A year and a half after CurrencyCloud raised $80 million in a round that included Visa, the London-based developer of the API that operates remittance and currency exchange services, is getting even closer to the financial services giant. Today, Visa announced that it would acquire CurrencyCloud in a deal valued at $963 million (£700 million).
That price is a pretty steep jump from that last funding round, when sources told us the startup was valued at around $500 million.
(Since Visa already has equity in the company, the amount it will actually pay will be reduced by that amount.)
CurrencyCloud has approximately 500 customers in 180 countries who use its API to power multi-currency wallets, currency exchange services and account management, including some of the biggest startups such as Monzo, Monez, Starling, Revolut and Dwolla. Huh. These will continue, and on top of that Visa will use the startup’s technology to strengthen its currency exchange rail to provide a comprehensive set of services to its own clients, including financial institutions, fintechs and more, As well as creating new services. For consumers as well.
“At CurrencyCloud, we have always strived to deliver a better tomorrow for everyone from the smallest start-ups to global multi-nationals. As we join Visa, it is time to re-imagine how money flows in the global economy It’s even more exciting to imagine,” said Mike Laven, CEO of CurrencyCloud, in a statement. “The combination of CurrencyCloud’s fintech expertise and Visa’s network will enable us to deliver greater customer value to businesses moving money across borders. “
Remittances and money transfers are big business in the world of financial services, and this opportunity is growing. Two factors driving this are that e-commerce has expanded well outside our national borders, especially in the last 18 months, and so have supply chains. (Visa notes that nearly 43% of all small businesses globally did some form of international business in 2020.) And with the rise of cloud-based, mobile services to facilitate transactions, consumers are increasingly taking their approach. have become more globalized.
Also, remittances and money transfers are two areas that are ripe for disruption, with existing services often costly and inefficient. All of this sets the stage for a company like CurrencyCloud, which has created a new implementation of currency transfer that can be embedded into other financial services to help them run more smoothly.
The exit is also a classic example of how large, existing financial powerhouses typically find it difficult to innovate and jump into new services, so instead they tap smaller and more agile startups that are big on technology. Betting on, and pulling it off, helping propel itself into the next generation of financial services. Whether Visa will be able to successfully integrate and use CurrencyCloud’s technology and working with its team are two things that have already been tested: both were strategic partners prior to the deal.
“The acquisition of Currency Cloud is yet another example of Visa execution on our network of network strategy to facilitate global currency movement,” it said. Colleen Ostrovsky, Visa’s global treasurer, said in a statement. “Consumers and businesses expect transparency, speed, and simplicity when making or receiving international payments. With our acquisition of CurrencyCloud, we enable our customers and partners to further reduce the pain points of cross-border payments and improve the quality of life for our customers. Can help develop great user experiences.