Cross-border payments platform IbanFirst is not one of Europe’s flashiest fintechs.
Founded in 2016 by serial entrepreneur Pierre-Antoine Dusoulier, the company has steadily established a firm footing in what he calls the “quiet revolution” of international payments, a global market expected to be worth more than $200tn by 2030, according to data compiled by Statista.
Even though IbanFirst flies largely under the radar, it’s been steadily growing for a few years, turning into a company that is firmly EBITDA-positive and nearing the €100m ARR (annual recurring revenues) mark.
Last year, IbanFirst made €65m in revenues — a growth of 30% compared to 2023. With €7m of EBITDA, it was the company’s first full year of profitability. Founder Pierre-Antoine Dusoulier tells Sifted he expects that to jump to €85m in revenues this year and achieve €100m in ARR by the end of 2025.
The startup provides a platform for SMBs (small and medium-sized businesses) to make payments across borders and currencies, which it says comes with fewer costs and complexities than with a traditional bank. Features include real-time exchange rates, payment tracking and the option to lock in exchange rates for future transactions.
The company reached profitability with a particular funding strategy — and a departure from the traditional VC-backed model.
In 2021, IbanFirst did a “mini leverage buy-out”. The startup — which had until then raised €46m in funding from French VCs Elaia, Serena, Breega and public bank Bpifrance — saw US private equity investor Marlin Equity take a 51% stake in the company, in a transaction that valued IbanFirst at €200m.
“The VC model is great to start with, but after a while it doesn’t work anymore. VCs want to deploy money that they want you to spend, they don’t worry that much about profitability. If it works, that’s great. If it doesn’t, it sucks for you — but for them it’s not that bad, because they’re protected by their preferred shares.”
Launched in 2016 and HQed in Belgium, IbanFirst has now grown to serve 10k clients worldwide with a team of over 350 employees based in 10 European countries – and it plans to keep growing.
“It was important for us to prove that we could be profitable, but it’s not the objective,” says Dusoulier. “The market has such traction that it’s a no-brainer to accelerate growth rather than try to generate more cash.”
Reaching profitability
IbanFirst targets small multinationals, says Dusoulier; companies that have up to 250 employees and need support to conduct cross-border business but don’t have the capacity to implement large-scale treasury management systems that are tailored to large corporations.
The startup’s main source of revenue is the ‘spread’ in foreign exchange — the difference between the currency rate paid for by the customer and the one actually secured by IbanFirst. It also makes revenue from fees applied to some transactions, as well as from interest rates that it receives from customers’ cash in transit.
Interest rates represented €15m of total revenues in 2024, according to Dusoulier; and although they are expected to keep going down, he says that this number should remain stable in 2025 as customers’ deposits keep growing overall.
IbanFirst is in direct competition with other European startups like UK-based Paysend and Ebury, which also provide cross-border payments for SMBs. In the US, companies like Payoneer and Airwallex also offer similar services.
It’s a “gigantic market,” says Dusoulier, in which IbanFirst resonates with a “new generation” of CEOs and CFOs that are looking for more modern tools to manage company finances.
Now, Dusoulier says that he wants to double down on growth — and that becoming profitable has given him lots of room to manoeuvre.
“What’s good about earning money is you have cash to deploy,” says Dusoulier. “This year, we’re going to open two new countries, and we’ve added €5m to our R&D budget to launch new products. So, we can do lots without having to raise funds.”
Open to acquisitions
Being EBITDA-positive also means banks are more willing to hand out loans, adds Dusoulier, which might be needed for acquisitions. IbanFirst has acquired three companies to date — Dutch payments company NBWM, German foreign exchange startup Forexfix and UK-based foreign exchange provider Cornhill.
Asked whether he’s interested in making any more acquisitions in the near future, Dusoulier says: “We’re definitely on the lookout.”
And what if anyone wanted to acquire IbanFirst? There are now three main shareholders in the company — Marlin Equity, Dusoulier and historical investor Elaia — which all hold common stock.
Dusoulier says that after nearly four years, Marlin Equity is slowly planning its exit from the company. The next investor is likely to still be a PE fund, he says, only bigger than the current shareholder.
There is plenty of interest from banks to acquire IbanFirst, says Dusoulier, and the startup also has the occasional chat with corporates like Visa and Mastercard. “But ultimately, we don’t want to sell,” says Dusoulier.
Read the orginal article: https://sifted.eu/articles/ibanfirst-2024-revenues/
