Tuesday, May 28, 2024

Eric Schmidt backs Keeta, a startup working to make cross-border payments ‘as easy as Venmo’

Keeta, a new startup developing an instant and secure way to make cross-border payments, raised $17 million in funding from a group of investors led by former Google CEO Eric Schmidt. The investment values the company at $75 million, according to Ty Schenk, founder and CEO of Keeta.

Schenk has been a software engineer since his teenage years, and much of his work prior to starting Keeta was building PayPal-like experiences in the cryptocurrency world. That kicked off his idea for the company and he started working on it in 2021.

Schenk explained that a traditional cross-border payment, for example, between the U.S. and Brazil is slow, and it’s difficult to calculate how much it will cost. The money may go through three or four “stops” at various banks before reaching the intended party. At each bank, there is a transfer fee collected and the money is verified, which could take a whole business day to complete.

“With Keeta, we want to make international payments as easy as Venmo,” Schenk told TechCrunch. “We want to make it very simple, very fast and we want to send your money where it’s going so you don’t have to worry about it.”

The team at Keeta built its platform from the ground up so it controls the whole process within its system. Fintechs and financial institutions can access Keeta via APIs or custom integrations.

The core technology is a proprietary ledger capable of processing more than 50 million transactions per second — something Schenk says is already operational — and a network of interconnected real-time payment rails. Thus, the company is able to offer money transfers across borders in seconds and for 50% to 70% less than the cost of traditional options, Schenk said.

Keeta’s strategy to fix cross-border payments is not new, in fact, it joins a crowded landscape of fintech companies developing similar approaches, like Stripe and PayPal, but also startups. For example, last week, NomuPay raised $53 million for its unified payments platform. Others, like Tazapay, Airwallex, Routefusion, UPI and PayNow, are also working on global platforms.

Schenk said payment transaction provider SWIFT is more closely related to his company, However, he noted that while Swift is “the de facto international wire,” it caters more to high-value payments, those over $1 million. Keeta’s target is payments under $1 million, which is an area with “a huge amount of opportunity,” Schenk added.

Meanwhile, Keeta launched Tuesday and is still in the very early stages of attracting customers. It is initially available by invitation in the U.S., Canada, Mexico, Brazil, the United Kingdom and the European Union. The company has several revenue streams planned, including transaction fees.

Next up, while the company is focused on business-to-business payment transfers, it plans to launch a consumer-facing mobile app to enable instant transfers between friends and family worldwide.

“The next three to six months will largely be focused on working with early customers, making sure that we have things in place for what they need and getting us in a position where we can scale,” Schenk said.

Eric Schmidt backs Keeta, a startup working to make cross-border payments ‘as easy as Venmo’ by Christine Hall originally published on TechCrunch

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