1023.News: How Airwallex became an $8 billion fintech giant as US funding falls

0:04This is Fintech Insider News this week. $330 million boost propels Airwallex to$8 billion valuation. Abu Dhabi launches cutting-edge fintech hub for digital assets and US fintech funding is on the decline. We'll be tackling all of this and more on today's news show, so don't go anywhere.

0:27Retail investment in the UK is the lowest in the G7. According to the Bank of England, there is over 280 billion pounds sitting in UK accounts earning no interest. Something has to change. Financial firms in the UK must look at making investing accessible, contextual and trusted through everyday platforms. That means bringing investment journeys to the point of need, alongside spending, saving and budgeting, and within platforms that already play a meaningful role in customers' lives. We dive into this and more in our latest report, Taking Advantage of the Embedding Investing Opportunity, produced in association with Seckle.

1:09Download your copy today at alumnafest.com forward slash embedded hyphen investing.

1:25Hello and welcome to episode 1023 of FinTech Insider brought to you by 11FS, the five-time consultancy of the year that works with banks, investment firms, digital banks and FinTechs to build the next generation of financial services. I'm Kate Moody, Customer Strategy director here at 11FS. With less than two weeks, oh my God, to go until Christmas, I'm absolutely panicking. We're well on our way to the big day. And while the L's might be winding down, the world of fintech shows no signs of slowing. Helping me wrap up the year are our fantastic panelists. Shall we meet them? First up, an exceptionally warm fintech insider return to Ruth Fox Blader, managing partner at Fox Capital.

2:05Ruth, always a pleasure to have you on the show. So would you mind just giving our listeners, maybe haven't come across you before, a bit of an intro to you and maybe what we've been up to recently? Absolutely. Thank you so much for having me on. I am a venture capital investor. I focus on early stage fintech. And this is the last time I will be on this show as the managing partner of Fox Capital because I am launching something new in the new year. I'm very glad that you caveated it as like in your current role because I was like, oh, my gosh, that's going to be so sad. But, well, exciting. I look forward to working back in your new role.

2:36But thank you very much for joining us. It sounds like exciting times. Next up, we have a FinTech Insider debut for Lisa Picardo, Chief Business Officer for the UK at Pensionby. Welcome to the show, Lisa. Always great to have a FinTech Insider debut. Would you mind telling our listeners a bit more about you and your role at Pensionby, please? Yes, of course. Well, thank you so much for having me on for my first time, joining you in conversation. So I work at Pensionby. I'm the Chief Business Officer for the UK. for those of you who don't know we are a leading online retirement savings provider and we help customers across the UK and the US we have around 300 ,000 of them to save for happy retirement I joined the business about six years ago having taken it public I'm now overseeing the execution of strategy.

3:25Awesome well yeah looking forward to picking your brains as we go through the news today as well so thank you very much for joining us and last but definitely not least it's a welcome return to the podcast for Thierry Koopman, partnerships and payments lead at Formance. Thierry, thanks very much for joining us. Again, for our listeners who don't know you or Formance, would you mind giving us a quick introduction, please? Yeah, so I spent about 25 years already in the industry in payments at the intersection of technology, payments, compliance, legal and finance. and I'm now with Formance, which is an open source ledger solution that can help you with all your financial plumbing and everything you need to move assets around and to keep track of them in an auditable and correct way.

4:14So I'm handling partnerships and payments connectivity there. Awesome. Well, thanks very much for coming back. Look forward to hearing from you as well. Fantastic. So we have a panel now on with the show. Our first story has been covered in lots of places, but we've taken this one from Finnextra, and that is Airwallex raises$330 million at a valuation of$8 billion. Airwallex secured $330 million in a Series G round, valuing the company at$8 billion, a roughly 30 % increase in valuation since its Series F round six months ago. The raise comes shortly after the firm hit an annualized run rate revenue of$1 billion, marking major revenue growth as demand for global business payments rises.

4:57As part of its growth strategy, Airwallux has established a second global headquarters in San Francisco and committed to investing over$1 billion between 2026 and 2029 to scale its US operations. The company also plans to double its US headcount to over 400 in the next 12 months and expand its global number of employees by over 50 % by the end of 2026, underlining a global expansion push beyond just funding. In a striking reflection on the company's journey, Airwallex revealed it turned down a$1.2 billion acquisition offer from Stripe in 2018 at a time when it had just$2 million in revenue, a 600-time multiple, underscoring the founder's conviction in the long-term potential of the business.

5:40To tell us more, we have a voice note from Shannon Scott, the CPO, Chief Product Officer at Airwallex. Hi, everyone. Shannon Scott here, Chief Product Officer at Airwallex. I lead our global product vision, building the modern financial infrastructure that helps businesses move money and operate seamlessly around the world. For those who aren't familiar with Airwallex, we're building the future of global banking for a borderless, real-time, and intelligent economy. More than 200 ,000 businesses already rely on us to power their global banking, payment acceptance, treasury, and spend management, and this new funding helps us continue pushing the industry forward.

6:18I'm excited to share that on Monday, the 8th of December, we announced our$330 million Series G round led by Edition, and with participation from T. Rowe Price Associates, Activant, Lingotto, Robinhood Ventures, and TIAA Ventures, bringing Airwallex to an$8 billion valuation. This investment not only fuels our US expansion and new global headquarters in San Francisco, but also accelerates our ambitious AI roadmap. Thanks to the FinTech Insider team for having me. Ruth, I'll throw it come to you first. What were your thoughts on this race? Super exciting for the company. Absolutely demonstrating that running into the end of the year, there is still massive interest in FinTech and FinTech at scale, which might contradict some of the other news that we're thinking about covering today in terms of global fintech investment.

7:13I think that I can't help but compare this story to a story from November on Ramp raising at a$32 billion valuation and a$1 billion run rate. So same run rate, different valuation. It makes a lot of sense to me that the kind of key messages, at least towards media at this point are around US expansion. It definitely feels like perhaps Airwallex is paying in terms of valuation based on where it has been based and operated, as well as AI. We know that if investment has been running away from late-stage fintech, it's running into AI. But I think that this is a very exciting story for the team. Yeah, absolutely.

8:01Completely agree with all those points. I wanted to ask your opinion as well on, And I'm like, how common is it to see a Series G round? Like I couldn't work out if I just hadn't been paying attention. But I just obviously you kind of get used to the letters being trotted out. But like is a G round, do we see this very often if I just miss them? Or is this a bit more of an unusual phenomenon from just a straight fundraising perspective? It's a really great question. It is not a strange phenomenon in 2025 moving into 2026. Companies are staying private longer. and that is partly because of, you know, somewhat inflated valuations and the difficulty of squaring private markets valuations with public markets valuations.

8:41We've seen a lot of folks pumping the brake on public offerings because of this kind of disparity between the way companies are valued in the private markets and the way companies are valued in the public markets. And there really is an incredible amount of liquidity in the private markets. And so we are seeing, you know, large companies choosing to stay private. We're seeing a number of, you know, brand name fintech companies choosing to stay private. We're also seeing folks prepare for public market offerings potentially in hopefully in 26 and 27. That's always very exciting for us. It's very important for VC that there are these kinds of liquidity events.

9:22But I think that this trend of companies staying private longer, raising more money in the private markets is certainly consistent with something that's happened in this venture capital super cycle. Okay, no, brilliant. Thank you. I really appreciate the context. Thierry, what was your take on this? Yeah, just on that topic, I was working at N26 back in 2009, and I remember they had at that time a series c announced just just before i joined and the interesting part is uh the series c increased over time so it was not like this is a this is a done deal this is what we what we have now i think over a period of of nine months the series c is increased so that's instead of having a G or an F, you could also have a wider window for investment, I guess.

10:21So that's a bit similar. Yeah, no, I think it's definitely interesting to understand. And obviously, you've got probably the deepest expertise in payments. What's your take on what Airworks are offering in this space? Obviously, the kind of payments space that they're operating in is now highly competitive. Do you think they're offering something that is helping them to cut through? I think the fact that they're really global and very operationally all over the world is basically a demand that they are serving. They're quite successful in that but as you mentioned they're not the only ones. I'm not sure if there's some consolidation that will happen in the future but at least it's an interesting space to be and especially with the evolutions in the cross-border rails and crypto and stable coins, see at what level these guys will become more or less relevant.

11:24Yeah, no one to watch for sure. And Lisa, I'm keen to bring you in as well. What was your take on this story when you saw it? So from my perspective, I agree with what Ruth was saying about companies is taking that decision to stay private for a lot longer. It makes a lot of sense in a lot of cases. We're actually slightly different. So we bucked that trend. We were a business that went to market in 2021. And so that last sort of big vintage that went public and I think it comes back to like, what are your reasons for being a public company? So for us, that transition from being private to public was actually quite an easy, straightforward transition because we're a regulated business and, you know, making that shift was not a difficult one.

12:13I also think that it gave us that opportunity to raise, you know, a large amount of capital to take us through on our growth journey in a sort of one-shot way. And so that's exactly what we did. We raised a lot of money in the public markets at a time where, of course, the markets were open and receptive. and then that has lasted us through the years to get us to the point of profitability. And, you know, only about a year ago, we tapped the markets again for a raise to launch our business in the US. So, yes, it's true. Businesses are staying longer for private, but there are also examples like PensionBee that have kind of taken a very different journey.

12:52Yeah, no, absolutely. I think the diversity is really interesting to understand. Rief, obviously a key part, as you touched on in your analysis, was their focus on using these funds to move into the U.S. and grow in the U.S. further. How do you rate their chances of cracking the U.S. market? That is a really good question. I'm not sure, honestly. I think that there is heavy competition. I think that where they have really flourished and succeeded is in kind of helping small businesses to, you know, initially move money internationally and really also then solidify their kind of finance and operations stack.

13:31And so there are a number of kind of almost incumbent startup competitors in the space operating in the United States. I'm not sure how much of the U.S. market they need to penetrate to achieve the goals that they have, which is to be a company which is respected by U.S. investors and, you know, can play a competitive role. But certainly they have, you know, a lot of arrows in their quiver. They've got 300 million bucks to go after the U.S. And, you know, they're going to be bringing some level of price competition and a bit more fragmentation to the existing U.S. propositions. As we see business just becoming increasingly international, I think that there is a special role that they can play.

14:20And, you know, there are a number of different companies that are working together in sort of collaboration and JVs to try to service the customer that Airwallex can probably service out of the box and perhaps more cheaply. So, you know, just we're going to see. Yeah, no, absolutely. yeah I think so many interesting dynamics I thought we could discuss this probably for most of the show I suppose one thing that I thought was really interesting when kind of the CEO Jack kind of posted about this race on LinkedIn was he sort of talked about in some ways that Airworks haven't been great up till now at sort of communicating their brand and their proposition kind of out to the world so I'm also interested to kind of see you know you sort of said that you know the partnerships they've got with the likes of you McLaren and Arsenal in the sporting space We've touched on that a little bit in the show in the past as well, but it sort of feels like they're going to obviously use this money to kind of really double down on some of their key markets, hire staff, kind of build their offering.

15:15But it'll also be interesting to see if they also just kind of invest in just telling the world a bit more about who they are and how they plan to differentiate as well. So, yeah, really exciting. 2026 ahead for Airwallex, I'm sure. Okay, I'm going to move on to our next story now. This story we've also taken from Finextra, and that is Abu Dhabi launches fintech center with focus on digital assets. The Emirate has unveiled the new FIDA, don't know if I should say that, FIDA, cluster, fintech, insurance, digital and alternative assets, aiming to position Abu Dhabi as a global hub for fintech, digital assets, insurance and alternative asset innovation.

15:52The cluster is projected to add 56 billion AED to Abu Dhabi's GDP by 2045, create 8 ,000 skilled jobs and attract at least 17 billion AED in new investment. FIDA will build institutional-grade infrastructure for digital assets, advanced fintech platforms and a coordinated regulatory slash innovation ecosystem, integrating regulators, investors, startups, insurers and asset managers into one structure. The initiative supports broad economic diversification and reinsurance, reflecting Abu Dhabi's ambition to lead in tech-driven financial services globally. Thierry, this kind of feels like it's aligned to your world.

16:34I'll come to you first. Do you think this is a good move? I think it's great to create ecosystems and microcosmos for fintech and specific industries. So it's great that they do this initiative and it's also very, it makes perfect sense for them within the context that they have in the Abu Dhabu global markets setup. So I think they try to attract more capital, they try to attract more talent. We'll see what it gives. The investment is in line with a standard AWS region rollout, so that's even more expensive. So it's not that much of an investment for a financial fintech hub, I think. So we'll see what it brings.

17:34And they've obviously gone fairly heavy on the digital assets side of things. There's multiple components to kind of what this hub is going to focus on, which I'm sure we can touch on. But digital assets feels like it's a key part of this. I'm guessing you probably have a bit of a bias. They call it digital and alternative assets. So what is alternative assets if they're not digital? So maybe somebody else has an idea there, but what could be an alternative asset? Probably something like real estate or something more like the real world versus the digital world. So not only money, and it's interesting that they go specifically into alternative assets.

18:17Ruth, have you got any hypotheses on alternative assets that you think they'll be exploring? I assume it's things to do with tokenization. Increasingly, we're seeing a trend towards tokenization of real-world assets or kind of synthetic assets. I mean, this makes sense to me given the kind of global mood music ushered in by, you know, the U.S. government with the Genius Act and kind of in some ways creating a crypto regulatory environment and another kind of unshackling crypto from a lot of skepticism. and, you know, criticism, frankly. And so this asset class has been growing tremendously and Bitcoin has seen, you know, specifically tremendous growth.

19:01Stablecoins have seen enormous growth. There's obvious real world utility around stablecoins and there's obvious, you know, tremendous desire to speculate using other digital assets. And so, again, I think Thierry probably, you know, said it best. It's like there's just a ton of capital in this space. And so if you want to create an environment where you can participate in kind of that capital and that business development, sort of nascent business development, one of the best things that you can do is to provide a regulatory environment, which is serviceable to the companies that want to work in that space.

19:46capital moves super fast. And so if, you know, companies view this particular location as one where they can do the stuff they want to do more quickly than somewhere else, they'll move there. Yeah, no, absolutely. Yeah, Lisa would be keen to get your perspective, I suppose, from the practical side of things. Obviously, they've talked here about, yes, of integrating regulators, investors, startups, insurers sort of all in one place, as Ruth alluded to, kind of lots of linking up there. How much of a difference do you think that will make for fintechs, operators trying to kind of really drive their businesses forward?

20:17I mean, it makes total sense, right? I think it is, you know, to have any fintech type of ecosystem that is going to flourish and do well, you need all of those key ingredients. You need talent, you need capital, but you really need the right regulatory framework. So yes, I think it's a really positive push if that is the goal. Yeah And I suppose one Obviously we know that the Middle East As a region is kind of seeing huge growth In the course of this year I'm sure that will continue to be the case Onwards into next year as well Ruth what do you think the kind of dynamics Obviously you've got Dubai as a hub You've got obviously Saudi Arabia as a hub Bahrain as well Do you think there's sort of Place for all of these Locations to be hubs in their own right?

21:08Or do you think we're going to see the emergence of one of them as being more dominant either way that we have with London, Singapore, New York, for example? Okay, I'm very boring. I always say the same thing. We'll see. I mean, there's just always these things that are not totally clear to the public. I think what is clear about the Middle East is that, you know, the sort of over-reliance on oil as a source of riches is something that, you know, there's a large attempt to diversify from. And sort of the new economy, which is generated by, you know, power and requires energy, of which, you know, they have a lot, really feels like an obvious link.

21:51So you have this former source of wealth and riches, which can power a new source of wealth and riches. And given the global demand on both sides, I would say that there might be enough room for multiple markets to be successful. Yeah, no, we'll have to wait and see. Jerry? There's also the context of business finds a way. So if they create the right environment, the right structure, the right regulatory environment, I mean, basically it's according to English common law, which is very, very well respected internationally and very valued for international businesses. If they achieve creating an environment where everybody is happy, can do their business, can be successful, they'll have the people and the businesses that they want.

22:48I mean, they can have, obviously they have a lot of money, but you cannot buy a let's now build this and throw some money to it. You have to create an environment, create an ecosystem around that and if that works then it'll take off. But just throwing money to it, I'm not that... I mean you'll attract something but you need to create a flourishing environment to keep the businesses there. And that's their challenge now, I guess. And obviously by creating this hub, it also means that they have the ambition to create that environment. So let's see what comes out of it. It's a good start. What do you think they need to do to create that kind of environment?

23:46Is there something you've seen in other parts of the world that you think has helped them to drive that? Well, if you look at some parts of the world that are focused in very specific areas, in the US you have Silicon Valley, right? So that's startups, that's technology. It's a very unique environment and people tend to go there because they find what they need there. They find the talent, they find the people, they find the venture capitalists. So if they are able to create an environment for fintechs that attracts the business specifically, because they find what they need, then they'll succeed.

24:27We'll wait and see. Okay, on that note, we're going to take a very quick pause. We'll be back shortly. Hey folks, if you're anything like us, you're on the road constantly. Airports, hotels, conference centers, half the time the Wi-Fi feels as safe as shouting, my pin is 1234 across the departures lounge. That's where NordVPN comes in. One click or no clicks with auto-connect and suddenly every sketchy airport network becomes a whole lot safer. You still get blazing fast speeds and 8 ,700 servers in 129 countries so you can switch your virtual location while you're waiting for yet another delayed flight.

25:07One account covers 10 devices and you get Threat Protection Pro to block malicious links and ads, plus dark web monitor if your details show up where they shouldn't. We've teamed up with them to offer Fintech Insider fans an exclusive deal. Head to nordvpn.com slash fintechinsider to get a huge discount and four extra months on top, completely risk-free with their 30-day money-back guarantee. Links in the description.

25:37now a quick break from the headlines to spotlight our latest insights episode this time we're diving into the future of small and medium business banking and why banks aren't just building apps anymore they're building digital cfos in this episode i'm joined by guests from plio and mastercard to explore how small business banking is shifting from simple dashboards to intelligent financial guidance because smbs don't just want to check a balance they want insight advice and a financial GPS they can actually trust. If you're looking for the shortcut to navigating smarter, saving time, and unlocking the path your business really needs, this episode is your go-to guide.

26:10Find it on the same feed as this one. And now back to the news. Our next story is taken from FinTech Global, and that is US FinTech funding on track to drop 6 % in 2025 as deals over$100 million dry up. The latest data shows US FinTech funding in 2025 is on track for a 6 % decline compared to 2024's large deals, those over US$100 million, have largely dried up. In the first three quarters of 2025, total fintech investment in the US fell 7 % year on year. The drop in large rounds is the main factor driving the slowdown, suggesting investors are becoming more selective or risk-averse, especially for late-stage or high-value fintech deals.

26:51Despite the headwinds, this shift could signal a coming recalibration, perhaps a tilt towards smaller, more sustainable funding rounds or increased scrutiny or profitability over higher valuations. Ruth, as you very presciently commented in our first story, obviously we're kind of coming back to the subject of funding. What do you make of these numbers? What I make of these numbers, we've had a bunch of successful IPOs this year, which is really great in the US. And I think that we have seen a bit of a repricing of assets over the past couple of years. And so we definitely have, you know, these in this kind of funding gap in later stage funding rounds, which is which is being highlighted here.

27:41I personally don't see it so much in early stage. Venture also is a very strange animal. There are no rules. And so one of the things that I, you know, founders I work with often find frustrating is like, this guy got this much for the same exact thing, and I'm not getting that. And it's so it's, you know, there's, there's really, there's still the kind of same mega deals that we were seeing in 2020, 2021 happening in fintech in the United States. And then there are other founders that are struggling to raise and they can't entirely figure out why, because maybe some of the unit economics are more interesting, or the revenues are, you know, stronger, and it it feels like the opportunity is equally profound.

28:24I personally don't get super wrapped up in this stuff. I think it's important to watch the market and to be hyper-aware of how things are moving. The obvious answer to why this is happening is because so much of investor interest has moved to AI and so many startups are trying to spin themselves as.ai and not necessarily fintech projects, but rather AI projects. And so I don't really know how the data is being collected. But we know that this is a highly social category, venture capital. And so, you know, the mood music changes and the dance steps change. And that's just what happens. Yeah. Lisa, what was your take on these stories?