Boston-based payment processing company Flywire raised $120 million in a Series E round led by Goldman Sachs, with participation from existing investors including Temasek Holdings. Tiger Management and Adage Capital Management joined the round as new investors.
This round brings the company's total venture funding to $260 million. The company also announced that it acquired Palo Alto-based Simplee, a SaaS company that develops payment software for the health care industry.
CEO Mike Massaro told BostInno that the acquisition will make Simplee a Flywire company, under its health care vertical. Simplee's staff of 70 are now Flywire employees or 'flymates,' bringing the total headcount to 540 across its 12 global offices. It will add another 100 employees organically by the end of 2020, Massaro said.
Additionally, the company will also invest in product, technology and its two newly acquired offices in Tel Aviv, Palo Alto and its existing Singapore location.
“This digital foundation enables us to develop vertical-specific applications that make payments more efficient and cost-effective for our global clients. The Simplee acquisition improves patient engagement and health care affordability and extends these capabilities to a broader customer base," Massaro said in a statement.
Founded in 2011, Flywire enables universities, hospitals and B2B companies to better transact in foreign currencies. It was started as peerTransfer in 2009 by Spanish entrepreneur Iker Marcaide to facilitate tuition payments from international students to universities. The company has partnerships with many US-based universities including Boston University, Carnegie Mellon, and Cornell.
peerTransfer became Flywire in 2015 and now works with hospitals and large firms that need international payment processing, although educational institutions make up over 80% of the company’s clientele. Flywire has processed over $12 billion in total payment volume for over 2,000 clients around the world.
Flywire’s play is that it partners with the middlemen including card processing companies like Visa, MasterCard and Amex and payment processing companies like Paypal, Adyen and Square who transmit transactions. Its software connects banks directly to universities and hospitals – because of the volume of transactions processed, which is usually in billions, the company is able to offer lower transaction fees (1%-2% compared to 3%-5%) and also get better foreign exchange conversion rates.
