A year and a half after Currencycloud raised $ 80 million in a round that included Visa, the London-based developer of APIs that power money transfer and foreign exchange services is getting even closer to the financial services giant. Today, Visa announced that it will acquire CurrencyCloud in a deal valued at $ 963 million (£ 700 million).
That price is a very decent jump from this last round of funding, when sources told us the startup was valued at around $ 500 million.
(Since Visa already has equity in the business, the amount it will actually pay will be reduced by that amount.)
CurrencyCloud has some 500 clients in 180 countries who use its APIs to power multi-currency wallets, currency services, and account management, including some of the biggest startups such as Monzo, Moneze, Starling, Revolut, and Dwolla. These will continue, and on top of that, Visa will use the startup’s technology to bolster its own currency rails to provide a broader set of services to its own clients, which include financial institutions, fintechs and more. , as well as to create new services also for consumers.
“At Currencycloud, we have always strived to provide a better future for everyone, from the smallest start-ups to global multinationals. Reinventing the way money flows in the global economy has become more exciting as we join Visa, ”said Mike Laven, CEO of Currencycloud, in a statement. “The combination of Currencycloud’s fintech expertise and Visa’s network will allow us to deliver greater customer value to businesses that move money across borders. “
Remittances and currency transfers are big business in the financial services world, and this opportunity is growing. Two of the factors behind this are that e-commerce has spread far beyond our national borders, especially over the past 18 months, as have supply chains. (Visa notes that about 43% of all small businesses globally conducted some form of international commerce in 2020.) And with the rise of cloud-based mobile services to facilitate transactions, consumers are also increasingly and more globalized in their outlook.
At the same time, remittances and currency transfers are two areas poised for disruption, with existing services often costly and inefficient. All of this sets the stage for a company like CurrencyCloud, which has built a new currency transfer implementation that can be integrated with other financial services to help them run more smoothly.
The exit is also a classic example of how incumbent financial powers tend to have a harder time innovating and launching into new services. propel itself into the next generation of financial services. Whether Visa will be able to successfully integrate and use CurrencyCloud’s technology and work with its team are two things that have already been tested: both were strategic partners prior to this deal.
“The acquisition of Currencycloud is another example of Visa’s execution of our network of networks strategy to facilitate the movement of money on a global basis,” said Colleen Ostrowski, global treasurer of Visa, in a statement. “Consumers and businesses increasingly expect transparency, speed and simplicity when making or receiving international payments. With our acquisition of Currencycloud, we can help our customers and partners to further reduce the problems with cross-border payments and develop exceptional user experiences for their customers. “