Boston international tuition payments startup peerTransfer has been doing so well, investors needed to ask for an additional six customer references, because the first six were exceedingly positive. What investors were met with, however, was more praise — and a company on track to hit 200 percent growth as it nears the end of another academic year.
Bain Capital Ventures has decided to fuel that momentum by leading peerTransfer's new, $22 million round, announced Tuesday. Also participating in the round were existing investors Spark Capital, Devonshire Investors, Accel Partners and QED Investors, bringing the team's total amount raised to $43.2 million.
The capital will be used to bolster the company's international growth, attract additional colleges and universities in the U.S. and abroad, as well as expand on peerTransfer's cross-border payments platform.
"We just continue to see growth," said peerTransfer CEO Mike Massaro. "We hit profitability."
Beyond that, the startup announced in August it surpassed 500 clients and processed more than $1 billion in international education payments. That customer count has since grown to 570, with peerTransfer adding roughly 50 new institutions to its platform per quarter. In 2015, the company will look to attract more schools from the United Kingdom, Canada, Australia and South East Asia — the latter of which peerTransfer has yet to have a presence in.
"We're a very test-, prove-it-out- and further-invest type culture over here. Like, 'Fail, fail quickly.'"
Given how big the business opportunity is, it's no surprise Massaro was able to close the company's latest round in all of eight weeks. The chief executive attended payments conference Money20/20 in Las Vegas at the beginning of November. There, he was able to connect with a slew of firms in one place, and the conversations escalated quickly.
"The business is growing at a great clip," Massaro said. "And we're relatively buttoned up, so the due diligence process went quickly."
While expanding to new schools, peerTransfer will also be improving the experience for those who are already using the platform to cover the costs of their college tuition and fees.
Through peerTransfer, college students are able to cover costs using their home currency and payment method of choice, whether that be bank transfers, online payments or credit and debit cards. Students receive better currency rates through the platform and, on the other end, schools are able to automate the reconciling process and eliminate unidentified, missing or short balance international payments.
Massaro said the company would like to expand on its core functionality, by expediting the payment process, as well as help international students with their bank account setup in the U.S.
With this new capital, however, Massaro noted "there's room for growth outside of education," given the team has built a cross-border payments platform.
"The cross-border payments space is highly inefficient and overly expensive, offering a significant opportunity for innovation and value creation," said Bain Capital Ventures Managing Director Matt Harris, who will be joining the company's board, in a statement. He added:
peerTransfer’s breakthrough insight was to design a payment scheme addressing the unique needs and business environment of the recipient, in this case, the educational institution. As a result, the risk, cost and complexity of the transaction is dramatically reduced for all parties.
The company will be testing out new products over the coming months and try to expand on other verticals.
"We're a very test-, prove-it-out- and further-invest type culture over here," Massaro explained. "Like, 'Fail, fail quickly.'"
It's a method that appears to be working, given the team is "busting out" of its office space. peerTransfer employs roughly 48 people globally and is expected to increase in headcount by 15 to 20 this year.
As Massaro said, "I think there's lots of potential to keep expanding."
Images via peerTransfer
