Fintech company Wise broke a record last week when it debuted on the London Stock Exchange (LSE) by reaching a valuation of £8.75 billion.
This direct listing was expected for a long time but the outcome was quite unsure. Mostly because of the disastrous post-IPO trading of Deliveroo and Alphawave.
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However, Wise (formerly known as TransferWise), managed to exceed all expectations.
This made the Estonian co-founders Kristo Kaarmann and Taavet Hinrikus paper fortunes worth over £1bn each.
“Wise’s successful direct listing is a great outcome for the London market,” said Tom Johnson, Barclays Plc’s head of equity capital markets for Europe, the Middle East and Africa. “We need to see innovation of this kind to put London on the front foot.”
The stock opened at £8 a share last Wednesday morning. The stock grew by as much as 10% to £8.88 by the time the market closed.
“London has the potential to be a global fintech center, and someone like Wise listing on the stock markets gives other companies options,” Rosh Wijayarathna, a managing director in the corporate banking division at Silicon Valley Bank, said.
“Wise was created to solve the problem of the billions unknowingly spent in hidden fees every year on currency exchange. Those are the billions we care most about, even today,” said CEO Kaarmann as part of a speech to employees.
“Our listing is incredibly exciting, and lots of hard work from many people has made it a reality. But, it’s important to remember that we’re still very early on in our journey,” said Kaarmann.
“Moving money into another currency is still a maze of hidden exchange rate mark-ups, high fees, delays, and small print for many people. We’re currently saving customers around £1bn a year in these hidden fees. The £149bn that’s still to go remains our focus,” he added.