XENDIT. the smart way to move money

Transcription

1 XENDIT the smart way to move money

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3 $200 $180? Nuneng $6 transfer fee $10 forex spread $4 in country fees Family in Indonesia

4 Problems with current money transfer 50+ interviews to date 1 Experience Inconvenient 2 Fees Cheated 3 Cash in and out Limited to cash

5 XENDIT provides the simplest way to store and move money across borders through the cheapest pipes in the world

6 Enter Xendit 1 Experience Transfers from your phone 2 Fees Halve remittance price with transparent fees 3 Cash in & out Partnerships for cash out

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9 Indonesian Overseas Foreign Worker (OFW) 120% phone penetration 80% unbanked Clusters around the world

10 $550b $50b $7b

11 Customer acquisition Referral bounties to incentivize user adoption Cluster outreach via on the ground campaigns Partnerships to build mass distribution

12 Partnerships Philippines Indonesia China MELOTIC

13 Won Hackathon Pilot product $30,000 USD Partnerships Jan 2015 Summer 2015 Nov 2014 Mar interviews Public Beta

14 16,000,000 IDR 1,100 meals 6 months

15 FINANCIALS $100m Annual revenue in 5 years Profitable in 3 years $1.1m round SOCIAL IMPACT $1.5b Cost savings 500,000 families step out of poverty

16 AS SEEN IN XENDIT

17 Risk FAQs Description Mitigation Bitcoin volatility Price volatility means currency risk Instantaneous transactions means no currency risk during the transaction We have multiple ways of moving money around the globe to mitigate this risk Regulation Countries disallow or make digital currencies difficult to use We build on top of exchanges so they adapt to the currency regulations Choose countries with more amenable regulation where interests are aligned Incumbent Banks and MTOs, e.g. Citi or Western Union lower rates so price war initiated Focus on convenience and ease of use price is not only competitive advantage

18 Team Bo Chen Juan Gonzalez Product Ripple Integration Brandcast Core Dev UC Berkeley Computer Science Expedia Software Engineer Pagoki Software Engineer UC Berkeley Computer Science Moses Lo Vivek Ahuja Casey Lord Customer Acquisition Amazon Retail Busn Dev makemysuit Founder Boston Consulting Group The North Face Strategy US Navy Lieutenant overseeing Nuclear ops Paypal Product Mgt CAF Venturesome Director Fulbright Scholar

19 Competition in the $500b global remittance market Average cost of 7% from US to Asia Easy UX XENDIT Expensive Low cost Hard UX

20 Competitor valuations Competitor Valuation Revenues Description 10.2b 5.5b Most trusted name in cash to cash remittances 0.46b 1.4b Second largest player in cash to cash remittances 0.65b 0.16b 4% of US-Philippines corridor; $43 CAC with $172 CLV 1b - Account to account startup 30b 7.9b Focused on merchant payments to make margin 0.4b - Trusted Bitcoin company for consumer wallets Source: 10K filings, Publicly available financial information Note: Moneygram s valuation is lower than its revenues not a typo!

21 3 distribution partnerships signed Financial Partners Distribution Partners USA Partners Description Status Partners Description Status 7,800 stores in USA Head of Asian Expansion If our customers want it, we ll give it to them Biggest bitcoin exchange Partnership in play for months, discounted prices 200 stores; 5,000 post offices; 17,000 ATMs Head of Digital revenues agreement to partnership Indonesia New bitcoin exchange CEO agreement to access discounted rates 15,000 stores around Indonesia Bitcoin remittance Looking for exclusivity in relationship 30,000 agents First discussion: open to partnership pending volume Largest bitcoin exchange CEO agreement for partnership Access to mass distribution Signed partnership deal Philippines Second largest Bitcoin exchange Signed partnership deal 1,500 branches Accessed via Rebit/Coins 1,000 branches Accessed via Rebit/Coins China Financial & Distribution access to bank accounts LOI signed

22 Overseas Foreign Worker: Target Customer Customer Profile Overseas Foreign Worker Global citizens Small/Medium Business Profile Size of market Consumers working in a foreign country sending remittances home, e.g. Filipino worker in USA Large 80% of transactions Served by Western Union and regional players Consumers with multiple accounts in multiple currencies across the globe, e.g. students Smaller 20% transactions, only 800k international students in US Served by banks and newer entrants (Xoom, Transferwise) Business with regular cross border transactions, e.g. Australian tailor paying suit supplier in China Trillions in business cross border transactions Served by banks Advantages Pain point highest here Consistent demand for transfers Technology savvy Larger transfers Low priority issue for owners Challenges Initial trust creation Competition is high at endpoints Smaller market (but growing) Inconsistent Demand Lower pain point Bottom Line Source: 50+ customer interviews Exciting segment when we can solve last mile distribution Great early adopter, easily accessible by our team, but is not the customer with the biggest pain Less useful segment for initial target market but is largest segment

23 Customer Acquisition Roadmap Pilot March 7, 2015 Beta Summer 2015 Public launch Q Growth 2016 High touch launch: simple seamless product Nurture early adopters; Introduce growth hacks Digital advertising; Build PR around launch Digital marketing; Data drives marketing plans Product Requires sender and recipient to have Xendit account Promote sharing: Facebook login provides bounty Support USD, IDR, PHP, AUD No KYC required on first transfer $10 bounty for activated referrals Build waitlist via gaming mechanisms; incentivize sharing to jump the line Confirm branding based on interview and focus group insights Onboarding process guides new users through their first transfer (mandatory) Streamline KYC through aggregation partners Launch in-country transfer products to drive stickiness Activation and retention hacks, e.g. rewards, gaming mechanisms Expansion to new currencies (Europe, Asia) Direct Pilot with clusters in Bay Area: focus groups to build trust Direct s to pilot network (closed group) Concierge experience: high touch support from team Heavy customer support for any issues Direct lines and focus groups for feedback Trial with clusters in LA; conference calls/focus groups for feedback Direct s to waitlist Appoint ambassadors in key clusters (schools, community orgs, union, expat) Physical presence in dense remittance locations (US and ASEAN) Lifecycle program Reward programs for ambassadors in dense remittance origins, e.g. OFWs in HK use to drive WOM and content Joint promotion with in country partners Social Media and Content Build content for blog Establish SM accounts, identify network brokers and influencers Establish tracking systems Build SM presence Build content marketing Build online presence, e.g. Quora, blogs Engage customers on social media Grow content marketing Run competitions Influencer marketing Drive brand awareness through social media and content Digital advertising Develop hypothesis around customer profile and usage based on focus group data Build A/B tests Digital campaigns across search and social media (including competitor names) Build A/B tests User data informs lateral search term campaigns (based on customer profiles) Ads on relevant high traffic sites Seasonal campaigns, e.g. tuition due dates, Chinese New Year In country marketing for in country transfer product

24 Xendit Correspondent banks Xendit cost difference: our payment rails avoids correspondent banks Sender Bank Correspondent Correspondent Bank Receiver up to 3x Fee Fee Fee >2% spread = 7% ave Sender Bank Bank Receiver Xendit Engine Peer to Peer Transfer Digital Currency Exchange Transactions Spot Market Forex Transactions 2% Fee = 2% ave

25 Xendit has a unique cost basis to move money globally Xendit triage engine finds the cheapest method to move customer funds Peer-to-Peer Digital currencies Traditional markets 0 marginal cost 5% transactions initially 50bps / txn 33% transactions initially $9 + 25bps / txn 62% transactions initally Customer acquisition means more transaction volume through P2P, lowering our cost base Source: CurrencyCloud, Bitcoin.co.id and Bitstamp

26 Most of the current cost base in commissions Consumer to Consumer Cash to Cash USD to IDR Western Union Moneygram Transaction volume Fixed fee 22.0 (11.0%) 15.0 (7.5%) Exchange rate fee 8.2 (4.1%) 4.8 (2.4%) Total fee 30.2 (15.1%) 19.8 (9.9%) Note: Costs are percentage of revenue; Prices as of Source: Cognizant 2012, Western Union 10K 2014, Moneygram 10K 2013, Western Union, Moneygram websites

27 Account to Account competitors at 1-3% Consumer to Consumer Account to Account USD to PHP Xoom Remitly Paypal Transferwise Transacti on volume Fixed fee 4.99 (0.5%) (1%) Exchange rate fee 27.8 (2.78%) 27.4 (2.74%) 29.4 (2.94%) - Total fee 32.8 (3.27%) 27.4 (2.74%) 29.4 (2.94%) 10 (1%) Note: Costs are percentage of revenue, Prices as of Source: Xoom 10K 2013, Paypal, Transferwise websites