Collaborative Pioneer Interview with Brett Meyers, co-founder of CurrencyFair

Brett Meyers is CEO & Co-Founder of the online p2p currency exchange platform CurrencyFair. Started five years ago, CurrencyFair has raised €5m in funding and currently serves more than 50,000 clients across 20 currencies.

Can you describe CurrencyFair and how it began?

CurrencyFair grew out of our own needs, as expats living in Ireland, to transfer money internationally between our bank accounts in different currencies. Banks charge a huge amount to do this; fixed fees which can amount to €40-50 as well as a fee built into, or hidden in, the exchange rate which can be 3% or more.

Co-founders Sean Barrett, Jonathon Potter and I figured out a way to avoid all these fees by matching our needs with our friends. So, for example, if I had Euros and wanted Australian Dollars, I would look for a friend that had Australian Dollars and wanted Euros. We’d then fix an exchange rate somewhere around the current mid-market rate (basically the true exchange rate without the bank margin), and we’d use our online banking to transfer the money directly between our bank accounts. I’d send my friend Euros, and she’d send me Australian Dollars.

It wasn’t always easy to find a friend with an opposite need though, and we soon realized that we could put this concept onto the internet, securing the process so that people could trust each other… and CurrencyFair was born!

How have consumers responded to the business and who are your current customers?

Consumers that use the CurrencyFair platform absolutely love it, and we have incredibly high retention and referral rates. The majority of our customers are expats, both working age and retired. A lot of British pensioners living in France and Spain use us, for example, to convert their Sterling pensions into Euros on a regular basis. Another good example would be young Irish families that have moved to places like Australia and Canada for work opportunities, and are saving money and sending it back home to pay their Irish mortgage. About ten percent of our business comes from small and medium sized businesses, who use us to pay foreign invoices and receive foreign payments.

Typical transaction sizes range from the hundreds all the way to the hundreds of thousands and even millions! Larger transactions tend to be things like foreign property purchases and relocations, or large corporate invoice payments. The average transaction size is around €5k but there’s a wide variation.

Our existing competitors, particularly banks, have gotten extremely good over the years at hiding the true charges of their service. There’s a lot of misleading advertising that goes on around ‘free transfers’ and ‘0% commission’, when the true costs are hidden in the exchange rates given to the customer. So it has been challenging to convince some consumers that they actually can save a lot of money using us, since we first have to explain to them how much they are actually paying with their bank!

Aside from that, we feel that the p2p element is really starting to become a key differentiator in the minds of consumers. People have an intuitive understanding that this kind of model is inherently better and leads to cost savings, by cutting out middlemen and making the most efficient use of resources. So we actually think that the recent popularity of p2p or the sharing economy in other industries, such as p2p lending, is helping our own growth.

Are your services offered worldwide?

Not yet! We currently operate in 20 currencies, and are looking to expand that number over time.

What’s been the best part of building CurrencyFair so far?

I think the best part has been knowing that we’ve had a positive impact on the lives of tens of thousands of people. We receive lots of great feedback from customers who are so happy with the savings they’re making on transfers and the service they receive compared to using their bank. The emails get sent around the whole office and everyone really gets a kick out of it. Since we launched people have sent over €1.2 billion using us, saving them over €60 million in fees, and that feels pretty amazing.

There have been lots of challenges as well of course. We’ve grown very quickly in the past 18 months in particular, adding around 40 staff in that period, and if anything we’re growing even faster now. Keeping the lines of communication open and making sure all the new team members really understand the core of what we’re about takes a lot of conscious effort. We want to make sure that the high levels of service that made customers love us in the past are maintained as we grow, and that takes a lot of organisation.

What partnership(s) really helped CurrencyFair?

We have good relationships with our banking partners, and that is of course very important, since we still need the banking system to make payments and receive funds. We also have a good relationship with Enterprise Ireland and have used their worldwide network on a number of occasions to get information and introductions. We are looking to partner with other organisations that provide services to expats, and businesses, and also keen to be involved with the innovators in domestic payment systems so that our customers can have access to additional ways of getting money in and out of CurrencyFair.

How do you stay on top of trust and security issues?

We’re fully authorised as a Payment Services Provider, which requires having strong procedures in place to protect client funds, and we employ top notch security technology including two-factor authentication on user accounts. On top of that, we have a policy of openness and transparency on our website so that any potential customers can see who we are, where we are, and even who has invested in us. That includes the Irish government (through Enterprise Ireland), and we’ve even had the honour of the Taoiseach (the Irish Prime Minister) officially opening our new offices.
Finally, nothing adds trust like a famous French rugby player dressed as a fairy!

  How do you compete with other companies in the same category?

Compared to banks and foreign exchange brokers, we compete primarily by offering far better exchange rates and top notch customer service. We also like to think we’ve implemented p2p international money transfers in a way which actually adds choice and control as well as just saving money. Customers using our marketplace can choose between exchanging instantly at a great rate, or offering up their money at an even better rate and waiting to be matched. So they have a level of control over foreign exchange that they have never had before with a bank or traditional broker.

There are a handful of other firms that have used p2p as a way of cutting costs, but the result has been delays in processing transactions and some inconvenience and uncertainty over the exchange rate. We don’t think that’s necessary. Having said that, we don’t actually feel like we’re competing with other p2p firms. It’s a huge market out there and despite having processed some big numbers, we’re still relatively small compared to the amount being sent through banks at ridiculously poor exchange rates. The more noise that the p2p market players can make, the better for all of us, particularly the end customer.

What’s the next step for CurrencyFair – any plans to get into p2p financial funding, lending, or investment services too?

We’re really interested in the possibility of expanding into other p2p financial services, but I think that’s a long way off yet. Our focus at the moment is in better serving our existing markets, making the experience of using CurrencyFair even easier, and also adding some additional functionality, particularly for businesses but also for individual users, to give our customers even more value.

CurrencyFair by numbers:

Number of customers: > 50k

Total amount transferred to date: >€1.2bn

Number of CurrencyFair staff: > 50

Number of currencies served: 17 to send / 20 to receive

Funding raised: >€5m