Money Men summary

Introduction

Money Men by Dan McCrum A journalist uncovers a billion-dollar fraud at a German fintech company. Dan McCrum received a tip. It concerned a German fintech company. The tip came with a warning.

He should be cautious. It was a $4 billion startup. McCrum recently started at the Financial Times. He was young and ambitious.

He wrote Wirecard in his notepad. He added a question mark. Four years later, Wirecard leaders celebrated. The firm replaced Commerzbank on the DAX30 index.

It joined elite German companies. The German darling became an unlikely success. It was Europe's answer to PayPal. Wirecard's growth skyrocketed.

One month before, shares peaked at 191 euros. The company was valued at 24 billion euros. It claimed over 5,000 employees. They processed payments for over 250,000 merchants.

Investors were very excited. Then, in 2020, everything crashed and Wirecard tanked. A report revealed the company was a fraud. The books had been cooked.

The profits were all faked. This summary follows Dan McCrum's reporting. He reported on Wirecard for a decade. We will explore Wirecard's early days.

We will see its runaway growth. The story involves short sellers and whistleblowers. Investors failed to see the truth. Regulators refused to look for it.

Join us to unravel Wirecard's true story. It is an epic rise and spectacular fall.

the shady beginnings

The Shady Beginnings Wirecard always had a high opinion of itself. Great companies have great origin stories. Wirecard's beginnings involved three ambitious men. They had mammoth egos.

This gives us a glimpse ahead. It begins on a flight from Munich to Berlin. The year is 1997. 40-year-old Paul Bauer-Schlechtegrohl was on the flight.

He wore a permaton and designer jeans. He spoke with a photographer for Hustler magazine. The connection was quickly made. He went to Beverly Hills.

He acquired German publishing rights for the magazine. He did not take long to realize the future. The real future was online adult content. He needed a way to charge for it.

He switched gears and started a new company. It took direct debit payments over dial-up internet. Soon after, a competitor went bust. He bought it for parts.

He kept the name Wirecard. Wirecard moved into online gambling. This was another shady internet business. In the early 2000s, many countries drafted regulations.

Other countries had already banned it. Banks avoided this gray area. They refused payments using code 7995. Wirecard found a way around this problem.

They created a third-party wallet. It loaded funds at digital casinos. They swapped the four-digit code when payments were rejected. Paul Bauer-Schlechtegrohl wanted to cash out.

Perhaps he saw the writing on the wall. He preferred to cut corners. He avoided an expensive initial public offering. This was known as an IPO.

He orchestrated a reverse takeover. Wirecard bought a defunct company for peanuts. It had already gone through an IPO. In 2004, Wirecard went public.

Bauer-Schlechtegrohl bowed out. Two other men became instrumental. They took the public company into its future. Dr.

Markus Braun was hired as CEO. He was a self-serious Austrian. He liked wearing black turtlenecks. This was in the style of Steve Jobs.

Jan Marsalek was an early employee. He was hired in his teens. He became chief technology officer. Marsalek was also Austrian.

He was a confident go-getter. He ran the IT department in the basement. His electronic payment system never worked. He spent years coding it.

It was junk. The two Austrians had to work together. They needed to find a solution. They had to save their company.