Silicon Valley venture capital fund Andreessen Horowitz led a high-profile $US58 million (£38 million) funding round into London-based international money transfer platform TransferWise at the start of the year.
But the fund originally wanted to invest in TransferWise back in 2013 during the company’s Series A funding round.
TransferWise co-founder and CEO Taavet Hinrikus told Business Insider: “We met them, it was pretty much a last-minute thing. At the time, it was widely believed that Andreessen Horowitz does not invest in companies outside of Silicon Valley, so we weren’t really targeting them.”
Andreessen Horowitz has invested in high-profile Silicon Valley success stories such as Twitter, Facebook, Skype, Airbnb, and Oculus Virtual Reality (it was also an investor in Business Insider).
Hinrikus says: “They loved what we were doing. They know a thing or two about the sector. But they were pretty clear, they said ‘Hey guys, we’d love to write you a $US10 million cheque but there’s one little if — only if you move to California’.”
“That didn’t interest us because we were getting this thing going in the UK.”
TransferWise ended up raising $US6 million in a round led by Valar Ventures, the venture capital fund set up by PayPal co-founder Peter Thiel.
Hinrikus says “When we went back two years later, it was very quick. They [Andreessen Horowitz] knew us. When we told them what we’d done they were very quick to come to an agreement.” TransferWise was reportedly valued at around $US1 billion in the funding round led by Andreessen Horowitz in January.
The four-year-old startup lets people send money internationally online and uses a peer-to-peer marketplace to cut down on fees. Customers sending money one way are matched with consumers sending cash in the other direction.
Each customer then gets cash paid out of a pot in their native country, saving the actual transfer and hence cutting out fees. TransferWise then moves its money around in bulk to save money.
TransferWise announced in June that it is now transferring £500 million ($US762 million) a month and has transferred over £3 billion ($US4.5 billion) since launch.
Disclosure: Marc Andreessen, co-founder of Andreessen Horowitz, is an investor in Business Insider.