Align Commerce, a blockchain-powered global payments provider, has closed a US$12 million Series A funding round led by Kleiner Perkins Caufield & Byers (KPCB) to take on the US$25 trillion international payments industry. Other investors in the round included Silicon Valley Bank, Recruit Strategic Partners and existing Align Commerce investors, including Pantera Capital, Digital Currency Group and FS Venture Capital LLC.
The deal marks KPCB’s the first investment in the bitcoin industry.
“The Align Commerce platform is not only a creative and transformative use of the blockchain technology, but a fundamental reimagining of how global payments can and should be done,” said Randy Komisar, general partner at KPCB.
“By offering a quick, reliable, and inexpensive method of exchanging money across borders, Align Commerce is empowering entrepreneurs and SMBs to expand into global markets without the friction of bank wire systems. We see incredible potential in Align Commerce as a superior digital path to convenient, transparent cross-border transactions.”
Based in San Francisco, Align Commerce uses the bitcoin blockchain as “a global payments rail” to move money from one country to another without the need of going through multiple intermediaries.
By leveraging the blockchain, Align Commerce cuts through time-consuming red tape and expensive fees, enabling users to make nearly instant cross-border money transfers while charging only a 1.9% exchange rate spread of the amount converting.
Essentially, Align Commerce provides users with a much-simplified process for sending money and an entirely new experience compared that the blockchain enables, according to Marwan Forzley, founder and CEO of Align Commerce, and a former executive at Western Union.
“Every year, banks charge small businesses US$50 billion in wire and foreign exchange fees,” Forzley said.
“Imagine a highly simplified experience in which proceeds from the savings in fees are injected back into the economy, thus contributing to additional employment, business spending and other avenues.”
Unlike other bitcoin payment providers such as BitPay and Coinbase, Align Commerce’s use of bitcoin is invisible to its business consumers who pay each other using government-issued currency and do not directly deal with bitcoin.
“You don’t need to know about blockchain, you don’t need to know about bitcoin, you just need to know this is easier, faster and cheaper,” Komisar told Ventured.
According to Komisar, as the blockchain industry flourishes and matures, blockchain-powered systems such as Align Commerce’s platform will scale. “Partly, we need to get the word out that there are different systems and different ways of doing things,” he said.
Align Commerce currently serves 30 countries with hundred of customers. With the new capital, Forzley said that the company will expand its solution into more markets and bigger geographical coverage.
Image credit: Global network, Shuttershock.com.