Airwallex, which was recently valued at $5.6 billion and is backed by Tencent, is one of a number of high-profile fintech IPO contenders to watch.
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TencentCloud-based payments startup Airwallex plans to reach $500 million in annual revenue and be ready for an initial public offering (IPO) by 2026, CEO and co-founder Jack Chan told CNBC in an exclusive interview.
When asked about the Singapore-based company’s future prospects after it crossed the $500 million ARR milestone last month, Chan said: “I think the next big milestone is $1 billion. Hopefully we can reach that in 2026 or 2027. That’s the target.”
Run rate roughly measures how much revenue a company makes in a year, based on month-to-month performance.
Zhang said Airwallex saw strong business growth last year thanks to its expansion into developed markets such as the UK, Europe and North America.
According to data obtained by CNBC, AirWallex saw revenue grow by more than 300% year-over-year in the Americas.
Currently, the UK, Europe and North America account for more than 35% of Airwallex’s total trading volume, according to Zhang.
When asked by CNBC how he felt about his company’s IPO prospects, Zhang said, “What’s important for us is to be IPO ready in the next two years and have the choice of whether to IPO or not.”
“Everything will be ready in 2025 and we can decide what to do from 2026 onwards,” he added.
Airwallex’s annual payment processing volume has exceeded $100 billion this year, up 73% from last year, Chan said, as the company saw increases in processing volume across all of its products, including payments, foreign exchange, disbursement and issuance.
“It took us nine years to break through the $100 billion target,” Zhang said. “I hope it will take less than a year to reach $200 billion.”
Utilizing “AI Workers” to reduce costs
Airwallex is currently in the red, but achieved profits on a monthly basis in December 2023 and January this year.
Zhang said Airwallex is not prioritizing making an annual net profit given its current pace of growth, but has found ways to keep costs down.
He said artificial intelligence is helping AirWallex employees be more productive, ultimately helping them do more with less.
For example, he said, Airwallex is experimenting with 11x, a company that provides digital access to other businesses.The company plans to replace most of its sales development representatives (SDRs), who specialize in sales lead management, with “AI workers.”
He says the pilot project only just started recently, but Chang is so confident about deploying AI agents to handle the day-to-day work of SDRs that he believes AI could replace 70% of the SDR role in the company’s operations.
However, Zhang stressed that while some roles will effectively be replaced by AI, most roles will be augmented by technology to make Airwallex’s sales team more productive.
For example, one SDR can manage five virtual SDRs.
Airwallex, which was recently valued at $5.6 billion and is backed by Tencent, is one of many big fintech IPO contenders to join the fray.
But Zhang said the mood in the financial technology industry remains depressed for now.
“Investor perception is still not very good and they are still conservative,” Zhang told CNBC. “This has been going on for about three years. Nothing has really changed much.”
But, he added, “Fintech is a huge market – there are big players like Nubank, Revolut and Stripe. Adyen It’s really going well.”
“Investors will still choose the right companies to invest in. We just need to ensure that Airwallex is No. 1 in global payments in the financial sector,” Zhang said.
