Wising up to UK fintech’s success

UK fintechs are coming of age, with Wise today announcing it will go public in London and Nutmeg being snapped up by JPMorgan Chase.

The IPO journey for Wise has taken 10 years. Previously known as TransferWise, it began in 2011 by offering cheap cross-border consumer money transfers. Co-founders Kristo Kaarmann and Taavet Hinrikus developed the business as a way to reduce the amount of money they were spending sending money between London and their native Estonia. They are now the Baltic country’s two wealthiest men.

The company changed its name to Wise in February as it broadened its product offering to include banking services such as multicurrency current accounts. It plans a direct listing to avoid “speculation and let the market set the price on the first day,” according to CFO Matt Briers.

Lex says Wise appeals more than food delivery service Deliveroo, whose shares trade 34 per cent below its mispriced April float. Wise makes profits thanks to low overheads on every new customer using its app to move money.

Meanwhile, our banking team reports JPMorgan Chase has agreed to buy UK digital wealth management platform Nutmeg in a deal that will net the US lender billions of pounds in assets in Britain as it prepares to enter the country’s retail banking market. Nutmeg has expanded rapidly since its launch in 2012 to manage £3.5bn in assets for about 140,000 customers. Two people familiar with the matter said the transaction valued Nutmeg at about £700m.

Back at the first-round level, Volt, which started out in 2019 and enables direct debit instant payments, today completed the largest Series A on record for the Open Banking industry, with $23.5m raised from VCs led by EQT Ventures.

The Internet of (Five) Things

1. ByteDance revenues doubled in 2020
ByteDance increased its revenues 111 per cent last year to $34bn and had 1.9bn monthly users across its apps at the end of the year. The owner of the short-video apps TikTok and Douyin recorded a lockdown surge in users to record an annual gross profit of $19bn.

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2. Not OnlyFans, but also investors
OnlyFans, the online platform where sex workers, influencers and celebrities sell subscription content, is exploring a share sale to new investors. Documents filed with Companies House this week showed that Fenix International, OnlyFans’ UK-based parent company, had increased its share count from 100 to 1m.

3. Nadella and Khan take chairing roles
Microsoft chief executive Satya Nadella has been named chair of the software company, ending two decades of separation between the positions, reports Richard Waters. The appointment made Nadella only the second person to hold both chief executive and chair titles in the company’s 46-year history, after Bill Gates. Richard also comments on the task facing a new chair for the Federal Trade Commission — 32-years-old Big Tech critic Lina Khan.

4. Velodyne vendetta
From new chairs to battling chairs. David Hall and Brad Culkin are inventors, longtime colleagues and brothers-in-law. But after a Spac deal and a boardroom bust-up at their company, Velodyne Lidar, they are now, in the words of Hall, locked in a “fight to the death”, reports Miles Kruppa. Hall, who founded the 3D sensor business, was ousted as chair earlier this year but remains the largest shareholder and is now determined to strike back against Culkin, who took over as chair, and anyone else on the board who helped remove him.

5. AT&T rings changes again
The unexpected, costly and humiliating U-turn on its media push is the fourth time that AT&T has “reinvented” itself in as many decades and returns the company’s strategy to its roots — plain old-fashioned telecoms services. But, as today’s Big Read explains, the problem it now faces is that it has fallen far behind its rivals in 5G.

Tech tools — Google Workspace for Everyone

Google introduced Workspace for Everyone this week, giving anyone with a Google account access to the same experience as education and enterprise customers. You may have noticed changes to Gmail’s interface as a result. I was a little confused to see Rooms appear in my sidebar, below Chat, and Google says these chat rooms are also going to be renamed Spaces. A new subscription offer, Google Workspace Individual, is aimed at small business owners and provides “smart booking services, professional video meetings and personalised email marketing”. The Verge says all the changes could have been communicated better.