Google backs UK-based payments company Currencycloud

[NEW YORK] Alphabet Inc's venture arm has invested in Currencycloud, a UK startup that provides technology to enable businesses to provide cross-border payments services to their customers.

GV, formerly Google Ventures, participated in a US$25 million investment round in Currencycloud alongside existing investors Notion Capital Ltd, Sapphire Ventures LLC, Japanese technology company Rakuten Inc and venture capital firm Anthemis Group, the payments company said on Thursday.

The cash injection, which brings the total raised by Currencycloud to US$61 million, will be used to support the company's global expansion plans, the company said. "We just opened up in the US and that requires a lot more development," said Mike Laven, Currencycloud's chief executive officer. "We are also seeing tremendous interest from Asia broadly."

Launched in 2012 Currencycloud's platform allows companies ranging from banks to popular payments startups to offer international payments services without having to set up complex and costly cross-border infrastructure.

Clients include Swedish payments business Klarna Inc, lender Standard Bank Group, foreign exchange company Travelex Ltd and startups Azimo and Revolut. Around US$25 billion has been sent through the company's infrastructure to more than 200 countries to date.

Mr Laven said Google was attracted to Currencycloud because it saw it as a company that provided computer developers tools to add cross-border payment functionality to their services. "Google looked at us as a tool that is used in globalising domestic businesses," Mr Laven said.

Currencycloud's funding round comes following a drop in venture capital investments in UK financial technology startups in 2016, as the country's decision in June to leave the European Union raised concerns on the prospects of local businesses.

UK-based fintech companies raised US$783 million from venture capitalists last year, down 33.7 per cent from 2015, according to a report by trade group Innovate Finance. Funding of US fintech startups also dropped by 12.7 per cent to US$6.2 billion, according to the Innovate Finance Report.

Mr Laven said the company saw business drop in the months following the Brexit referendum, but that it has been "business as usual" since September. The company was prepared to seek a license to operate in the EU were that to become necessary after the UK formally leaves the bloc, Mr Laven added.

REUTERS