New Zealand-based crypto exchange Easy Crypto has raised $11.75 million (17 million New Zealand dollars) in Series A funding, as the firm eyes a potential initial public offering (IPO) in the future.
The round was led by venture capital fund Nuance Connected Capital. According to a Wednesday announcement from Easy Crypto, the 17 million NZD figure “seemed to have set a new record in New Zealand” for the largest Series A funding from a local firm.
The funding round marks a significant milestone for the firm. Easy Crypto co-founder and CEO Janine Grainger has expressed how difficult it had been to garner investment in the early stages of the company due to working in the “fringe” crypto sector.
The funds will be used to accelerate growth via product and tech development, investment in talent, and expanding to new markets in Indonesia and the Philippines to service the unbanked.
The round was oversubscribed by 50% and included participation from a host of local and international companies, including KiwiSaver provider, Pathfinder, Icehouse Ventures, Even Capital, GDP Venture (Indonesia), Hutt Capital (United States) and Seven Peaks Ventures (U.S.).
Easy Crypto was founded by siblings Janine and Alan Grainger in 2017 and has generated $760 million (1.1 billion NZD) worth of sales to date from a customer base of more than 150,000 across New Zealand, Australia, South Africa and Brazil. The platform hosts buying and selling services for 151 digital assets and also sells a range of hardware wallets from Trezor and Ledger.
According to TechCrunch — which is yet to list Easy Crypto’s latest funding round — the largest previous Series A funding rounds in New Zealand are from analytics firm Joyous and blockchain-based fintech service providers TradeWindow, which both fetched $10.3 million (15 million NZD) each. New Zealand-based artificial intelligence firm Vital fetched the highest amount internationally via a $15-million (21.6 million NZD) Series A funding round in the U.S. last month.
Janine Grainger spoke to the New Zealand Herald on Wednesday and said that the firm plans to use the funds to ramp up its overseas operations and target new markets in South East Asia, such as Indonesia and the Philippines:
“The reason that we’re targeting those markets was that there is a large population of people who are unbanked or underbanked, and don’t have the same access to financial products like you and I do.”
Janine also said that the firm is looking at a potential IPO.
“We are still working out what that looks like, and what plans there are for us into the future but very likely we would be looking at an IPO,” she said.
The CEO said that Easy Crypto generated $3.46 million (5 million NZD) worth of revenue in the previous financial year and is on track to more than double that amount this financial year.
According to the firm, its customer base has grown by “almost five times over the past 12 months.” Grainger told the New Zealand Herald that the firm’s path to success has been tough, as it took 13 months to get its first dollar of investment before being able to raise $11.75 million within three weeks in 2021.
“Cryptocurrency is seen as a bit fringe still, a bit volatile and I think it’s taken us a while to find investors who perhaps had that forward-looking and strategic vision to be able to take a punt on what we’re doing,” she said.
Related: New Zealand central bank releases issue paper on digital currency
There has been something of a pall cast over the industry in New Zealand due to the now-defunct crypto exchange Cryptopia becoming the victim of a major hack in 2019. Roughly $16 million–$18 million worth of crypto was swiped from the platform.
Cointelegraph reported in July that a former Cryptopia employee pled guilty to the theft of around $172,000 in crypto he obtained by making a copy of users’ private keys while working at the firm.