Investment opportunity
April, 2019
Investment opportunity Wirex
Fintech industry: rise of the unicorns
Private equity financing of young Fintech companies
Post-money valuation of Fintech
companies ($ Millions)
N26 Fintech companies provide banking services to people
Revolut who value convenience and technological innovation
Monzo UK has been a leader by quantity of successful Fintech
Atom startups
Starling None of the companies are profitable, yet they
Wirex (estimate) attracted millions of investments within past 2 years
Monese
Tandem
Curve
0 500 1 000 1 500 2 000 2 500 3 000
Source: Corporate websites, industry press, Crunchbase, Intellace Research
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Investment opportunity Wirex
Fintech profile: who is who
Of all the peers provided in the table, only Wirex and Revolut have exposure to cryptocurrencies
Company type Key Products Regions
Accounts
N26 Bank 24 European markets
Payments
Payments
Revolut EMI, Bank Accounts 32 European markets
Cryptocurrencies
Accounts
Deposits
Monzo Bank The UK
Loans
Payments
Deposits
Atom Bank The UK
Loans
Accounts
Deposits/loans
Starling Bank The UK, Ireland
Payments
Other (marketplace)
Accounts
Wirex EMI Payments 130+ markets
Crypto exchange
Accounts
Monese EMD Agent 33 European markets
Payments
Deposits
Tandem Bank Loans The UK
Payments
Payments
Curve AR* 27 European markets
Loyalty
Source: Corporate websites, industry press, Crunchbase, Intellace Research 3
Investment opportunity Wirex
Comparing peers’ customer bases
Operating performance metrics
Company Number of Deposit / Customer, $
Wirex customer base is in line with its peers, and
Customers (MM)
the deposit/customer ratio is in line with the
Revolut 4.0 3.5
industry median
N26 2.3 434.8
Monzo 2.0 35.6
Wirex* 1.8 48.4
Monese 0.8 2.4
Starling 0.3 68.0
Atom bank has the highest deposit/customer Tandem 0.3 1 528.3
ratio as it targets businesses, while the rest of the Curve 0.3 N/A
Atom 0.1 18 340
table relies of retail customers
Median 0.8 48.4
Average 1.3 303.0
* The number of customers for Wirex represents total customer amount as of 25th January 2019
according to Blockonomi. The The Deposit/Customer ratio was calculated by adjusting down the
number of customers to reflect only the deposit holders based on industry standards and our
own assessments.
Source: Corporate websites, industry press, Crunchbase, Intellace Research, Proprietary Data,
Forklog
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Investment opportunity Wirex
Wirex facts
The company attracts many cryptocurrency enthusiasts, as it is the only one from our list who links a Visa
debit card to users’ crypto wallets, allowing them to seamlessly convert their digital assets into fiat and spend
them wherever Visa is accepted. It also permits receiving and sending crypto-assets from and to external
blockchain addresses.
In May 2018, Wirex became the first and is still the only EEA card provider to be approved by VISA for
crypto, despite an industry-wide suspension of crypto-enabled VISA cards!
The only mobile bank combining digital wallets (8 cryptocurrencies) with multi-currency bank accounts
(20 fiat currencies) supporting multiple in/out funds options (crypto, ACH, SEPA, SWIFT, debit/credit cards)
Wirex has 1.8MM+ registered users (source: blockonomi)
$2.0bn transaction volume processed to date (source: blockonomi)
UK EMI License received, Canada MSB registration granted. Applications submitted in Singapore, Japan
and USA
Wirex did not attract external funding since March 2017 ($ 3.2 Million from SBI Group, Japan) (source:
CrunchBase)
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Investment opportunity Wirex
A good investment opportunity: Wirex
vs Revolut
Both companies have similar businesses:
They have same target audience – retail customers and cryptocurrency investors
they offer online banking like prepaid cards, current accounts, business accounts, wire transfers, currency exchange
and cryptocurrency exposure
The difference comes in cryptocurrencies… :
Revolut offers limited exchange services for 5 cryptocurrencies. Customers can buy, sell and exchange them in the
Revolut’s application, but cannot send them out to the external cryptocurrency wallets.
Wirex has no limitations on sending, receiving and transacting cryptocurrencies that are listed on its platform
… And funding policies: Revolut has been actively expanding though external financing, while Wirex has
been using own equity to fund its expansion and operations since March 2017.
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Investment opportunity Wirex
Wirex relative value analysis
Wirex offers a funding round to investors based on a very modest €75MM valuation, which is at a considerable
discount to its RV assessment of $125MM-$195MM
PRIVATE COMPANIES:
In $ Million Valuation P/CD* P/S 1 We took two price multiples to assess the relative value of Wirex:
Revolut $ 1 700 121 101 P/S – is the ratio of the company’s price (valuation) to its historic earnings – Sales
Monzo $ 1 270 14 538
P/CD – is the ratio of the company’s price to its customer deposits in monetary
Monese $ 120 63 55 terms, which is a source of future earnings
PUBLIC COMPANIES:
In $ Million MarketCap P/CD* P/S 2 We excluded several peers from the RV for following reasons:
Square $ 31 600 39 10 Atom bank has a different business model – it provides services to businesses and
corporates, hence its multiples are considerably different
Wirecard $ 13 345 13 7
Starling bank, Tandem and Curve do not provide enough data to build RV multiples
StoneCo $ 12 030 2 8 for them
P/CD P/S
Median: 26 33 3 We included public companies multiples to increase the assessment base and smooth
the multiple distortions of private companies
Average: 42 120
*CD- is customer deposits in monetary terms. Sources: companies’ annual reports, craft.co, CrunchBase, ycharts.com
WIREX valuation estimate based on
industry’s median
Valuation (P/S) Valuation (CD)
2018 Wirex Estimate $ 123 500 000 194 826 882
Sources: Wirex, craft.co, proprietary research
Note: the Estimate is derived by us separately from Wirex or any other company.
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