Our tech start-up of the week is CurrencyFair.com, a Dublin, Ireland-headquartered venture that has created a peer-to-peer (P2P) marketplace model for people to transfer money between different currencies online – taking banks out of the equation. CurrencyFair has also just raised €1.9m in an investment round.
CurrencyFair, which was launched in 2010, currently employs 24 people, but the plan is to scale fast and employ up to 30 people by 2014, explains Brett Meyers, co-founder and CEO, who originally hails from Perth in western Australia. He has been living in Ireland for some years now as an expatriate.
The other two co-founders are two of Meyers’ friends – Sean Barrett, who is based in Newcastle, just north of Sydney in Australia, and Jonathan Potter, who is based in CurrencyFair’s London office.
In terms of the €1.9m (US$2.5m) funding CurrencyFair has just raised, the Irish-based venture capital (VC) firm FrontLine Ventures led the funding round, with a number of other angel investors making up the rest of the investment.
Since it first launched in 2010, CurrencyFair has secured more than €3m (US$4m) in funding and transferred €600m globally for its customers, saving them an estimated €25m in what would have been spent on bank fees, according to Meyers.
Now, the plan is for CurrencyFair to leverage the investment to bring out product enhancements and new features that will provide customers with a better online experience when transferring money, Meyers explains.
Indeed, the start-up has just moved its HQ from Pembroke Street in Dublin 2 to the trendy environs of Ranelagh village in Dublin 6.
At the minute, people can use CurrencyFair for currency transfers in up to 17 different currencies, but Meyers says the plan is to scale up and bring this up to 30 currencies by next year.
And, in relation to the current employee headcount at the start-up, 17 are based in Dublin, three are in Australia, three are in the UK and there’s one employee in Poland.
Brett Meyers talks to Siliconrepublic.com at the Dublin Web Summit, held in the RDS this past week
So, just how did CurrencyFair come about?
“I knew all my co-founders individually, although they didn’t know each other,” explains Meyers. “In fact, I had worked with them all in various different positions over the past 10 years.”
Meyers himself has degrees in physics and electrical engineering. He says he worked as a graduate electrical engineer for a couple of years.
“I then moved into technology, working in programming jobs before eventually taking a job at JPMorgan in Dublin, where I headed structured finance analytics.
During this role, he says he basically transitioned from programming into finance.
“So, in a sense, I have an ideal background for a fin-tech start-up.
The real reason CurrencyFair came about was based on Meyer’s own personal experience when transferring funds back to his Australian homeland.
“As an expat, I often needed to transfer money back to Australia. I got stung on a bank transfer, losing hundreds with a really poor exchange rate, and decided not to get ripped off anymore.”
That’s when he decided he would call friends of his from home that he knew had the Aussie dollars he needed, and see whether they needed Euro.
“If I found a match, I would transfer Euro directly to my friend’s account, and they’d transfer Aussie into mine, and we’d both save at least 3pc. I realised that this would work well online.
“By the end of 2008 I had pulled a core team together, and we officially launched CurrencyFair in May 2010.”
How the P2P model works
CurrencyFair’s marketplace allows people to choose either to exchange immediately using the best rate currently available, or offer up your funds at a rate of your choosing, and wait for another customer to match you, explains Meyers.
“It’s this unique P2P marketplace model that results in a 90pc saving compared to typical bank charges.”
By using such a system, and operating local accounts in each country, he says CurrencyFair is able to use local domestic payment networks that are generally free or very cheap, and fast, rather than “expensive and slow” international SWIFT payments.
CurrencyFair is currently monetising from the platform by charging 0.15pc on the total amount exchanged when customers match each other.
“We also charge a flat transfer fee of €3 or the equivalent in other currencies to make a payment out to a beneficiary bank account.”
Meyers says that, CurrencyFair has, in the past, grown rapidly, largely through referrals.
“Since launching, we’ve exchanged and transferred over €600m for our customers, saving them more than €25m in bank fees in the process.
There is now around €2m being exchanged through the platform every day.
“We’re now looking to accelerate that growth by investing more on marketing, and the latest funding round will help with that.”
And the ultimate goal?
The vision, Meyers explains, is for CurrencyFair to “revolutionise” the way it sends money internationally, making it “faster and far cheaper”.
“We’re already doing that for over 30,000 customers, and we now want to bring it to the rest of the world”
Finally, his advice for other tech self-starters based in Ireland right now is to always seek out plenty of advice.
“Even though you are probably an expert in the business area that your start-up is targeting, running a tech start-up has lots in common with other tech start-ups, even those in different industries.
“You don’t know what you don’t know, so make sure you have good advisors and an open mind.”
He wraps up the conversation by saying that if he had known five years ago what he knows now, then CurrencyFair would be at least twice the size it is today already, probably more than that.
“So try to tap in to the local tech community, and talk to people that have done it before. You’ll find no shortage of successful entrepreneurs happy to share some tips over a cup of coffee, or to get even more involved if that’s what you’re looking for.”