Payments platform Airwallex has set its sights on a major expansion in the Americas and plans to leverage its recent acquisition of a small California billing startup to do so.
Airwallex sells software for businesses to coordinate their financial operations, including payment processing, card issuing and expense-management tools.
Last month, Singapore-based Airwallex purchased OpenPay to expand its billing capabilities, particularly in helping customers secure additional revenues through recurring billing.
OpenPay was founded two years ago and “bootstrapped to seven figures of revenue,” co-founder and CEO Lance Co Ting Keh, a former Google engineer, wrote on his LinkedIn page. The small San Francisco-based startup focused on billing, payment orchestration and revenue analytics.
Financial terms of the Airwallex acquisition were not disclosed. Co Ting Keh joined Airwallex as a general manager after the transaction, according to his LinkedIn profile.
By integrating OpenPay, Airwallex said it will create “the first truly global billing platform” by merging a global fintech infrastructure with billing and subscription management.
“OpenBay already has that billing solution and already has some great features that we didn't have or that we were looking at building,” Shannon Scott, Airwallex’s global head of product, said in an interview from Melbourne, Australia, where the company was founded a decade ago.
Airwallex used the Sept. 3 press release announcing the deal to essentially serve notice to two direct competitors, Stripe and Recurly, that a new rival was spoiling for a fiercer fight in the recurrent billing space, name-checking both of those San Francisco-based companies.
“There are relatively few (providers) that have an end-to-end, sort of vertically integrated stack with both the billing and the payment processing,” Scott said. “And Stripe is one of those end-to-end companies alongside Airwallex. So, I think, we just were acknowledging that this is a similar, comparable product in the market.”
In May, Airwallex said it had raised $300 million, including secondary share transfers, at a valuation of $6.2 billion. It plans to use some of the funds to expand into new markets. The U.S. “will be a really key market for us to continue to expand,” Scott said.
Combined, the U.S. and Europe represent about 30% of Airwallex’s current revenue, Scott said.
“There’s just within the American customer base a really high willingness to adopt these (financial) technology services and actually sort of recognize the value of these solutions,” he said.
In terms of building out a billing platform, subscription pricing models are growing because of the predictable cash flows and customer engagement they provide, Scott said. But recurrent billing is also a useful tool as pricing evolves, including with the assistance of artificial intelligence, he said.
“Pricing actually starts to get very complicated,” Scott said. “More and more, there’s a need for software to fill that gap in managing that complexity and not having to worry.”
Airwallex reached $900 million in annualized revenue as of July and expects to hit $1 billion this year, a company spokesperson said. The company has exceeded $200 billion in payments volume on an annualized basis, with 150,000 companies using its products.
Airwallex is also “poised to launch services” in Brazil and Mexico, the two-largest Latin American economies, the spokesperson said. Airwallex has about 60 licenses and banking partners globally, Scott said.
“We want to really maximize the benefit of the efforts we’ve put into the last ten years of acquiring these licenses and make it available to as many regions as possible,” he said.
