Why Wise Is Moving to the US
Index eligibility matters — and UK rules still deter founder-led companies
When Wise announced this week that it plans to switch its primary listing to the US, most of the headlines followed a now-familiar pattern: another British tech success story decamping across the Atlantic, more hand-wringing about the London Stock Exchange’s competitiveness, more calls to revive the UK’s moribund capital markets.
All of that is true. But it’s not the whole story.
Beneath the noise about liquidity and trading volumes lies a simpler, deeper reason for Wise’s move — and one that should be ringing alarm bells in Whitehall, at the LSE, and at FTSE Russell.
Wise isn’t just moving to find more active traders or more US investors. It’s moving because it wants to be included in a major stock index — and in the UK, that door has been firmly closed.
The reason? The very share structure that enabled Wise to get where it is — and which is perfectly standard for US tech companies — still makes it a misfit in the UK’s index rulebook and market culture.
The prize Wise is chasing
At first glance, Wise’s motivations sound predictable. The company says it wants “a wider pool of investors, more active trading, and a potential pathway to inclusion in major US stock indices.”
That last part — index inclusion — is the key.
Being included in an index matters. It unlocks automatic demand from passive index-tracking funds, brings greater liquidity, and typically results in higher valuations. It also signals that a company is now a core part of the market it operates in.
For Wise, this is about more than liquidity. It’s about legitimacy and long-term positioning. And here lies the rub: in the UK, despite being worth £12 billion — larger than many FTSE 100 companies — Wise remains ineligible for the FTSE 100.
Why is Wise excluded from the FTSE 100
The issue is Wise’s share structure.
When Wise listed in London in 2021, it chose a dual-class share structure:
Class A shares (held by public investors), 1 vote per share.
Class B shares (held by founder Kristo Käärmann and insiders) and enhanced voting rights.
As of March 2024, Käärmann owns 18% of Wise’s shares but controls 50% of its votes. That control mechanism, which protects founders from hostile takeovers and shareholder activism, is entirely normal for US tech companies.
It is a major reason why US founders are willing to take their companies public without surrendering strategic control.
In the UK, however, this structure clashed head-on with the FTSE Russell index ground rules.
FTSE Russell insists that to be included in the FTSE 100, a company must have a free float of at least 25%, both in terms of economic interest and voting rights.
Wise’s Class B shares meant that, in practice, a large block of voting power was locked up and unavailable to the market. The FTSE ruled Wise ineligible for the index.
The irony is that this happened even as the UK was trying to make its listing regime more founder-friendly. Following Lord Hill’s 2021 review of UK listing rules, London began allowing dual-class shares — but only with a 5-year sunset clause.
After five years, super-voting rights must fall away, restoring one-share, one-vote governance.
Wise’s super-voting Class B rights were scheduled to expire in 2026. In theory, Wise could have simplified its structure, dropped the dual-class, and become FTSE 100-eligible. But it didn’t. Instead, it chose to move to a market where such share structures are not only accepted but celebrated.
Why the US is a better fit for Wise’s model
Wise’s US listing statement all but spells this out: it wants a structure that “aligns with US market practices including those of our US-listed tech peers.”
That’s not just a nod to liquidity — it’s about governance.
In the US, founders retaining control through dual-class shares is entirely normal:
Mark Zuckerberg still controls Meta through enhanced voting shares.
Google’s founders structured Alphabet the same way.
Snap’s founders issued public shares with no voting rights at all.
US indices are also more flexible.
While S&P 500 inclusion rules used to block dual-class companies, many such companies are now part of the index. Inclusion pathways are clearer and more culturally aligned with founder-led governance models.
In contrast, London still treats such structures as temporary compromises at best — and fundamentally undesirable at worst. The sunset clause makes this explicit. Wise was approaching the moment when it would either need to conform to UK governance norms or look elsewhere.
It chose elsewhere.
A cultural gap the UK still hasn’t closed
What’s revealing is that Wise’s move is happening after the UK did reform its listing rules.
The 5-year sunset clause was meant to lure companies like Wise to London, offering a compromise: you can retain control for a few years, but then transition to public-market governance.
In practice, this halfway house may be backfiring: rather than let the sun set on its founder’s control, it is preparing to move to a jurisdiction where the sun never needs to set.
This exposes a deeper cultural gap between London and the markets it aspires to compete with.
In the US, founder control is seen as part of the modern tech playbook. In London, it is still viewed as a deviation from proper governance, tolerated briefly, but not permanently embraced.
Until that cultural mismatch is addressed — not just in the rulebook, but in the mindset of UK investors, regulators, and index providers — London will struggle to keep its most dynamic growth companies.
A warning shot for UK markets
In the end, Wise’s move is not just about one company’s listing. It is a case study in how global capital markets are evolving — and where London still lags.
UK policymakers can cut stamp duty. They can talk about making the LSE more competitive. But unless London becomes a place where founder-led companies feel they can scale and retain control in line with global peers, it will keep losing the companies it most wants to attract.
Wise is voting with its feet.
Unless the UK learns the lesson, it won’t be the last.