Business 4 min read By Arthur Ellington
Former Tink founder backs compliance platform Freda after $2bn Visa sale
Tink co-founder Daniel Ek's peer Fredrik and co-founder say the compliance burden that slowed Tink after its Visa acquisition is driving their next venture, Freda.
Having sold their fintech company Tink to Visa for around $2 billion, the co-founders could have stepped back entirely. Instead, one of them is putting his own money into a new venture aimed at a problem he says slowed his first company down: compliance. The founder, writing in Fortune, describes his decision to build Freda, a platform designed to make regulatory obligations easier for fast-growing businesses to manage.
The author says the years before and after the Visa deal changed how the company operated. Ideas that he and co-founder Fredrik once shaped in a taxi and shipped within a week now had to be cross-checked by dozens of people across many departments. He argues that compliance, though necessary for a well-functioning society, gradually erodes the speed, agility and willingness to experiment that make building technology companies appealing in the first place.
By the time Tink had reached 700 employees and operated in 19 markets, the company was facing a new obligation almost every day, each one assuming that earlier requirements had already been met. The founder says that a rule that seems tedious early on, such as VAT registration in a market a company has never entered, can determine whether a young business is first to reach that market. He notes that discovering a product is not compliant in most markets halfway through an expansion can stall momentum entirely.
The article also challenges the view that the United States is largely unregulated. The author says that Tink's experience in America showed a different reality: US rules are often set through case law, the laws of 50 state legislatures and lengthy commercial contracts, which can leave businesses paying heavily for disputes arising from unclear requirements. European regulation, by contrast, is more visible and standardised, with the same rules applying across the bloc and guidance readily available. Founders should therefore research the rules in each market before expanding, he argues, and understand that crossing the Atlantic brings its own compliance maze.
On artificial intelligence, the author is sceptical that AI tools can solve the problem on their own. He says founders who have tried to build compliance systems using AI have found them no better than feeding documents into a chatbot. Compliance, he writes, is not a single task but an umbrella covering everything a business does, and what it requires depends on company size, sector, target markets and commitments already made to customers and regulators. AI is only as useful as the context it receives, and it is often playing catch-up as the regulatory landscape shifts.
The founder concludes that regulation will become more complex as AI spreads into the world's most critical industries, raising the stakes for the work it governs. He says he is betting his own money that the problem is worth solving. The views expressed are his own and do not necessarily reflect those of Fortune, where the piece was originally published.
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