Opinion: Transferwise leaving Estonia would be huge loss ({{commentsTotal}})

Tarmo Jüristo.
Tarmo Jüristo. Source: Anna Aurelia Minev/ERR

It would be a very serious loss if Transferwise left Estonia, but it would an even bigger loss if our current actions and lack thereof ended up being the reason why the next startups, the next potential Transferwises, went unestablished here, said Praxis think tank board chairman Tarmo Jüristo in a comment on Vikerraadio.

Last week, it was announced that Transferwise, established by Estonians Taavet Hinrikus and Kristo Käärmann in 2011, had officially become Europe's most valuable financial technology (or fintech) company.

In the latest investment round, a bunch of early investors — including employees — sold their stocks to new investors for a total of 292 million USD (over €260 million). This means that in barely eight years, Transferwise's value has sprung from zero to €3.5 billion.

In order to put that number into a comprehensible context: that is about four times Finnish national airline Finnair's current market value; it is a sum equal to nearly one third of Estonia's state budget. Or in other words, it is the amount of money that the Estonian state will spend on funding research and development activity at current levels for the next 20 years.

Among other things, Transferwise's latest transaction led to 33 of its employees to have owned stock in the business becoming new millionaires, and with that, the business Hinrikus and Käärmann founded has made more than 150 people millionaires over the past eight years.

But even all of this is actually just the tip of the iceberg. Transferwise employs more than 1,400 people of more than 70 different nationalities, in 11 cities around the world, including nearly 800 working in Estonia. These are people who receive a monthly salary that is taxed — including, again, in Estonia — and that, via consumption, largely ends up back in the local economy.

The millions paid for stocks last week don't typically end up collecting dust in bank accounts either, but rather keep moving in large part as new investments into the next round of new businesses, where they in turn serve to launch the next such cycles.

Careful what you wish for

This is something that should be paid careful attention. We're talking about the same people that Minister of Finance Martin Helme (EKRE) recommended packing their bags and moving to Canada a couple of months ago.

We're talking about, among others, people who in recent years have moved to Estonia from elsewhere in the world, made themselves at home here and are now currently worriedly considering their future prospects.

It would be a very serious loss if Transferwise left Estonia, but it would an even bigger loss if our current actions and lack thereof ended up being the reason why the next startups, the next potential Transferwises, went unestablished here.

It would be a loss, the size of which is difficult to even comprehend today. So let's stop and think for a minute before we talk big and send anyone away from here — because there is a risk that they may actually leave.

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Editor: Aili Vahtla



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