LONDON (Alliance News) - Venture capital firm Draper Esprit PLC said Wednesday "fast growing" international money transfer platform TransferWise will remain a "core portfolio holding" despite selling a portion of its stake in the company.
TransferWise performed a USD292.0 million share sale, valuing the company at USD3.5 billion. Draper Esprit said the company is "now one of the world's fastest growing payment firms".
Draper Esprit originally acquired a stake in TransferWise as part of its acquisition of Seecamp Funds I and II for GBP17.9 million in October 2017.
The fair value of TransferWise in Draper Esprit's gross portfolio at March 31 stood at GBP27.7 million, more than double the GBP13.1 million reported as of September 30.
As of today, TransferWise holds a fair value of GBP12.0 million in Draper Esprit's portfolio. The company said it has now generated GBP18.1 million in cash from Seedcamp I and II, from the sale of TransferWise and three other companies.
"Having first invested in TransferWise in 2017, we are delighted to continue our support as they embark on the next stage of their development, while simultaneously recognising the opportunity to create value for our shareholders. The fact that we have already realised the original sum we invested in the Seedcamp portfolio is an important vindication of our strategy and underlines our sustainable investment model. The transaction indicates a maturing European ecosystem, where opportunities for liquidity via secondary markets are growing," said Chief Executive Simons Cook.
"The remaining stakes in Seedcamp I and II are currently valued above the original cost," the company added.
The Financial Times quoted TransferWise Co-Founder Taavet Hinrikus Wednesday, who said: "I still believe eventually we'll be a public company, but this proves there's no rush. We're a profitable company, we're fully in control - maybe two years from now we'll realise there's so much more we could do - by raising fresh investment - but for everything we're doing now we're really well capitalised."
Hinrikus told the FT the share sale allowed the TransferWise's earliest backers to realise substantial gains on their investments without going through the distraction of an IPO.
TransferWise is now, according to the FT, Europe's most valuable fintech start-up.
Two other Draper Esprit holdings recently completed fundraisings, too.
"UiPath and Perkbox's successful fundraisings underline the strength and depth of our portfolio," Draper Esprit said. "Although both businesses operate in very distinct areas, both are true innovators in their respective markets with significant growth potential. We are delighted to support both firms as part of their ongoing development."
UiPath, a robotic process automation firm, closed a Series D investment round, raising USD568 million - valuing the company at USD7 billion.
Draper Esprit acquired a holding in UiPath through its partnership with European technology venture capital firm Earlybird. Draper Esprit acquired a 5% interest in the Earlybird Digital East Fund I for USD20 million in January.
At the time, UiPath was valued at USD3 billion and made up 85% of the fund. At March 31, the fair value of UiPath in Draper Esprit's gross portfolio is now over GBP30.0 million.
Perkbox - a company which offers employee benefits and discounts - recently announced a GBP13.5 million equity funding, to support its global expansion plans. Draper Esprit said it "led the round" alongside other angel investors.
Draper Esprit said it remains confident it is on track to meet its net asset value growth expectations for the year ended March.
The company is expected to release its full year results on June 4.
At the end of March last year, Draper Esprit's NAV per share stood at 431.0 pence each. At the end of September, its NAV per share had risen to 454.0p.
Shares in Draper Esprit were down 1.3% Wednesday at 467.08p each.
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