If the last few years have shown us anything, it's that virtually everything--from health care, to the way we communicate with friends, to the way we shop for anything from groceries to luggage--is going digital. Just as the internet has transformed the way people share content and conduct their lives around the globe, it now has the potential to revolutionize how people share and transfer capital.
Among other innovations, digital connectivity has heralded in a push for faster payments, user-friendly interfaces, and payment transactions that are "embedded" within apps (a la Uber). While several brands seek to capitalize on the new frontiers of the digital payment industry, Boston-based Circle App is pushing one of the grandest visions around. And with a recent $60 million round of funding, Circle is now aiming to take digital payment sharing to new global heights.
If all goes to plan, here's how they'll transform the digital payment industry.
A Global Vision
Circle's founders envision a future in which financial transactions work much like social media communications: instant, free, fun--and completely unrestrained by national borders. The goal is for users to be able to exchange currency in the same manner that they share content and messages across the internet. In the process, the app's founders hope to supplant more cumbersome (and expensive) money transfer options such as government rails, bank wires, and credit card networks.
To that end, the company enables users to make international, peer-to-peer payments via the Bitcoin blockchain or network. Users send money to someone in another country, and that person can then receive the money as bitcoin or cash it out in their own currency. In order to achieve the goal of making payments fun, the app also includes a social component: Users can send emojis and GIFs along with their payments.
So far, the idea has proved popular with investors. To date, Circle has raised over $140 million in its quest to revolutionize international, peer-to-peer payments, and the company's global customer base has skyrocketed by 300 percent in the last year. In its latest push for funding, Circle raised $60 million in a round led by Beijing-based IDG Capital Partners along with Breyer Capital, General Catalyst Partners, and a syndicate of China-based partners (including Baidu, CICC ALPHA, China Everbright Limited, Wanxiang, and CreditEase), among others.
It's the latest step in the app's quest for nothing short of a global takeover.
Expanding into the Chinese and European Markets
Circle already has licenses in the U.S. and U.K. that allow it to facilitate money transfers in dollars, pounds, euros, and bitcoins. The company predicts it will surpass $1 billion in transaction volume this year alone. Now, Circle is hoping to tap into the world's second-largest economy in China.
In addition to announcing its latest round of funding, Circle also recently revealed that it created a new, Chinese-based company six months ago with a multimillion-dollar seed investment. Dubbed Circle China, the company is meant to enable Circle to execute its vision for connecting each of the world's major currency zones.
"We want to connect consumers using dollars, pounds, euro and renminbi the same way that the web, email and other protocols have connected consumers globally," write the company's founders in a recent blog post.
A quick look at the data suggests China should be a safe bet. China's local currency, the renminbi (RMB), is on the rise, and the Chinese middle class is expected to play a big role in the global economy in upcoming years.
Chinese consumers are already comfortable making peer-to-peer payments domestically thanks to companies such as Alipay and WeChat. And while other Western companies (such as Facebook and Google) have struggled to survive in China, Circle expects to circumvent the country's strict regulations by founding an independent Chinese company.
Circle also hopes to thrive in China by avoiding competition with strongly entrenched Chinese companies such as Alipay. Instead of going after domestic competitors, Circle China will turn its sights to connecting Chinese consumers with international users. In particular, the company will seek to connect the half million Chinese students who study abroad each year with their families back home via immediate, cross-border cash transfers.
At the same time that it's expanding into China, Circle is also building a larger presence in Europe. The service launched in the UK earlier this year, and Circle Euro will soon be open to consumers in Spain. It's the beginning of a European-wide rollout expected to occur over the next month or so.
If Circle achieves its aims across the U.S., Europe, and China, it will effectively connect more than two billion consumers looking to share value. In so doing, the company seeks to transform the way people think about sharing money and conduct their financial transactions--no matter where in the world they are.