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Here’s what Aussie fintech unicorn Airwallex is focused on for 2020

Airwallex founders (L-R): Xijing Dai, Jack Zhang, Lucy Liu, Max Li

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Fintech unicorn Airwallex had another busy year in 2019, after announcing a marquee $US140m ($201m) capital raise back in March which gave it an implied valuation above $1 billion.

Since then, the company has increased global staff numbers by around 200 and doubled the size of its Australian office, as it works on product development and a push into western markets from its base in Asia.

Speaking with Stockhead, Airwallex head of engineering Craig Rees said he was looking forward to seeing the “culmination” of those efforts as Airwallex pushed into new markets in 2020.

Airwallex built its initial competitive advantage by establishing a foothold in Hong Kong, where it obtained key financial licences and gained traction processing foreign exchange transactions for businesses out of China. Now, it’s got its sights set on a western expansion.

“Certainly we see the UK and Australia being our beachhead for growth in western markets in the first half of 2020,” Rees said.

“Then the latter half of the year will be very much around getting licences in the US and starting to grow our customer base there.

“Targeting that market growth is one of the key levers we’ll be pulling down on over the next 12 months. And the other key focus is product range.”

 

New products

Rees said Airwallex’s product development strategy had been focused on building out a platform that allowed business clients to facilitate transactions — both payments and receipts – across different jurisdictions.

Heading into 2020, the plan is to onboard more currencies for the countries where it can offer a service. Rees said there was also two new products “coming towards the end of development” which would launch early in the new year.

The first of those is a multi-currency “virtual card”, which will allow clients to purchase products in different currencies using Airwallex’s proprietary FX platform.

The other initiative is a multi-currency payment gateway that facilitates the receipt of payments in different currencies.

“Once we’ve got that it gives customers the capability to both collect and make payments via a bank account and via the card network,” Rees said.

“At that point the goal is to drive scale towards our vision of creating a global financial infrastructure platform.”

 

Not just for the big end of town

A key target market for that infrastructure will be small-to-medium (SME) businesses looking to expand offshore.

“We see SMEs are finding it difficult to launch and grow their businesses internationally,” Rees said. “For example, we’ve got a number of clients based in Australia — their main customer base is in the US while their supplier base is in China.

“And it’s just incredibly difficult for these kinds of businesses to grow quickly because of all the impediments. Whether it’s opening bank accounts, paying suppliers, changes in exchange rates – we want to provide the financial infrastructure capability to support these organisations to grow.”

Rees said that from a consumer standpoint, fintech platforms were increasingly providing a gateway for customers to become “global citizens”, reducing barriers to opening bank accounts and making payments.

“But from a corporate position, if you sit outside the top 10 per cent of multinationals, you spend huge amounts of money in setting up your capabilities,” he said.

“So it’s about building a platform that will allow all organisations to be able to compete.”

 

Australian strategy

Rees said from a client perspective, Australia was an attractive market for Airwallex because many local companies established their business locally before looking to expand offshore.

“We’ve seen more companies setting up locally where their dominant marketplace is outside of Australia,” he said.

“But it goes beyond that – we really see Australia as the jump-off point for growth in western markets. We’ve setup local teams in the US and UK, but when we look at product development and marketing – centralising those functions in Australia allows us to really work out what our playbook is.

“Australia is a great proving ground for our strategic plans. We know if we get it right here from a product and marketing point of view, then we can roll out across other western markets.”

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Categories: Private-i

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