TransferWise, the peer-to-peer international money transfer business, has secured a $6 million investment round led by Valar Ventures, the venture fund founded by Facebook's first outside investor and co-founder of PayPal, Peter Thiel.
This marks his first Valar Ventures investment in Europe.
TransferWise, based in London's Tech City, has seen spectacular growth in the two years since it launched. The company has transferred over £125m worth of customer money - and over half of that has been in the last six months.
The business started in early 2011 with the two founders, making transfers between just British Pound and Euro. It has since added a further 33 members of staff, and transfers between Euro, British Pound, US Dollar, Polish Zloty, Danish, Swedish and Norwegian Krone. The firm continues to grow between 20-30 percent a month.
Peter Thiel said: "Innovation in the banking industry typically involves rent-seeking or unsound derivatives, which offer marginal benefits to consumers. TransferWise demonstrates true innovation in banking by enabling its users to retain their wealth across borders."
Taavet Hinrikus, co-founder of TransferWise, said: "We're delighted to have Peter Thiel as an investor. He really understands how to bring innovation into the banking sector - which is exactly what we're doing at TransferWise. His investment will help accelerate our expansion plans. This year we're aiming to add a dozen new currencies and launch the site in new markets including Germany, Spain, France, and Italy."
Trade and Investment Minister Lord Green said: "It is great news that Peter Thiel, co-founder of PayPal, is injecting $6 million in London's TransferWise. Peter Thiel's decision to bring Valar Ventures' first investment in Europe to Tech City, demonstrates that London is the ideal location for technology firms looking to expand into Europe."
Joanna Shields, CEO Tech City and UK Business Ambassador for Digital Industries, said: "Transferwise is a shining example of the successful businesses that make Tech City a thriving ecosystem. London has a real strength in financial services and technology, with many companies llike Transferwise transforming financial services for consumers, for the better."
Thiel's Valar Ventures leads TransferWise's 'Round A' funding. Existing investors and SV Angel also participated. They join fellow PayPal founder, Max Levchin, IA Ventures, Index Ventures, TAG (Robin Klein and Saul Klein), Seedcamp, Betfair's former CEO David Yu, and the owner of Le Monde Xavier Niel (via Kima Ventures). This brings the total TransferWise has raised to $7.35 million in the two years since its launch.