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MADRID, SPAIN – The CEO and cofounder of TransferWise says cities around the world are becoming increasingly competitive in attempts to attract tech companies.
Speaking on the first day of the MoneyConf conference, Taavet Hinrikus said on Tuesday: “The competition is about cities. We really should be talking about the top 50 cities worldwide. These are the cities competing for talent, for business. The world, in that sense, has become way more competitive than it’s ever been.”
TransferWise, which lets people send money internationally online, is headquartered in London but Hinrikus said at an event in April that last year’s Brexit vote means he would not choose the UK capital as a base if he were starting today. Hinrikus repeated that view on Tuesday and said Brexit was partly behind the spur in competition among cities.
He said: “We’ve opened TransferWise in Australia, US, Japan, Singapore, in the last few years and what we’ve seen is there is a huge fight for the fintech capital of the world. Every city – from Sydney to Singapore – tries to be the fintech capital of the world.”
Luxembourg earlier this year set up a public-private partnership called the “House of Fintech,” aimed at attracting more companies to set up in the country. Lobbyists from Paris have made multiple trips to the UK in recent months in a bid to tempt financial services, including fintech, to set up in the French capital in the wake of Brexit. The Monetary Authority of Singapore has also copied the UK regulator in setting up a regulatory “sandbox,” which allows innovative companies to experiment with new products in a safe environment.
These are just some examples of how regulators and city officials around the world are trying to tempt tech talent to their cities.
Hinrikus said that London is still the number one city for fintech globally and “probably will be for a bit more.” But he warned: “I do think that other places are catching up.”
He said: “They’re looking at what the UK regulator has done, they’re copying these moves. Inevitably, for every follower, the job is much easier. If you think about this going forward, the UK has to keep on innovating or other people will catch up, they will pass.
“If you think about France, I think Paris will become a much more exciting place. Yes, it’s going to take time for them to figure this thing out, but we will be seeing much more competition. There will be many more tech hubs.”
TransferWise, which was reportedly valued at $1.1 billion last year, announced last month that it is on track to make £100 million in revenues this year and turn a profit for the first time. The company has raised over $110 million in funding to date and currently transfers over £1 billion across its platform each month.