarters are in London, the majority of TransferWise’s employees are based in Talinn, Estonia, and it has offices smattered around the rest of the world too.

Shortly after the vote, TransferWise again mulled relocation. Hinrikus said: “We will probably not grow the team based here much more. Headquartering elsewhere is a possibility, but we haven’t made a final decision yet.”

Does the new office represent a softening of his approach? Might Brexit not be so bad after all? “No,” he says.

“I still think the disaster scenario is real and possible.” He cites reports that venture capital funding has dried up for early-stage startups: “I think that is pretty horrible. At the best case, that means that the UK has one or two lost years for startups, because for one or two years during uncertainty, people couldn’t raise money.”

What about technology in general in the country? Should London-based tech reporters start making alternative plans? “Yes. If the hard Brexit happens, I would assume that London wouldn’t be the centre of the tech world in Europe.”

As a European citizen, Hinrikus is limited to opining from the sidelines. Despite a billion-dollar business headquartered in the nation’s capital, he didn’t get a vote in the referendum, and accepts that he has limited power over what follows. But he hopes that whatever happens will do two things: clear up uncertainty, fast, and keep Britain as close to Europe as is democratically possible.

When we spoke, he had just returned from a trip to Switzerland to scale the Matterhorn, and Theresa May was in the middle of her “brainstorming” session to determine “what Brexit means”. For Hinrikus, he had hopes that they’d come to a good conclusion, “with a clear plan of what’s achievable in a short timeframe. And keeping us as close to Europe as possible is my preference, but hey, the people of Britain – which doesn’t include me – have made their moat. Maybe they were frustrated and it’s not really what they wanted, but that doesn’t matter any more. The government needs to come up with a realistic plan which is deliverable in a short timeframe which Europe also will agree to.”

As for what that plan should be, it’s the same thing Hinrikus, and most of the rest of the technology community, have been pushing for since even before the referendum campaign kicked off: access to the single market and access to talent from all across Europe. For TransferWise in particular, there’s an additional red line in the form of financial passporting. The firm is regulated in the UK, but EU rules let it operate all across the continent. If that goes, it seems unlikely that the British headquarters will be able to stay much longer, relegating the UK to the same status as the Australian or Japanese subsidiaries.

Still, Hinrikus is confident that his own company won’t be negatively impacted too much by Brexit. “I’m not afraid that TransferWise won’t survive,” he says. The company is big enough, and diversified enough, that even a hard Brexit – one where Britain closed its borders, and kept services out – would leave it in a healthy position. But he adds that “if I think about the UK as a place, if UK the becomes not competitive for entrepreneurs, the next TransferWise will be built in Berlin, or Tel Aviv, or Stockholm, or in Talinn. Not London. We have more than 100 jobs in London; the next TransferWise will create a thousand jobs outside London.”

The company’s most recent results, released on Saturday, show it’s well on the way to its goal of kicking banks out of the international money transfer market entirely. Privately held with an estimated valuation of around $1bn (making it one of Britain’s 18 technology “unicorns”), TransferWise’s latest annual accounts show a doubling of monthly revenue and transactions year-on-year.

The company’s annual turnover for the 2016 financial year now stands at £28m, while its monthly revenue has continued to rise, standing at £5m. It holds a market share in its native Britain of 8%, and, Hinrikus tells me proudly, can now transfer money to 90% of the world’s bank accounts.

Even the one sour note doesn’t faze him. TransferWise’s losses have increased, from £11m in 2015 to £17m this year. As a proportion, that growth is significantly lower than the increase in revenues, and Hinrikus points out that the losses are because of heavy investment in expansion: the company recently launched in Australia, and will soon come to Japan and Singapore.

In Britain itself, the company is in a strong position, he says. “If you break out UK as a separate business, its economics are working really really well … So it really depends on the speed of our expansion. We’re very well capitalised, so it’s not the top of our concerns. Break-even on its own shouldn’t be the biggest goal.”

Brexit or not, TransferWise is focusing on growth internationally. Just like Facebook’s theoretical growth is capped by the size of the internet, so Transferwise is rapidly hitting the limit of the portion of the world with bank accounts: nine-tenths of the banked world can receive money from the company, although currency controls in countries like China and India mean that the number who can send cash is rather smaller.

And so to get much bigger, TransferWise now has to double down on the other aspect of growth: getting those who have access to its services to actually use them. That means taking on the banks. As for how that will go, Hinrikus is optimistic: “We can beat them on speed and cost. We’re seeing the very early stages of a financial revolution. We’re seeing that kind of exciting where this can lead us to. Yes, we have 8% market share in the UK, which is fantastic, but if we think about the world and fintech at large, it’s the beginning.

“And I think that’s the most exciting thing, right? If I look at the five years we’ve been in existence as ‘this was the warm-up phase’, it’s about how long will it take for fintech as a whole to have a 10% share of the finance system.”