LONDON — A fintech business backed by Google’s venture capital arm went to its investors for cash just months before raising money from the search giant, accounts show.
CurrencyCloud, which provides a platform to process international payments, raised £9.5 million from its existing investors in December 2016. The company had £10.5 million in the bank at the end of the month, accounts show, suggesting the platform had around £1 million left at the time of the fundraising.
The company says in its 2016 accounts that the cash call was necessary to “continue to achieve [its] goals” of developing its payment platform, expand its payout network (where people can collect cash that has been sent internationally), and to grow its customer base.
The investment was not announced at the time. CurrencyCloud went on to raise £10.5 million from new backer Google Ventures in February and March of this year and announced both investment chunks in one go.
In a note in its accounts, CurrencyCloud said that it “carried out two fundraising exercises, which enabled the group to be fully funded for the next 12 months from date of approval of the financial statements or at least until the point anticipated profits are expected to be achieved group wide.”
CurrencyCloud, founded in 2012, has raised around £45 million to date from investors including Google Ventures, Sapphire Ventures, Japan’s Rakuten, and Notion Capital.
CEO Mike Laven denied that the company was in danger of running out of cash in December, saying in an emailed statement to Business Insider:
“For administrative reasons, our Series D funding round of £20 million led by GV, Rakuten, Notion and Sapphire closed in two tranches, the first at the end of 2016 and balance in Q1 of 2017. The company has experienced no cash issues and is fully funded going forward while we build out our global platform.
“2017 Y/Y growth is currently accelerating with transaction volume up over 100% and revenues over 75%. The company has never been in a stronger position.”
CurrencyCloud’s accounts show a year of transition for the business as it moved from targeting big payments to higher volume, lower value payments on its platform.
The volume of payments jumped by 110% to 1.5 million but net revenue from currency transactions increased by just 10% to £3.2 million. Meanwhile, administrative expenses rose by 54% to £13.9 million as CurrencyCloud invested in “recruiting staff, developing our technology infrastructure and operations services, and moving to new office premises.”
The company made a pre-tax loss of £11 million on revenues of £7.5 million. That compares to a loss of £6.2 million on revenues of £4.8 million in 2015.