Melbourne fintech startup grabs $3 million before launch
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Photo credit: Airwallex

Photo credit: Airwallex

With a $3 million pre-launch round, Airwallex seems poised to hit the ground running

International transactions platform Airwallex announced a $3 million (AU$4.5 million) pre-launch round Tuesday, led by Gobi Partners.

Airwallex estimates so-called real exchange rates, (a.k.a. mid-market rates, spot rates or interbank rates), the midpoint between buy and sell prices for currency trades. The business is aiming for SMEs as their primary customers.

“Initially I didn’t think it was going to be that fast, we were planning for a few months,” CEO Jack Zhang told Australia’s StartupSmart, mentioning initial plans to fundraise in Silicon Valley were scuttled in favor of what turned out to be a quick mission to China.

The platform is apparently preparing to hit the ground running, with a lot of that money being invested in new hires in New Zealand, Singapore, Japan and the United Kingdom. Besides Gobi, investors included several angels and Gravity VC.

Alibaba-backed news site Alizila estimates cross-border e-commerce will be worth $1 trillion by 2020, up from $230 billion in 2014. It suffices to say that handling international transactions is major business, and getting enterprise clients favorable currency exchange rates even within fractions of a penny on the dollar is a big deal for would-be clientele.

A number of startups are popping up for wire transfers, from TransferWise in Estonia to Singapore-based InstaRem. But according to Zhang, it still hasn’t been picked up as a major business opportunity by would-be entrepreneurs.

“The major companies are the banks and a few big companies – PayPal is the big payments company but they’re not really focusing on cross-border transactions,” Zhang remarked to StartupSmart. “There’s nothing out there that helps SMEs when they’re trying to expand globally. They reach a bottleneck in Australia, want to sell in China and gets complicated with payments.”

Airwallex keeps its headquarters in Melbourne with operations in China.

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  • ProudOne

    Seems like all the new cross-border fintech startups are mimicking Payoneer’s idea which are here for almost a decade and put the next statement from the above article in question “There’s nothing out there that helps SMEs when they’re trying to expand globally”