1. Transferwise: Disrupt or disrupted?
Asper Consulting Group Emily Sanders Matt Borgford Tanis Brako Carlos Kan
Presenting to: Mr. Kristo Kaarmann & Taavet Hinrikus, Co-founders

2. How does TransferWise scale it’s business sustainably into the future?
Key Issue
How does TransferWise scale it’s business sustainably into the future?

3. Core Challenges Business Model Reliant partnerships Scalability
Internal Capability
Financial Security
Unbalanced liquidity
Unsustainable acquisition cost
Reputation
Recent glitch
Comparative advertising

4. Innovate business model through advertising revenue & new technology
Recommendation
Innovate business model through advertising revenue & new technology

5. Financial, profitability
Strategic Objectives
Zero Fees
Sustainability
Create Brand Excitement
Achieve within 10 years
Financial, profitability
Increase user base

6. Transferwise
Price
Trust
Speed
Coverage
Convenience “ ”
Delight users and eliminate inefficiencies in the existing money transfer ecosystem.

7. Core Competencies
Cost Effective transferring of funds across international borders
Financial Technology
TransferWise needs to leverage core competencies to fuel growth

8. Revenue and profitability
78% of revenue from Europe
Profitability %

9. Transferwise Environment
Competition
Partnerships
Western Union
Market leader in money remittance services by revenue
Low fees for India and Mexico
Wide reach
Quick transfers
French Groupe BPCE
Can use TransferWise directly through App
Bank of England
Permission to use real-time gross settlement account
Startups
N26
LHV

10. The consumer drives the need for TransferWise
Low Fees
Convenience
Security
Quick Transfers
Accessibility
Outflow Country
New entrants sending money home
Students living abroad
Low/mid income level
Inflow Country
Receiving funds
What do they value?
The consumer drives the need for TransferWise

11. Key Countries (US Billion$)
Migrant Remittance Outflows
2013
2014
2015
2016
United States 56 59 63 67
Saudi Arabia 35 37 39 38
Switzerland 25 26
Germany 20 21 29
Migrant Remittance Inflows
2013
2014
2015
2016
India 70 69 63
China 59 62 64 61
Philippines 27 29 30 31
Mexico 23 25 26

12. Key Countries (US Billion$)
Migrant Remittance Outflows
2013
2014
2015
2016
United States 56 59 63 67
Saudi Arabia 35 37 39 38
Switzerland 25 26
Germany 20 21 29
Migrant Remittance Inflows
2013
2014
2015
2016
India 70 69 63
China 59 62 64 61
Philippines 27 29 30 31
Mexico 23 25 26
There is opportunity in United States, Philippines, and Mexico

13. TransferWise needs to be innovative and agile to grow
Market Trends
Increase in App usage
Agility of tech startups
Disruptive models
TransferWise needs to be innovative and agile to grow

14. Environmental Analysis
Strength
Challenge
Opportunity
Threat
Easy to use
Quick transfers
Low fees (10-20 times)
Reputation of partnerships
Inexperienced leadership
Recent PR issues
Adoption of tech
Consumer Trends
Low fees at banks
Partnership sustainability
Emergence of fintech startups

15. Alternatives Innovate through new technology & revenue stream
Differentiate to related services
Launch Digital Bank
Innovate through new technology & revenue stream

16. Differentiate to Related Services
Alternative 1
Differentiate to Related Services
Differentiate to related services from the customers perspective.
Ex: social media/ chat functionality
Pro
Con
Competition
Cost
Strength
Scale
Customer engagement

17. Alternative 2 Pro Con Launch Digital Bank Relationship Dependency
Innovate through the value chain by launching a digital bank.
Ex: Tangerine
Pro
Con
Strengths
Regulation
Relationship
Convenience
Dependency

18. Innovate through New Technology & Revenue Streams
Alternative 3
Innovate through New Technology & Revenue Streams
Innovate through the adoption of new technology and expanding to new revenue streams.
Ex: adopt blockchain and advertising revenue
Pro
Con
Alignment
Revenue
Trends
Change Management
Focus

19. Customer Satisfaction
Decision Criteria
Scale the business by increasing the user base
Growth
Core Competencies
Customer Satisfaction
Sustainability
Ensure financial sustainability of the company
Play to strengths
Maintain strong customer satisfaction ratings

20. Decision Criteria Differentiate to Related Services
Launch Digital Bank
Diversify through ad revenue & New Tech
Growth Scale the business
Core Competencies Play to strengths
Customer Satisfaction Maintain strong rating
Sustainability Ensure financial sustainability

21. Future Forward
Leading Financial remittance company in the world
Innovate business model through advertising revenue & new technology
Financial Sustainability
Brand Excitement
Zero Fee

22. Implementation Drive Growth Innovation Instill Trust
Banking partnerships
Reach new customers
Drive Growth
Security Considerations
New emerging technologies
Innovation
Invest in IT
Banking Partners
Instill Trust

23. Drive growth – consumer awareness
Demographic
New Entrants
Students
Public
Value
Low fees, trust
Convenience
Accessibility
Campaign
Location:
Mexico & Phillippines
Signage in Embassies to create relationship before moving to new country
Guerilla Marketing:
College Football (Soccer) game
“Surprise & Delight” representatives at game
Free Drink Tickets
Social Media #TransferWire Promotion
Continue:
SEO, Social Media
Digital Word of Mouth
Targeting the consumers that require this service is key to growing TransferWire

24. Drive growth - Natural affiliations
Mexico
Large need for money transfers
Develop bank partnership
USA
Growing outflow of money transfers
Bank of America
Leverage existing natural affiliations and growth of money transfers to drive growth

25. Drive growth - Natural affiliations
Phillippines
Large need for money transfers
Develop bank partnership
Canada
Growing outflow of money transfers
Scotiabank
Leverage existing natural affiliations and growth of money transfers to drive growth

26. Innovation – create hub within transferwire
Optimize Business Model
Use AI to optimize money pools
IT Development
Continually improve the platform
Security
Digital fingerprints
Blockchain
Invest in research to incorporate technology
Invest in people to adapt to technology trends and instill trust by creating a reliable service

27. Ensure the platform is accessible to the target consumer
Drive growth
Quick transfers
Ease of use
Product
Lower fees by incorporating new partnerships
Offer incentives using Artificial Intelligence (optimize money pools)
Price
Facebook and Instagram
Banks where partnership exists
Scooters/mopeds in Mexico and Phillippines
Cars for Canada & US
Place
Ensure the platform is accessible to the target consumer

28. Internal – hr requirements
Innovation Hub
1 Research Scientist
Businesses
Advertise on TransferWire Platform
5 staff
Expansion
US, Mexico Office
Canada & Phillippines Office
5 staff each
Natural growth
Invest in people to adapt to technology trends and instill trust by creating a reliable service

29. Implementation timeline

30. Cost of implementation

31. Customer acquisition cost

32. Assumption for advertisements

33. from remittance fee to ads will reach “zero transaction fee” by 2028

34. Increase in traffic will drive revenue growth
Amounts in MM
Revenue will be 2.2x vs 2019

35. Profitability driven by advertisements

36. Positive NPV of USD 5.0 MM in conservative scenario (pay-back period 3.5 yrs)

37. Kpis and controls

38. Risk and Mitigation 1. Advertiser Acceptance 2. Employee Buy-In
Invest in relationships and reduce rates
2. Employee Buy-In
Increase focus and change management
3. Declining Customer Satisfaction
Increase personalization of advertising
Probability 1. 2. 3.
Impact

39. Innovate business model through advertising revenue & new technology
Conclusion
Innovate business model through advertising revenue & new technology

40. APPENDICE

41. APPENDICE