When Australian-born, now Singapore-headquartered, Airwallex disclosed on 21 May that it had pulled in another US $300 million at a US $6.2 billion valuation, many observers, including myself, reacted with surprise – if not disbelief. Venture investment into fintech is trudging through its deepest freeze in seven years, down 72% year-on-year for “banking tech” deals in the March quarter alone, according to fresh industry tallies.
Yet here was a cross-border payments specialist posting an 11% valuation jump on the back of a round that was half secondary and half primary, led not by desperate existing investors but by a syndicate that still includes DST Global, Lone Pine and Square Peg.
The outlier pattern
Airwallex is not the only money-movement start-up sidestepping the funding winter. In the past fortnight alone:
Both sums are rounding errors next to Airwallex’s war chest, but the optics are identical: cross-border payments, particularly B2B FX, remain fundable even as consumer-lending, wealthtech, and Buy Now Pay Later (BNPL) valuations continue to compress. Investors have decided that helping companies shift money across borders is a fundamental plumbing business, not a cyclical sugar high.
Why this niche defies gravity
1. Locked-in revenue pools
McKinsey’s most recent Global Payments Report put 2025 cross-border flows at US $200 trillion – a 15% jump in a single year. B2B trade still makes up roughly two-thirds of that. Even if the growth rate cools to a projected five percent CAGR through 2028, that still adds up to a tremendous amount of potential fee income across the system. Unlike retail BNPL, those flows are not optional; they are the grease that keeps global supply chains moving.
2. Diversified corridor exposure
Airwallex’s latest numbers show the firm’s gross profit in the Americas and Europe growing at a 250 percent CAGR over the past four years, while Asia remains its anchor. A corridor-agnostic model hedges geopolitical risk far better than single-market neobanks.
3. Enterprise stickiness
Companies that integrate a provider’s APIs into their treasury or marketplace stack rarely rip them out. Once Airwallex sits under Shein, Qantas or Xero—as the company now boasts—the switching costs soar. Net revenue retention north of 120 percent is commonplace, cushioning any macro wobble.
4. Structural tailwinds
Cross-border e-commerce, digital nomad payrolls and the still-unfinished job of real-time interlinkage (PayNow-DuitNow, PROMPT Pay, InstaPay et al.) are permanent growth levers. Even banks concede that “up to 65 percent” of low-value international transfers have already migrated to non-traditional providers.
Funding winter? Not for FX
Compare Airwallex’s trajectory with that of two other fintech archetypes:
- Neobanks. UK data show funding for pure-play consumer banks plunging in 2024; an April analysis put the drop at 72 percent year-on-year. Valuations at Revolut, Monzo and N26 are effectively flat-lined, and Zopa’s 2024 “pre-IPO” raise priced in a down round that management had to explain away as “market normalisation.”
- Wealth-robo and BNPL. Klarna’s 2023 85 percent markdown still colours every conversation, while Affirm trades at a fraction of its pandemic peak. Investors are demanding a clear route to profitability – something cross-border specialists can already flash.
Why the difference? Because cross-border players monetise both volume growth and FX spread, giving them an inbuilt hedge against interest-rate gyrations. When the Fed raises rates, Klarna’s funding costs balloon; when the dollar spikes, Airwallex makes more money per transaction.
The new valuation landscape
Airwallex’s US $6.2 billion price tag now represents roughly 5.5 times its forecast US $1 billion run-rate revenue for 2025. That multiple looks steep beside public-market comps. London-listed Wise trades at about 3 times forward revenue and a US $11 billion market cap as of 23 May. Yet private investors seem willing to pay an “execution premium” for the faster-growing challenger, betting that it will eventually land above the peers once it monetises adjacent services such as multi-currency credit and corporate cards.
The brutal reality for most late-stage fintechs is a flat or down round. According to venture advisory Pathlight, fewer than 10 percent of Series D+ fintech deals in Q1 2025 priced above their previous round. Airwallex sits in that privileged minority—one reason its raise captured headlines far beyond the payments clique.
What the money will buy
CEO Jack Zhang says the fresh cash will bankroll pushes into Japan, Korea, the UAE and Latin America, plus heavier investment in an embedded-finance suite that already offers treasury, expense management and credit. The more interesting subplot is the US $150 million in secondary share sales baked into the deal: early employees and angels are finally getting partial liquidity, a gentle nod to the fact the IPO window may still be 18-24 months away.
For customers, that war chest translates into ever-thinner spreads. The dirty secret of cross-border FX is commoditisation: if you cannot beat Wise or Revolut on price, you had better differentiate on API depth or local payout options. With annual transaction value already above US $130 billion, Airwallex can amortise margin pressure across scale.
Can the story repeat?
Yes, says the recent flow of smaller cheques into seed-stage payment infrastructure outfits. OpenFX’s seed-plus round and Navro’s Series B tell us that VCs are still pushing money toward anyone claiming to shave basis points off global settlement. They are not underwriting the next consumer wallet; they are underwriting the next generation of “picks and shovels” that power borderless trade.
That aligns neatly with corporate procurement habits. When an apparel marketplace in São Paulo wants to pay a fabric mill in Guangzhou on Sunday night, it does not care about flashy branding; it cares that the money lands in hours, not days, and reconciles back to its ERP automatically. Cross-border infrastructure has become a utility – and utilities attract “flight-to-quality” capital when the rest of the market turns risk-off.
What could go wrong
1. Regulatory minefields. Every jurisdiction now flirts with hard data-localisation rules, tougher licensing for Payment Aggregators (India’s PA regime is the poster child) and looming equivalence questions under Basel’s prudential treatment of digital-asset exposures. A single compliance mis-step can turn a growth engine into a money pit.
2. The ascent of instant domestic rails. ASEAN’s mesh of bilateral QR links promises dollar-free retail settlement. As those networks mature, spread-taking intermediaries could be squeezed out of low-ticket corridors entirely. B2B flows are safer, but the margin ceiling will keep ratcheting down.
3. IPO timing risk. Airwallex clearly wants a public listing – rumour has long swirled around a dual US-Hong Kong float – but the 2025 window is crowded. VC-owned peers such as Nium, Stripe and Rapyd eye the same runway; saturation could trigger valuation discipline that private investors have postponed.
Reading the tea leaves
The broader lessons for founders and investors are stark:
- Infrastructure beats interface. Consumers and small businesses may switch apps in a heartbeat, but APIs buried inside procurement systems stick.
- Gross settlement value is a better predictor of durability than “super-app” engagement metrics. Airwallex is on track for US $150 billion-plus in annual volume; few digital banks come close.
- Geography still matters. By balancing Asian DNA with US and EU licences, Airwallex avoids the “single-regulator choke point” that clipped Wirecard and Paytm.
For regulators, the raise is another data point that competition in international payments is intensifying without formal regulatory bulldozing. The BIS’s Project Nexus and ASEAN’s multilateral Fast Payment System have yet to launch – and already the private sector is slashing fees and speed.
Bottom line
Fintech may be in a funding freeze, but cross-border payment specialists like Airwallex are skating on a thicker sheet of ice. They own the pipes through which global commerce flows, and—at least for now—those pipes are indispensable. As capital reallocates toward ventures that promise boring reliability rather than headline-grabbing growth, the humble FX spread is turning into one of the safest bets in next-generation finance.
If history is any guide, a 5–6× revenue multiple for a hyper-growth infrastructure play will not look extravagant once public investors regain their appetite. Until then, every Series C founder building treasury APIs or multicurrency wallets will pin Airwallex’s funding deck to the virtual wall and tell investors: “See? Payments plumbing pays.”
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