Not too many businesses feel that getting to $50 billion of transactions represents barely scratching the surface. But payments specialist Thunes, which is today announcing the completion of a Series C funding round worth a little over $60 million, thinks that’s exactly where it currently stands.
“Around $150 trillion of payments go through [the banking industry’s international money transfer network] Swift and the correspondent banks each year,” explains CEO Peter De Caluwe. “Some of that is accounted for by large payments that don’t necessarily need to move quickly, but the type of payments we support come to around $60 trillion, so that is our total addressable market.”
In that context, the $50 billion of transactions that Thunes has completed since its launch in 2016 does indeed look relatively modest. Yet starting from scratch, the company has made impressive inroads into a market that was crying out for innovation.
Thunes started out with the intention of helping to connect the populations of Africa and Asia to the global financial infrastructure. In these two regions, it is telecoms players and ecommerce providers that provide people with the majority of banking services, rather than banks themselves; as a result, transferring money to and from them via conventional banking networks such as Swift is challenging or even impossible. Thunes therefore built an entirely new payments infrastructure to facilitate such transfers.
This work has expanded over the past seven years. Today, Thunes enables people to make payments to and from 130 countries worldwide, whether the sender and recipients hold bank accounts or alternative arrangements such as digital wallets. It has connected 3 billion such wallets alone. “Our network aims to connect everyone,” says De Caluwe.
To build that network, Thunes’ team have travelled the world, negotiating access and compliance terms with regulators and central banks in each new market. The result is an infrastructure that enables Thunes to offer a service level that traditional banks have struggled with: customers can make payments instantly, they get charged one upfront fee for the transfer, the recipient knows how much they will receive, and confirmation of receipt is provided.
Thunes last raised funding in the Autumn of 2021, when Forbes broke the story of the company’s Series B round. That cash enabled it to accelerate its growth trajectory – the company has added 30 new markets to its network since then – but also to make a couple of strategic acquisitions to build out its value model.
Today, the company essentially offers three products. Its traditional payments service is the mainstay of Thunes’ activities, but it also offers a compliance-as-a-service solution to banks, leveraging the in-house technology solutions it has developed to cope with requirements such as anti-money laundering regulation. The third arm is a collections business, enabling companies to collect payments from customers with digital wallets more easily.
Given that $60 trillion addressable market, De Caluwe believes the business is only just getting started. “All that limits growth is ourselves,” he says. “We have to move steadily but cautiously – there is no cutting corners in this business.”
Still, this is a business that has now built market reach to well over half the world’s population. It may therefore be surprising that Thunes is not yet a household name, but the company’s relative anonymity is explained by the nature of its customer base. Thunes has never been consumer-facing – rather, it deals with enterprise customers including some of the world’s largest digital money transfer operators, leading fintech banks, ecommerce and mobile wallet providers, and gig economy businesses. Customers include the likes of Visa. Revolut, Moneygram, UberEat and Deliveroo. That gives it a much lower profile than, say, Wise, the international payments company that has grown through a similar approach to building new infrastructure, but with consumers as the target market.
Thunes does have rivals, with obvious competitors including the likes of Airwallex, CashQ and NIUM. But De Caluwe argues that Thunes is the largest payments network in the world outside the Swift network and the only one to serve digital wallets so comprehensively. “It takes time and effort to build this sort of infrastructure for yourself,” he says. “But having that control is what enables you to offer high-quality services.”
As for the future, Thunes expects to have connected 5 billion wallets within the next three years. Today’s Series C round will provide it with further capital to support growth and to bolster its balance sheet, providing it with important credibility in negotiations with regulators and central banks. Further M&A is also possible, though not central to the firm’s strategy.
The money is coming from investors led by the London-based hedge fund Marshall Wace, with support from Bessemer Venture Partners and the private equity firm 01Fintech. “Our ambition is to provide everyone – businesses, entrepreneurs or individuals – with access to cross-border money movement at high speed and with absolute efficiency,” adds De Caluwe.