INSUBCONTINENT EXCLUSIVE:
Airwallex, a three-year-old fintech startup focused on international payments for SMEs and businesses, is putting itself on the map after it
raised an $80 million Series B round.Based out of Melbourne, but with six offices in Asia and other parts of the world, Airwallex’s new
funding round is the second-largest financing deal for an Australian startup in history
The round was led by existing investors Tencent, the $500 billion Chinese internet giant, and Sequoia China
Other participants included China’s Hillhouse, Horizons Ventures — the fund from Hong Kong’s richest man, Li Ka-Shing —
Indonesia-based Central Capital Ventura (BCA) and Australia’s Square Peg, a firm from Paul Bassat, who took recruitment firm Seek to IPO
and is one of Australia’s highest-profile founders.The financing takes Airwallex to $102 million raised
Tencent led a $13 million Series A in May 2017, while Square Peg added $6 million more via a Series A+ in December
Mastercard is also a backer; the finance giant uses Airwallex to handle its “Send” product, while Tencent uses the service to power an
overseas remittance service for its WeChat app.Airwallex handles cross-border transactions for companies that do business in multiple
countries using international currencies
So it’s not unlike a TransferWise-style service for SMEs that lack the capital to develop a sophisticated (and expensive) international
banking system of their own.The service uses wholesale FX rates to route overseas payments back to a client’s domestic bank and is capable
of processing “thousands of transactions per second,” according to the company
A use case example might include helping a China-based seller return money earned in the U.S
or Europe via Amazon or other e-commerce services, or route sales revenue back directly from their own website.Airwallex CEO Jack Zhang
(far right) onstage at TechCrunch Shenzhen in 2017China is a key market for Airwallex — which was started by four Australian-Chinese
founders — as well as the wider Asian region, and in particular Australia, Hong Kong and Southeast Asia
With this new capital, Airwallex co-founder and CEO Jack Zhang said the company will increase its focus on Hong Kong and Southeast Asia,
whilst also extending its business in Europe (where it has a London-based office) and pushing into North America.Product RD is shared across
Melbourne and Shanghai, while Hong Kong accounts for business development, compliance and more, Zhang explained
However, Airwallex’s locations in London and San Francisco are likely to account for most of the upcoming headcount growth planned
following this funding. Right now, Airwallex has around 100 staff, according to Zhang.The company is also aiming to expand its product
range.The firm is in the process of applying for a virtual banking license in Hong Kong, a third-party payment license in mainland China and
a cross-border Chinese yuan license
One goal, Zhang revealed, is to offer working capital loans to SMEs to help them scale their businesses to the next level
Airwallex is working with an undisclosed partner to underwrite deals in the future
Zhang explained that the company sees a gap in the market since banks don’t have access to critical data on clients for loan
assessments.More generally, he’s bullish for the future, despite Brexit and the ongoing trade war between the U.S
and China.“The trade war gives the Chinese yuan a lot of vitality, and we’ve seen more demand in the market
China’s belt road initiative has really taken off, too, and we’re seeing the impact in many, many of our payment corridors,” he
“Business has been booming, especially as traditional offline SMEs start to move online and go from domestic to global.”“We want to be
the backbone to support these new opportunities for businesses,” Zhang added.
