Indonesian fintech Xendit is now a unicorn, with $150M in fresh funding

there is a new Entering Southeast Asia’s growing list of unicorns. Jakarta-based Xendit, which is best known for its digital payments infrastructure but also focuses on other financial products, today announced that it has raised $150 million in Series C funding, upping its valuation. raised to $1 billion. The round was led by Tiger Global Management, with participation from return investors Accel, Amasia and Bakri Capital, the venture firm co-founded by former Y Combinator partner Justin Kahn (in 2015, participating in the Zendit Accelerator program). Became the first Indonesian startup to take

Accel led Xendit’s $64.6 million Series B, which was announced just six months ago. This new round brings the total funding so far to $238 million. The company was founded in 2015 by Chief Executive Officer Moses Lu and Chief Operating Officer Tessa Vijaya.

Late last year, Xendit expanded into the Philippines, saying it is now one of the largest payments players in the country. In July, it announced a strategic investment in legacy online payments platform DragonPay.

Xendit decided to scale up again due to the expansion of the fuel to other countries, Vijaya told . “Our main focus at this time for this new fundraising is to regionalize and expand our product suite in the regions where we are or will be expanding.” The company also plans to launch value added services.

Wijaya said Xendit has experienced more than 200% year-over-year growth in total payment volume, and now has $9 billion in total payment volume (TPV) processed per year.

Before COVID-19, many of Xendit’s customers were in the travel industry, and it was hit by the pandemic. But since then, it has expanded its scope.

“A large segment are SMEs. As of August, there were 10,000 SME sign-ups on our platform alone. The second is expanding to fintech companies – for example, in Indonesia, there has been a particularly large growth in accounting platforms. We have also expanded to traditional enterprises such as telecom companies, which have focused on having retail outlets in shopping malls. Suddenly malls are closed, so we have been able to sign some big retail outlet groups in the market as well.”

The company’s clients range in size from SMEs to some of the biggest tech players in the sector, including Traveloca, Wise, Wish and Grab. Digital payments are extremely fragmented in most Southeast Asian markets, with consumers using everything from digital wallets, buy-now-pay-later services and virtual accounts to traditional debit and credit cards.

Xendit’s solutions let businesses accept payments in several of these ways through three integration options. These include live URLs that sellers can message to the customer for payment; Web and mobile checkout that work with e-commerce platform plug-ins; and API.

Although it is best known as a payment infrastructure provider, referring to itself on its website as “a Stripe alternative build for Indonesia and Southeast Asia”, Xendit is working on other services as well. Is. “In Southeast Asia, you can’t just focus on one thing, you can’t just focus on payments,” Vijaya said. “You want to focus on this platform for every merchant, and never give up whenever they transact digitally.”

For example, Xendit is experimenting with working capital loans for merchants, and is also exploring issuance of credit cards with partners, as credit card penetration is still very low in Indonesia and the Philippines. “For merchants to come online, they don’t just need payment, they need to be able to do things like subscribe to Shopify or subscribe to Google Suite to be able to support being digital-first.”

Xendit’s expansion strategy into new markets such as Malaysia and Vietnam will depend on solving problems that are unique to each market. For example, Vijaya said that disbursements, including marketplace refunds, were difficult in Indonesia, so Xendit focused on fixing that. On the other hand, in the Philippines, “the real problem was accepting money,” so Zendit developed direct debit with Grab.

“I think the formula we had in the Philippines, hiring a lot of local people who understand the market what they need to do, has really worked for us, and that is how we plan our expansion. going to continue,” she said.

Some of Xendit’s competitors in its current markets include MidTrans in Indonesia, which was acquired by Gojek in 2017, and PayMongo in the Philippines, which is backed by Stripe.

Wijaya said Xendit’s edge is combining a global approach with its intense focus on localization. “One of our investors sent a survey to some potential clients, big traders, and they said what they like about Xendit because we have a complete commitment to staying grounded. We are not the kind of players where a Expanding in the market means having a sales team, and that’s it. When we expand somewhere, what we really mean is that we’re going to expand. We’re going to hire people in partnerships, who There’s a customer success team out there. We’re going to be hiring a whole team on the field.”

In a press statement, Tiger Global Management Partner Alex Cook said, “Xendit’s digital payments infrastructure, built specifically for Southeast Asia, is rapidly becoming the standard for financial operations in the region. One By providing reliable and secure payment gateways, Xendit has created an on-ramp for the digital economy for businesses across the region.”

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