Today’s interview is with Taavet Hinrikus, Co-founder/CEO of TransferWise, an Estonian developed and UK-based peer-to-peer money transfer service. Before cofounding TransferWise, Taavet was the Head of Strategy for Skype, starting as their first employee.


Great to have you. Could you please introduce yourself?

I’m Taavet Hinrikus, CEO of international money transfer company TransferWise. My friend Kristo and I set the business up four years ago. Before that, I was Head of Strategy for Skype; I started as their first ever employee in 2003.


When did you conceive the idea of starting TransferWise? Was there any specific incident which ignited the desire in you to launch TransferWise?

Yes it started when Kristo and I were living as expats in London and realised how much money it cost to transfer money between the UK and our native Estonia. I was based in London but was paid in euros by Skype; Kristo worked in London but paying a mortgage in Estonia in euros. Not only was it a painful and long process to make the transfer, we also realised that every month our banks were charging us fees they hadn’t told us about.


We each needed what the other had, so we worked out a fair way to exchange the money between ourselves – without the mark-up rate and fees charged by the bank. Each month,  I put euros into Kristo’s account in Estonia and he put pounds into my account in the UK. We saved thousands of pounds by swapping the money between us and realised there must be millions of people across the world who could do the same. That’s when we decided to set up TransferWise. Four years in, we’re now transferring £500m of customer money every month, meaning we’re saving our users £22m every month in hidden fees compared to a bank.


How has TransferWise been able to disrupt the international money transfer market?

Between 5 and 10 trillion dollars is moved around the world every year, the majority of which is done by banks. Unfortunately for consumers, banks and brokers rarely state all their fees upfront. Even when advertised as free, there is usually a fee hidden within the exchange rate. What the customer receives is usually around 3 – 5 per cent more expensive than the real exchange rate – known as the mid-market rate. At TransferWise, we’re completely transparent about the fee we charge and the exchange rate you’re getting, and we make it as low cost as possible. We’re able to do that using peer-to-peer technology. So for example, in the UK, using TransferWise is up to 8x cheaper and 5x faster than banks.


We’d like to clean-up the market even more by making it illegal for banks to hide their overseas money transfer fees in the exchange rate they give to the customer. Our Stop Hidden Fees petition is campaigning the UK government to take a stand and make this change for the good of the customer.





Wow! That’s good news. Could you tell us how your experience at Skype influenced what you’ve become today?

Around the time I joined Skype I was studying for my degree in computer science in Estonia. My friends Niklas and Janus told me they were building this cool new telecoms startup called ‘Skype’ and asked me to join. It seemed like a pretty exciting project to be a part of, so I dropped out of university and joined as Skype’s first ever employee. I was with Skype for eight years as the Head of Strategy.


My time at Skype taught me to think big. Today Skype controls 40% of all international calls, that’s the level of disruption we’re aiming for with financial technology.


What are the challenges of running an international brand like TransferWise?

A major challenge is sustaining the culture of the company as we scale. In four years, we’ve grown to be a team of around 400 people in five locations.


Our on-boarding process is hugely important to how we grow the team and culture successfully. In order to maintain culture, it’s essential that new joiners understand our values, meet the entire team and learn about all areas of the business. At on-boarding, new joiners take customer calls – and it’s something that we encourage everyone to do regularly. The customer is central to everything we do and everyone understands that from product to marketing.



Taavet and Kristo


Tell us about January’s $58 million investment led by Andreessen Horowitz, the California-based $4 billion venture capital firm.

We use our investment to help with our global expansion. Our focus continues to be launching new currency routes to help more customers, in fact today our platform offers over 400 of them. One of the most exciting currencies we opened this year is Nigerian Naira.


If you could give prospective entrepreneurs 3 pieces of advice, what would those be?

The first bit of advice I’d give is when thinking about building a business, think of a very big market. Having a big vision will help you build a truly global product.

Secondly, you have to have a product or service that consumers really want. Once you have that right, it’s vital to stay focused on the customer and to evolve with their needs and values.

Finally, it’s essential to hire the smartest people you can find – they are your business. Once you have them, make sure you look after them.


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