Remitly Global, Inc.
Why We Mistrust Remitly
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Remitly Global, Inc.
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Remitly Global, Inc.
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Remitly Global, Inc.
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Remitly Global, Inc.
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Remitly Global, Inc.
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Remitly Global, Inc.
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Research Overview

INDEX:
S&P 500
Sector:
Financial Services
Position:
Short
Date:
Mar 11, 2025

After conducting a forensic financial review of Remitly Global, Inc. (Nasdaq: RELY) (“RELY” or the “Company”), a provider of cross-border remittance services through its mobile app and website, Spruce Point finds evidence that the Company has used dubious customer testimonials and doctored Trustpilot reviews. Moreover, Spruce Point believes there is ample evidence to distrust the Company’s accounting, financial reporting, governance and equity growth story. We believe Remitly trades at an irrational premium to peers on the belief that it is a high quality fintech with new product growth opportunities and sustainable competitive advantages. We disagree and believe Remitly is facing numerous short- and long-term disruption risks while it may be running out of growth levers to pull in order to improve performance. Based on our investigation, we estimate a 40% - 55% potential long-term downside and market underperformance risk.

The report highlights several key concerns with the Company, including:    

  • While trust is perhaps the most important factor that leads customers to choose Remitly, evidence suggests that the Company has betrayed its customers' trust by advertising inauthentic customer testimonials.
  • We believe that Remitly's business is exposed to short- and long-term risks associated with uncertainty regarding U.S. immigration policies and to displacement from the adoption of cryptocurrency including stablecoins.
  • Remitly recently dropped "Be Transparent" as a corporate value at a time when we believe they should be more, not less, transparent and should explain the stability of their take rate.
  • We are concerned by Remitly's audit and risk oversight given multiple executive departures and a history of material weaknesses.
  • We believe RELY trades at an irrational premium to peers and is extremely dependent on keeping the perceived value of its equity high, evident by aggressively issuing stock-based compensation.
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