Atlanta blockchain payments provider, BitPay, announced it has closed a $40 million extended Series B funding round Monday and plans to nearly double the company’s employees at home and in Asia.
Menlo Ventures, Capital Nine, G Squared, Nimble Ventures and Delta-v Capital joined BitPay’s initial round investor Aquiline Capital Partners. BitPay said it extended the funding round “due to increased investor demand,” and the recent funding has raised the startup’s total venture capital funding to more than $70 million.
Notable individual investors such as Christopher Klaus Family Office, founder of Internet Security Systems (ISS), and Alvin Liu, co-founder of Tencent, have also jumped on the BitPay train.
“We had a record year last year,” Sonny Singh, chief commercial officer at BitPay, told Atlanta Inno. “We processed over a billion dollars in payments and we expect that movement to continue.”
BitPay is the first major crypto investment for Menlo Ventures, a 42-year-old VC firm that has backed industry disrupters such as Uber, Betterment, Roku, BlueVine and Warby Parker.
“We gravitated towards BitPay because we felt the company had identified a killer use for crypto in facilitating low cost payment solutions for cross-border commerce and B2B payments, which is a massive market poorly served by the existing payment rails,” said Tyler Sosin, a partner at Menlo Ventures. “We are impressed with the company’s execution—it has demonstrated extremely efficient growth and a stickiness with merchants and consumers that is the hallmark of many great payment service providers. As the market leading crypto-processor, BitPay is well positioned to both benefit from and serve the fast moving crypto-ecosystem.”
An Eastern expansion appears to be in the works for BitPay, at least where investors are concerned. Asia is a rapidly growing market for the startup, and several Asian investors, including FinTech company Capital Nine, individual investor Alvin Liu and Yong An Financial Holdings Co., Ltd. played a significant role in this recent funding round.
“Bitcoin’s popularity is spreading rapidly throughout Asia and BitPay has an opportunity to extend its technology solutions across Asia,” said Sam Lin, director of Capital Nine. ”BitPay’s cross-border payment solution helps businesses pay or receive international payments faster and more economically.”
BitPay plans to tap into the largest bitcoin trading market in the world, focusing on B2B payments, Singh said. The company already announced a partnership with Bithumb, one of the world’s largest crypto exchanges, to facilitate international business transactions in South Korean.
“We’re able to be cheaper and quicker than a bank wire from payments from Asia to America, or Asia to Europe,” Singh said.
In addition to establishing themselves in the Asian market, Singh said BitPay will hire more employees to work out of their Alpharetta office. He said the company expects to hire 100 employees by the end of the year, and will focus on drawing in local talent.
“A majority of the hiring will happen in Atlanta,” he said.
The recent investments are less about cash flow and more about leveraging BitPay to grow to a mid-tier company, Singh said. BitPay’s business model and profitability were enough to keep the company moving forward on their own, but the expertise in growth, hiring and expansion from venture capitalists were appealing enough to sign on for these recent investments.
“It’s about the help they can bring,” Singh said.
Originally founded at the Atlanta Tech Village in 2011, BitPay has been on the fast-track for growth in recent years. In 2014, BitPay raised a $30 million Series A round from investors including Index Ventures, Founders Fund, Felicis Ventures, RRE Ventures and Sir Richard Branson. The company recently expanded from their Buckhead office to a 224,000-square-foot office space in Alpharetta in December.
The payment service provider develops software tools that allow consumers to collect online payments via the bitcoin peer-to-peer payment network. So far, the company has rolled out a plastic card in partnership with Visa Inc. to allow customers to store bitcoin and convert it into cash and the BitPay Wallet, a mobile app that allows users to manage blockchain finances.
According to company representatives, the BitPay Wallet is growing with a monthly average of more than $3 billion in transactions.