There was a mix of curiosity and anticipation in the air as the management of Adyen, a rising Dutch payments company, and Temasek’s Financial Services team took their seats in a conference room in the heart of Amsterdam. The questions were many. Each was well-established in their respective markets, but their knowledge of the other – and the potential synergies between them – were less explored.

It was 2014, and Temasek was looking to break into the rapidly expanding digital payments space while growing its European footprint. Adyen, a next-generation payments company focused on seamlessly enabling electronic payments for its merchant clients and their customers, was a promising prospect.

“It felt groundbreaking on many fronts,” recalls then-Director of Financial Services Connie Chan, who led the investment team. “We had been closely monitoring the increasing penetration of digital payments, especially given the rapid growth of e-commerce. With its differentiated technology platform, the experience of its co-founders, and strong track record, Adyen checked all the boxes.” On its part, Temasek was well-placed to provide the capital, connections, and capabilities to support Adyen’s growth.

Being one of its first forays into early-stage companies, Temasek went in with a modest initial investment of S$50 million (€35 million) in 2014, valuing the company at US$1.5 billion. Three years later, in 2017, it scaled up its commitment, convinced by Adyen’s strong fundamentals and continued growth prospects.

“Over time, we saw its potential to break out and be a real winner in the payments category, so we more than doubled down,” says Connie.

In 2018, Adyen went public on the Euronext Amsterdam stock exchange, raising US$1.1 billion at a US$8.3 billion valuation in an IPO that was oversubscribed several times over. Today, the company has a market capitalisation of over US$45 billion.

A calculated leap

When Connie left investment banking to join Temasek in 2013, the emphasis was still largely on traditional financial services sectors like banks in Asia. As digitisation swept across sectors, the team began to push towards new horizons.

Connie seized the opportunity to develop Temasek’s financial services portfolio by taking an “entrepreneurial” approach. Her boss at the time, Png Chin Yee – now Temasek’s CFO – put Europe on her agenda, with the goal of diversifying portfolio exposure to developed markets. Connie began to ladder up her knowledge and connections, actively seeking out investments that aligned with Temasek’s strategy.

It was a transformative time for Temasek, she says. The company was still deciding on its approach to early-stage investments, assessing when and how to invest in earlier-stage companies with solid prospects. “It was very refreshing, having a blank canvas. We were charting a path, creating a strategy, and building a network. Part of the job was to establish Temasek as a trusted partner that brought value to the founders and management teams.”

Adyen stood out with its track record, innovative platform, and strong grasp of the evolving landscape, combined with a client base that included global digital giants like Facebook, Uber, Spotify, and Airbnb. “It is a company built for purpose and that offers a seamless omnichannel proposition, which means being able to integrate payments across online, offline, and mobile platforms in many markets across the globe for its merchant clients,” says Connie. This was a crucial differentiator as many payment companies grappled with legacy payment infrastructure.

Beyond the product, it was a meeting of minds.

“They weren’t just focused on immediate gains, but on positioning the company for the long term. That resonated strongly with Temasek,” she says.

What also resonated was the sense of ownership its employees had, and the emphasis on transparency and direct communication. “They are much bigger today, but they still live by the principles that led to their success, like continuous learning, working as one team, and even simple things like picking up the phone to talk instead of sending lengthy emails,” she says.

Getting in early with Adyen turned out to be mutually beneficial. It gave Temasek valuable insights into developments in the payments industry and a clear idea of how they could impact – or enable – other companies in its portfolio. Meanwhile, Temasek’s reputation in Asia, its extensive ecosystem, and global reach helped Adyen gain a foothold in the region.

In 2019, Singapore Airlines became one of Adyen’s largest airline customers, simplifying payment processes on its website and app.

“Adyen shared their global ambitions, and we were able to make those referrals and introductions, including to our portfolio companies,” says Connie. “Seeing how far they have come today, I take pride in Temasek’s recognition of their vision, and its commitment to supporting its growth.”

A new future for finance

Temasek’s investment in Adyen paved the way for more strategic moves into the payments and fintech space.

“This investment set a new path, bringing into focus the potential of other asset-light businesses in the financial sector. It has been a constant evolution,” explains Connie, who now heads the Financial Services team.

Diversifying into financial sectors outside of banks has not only uplifted returns, but also bolstered the resilience of Temasek’s portfolio. “That means we are better able to weather different business cycles and achieve more stable returns."

It has been satisfying to see the immense growth achieved by the company since Temasek’s initial investment in 2014, when Adyen’s annual processed volumes were $30 billion compared to $680 billion in just the first half of 2024, says Connie. More importantly, she says, Adyen is a company that impacts people’s lives daily. 

“When I go to pay for something and see an Adyen terminal, or when I make a payment online and see that it is powered by Adyen, it’s a reminder that our capital empowers financial solutions that touch everyday lives.”