Fintech Insider Podcast by 11:FS
00:22:20 · Benjamin Ensor, Pranav Sood
[00:22:20] S0: And a quick question just to build on that. What what does an acquisition get you that a partnership wouldn't? Because obviously you've got a number of partnerships around the world and so on. Are there things that you can do because you're acquiring or hopefully acquiring Max Pargo that you wouldn't be able to do if you had just, let's say, just partnered with them? [00:22:36] S3: I think one is, of course, the speed. So it... It's a lot of... You know, we... We've gone and got, I don't know, 70, 80 licenses around the world ourselves, of all flavors, and getting a a license, keeping a license is a very difficult and time consuming thing. And so it's it's obviously helpful if somebody else has gone through that work already, and you can benefit from it. I think the second thing, which is also important to us, is being as close to the metal as you possibly can be. And and so, of course, you can partner with, fintechs around the world, but our preference is if we can find a way to go deeper and go closer to the core, we should do that. So it's speed and it's also depth that we think is really important. [00:23:14] S0: Kate, what do you think? Is this exciting news?
00:23:14 · Benjamin Ensor, Kate Moody
[00:23:14] S0: Kate, what do you think? Is this exciting news? [00:23:18] S2: Everything, I mean, yeah, sorry, I gave it away with my facial expression, but I find everything about Mexico exciting as Pranav rightly deduced. I mean, we've had so many guests on, you know, over the last twelve months and beyond who are doing their own thing In Mexico, just an absolute ton of interesting fintechs coming out of that market, serving, as Pranav said, like a really fascinating market opportunity, and as a hub within LATAM as a whole, which is seeing just a totally different population trajectory to what we're seeing in North America and Europe. So yeah, makes complete sense. And I suppose the outcome of that is Mexico isn't a market that's just getting started. Like it's a market where this innovation has been happening for a long time. So if you're just getting to the point where you are in a position to commit to Mexico and you are going to go in and start building from scratch, you know, as Panav said, like getting those licenses, building those relationships takes time. So actually, I can totally see why an acquisition makes sense. You need to get into this market now and you need to be able to use it to kind of drive yourself forwards, you know, in the next couple of months, not twelve months down the line. So I can totally see why an acquisition would make sense in a market which is accelerating at the rate that Mexico is.
00:24:24 · Benjamin Ensor
[00:24:24] S0: Jeremy, what do you think of, do you agree with Pranav's point that Mexico is not only super interesting as a market in its own right, just because of its sheer scale, but also because of that sort of that near shoring, it's importance to the American economy, the Canadian economy. What do you think?
00:24:40 · Jeremy Balkin
[00:24:40] S4: First things first, think let's just take a step back. Few outside of The Americas truly understand the scale of Mexico. You've got an economy of something like $1.3.1400000000000 of GDP. It's the world's top 20 economy. Population growth and economics data over the next sort of decade or two, Mexico is gonna be an economic force to be reckoned with. The second is one of the driving forces with the Mexican economy is tourism. And obviously payments in tourism for foreign guests wanting to seamlessly book those hotels, those restaurants and vice versa is key. So the speed of payments innovation that is becoming sort of digital native in economy is one of the, I think the tailwinds driving what Airwallex has done. And more importantly, think look at the manufacturing hub that is Mexico, something like 70,000,000 Americans speak Spanish. So that, you know, there's a border that's shared obviously, there's common culture in many ways. So this is a phenomenal growth story. And if you look at The Americas more broadly, you know, it's a phenomenal wave of innovation of venture capital investment of payment flows and FinTech. This is a great story that needs to be told more, I think. And shout out to Airwallex with Jack, you know, the Aussie founder as well. He's from the second best city in Australia though, should just say. Melbourne's the second best, not the best, as they often incorrectly tell everybody. Sydney would be number one. But full credit to Jack and the team for taking an idea from a piece of paper to execution and doing it at scale and making cross border payments be as seamless as a peer to peer payment in any home market. It's absolutely incredible what they've done.
00:26:26 · Benjamin Ensor
[00:26:26] S0: Pranav, Jeremy makes an number of amusing and also important points there. How important is the cross border angle to this, right? Because in Mexico, as Jeremy said, huge economy. Being part of the Mexican sort of e commerce ecosystem is fantastic in its own right. But how important is it to Airwalex that that cross border trade between the states in Mexico and between other economies in Mexico? How much is that a part of the sort of the logic for you?
00:26:51 · Pranav Sood
[00:26:51] S3: Hugely. Mexico is The US's second biggest trading partner after Canada, I think, and and not by much. They're very, very close, on that on that list. I think from our point of view, the the... You know, to to step back a bit from from the question, the main problem that we're trying to solve as a business is that we live in a more and more globalized world which the financial system has maintained its incredibly fragmented nature. And so the more that we can do the hard work of, you know, bringing together, knitting together the infrastructure in different countries into something that our customers can access really easily through a single set of APIs or or through... Even through a dashboard, the easier it is for people who are trying to grow businesses across borders to focus on doing that rather than focus on how do I open a bank account, how does this local scheme work, What do I need to collect in terms of documentation from my customers? And so that's what we're really trying to do here. And I think as Jeremy and Kate have said, Mexico just happens to be one of the most exciting markets in the world to do it.