Why We Are Launching A Venture Arm

Yesterday we launched OpenFX Ventures, a new investment arm focused on companies working to build the future of cross-border payments.

The correspondent banking system is a multi-trillion dollar market, built on technology that is now nearly a half-century old. It is slow, opaque, and bogged down by layer upon layer of bandaid “solutions” built primarily to serve the interests of a few economies in the G7.

This is the sort of industry that is ripe for disruption.

Our goal has always been to create an ecosystem that supports real, systematic change across this market. To do this we are focusing on creating Embedded FX, modern infrastructure to replace the correspondent banking system. We want to build a platform that can plug into the systems that product managers and treasurers already use: globally licensed, stablecoin-native and API-first.

We want to do for cross-border FX what Amazon’s AWS did for server provisioning. Instead of forcing founders to spend years rebuilding the same infrastructure over and over again, we are offering a plug and play solution, allowing them to: hold money, seamlessly convert between any currency, and scale their businesses with liquidity they can trust to settle quickly and reliably.

Growing success

We have seen enormous amounts of traction towards this goal, in less than 2 years we have gone from stealth to more than $80 Billion in annualized TPV, serving over 100 of the fastest-growing global fintechs.

We did this with a staff that would surprise you, an order of magnitude smaller than other payment firms that support the same volume of transactions, because we have focused on a philosophy of “automation first,” finding ways to take inefficient manual processes and systematize them for scale.

The idea behind Ventures was born from this lesson.

Our thesis is that as AI adoption grows and software development costs shrink, more founders will build more compelling applications for niches currently underserved by correspondent banking.

Cross-border payments is a global market, but so much of the work that goes into actually sending money from place to place happens locally. The founders building in these areas understand these challenges in ways that are often difficult to reproduce, local knowledge creates exceptional leverage.

What we look for

We are building a robust bench of high-quality firms, with nearly two dozen companies in our portfolio.

We are actively looking for other founders in the U.S., Europe, Latin America, and APAC who are:

Interested in a really hard problem

We are drawn to founders who are deeply committed to solving problems in cross-border payments that others might think are too complicated or too niche to matter.

Settlement speed and price for the parts of the world not touching the G7 were largely ignored for decades, we believe this is as much a failure of perspective as it was a failure of incentives. There are dozens of other problems like this, and we want to invest in those with the perspective to tackle them.

Believe in the power of automation

We are living through a period of unprecedented change, one where autonomous systems are becoming an increasingly normal part of everyday processes. We have always built OpenFX on the principle that if something can safely be automated, it should be, and that the only way to keep up with technological change is by always starting with the question, “what does this new technology allow us to do that we couldn’t twelve months ago?”

Cross-border payments contain a remarkable amount of rote, operational work. Some of it exists for good reason, plenty of it doesn’t. We want to invest in founders who see these inefficiencies and are interested in building novel, autonomous systems to surmount them.

Focused on growth

We also pay attention to how our founders think about growth.

A company may begin with one corridor or one specific problem, but eventually it will need to branch out in product type or coverage. As it does, it will need infrastructure to support that scale.

This is an area where we believe OpenFX can help.

We have spent years building Embedded FX systems for companies moving money across borders. When we invest in a business, our goal is to give its team access to the infrastructure it needs to scale faster while allowing the founders to stay focused on the problem they understand best.

Building the next layer of cross-border payments

The payments industry is becoming more specialized.

Companies are emerging around challenges that were once buried inside banks or handled through manual operations.

This opens new opportunities to solve real problems in places that have historically been poorly served by traditional finance. As the companies tackling these challenges grow, they need to connect to infrastructure capable of carrying them into this future.

OpenFX Ventures is one way we can help accelerate that process.

If you are building one of those companies, we want to hear from you: ventures@openfx.com