Wise: Moving Money Around the World

This episode is brought to you by:

Tegus.

Tegus
is the modern research platform for leading investors. I’m a longtime user and advocate of Tegus, a company that I’ve been so consistently impressed with that last fall my firm, Positive Sum, invested $20M to support Tegus’ mission to expand its product ecosystem. Whether it’s quantitative analysis, company disclosures, management presentations, earnings calls - Tegus has tools for every step of your investment research. They even have over 4000 fully driveable financial models. Tegus’ maniacal focus on quality, as well as its depth, breadth and recency of content makes it the one-stop, end-to-end research platform for investors. Move faster, gather deep research to build conviction and surface high-quality, alpha-driving insights to find your differentiated edge with Tegus. As a listener, you can take the Tegus platform for a free test drive by visiting

tegus.co/patrick
.

[00:02:27] - [First question] - Overview of Wise, their key product, and core competency 

[00:04:17] - The founding story of Wise and the road leading to today

[00:09:18] - Wise’s size and scale today compared to 2011

[00:11:07] - Their competitive advantages and how it informs their goals 

[00:19:24] - Exploring Wise’s closed loop system and why their model can’t be copied

[00:21:28] - Unique characteristics of their business model that allows them to capture such robust margins

[00:25:32] - Overview of Wise’s unit economics and their revenue model

[00:34:49] - Interchange fees and how Project Zero guides the business

[00:36:44] - Why their lower take rate doesn’t destroy the industry 

[00:38:24] - Ways Wise’s business model can’t simply be copied and replicated 

[00:44:35] - Thoughts on who their true competitors are

[00:48:10] - Their customer acquisition flywheel 

[00:49:49] - Float, increasing net margin, and how they contribute to durability

[00:53:55] - Key risks associated with Wise when evaluating the business

[00:58:35] - Reasons behind the decision to raise money as a direct listing in the UK

[01:01:03] - How people looking at Wise should think about margins over time

[01:03:32] - Lessons for builders and investors when studying Wise’s story