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For the second week in a row, you get a triple boost of our Post-Earnings Call Series. This time with the CEOs of OFX, Payoneer and Remitly. All three posted very strong numbers, all three target very different customer groups.
With ecommerce slowing in the Western world, we take a look at the impact of Singles Day in China, the biggest shopping day of the year.
We've had a busy week externally presenting at Citi's annual Fintech Conference on B2B Cross-Border Payments as well as delivering an insights session on industry and pricing trends to a global bank's worldwide payments and FX team.
And if you're looking for a new challenge in the New Year and love payments, data and fintech, we have a whole range of open roles across Product, Technology and Sales/Account Management. More details below or reach out to me directly.
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Payoneer builds growth beyond Covid
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Payoneer’s Q3 2021 results have seen the company significantly exceed expectations, with a 35% year-on-year revenue increase, a 16% increase in volume and a notably improved take rate. Investors agreed, bumping the stock up c.20%. I spoke to CEO Scott Galit as part of our Post-Earnings Call Series to get into the details.
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Payoneer has also grown its presence globally, seeing 50%+ growth in a number of emerging markets, and overall adding record numbers of new customers in the quarter. Meanwhile, it is expanding its efforts beyond its core product areas, including with the launch of Payoneer Checkout, as well as embarking on an unusual CBDC-related project with Citi.
We also spent time talking about its B2B AP/AR segment as Payoneer looks to broaden its services beyond marketplaces. B2B AP/AR now accounts for 10% of the business and it mirrors a trend in the B2B payments space of providers broadening their TAMs and product sets.
Key topics in our discussion include:
- Payoneer’s key growth drivers
- Building growth in emerging markets
- Payoneer’s value proposition
- Defining Payoneer’s B2B offering
- The potential of Payoneer Checkout
- Exploring a regulated liability network for CBDCs
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For more background articles and context on Payoneer, see the context section at the end of this letter
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Remitly shows strength in post-IPO earnings
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Remitly has published its Q3 2021 results, the first as a public company, with some strong headline numbers. I caught up with CEO Matt Oppenheimer as part of our Post-Earnings Call Series to understand the key drivers of his business.
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Remitly has seen quarterly revenue grow by 69% year-on-year to $121m, while active customers and send volume increased 51% and 61% respectively. The company also used its first earnings call to provide a deeper understanding of Remitly’s market position and typical customer, as well as provide an update on the company’s partnership with Novi.
Remitly has what Matt calls a maniacal focus on unit economics. As our deep dive analysis on Remitly around their IPO showed, Remitly has some of the best unit economics across the consumer cross-border payments space (not just in remittances).
Topics we covered include:
- Core drivers of Remitly’s growth
- Customer acquisition strategy
- Developing brand trust
- Defining localization at scale
- Remitly’s four pillars of growth
- Market differentiation
- Network quality and reach
- Remitly for developers
- Partnering with Novi
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For more background articles and context on Remitly, see the context section at the end of this letter
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OFX bounces back from the pandemic
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OFX is a fascinating cross-border payments player as its one of the few companies with real traction in multiple segments - consumer, SME and the online sellers space. Despite facing tough headwinds during the pandemic, OFX has had a strong recovery in its H1 2022 (April-September 2021), with a 20% revenue increase to AUD$74m and a 27% climb in net operating income. With this in mind, I spoke to CEO Skander Malcolm in our latest in-depth discussion.
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Numbers bounced back across OFX's business. High-Value Consumer, which saw a significant pandemic drop, saw revenue grow 28% – driven by high asset prices worldwide as people are cashing in on their gains.
Corporate (SME-focused) increased 16%, underpinned by strong growth in the tough North American market. The small but growing enterprise segment, meanwhile, climbed 41%. Online sellers saw the slowest growth – typical of ecommerce across the market – although outside of Asia saw 14% growth (OFX is pivoting away from the highly competitive Asia market in ecommerce).
Topics we covered include:
- OFX’s return to growth and improved operating leverage
- Growing the high-value consumer segment
- Competing in the highly competitive corporate space
- Evolving positioning for online sellers
- OFX’s approach to enterprise
- Building network and infrastructure strength
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For more background articles and context on OFX, see the context section at the end of this letter
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Singles Day provides ecommerce insight
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Last week was China's 11.11 Festival, also known as Singles Day, one of the biggest dates on the global ecommerce calendar. Having previously set online payment processing records, 11.11 is a key indicator of the state of both domestic Chinese ecommerce and cross-border ecommerce – as well as providing some insights into what the ecommerce industry can expect from Black Friday in just a few weeks.
With this in mind, here's our main takeaways from some of the biggest participants in Singles Day this year:
Tmall.com from Alibaba
- Running from November 1 -11, Alibaba’s 13th annual 11.11 Global Shopping Festival generated CNY540bn ($85bn) in gross merchandise volume (GMV) during the 11-day campaign – an 8% increase from 2020.
- A record 290,000 brands participated in 11.11 this year, of which 65% are small and medium-sized businesses, manufacturers from industrial belts and new brands.
- 78 brands grew from CNY10m in GMV last year to CNY100m this year, while 698 brands grew GMV from CNY1m to CNY10m over the same period.
- More than 45% of consumers that made purchases were born in the ‘90s and ‘00s. Consumers born in the ’00s increased by 25% year-over-year.
- More than 1.3 million new products were offered by over 29,000 overseas brands that participated via Tmall Global this year, with some 2,800 overseas brands joining for the first time.
JD.com
- JD.com reported record-breaking transaction volume of CNY349bn ($55bn) during the single-day period on 11.11 – more than 28% increase from last year’s CNY272billion.
- 31 brands’ sales exceed CNY1bn ($160m).
- Apple’s sales exceed CNY10bn ($1.6bn). Transaction volume of iPhones surpassed CNY100m ($16m) 2 seconds after the sales began.
- More than 100,000 users made a payment with China's CBDC eCNY on the JD app during 11.11.
Xiaomi
- Xiaomi took a record-breaking CNY19bn ($3bn) on its platform between November 1 - 11 – an increase of CNY5bn ($780m) from 2020.
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For more background articles and context on ecommerce, see the context section at the end of this letter
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On our radar this week:
Curated by FXC Intelligence's Team
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Amazon drops UK Visa credit cards
Amazon has announced that it will stop accepting Visa credit cards issued in the UK from mid-January due to higher transaction fees. Just negotiating??
Reuters
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Western Union announces new CEO
Western Union has announced that it is appointing Devin B McGranahan as CEO following the upcoming retirement of long-time CEO Hikmet Ersek.
Yahoo Finance
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Euronet launches B2B platform
Euronet has launched a cross-border B2B payments platform, Dandelion, that is designed to provide a true real-time solution for banks, fintechs and ERPs.
GlobeNewswire
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India to ban crypto payments
India is to ban the use of cryptocurrencies for making payments, and regulate the trading of cryptocurrency as assets, according to reports.
CoinDesk
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