Why Airwallex Could Be the Future of Foreign Currency Transfers

Friends built a fintech platform for foreign-exchange payments – and turned their global vision into a unicorn.

What is it?

Airwallex is a digital multi-currency payments system that makes it simple for businesses to send and receive foreign currencies in real time, claiming exchange rates up to 90 per cent below those of the Big Four banks. The three main verticals it serves are ecommerce (everything from a seller to Amazon to a small business selling direct), digital (online education, gaming and streaming) and fintech (such as Australian digital brokerage startup Stake). “Airwallex’s mission is to build a global financial infrastructure in applications to help customers grow in every corner of the world,” says co founder and president Lucy Liu, who’s based in Shanghai. “We help businesses of all sizes to collect and pay out in multiple currencies, removing the challenges involved in growing a global business.”

Where did the idea come from?

Zhang and Li opened a café, Tukk & Co, in Melbourne’s Docklands in 2014 as a side hustle to their software-engineering jobs in banks. To import items such as cups, “they were making a lot of purchases from overseas and discovered how difficult it is to make international payments as a small business,” she says. “We founded Airwallex with a focus on solving these issues. Two of us are software engineers, one is a solution architect and I studied commerce.”

How did you get it off the ground?

Early on, they all quit their jobs. Liu says their leap of faith as founders wasn’t as great as that of staff who joined them. “We didn’t take a salary in the beginning but we had savings from our previous jobs. Those early team members had to take a salary cut and there’s a lot of instability associated with a startup.” They spent three years building a settlement network and the infrastructure to support the applications they wanted to build on top of it. “We started with the major currencies and main countries where the infrastructure is better because we needed the traditional banking networks to support what we were building. To make sure we were compliant and had the licences to operate in different countries was a lot of work.” Today Airwallex is available in more than 130 countries.

What have you learnt?

The benefit of big ambitions was “you can see problems from a higher view, as opposed to just solving what is presented to you at the time… we started to solve something specific and discovered that everything is related to each other”. At first only supporting bank accounts for collection or payout, the founders realised that cards dominated as a payment method “so we had to add card solutions to our platform”. That process “was a lot larger than we envisioned but we always knew we had to do more – we just didn’t know what that more was”. Liu’s biggest lesson? “Embracing change and not being afraid of what’s ahead.”

What’s next?

For a foreign-exchange platform, Airwallex is “still quite APAC-focused” but that will change. “We’re continuously building our network as we focus on global expansion. We’re scaling our presence in North America, the United Kingdom and Europe, as well as emerging markets, such as the Middle East and South America. The complexity is doing multiple things at the same time in multiple geographic regions. We want to be a dominant leader in the global payments industry.”

Need to know

Co-founders
Xijing Dai, 38, Jack Zhang, 37, Lucy Liu, 31, and Max Li, 37

Staff
More than 1000

Headquarters
Hong Kong, plus another 20 locations, including London, Singapore, Melbourne and Beijing

Investors
Lone Pine Capital, G Squared, Vetamer Capital, Greenoaks, Grok Ventures, Tencent, DST Global, Salesforce Ventures, Sequoia Capital China, Hillhouse Capital, Horizons Ventures, Square Peg Capital, Skip Capital, 1835i Ventures, Mastercard

Market valuation
US$5.5 billion

First customer
Australian cross-border ecommerce company in 2018