Airwallex, a Hong Kong/Australia startup that provides cross-border banking and other financial services for businesses, has raised $100 million in funding, which it will use to expand its business operationally, geographically, and with new products in areas such as credit and expense management — as well as for M&A. Even though the economy is currently displaying indications of decline, many businesses still require foreign trade. Now, a business that provides the tools for making and managing those transactions has announced some investment.
The cash will be provided through an extension to Airwallex’s Series E — technically a Series E-2, following a $100 million extension in November 2021 and the original $200 million in September 2021. Previous backers Square Peg, Salesforce Ventures, Sequoia Capital China, Lone Pine Capital, Hermitage Capital, 1835i Ventures, and Tencent all participated, as did Australian fund HostPlus and an undisclosed “major North American pension fund.”
Airwallex CEO Jack Zhang, who co-founded the firm with Xijing Dai, Lucy Liu, and Max Li, told TechCrunch that business has been improving in the previous year. According to him, the company’s sales have increased by 184%, ARR has surpassed $200 million in September, and it processes close to $50 billion in annually transactions. Customer numbers have more than doubled, however the total is only given as “tens of thousands” of enterprises (they include Papaya Global, HubSpot, Plum, GOAT and others).
This round was not without its difficulties, given the present economic condition. It is valued at $5.5 billion, which is the same as what Airwallex attained a year ago, when the valuation skyrocketed by $1.5 billion in a matter of days.
“It’s been a more difficult situation to raise money, “Zhang explained. He and others on the team could see what was coming around the corner earlier in the year, he added, and despite the fact that Airwallex still had significant cash on hand – $600 million out of the total $900 million raised as of the end of September – when Zhang and I spoke – the startup chose to raise more, just in case.
“It took two weeks to raise $100 million last year,” he remarked of the previous fundraising. “It took four months this year.” We consider it a success that we were able to gather funds at all.” When we last talked about Airwallex, I mentioned that it was entering its Series E round after turning down two takeover proposals from fast-growing fintechs. I’m curious if investors (or Airwallex itself) consider if being independent was the best decision.
Meanwhile, the corporation continues to build its own platform. Airwallex’s primary focus is on two areas. Banking accounts, money transfers, payment cards, cost management, and B2B payment linkages are all part of business banking. And its platform offering is a collection of embeddable financial services that clients can integrate into their own platforms or websites using APIs to create experiences for themselves and their customers. These include online payments, treasury services for international fund storage and management, foreign currency for international power pricing, payouts, and card issuance.