It doesn’t take an expert to see that FinTech is booming as sophisticated players are emerging and fundamentally transforming the industry. Our investments in companies like OnDeck, Square, and IEX are all predicated on our belief that many areas within financial services are ripe for disruption.
Currency Cloud is part of a wider movement to actively improve the industry as a whole, rather than seeking to turn it on its head. In software, there has been a spotlight on what some have dubbed “full-stack” companies as of late. Take two of the best known full-stack companies for example, Uber and Airbnb. Each of the start-ups has created an entirely new order in its industry by controlling the end-to-end customer experiences. Everything from supplier management to customer services falls in their purview.
While some FinTech companies choose this route to disrupt banking services — Currency Cloud takes an altogether different approach to innovation. Currency Cloud offers foreign exchange and international payments through APIs. Their lightweight approach to providing critical infrastructure enables other financial services industry players to easily build and deliver improved services atop their offering. Currency Cloud unbundles an outdated piece of the traditional banking value chain allowing innovation to flourish for their customers with no need to build out an incremental technology stack. Albert Wenger, from Union Square Ventures, calls this the no-stack approach to innovation.
By delivering a no-stack technology for foreign exchange and international payments, Currency Cloud can enable a wave of innovation to bring real time transparency and certainty to services that have traditionally been opaque and uncertain.
Currency Cloud’s customers include challenger banks, prepaid services, payment service providers and traditional banks. By offering flexible and easy to integrate APIs along with full regulatory compliance, companies formerly unable to enter this space will be able to service new and underserved segments of the market for international payments through completely new channels.
Currency Cloud demonstrates the truly enormous opportunity to enable business transformation by introducing improved service and flexibility to everyone in a massive market. We believe the bigger opportunity by far lies on the business side of international payments. With this new infrastructure for international payments, the industry will be able to transform. And, Currency Cloud’s transaction volume speaks for itself. Currency Cloud now processes $10 billion international payments a year — spanning 212 countries and 40 currencies for over 125 corporate clients.
The potential is even more exciting. Processing international payments is already a $26 trillion industry. Thanks to rising prosperity in the emerging world and the surge in internet and digital technologies, the international payments industry also has huge growth potential. McKinsey estimates that by 2025, global flows could reach $54 trillion to $85 trillion, up to triple their current scale. Currency Cloud will be one of the key beneficiaries as the industry continues to grow and thrive.
We couldn’t be more thrilled to welcome Currency Cloud to the Sapphire Ventures family as they strive to create a world in which the old and new complement each other to provide better services for customers.
The information set forth herein is not intended to constitute investment advice and under no circumstances should any information provided herein be used or considered as an offer to sell or a solicitation of an offer to buy an interest in any investment fund managed by Sapphire Ventures. Sapphire Ventures does not solicit or make its services available to the public and none of the funds are currently open to new investors. Past performance is not indicative of future performance.
The portfolio companies referred to above do not necessarily represent all of the investments made or recommended by Sapphire Ventures, and were not selected based on the return on Sapphire Ventures’ investment in them. It should not be assumed that the specific investments identified and discussed herein were or will be profitable. Not all investments made by Sapphire Ventures will be profitable or will equal the performance of the companies identified above.