Remitly — a mobile platform that lets users send money abroad — is one step closer to achieving its goal of establishing a “global footprint.” Today, the Seattle startup is announcing a $38.5 million Series C fundraising round — one of the largest venture financing deals in a Washington state technology company this year.
In addition to the funding announcement, Remitly is also unveiling a new logo and launching in Canada. The expansion will give Remitly access to Canada’s large remittance network, which sends an estimated $24 billion per year to other nations.
“It’s a really exciting time when we think about the trajectory of the business,” said Remitly CEO Matt Oppenheimer. “We grew 400 percent year-on-year so we’re sending over a billion dollars a year.”
Remitly has raised $61 million to date, from firms like Bezos Expeditions, Founders’ Co-op, and DFJ. The startup — a Techstars Seattle grad formerly known as Beamit Mobile — also raised a $12 million credit from Silicon Valley Bank in September of last year.
Stripes Group, a New York-based equity firm focused on software, healthcare and consumer products, led Remitly’s latest fundraising round. Its portfolio company includes companies such as Blue Apron, Udemy and GoFundMe. DFJ, DN Capital, Bezos Expeditions, Vulcan Capital, and Trilogy Equity Partners also participated.
The cash infusion comes at a time when many are predicting a cooling climate for venture-backed companies, with venture dollars and deals down 11 percent in the first quarter of 2016 when compared to the same period in 2015. Remitly plans to use the new capital to grow its team, which comprises about 100 employees worldwide.
“When we talk about setting up a global footprint that means we’re going to be recruiting top tier product, engineering talent,” said Oppenheimer. “It means that we’re going to be recruiting marketing talent and other aspects, operations, other components of our business that we’ll need to scale up.”
Remitly also plans to grow its user base in its current markets and expand to new money corridors, with help from the latest financing.
Canada will be the second country, after the U.S., that Remitly users can transfer funds from — what Oppenheimer calls a “send corridor.” “Receive corridors” include the Philippines, India, and Mexico.
Remitly aims to stay ahead of the competition with lower fees and an emphasis on mobile. Competitors, like Western Union and Xoom, charge customers a 7.9 percent fee, on average, according to Oppenheimer. Remitly allows free transfers if the sender can wait three days for the funds to arrive. It costs a $3.99 flat rate for same-day transfers and credit card transfers include a three percent fee. Remitly users who send over $1,000 to India don’t pay any fees.
The company’s long-term goal is to develop “send markets” in Europe and expand receiving markets to countries in Latin American and Africa.
Oppenheimer left a job at Barclays Bank in Kenya to found Remitly, after witnessing how difficult and costly it was to send remittances abroad. He sees the projected $588 billion in yearly remittances as a second — and more effective — form of foreign aid.
“There’s a long tale of other countries that we will eventually serve, but by focusing in these corridors in the early days — you look back at any successful global technology and they’ve focused on the customer, they’ve focused on a big market where the customers are at, and then they scaled up,” Oppenheimer said. “That’s really the story of this round.”