Podcast transcript
James Dihardjo
Hey guys. So I've got Cainen and Curtis here all the way from somewhere in the US. And we're going to be talking about I guess, finance and analytics and that kind of marriage, I suppose. Yeah, maybe it's worth just me kicking off a little bit so everyone who's watching this probably knows that MerchantSpring is an analytics product and all that kind of stuff but it's probably worth either you Cainen or Curtis just giving the audience a bit of an explanation of what Airwallex is, or you know, we'll get into what it does, but like a little bit about what it is. Little bit of background.
Curtis Shoung
I'll let you have it Cainen.
Cainen Gerety
Yeah, sure. I kick it off. I mean, Airwallex is a financial platform. You know, we have a lot of sellers, e-commerce businesses who use us. But it's really meant for anyone who has a global payment need typically. So moving funds globally, efficiently. I mean, really simplifying that process and making it easier for businesses to expand, automate and just, you know, really make, make, you know, global payments and global expansion, affordable at the end of the day.
James Dihardjo
I see now I've obviously pitched Airwallex to a bunch of people in the industry and all that kind of stuff. And I suppose how I pitch it to people is very different to what the marketing stuff says. Maybe really much more simple. So, can you tell us in really simple terms, what is the global account? I mean, I think you just mentioned it but, and I know I use it, but what is that?
Cainen Gerety
Yeah, so the global account is one of the kind of pillars of what we offer. We offered a lot of different types of features, but a global account is essentially a way to open up bank accounts in different regions around the world. Or really kind of nested under one same entity. So if I was a business in the US for example, I could say, Hey, I'm going to sign up with Airwallex United States, with my United States entity. Now I have the power to open up a global account in my name and actual business banking account in Australia and Canada, Europe, UK and a myriad of other regions. And what this does is it gives you really kind of saves you a lot of time, effort, energy, not having to fly to Australia to open up an account, pay money, things like that, you're able to really scale quickly and have that banking in your name, you know, globally from day one.
James Dihardjo
Okay. So, in really practical terms, I mean, for me, and correct me if I'm wrong, I can literally go into Airwallex, I can say I need a bank account in the US. And at least from my experience in, I don't know, 15 seconds later, I have a bank account in the US or whatever. Is that understanding correct or is there a different way you would explain that?
Cainen Gerety
I mean, yeah. I mean and what it is really to be right. It's like the account is in your name and you're right, right? It takes about, maybe I tell people five seconds, but 15 seconds works as well.
*(All laugh)*
Cainen Gerety
But yeah, essentially, this bank account is in your name. It's in the United States or in Canada, wherever you're opening it at. It's powered by Airwallex. So the way I like to explain it is you can't, like if you're traveling in the United States and you walk up to that bank and you're like, Hey, where's my money? That wouldn't necessarily work. It's like Airwallex powering that bank on behalf of you. But the bank is still in your name and able to accept local funds and USD, CAD, you know, whatever, wherever you have that bank. But you know, it's really kind of powering through our platform. So, yeah, it's as simple as just logging in, opening the bank, and you can receive funds there the very next day or same day.
James Dihardjo
Cool. Well, I']]m, I'm glad because that's my elevator pitch to anyone I need, who needs a foreign bank account.
*(All laugh)*
James Dihardjo
Just on that. So reversing it, what are the pain points that actually solves? Now you did list a few, like you don't have to fly to a different country. You don't have to, I guess you don't really have to deposit money to open the account. There's no KYC like anything else there, or is there a long list of things that that global account solves?
Cainen Gerety
Yeah, I mean, I think you kind of touched on a few of them, right? I mean, there's one, you don't have to have an entity in that country, so typically you might have to have an entity in Australia or the US if you're going to open up a bank account there. Sometimes different regions have different requirements, like you might have to have lived in that country for six months to open bank count.
Obviously there's a cost as well of opening bank accounts, you know, KYC processes for each, whereas like with Airwallex, you go through a K YC process once and like the world is your oyster kind of thing. So I think really just being able to act swiftly and nimbly and like being able to just spin up these accounts as you see quickly is going to be and obviously at no cost is really, important. I don’t know if Curtis got anything else to add on that part, but.
Curtis Shoung
No, I mean, yeah, I think ultimately, like, if we're talking to mostly e-commerce merchants here or this audience, right? And people who are selling products internationally. And if you don't sort of go through this process of opening up a bank account in a local market, Amazon is more than happy to like, convert your, your funds for you, right?
Let's say you're selling the UK and everyone's buying in GPP, in the British Pounds. And if you have, let's say a US Bank account connected that Amazon UK account, Amazon will convert that to you so you can collect US dollars, right? But that's going to cost you two and a half percent right? And then you might have to like send that money back out to the UK for your like 3PL your translation service, your market agency, and that's another two point half, 3% from your traditional bank.
And now you're at like five to 7% of your profit margin, right. And we just call that like sort of repurposing your funds. And there were different ways you can send the money out without any sort of fees and costs. But it's, it's really about like, Hey, how do you like actually operate like a local, and if you were a local person living in the UK, you wouldn't have to worry about this sort of stuff. But because you're not a local, you're a US person trying to operate globally, these are the sort of things we solve for.
James Dihardjo
Get it. Okay. And then I guess shifting gears a bit, so that's what you solve. That's what it is. But then how does it actually work? Like, I know I've got my understanding of how it works, and I mean, when I ask that question, I mean, you know, I'm looking into my Airwallex account. And this is kind of what we do. Like we see, okay. USD balance, GPP balance, like, talk us through, like, how does that work? Or is it easy? What does it look like?
Cainen Gerety
Yeah, so I'll, I'll take that one. I mean, we pretty much have made dozens of maybe over a hundred now, banking partnerships around the world, so you don't have to, right. So that's kind of how this all works. And one of our primary partners here in the US, United States is JP Morgan Chase. So they're obviously holding and kind of managing all the US funds in the United States.
But as you are opening up accounts and managing wallets, you know, and these different currencies within the platform, different banking partners might have, you know, be in responsible for different parts, whether that's like the global account feature, maybe you're transferring something in a local currency, sending something via AACH. You might use a different banking partner with that. But it's nice to have the flexibility. And kind of just the partner ecosystem of all these banks to really offer this one kind of hub where you can move money globally like really easily.
James Dihardjo
Yeah. And I guess if I'm thinking about a mutual customer we've got here, like the, well, there's many of them, mutual MerchantSpring, and Airwallex customers, they all talk about like they needed to set up a UK, they're US business need to set up a UK bank account. It takes only five seconds, as you said, Cainen. But is there anywhere that doesn't work? Like, obviously it's really seamless for a whole range of scenarios, but like for example, if I wanted to set a bank account in Malaysia or Indonesia or, you know, if I'm Singaporean entity and I want to do a bank account in Australia, like, can you give us a couple of examples where maybe it doesn't work now, but it's going to work in the future?
Cainen Gerety
Yeah, I mean we're always expanding our coverage, and there's different currencies and countries where we support for different things, right? So we have the ability, for example, to pay out to 150 countries. So that's a really large chunk of countries where we can actually move money around the, the globe quite easily.
And within those 150, there's like, 90 local currencies we support. So, we can like move money via local payment rails with like, ACH in the US for example. And you know, all over the world. And then for our global account specifically talking about those, we have those in, I believe about 15 or 16 different regions right now. And that's growing.
But like for example, if someone wanted to open a bank up today in Mexico, for example, we don't have that live yet. You know, but that is on the roadmap and coming soon. So there's definitely places where we're expanding our coverage. We're making a pretty big, imprint into, I mean, we have already, you know, quite large in the APAC region, but we've made a pretty big, move into Latin America, this year, which is quite interesting and kind be able to open up banks in Brazil and Mexico and a few other regions as well for coming on the roadmap.
James Dihardjo
Interesting. So just on that, I know you were just in Japan recently. What's the newest kind of market that Airwallex is operating in just for interest's sake?
Cainen Gerety
Yeah, I mean, actually it's funny you mentioned that because we are officially launching in Japan, so we have the ability to have Japan, like JPY accounts, we have transfers. We have a really great infrastructure over there. But we do have a team that's going like official launch in Japan, the end of Q3, early Q4. So that's going to be, you know, right now we have different regions kind of supporting that infrastructure, but we'll have a dedicated team in Japan.
And I believe, Curtis correct me, I'm wrong. I think there's like we're kind of doing a, a big push to the Middle East as well. We just launched a team out there. So we're really expanding our coverage and trying to get infrastructure set up, not just from other regions supporting like, Hong Kong. Like today, our Hong Kong team will support certain regions, but we want actually have like boots in the ground relationships built with the, with the banking partners in those regions.
Curtis Shoung
I think we just launched an office in Israel, like a couple months ago. I think Denmark Collections and banking just went live right this past week has been beta for a little while. So like, I mean, I would say like, probably in the last like three or four months, we've added three or four new countries where the collections are locked.
So it's never going to stop, basically. Our CEO and our leadership team pretty much mandates like we have global coverage. Because that's what you know you need, right? We don't want to have to educate. We're like, oh yeah, I really want to do this in this country and we can't support it. That's just not going to happen here.
James Dihardjo
Yeah. Yeah, I can see that. Must be a Melbourne thing. So you know, with such a broad customer base, like do you have a unified story as to why sellers love Airwallex? I suppose, like, you've got obviously customers all around the world, but is there a central narrative that just paints a picture of why they love you.
Cainen Gerety
I mean, should we start with Origin story Curtis? I mean, that's kind of where I was going first. I'm curious if you have any thoughts on that.
Curtis Shoung
I mean, yeah. That, that kind of kind of works, right? At least it's sets the table for like, you know, who we are, what we do. So go for it.
Cainen Gerety
I mean, yeah, I just feel like the origin story kind of tells a little bit of like why we're here. So, I mean, you might even know this too, James, but, you know, essentially our CEO and kind of part of our kind of founding team actually started a coffee shop in Melbourne about eight or nine years ago, potentially almost 10 years ago.
And one thing they noticed when they started this coffee shop is they were ordering cups and coffee and things from different regions. Maybe it's from China, maybe it's from other regions. They were ordering coffee from other regions that were like selling coffee and they kind of pinpointed an issue with like the supply chain and kind of how difficult it was to move money around the world, globally and to actually. Get the supplies that they wanted on time and like affordably and kind of like being able to make those relationships with people in other regions around the world.
So that's where they kind of had this idea to spin up a financial platform that was really connecting the world from a banking financial perspective. So kind of going into like why people love us, it's obviously just we're trying to make global companies like their operations easier at the end of day. I think it's a little bit of antiquated system with bank, you know, kind of old school banks kind of moving money through old archaic systems like swift messaging, you know, like the Swift, swift network. So, really trying to just make things easier and kind of more simple for businesses who are going global or already global and kind of expanding from there.
James Dihardjo
Interesting. There's always a coffee shop central to a Melbourne story. Oh, well that seems to be the case. Just on like simplifying, do you think that the simplification of financials and banking and being out, being able to do business in other countries more easily and so on, so forth. Do you think that that's really helped with profitability? Of a lot of businesses, like I'm changing gears here, but you know, obviously Airwallex is not a cost saving thing, but maybe it's an opportunity thing. Do you, do you get that sort of feedback?
Cainen Gerety
Yeah, I mean, really. I mean you're expanding your market, right? You're being able to tackle a new set of customers. I do think there's like generally, when you're going to go expand, there's a little more, a complexity that comes, some, we can't help with everything, right? New taxes you're taking on, there's kind of new compliance and regulations and selling your product into new markets, and you need to make sure everything is right from like a logistics perspective. But we're trying to make things simple on the financial side, make things affordable as well. And I think just generally, if you can succeed in a new market, you can double, triple your customer base quite, quite easily.
James Dihardjo
Yeah, for sure. Yeah. Look, I mean I've got obviously a lot of insight from MerchantSpring about the complexity of profitability. Different marketplaces have hundred, like Amazon as an example, has 120 different revenue and expense lines, I think and contra revenues and contra and expenses and I guess making the finance side of it, the banking side of it, just easy. Lets them focus more on expanding and making, like actually making the money. Which means my next point, so we're launching this sort of partnership right? Where, we are giving out an analytics tool in I guess in in partnership with you, which is going to help with profitability. Can you tell us a bit more about, a little bit more about that and how that, that works?
Curtis Shoung
Yeah, I can go there. So yeah, just everyone knows I'm Curtis. I'm on the partnership at Airwallex. Just properly introduce myself here. And you know, Airwallex is really great at sort of the banking and the infrastructure and making sure you can quickly expand your new market and making sure you're not like burning money, converting funds back and forth and all, all those sort of things we're really good at. And giving you cash back on your card spend and et cetera, et cetera, et cetera, all that other stuff.
One of the things that we hear from our clients is like, Hey, it is complex to manage two or three or five different marketplaces, right? It is actually quite hard to like track inventory in this sort of way and just track how much I'm spending my Ads, right? And you know, like, just for full transparency, like me and James have been Merchant Spring has been a partner of ours for like over a year now. And it's one of those things where like, you know, I wish we built it, right? I wish Airwallex built this tool because it this makes a lot of sense, right? Where in my head, Airwallex helps you with all the financial back office stuff.
And MerchantSpring helps you all the front office stuff. MerchantSpring tells you where you should go, where you should double down in, where you're making money, where you're hopefully not losing money, we're not losing too much where you could fix it, where the challenges are. And so, you know, MerchantSpring will going to help you grow and we'll make sure we're helping you stay sane in the backside and not leaking money out the backside of your revenue.
James Dihardjo
Yeah. Cool. Yeah, look, I think it was also just to build on that a lot of the enough mutual customers that kind of suggested that it also made sense like they're using Merchant Spring to monitor what's going on underneath that settlement into that bank account. So yeah, look, I guess that's enough from us, right? I know there's probably some questions that have come through from your side, in the four minutes have gone left.
Curtis Shoung
Yeah.
Jame Dihardjo
You got those questions?
Curtis Shoung
Yeah. I mean, because like, I think generally speaking, and maybe your customers know this, but as we're announcing this partnership. I think what do you sort of see e-commerce merchants do that sort of like as, hey, wow, this MerchantSpring solution is great because I know it's great. I've heard from our joint customers, it's great. But sort of what do you see as like the typical like, oh wow, MerchantSpring’s amazing. I'm never leaving this product again. Why do they log back in like everyday to your tool?
James Dihardjo
Yeah. I think the answer like varies depending on where that merchant is. But if I think back to The customers that are like based here in Melbourne as an example, they'll have, they would have like maybe 15 marketplace accounts. Like they'd have Amazon, US, UK, Australia, probably sometimes all of them, like every single one. And they may have eBay, Shopify, I don't know, and Walmart, right.
One simple thing for them is well, MerchantSpring would let them see all of those channels in one kind of, literally in one card. So they log in and go, okay, I want to see month to date, 1st of July, 27th of July. And it'll just say, the total figure across all your sales channels is blah. And then here's the breakdown. I know that doesn't sound really sexy, but it's actually a difficult question to answer. Like the alternative is, you go and log into US and then you go into UK, and then you log into your eBay, and then you kind of sum it all up on, I don't know, like Excel or whatever.
Curtis Shoung
Yeah.
James Dihardjo
So that's like a key thing that a lot of people just. Yeah, it's a massive time saver and, and you go from being blind to being able to see everything, you know what I mean?
Curtis Shoung
Yeah, it's very similar to what we hear too, right? Like if you're not using an Airwallex like solution, you have a US bank and actual UK bank and like you have like 5th, 13th different bank accounts and different markets, and Just to like rebalance it, you're actually wiring money back and forth to yourself.
James Dihardjo
Yeah.
Curtis Shoung
Which is just like nonsense. You're not just like, oh, like I want to just send money to myself in my Airwallex account. No, no, no. I'm sending money from my UK physical bank to my whatever bank. And that needs like four different authorizations and you know, all sort of stuff. And it just becomes really painful. So that's totally makes a lot of sense. Great. And then I mean, another question, right? So on your product, a product roadmap, People who sort of like know what MerchantSpring does already, but what can they look forward from to the product itself and possibly from the partnership as well?
James Dihardjo
But I don't know how to answer that question, man. So I think the things that I can say is definitely enhancements to advertising. So obviously if you've got Amazon or whatever it is, marketplace you're selling on, where the industry's going is we're seeing like more activity in the advertising space outside of Amazon, maybe through display networks like Criteo, CitrusAd or through things like Facebook or TikTok bringing traffic ultimately back to an Amazon listing or a Shopify listing or whatever it is.
So our roadmap is going heavy in that. So like you'll be able to connect many different types of advertising channels and be able to kind of track that financial performance there back to the actual product or the sales channel that you, you have. I think on the other side of the roadmap, we're also doing more connectors. So, you know, we've launched this year, Mercado Libre. And Magento and BigCommerce and a bunch of things in Europe like bowl and blocker and all these like Dutch marketplaces.
But we'll just go harder at that. So that just means this year, it's probably in the tail end will be more about 1P Channels like Walmart 1P, got Walmart 3P, but more Walmart 1P and then Asia. So like Rakuten, Shopee, Lazada, those sorts of things. So yeah, two streams, connectors, advertising, functionality. That's the next 12 months.
Curtis Shoung
Very, very cool. I'm glad we're partnering and that go against you. So, I guess I can just we're like another minute or two here, right? I'll wrap it up a little bit. So just to be perfectly, you know, if, if you like what Airwallex's saying, like what James was saying on MerchantSpring side, we are launching this partnership, right? And the partnership is actually like you will get through Airwallex a MerchantSpring account for free, as long as you sign up to be an Airwallex customer.
And you're getting like all the bells and whistles, all the feature sets that MerchantSpring has, that James has, when you sign up for an Airwallex account. And you know, change, transact and we make sure you're good standing and all that stuff, stuff, but it's, you know, very low thresholds here. And we're really excited about this partnership because of the vision I sort of like bounced earlier, right? Where you can sort of get the growth from, you know, one side and the savings on the other side. And and together, it should be great, you know, a very valuable value proposition for you. So we do have a link. I don't know, I want to share this link with you now that I think about this.
James Dihardjo
Well, I think everyone will get this, just everyone listening now and get a link to the recording. And
Curtis Shoung
Perfect.
James Dihardjo
Yeah, we'll include that link with it then.
Curtis Shoung
Yep. Perfect. So there's going to be a link click on the link, takes you to our site. Don't sign up for MerchantSpring site. Just sign up on our site for the MerchantSpring thing. Because otherwise we won't be able to track it. And hopefully, you get a lot of benefits and we're going to be doing this a few more times right James?
James Dihardjo
Yeah, I think we'll try and do it. Maybe not with you, Curtis, no offense.
*(All laugh)*
James Dihardjo
But it'll be at least Cainen and I cycling through different kind of attendees and maybe mutual customers and users of both products and so on. So yeah, keep an eye out for it.
Curtis Shoung
Perfect. Sounds good everyone.
James Dihardjo
Awesome. Thanks guys. See you next session.
Curtis Shoung
Yeah, thanks James. See you next time.
