Fintech startup Rewire acquired by Remitly for $80 million
Remitly Global, a global provider of digital financial services for immigrants and their families, announced on Tuesday that it is acquiring Rewire, an Israeli fintech startup that has developed a service platform for migrant workers. Under the terms of the agreement, Remitly will acquire Rewire for approximately $80 million consisting of a mix of cash and stock. This is the largest acquisition in the history of Remitly, which trades on the Nasdaq at a market value of around $2 billion.
Rewire was founded in 2015 by founders Guy Kashtan (CEO), Saar Yahalom (CTO), Adi Ben Dayan (VP R&D) and Or Benoz. Rewire has previously secured $62 million in two large investment rounds (A and B), as well as a credit line of $15 million, which makes the price of the acquisition far from impressive. The company’s investors include Glilot Capital Partners, OurCrowd, Renegade Partners, former Yahoo co-founder and CEO Jerry Yang, Viola Fintech, BNP Paribas via Opera Tech Ventures, Moneta Capital Partners. and more investors. According to most estimates, the company’s investors will not record a profit as a result of the acquisition, with some only to get back the money they invested.
Remitly employs 2,200 people and serves more than 5 million people in 170 countries who use their solutions for international money transfers. In 2021, customers transferred over $20 billion through the app. The company is growing rapidly with an annual growth rate of close to 35%, and its annual revenue for 2022 is expected to reach around $630 million.
Rewire has developed an international financial services platform for migrant workers through an application offered in eight languages. Hundreds of thousands of migrant workers in Europe and Israel use Rewire’s app to perform a variety of financial operations.
Speaking to Calcalist, Guy Kashtan, co-founder and CEO of Rewire, said: “It is an acquisition for a sum that is more than what we have raised, and while we would have preferred to be acquired for a higher amount, at this time, this acquisition is very good for our shareholders. We planned to reach such heights in a few years and this is a great opportunity for us. Remitly is a market leader focused on migrant workers and competes with us mainly in Europe. For us, your company has served as an inspiration all these years. Part of this purchase is about expanding our activity. We will recruit labor and increase budgets. There will be no redundancies after the acquisition and we want to recruit dozens more employees.
“The process of the acquisition took three months and was signed early this morning,” Kashtan added. “Being acquired by Remitly has always been our priority. When we were looking at choosing between going with Remitly or raising new capital, we preferred the connection with them.”
In 2020, Rewire received from the Central Bank of the Netherlands a European Electronic Money Institution (EMI) license enabling, among other things, international money transfer and digital account management throughout the EU. In Israel, Rewire has a license to provide a service in an extended financial asset from the Capital Authority of the Ministry of Finance.
Rewire employs 132 people, of which 119 are in Israel and 13 in its offices in the Netherlands.
The company’s workers come from very different backgrounds, 34% of the employees in Israel are migrant workers themselves who provide support to immigrants from China, Thailand, the Philippines, Nigeria, India and more.
“From its inception, Remitly has focused on delivering trusted digital financial services to serve immigrant communities around the world,” said Matt Oppenheimer, co-founder and CEO, Remitly. “We share with Rewire a deep commitment to our customers and that mission. Security starts with a reliable way to send money home for critical costs. Rewire accelerates our progress as together we will continue to market trusted financial services that are inclusive and accessible to all .”
