“We’ve been quiet for a long time, but it’s not because we’re not running.”
Launched in 2014, bitcoin startup Coins has focused on promoting financial inclusion in Southeast Asia. Armed with services in the Philippines and Thailand, Coins garnered early interest from major merchants while signing up more than 500,000 app users – yet, it hasn’t been public about its activities since 2015.
That might soon change, however, as Coins has raised $5m in funding from an impressive array of global investors to further develop its mobile wallet and supporting services such as remittances and bill payments.
Announced today, the Series A round was led by Accion Frontier Inclusion Fund, a fund dedicated solely to startups focused on financial inclusion. The round also included participation from BeeNext, Digital Currency Group, Eric Schmidt’s Innovation Endeavors, Global Brain, Pantera Capital, Rebright Partners and Wavemaker Labs.
Notably, the investment included support from two innovation labs backed by major telecom providers in the Philippines: Kickstart Ventures, a wholly owned subsidiary of Globe Telecom; and IdeaSpace Foundation, an incubator backed by First Pacific, which owns telecom providers including Smart Communications.
Reaching the underserved
It’s the latter two investors that CEO Ron Hose believes offer his startup the biggest avenues for growth as it tries to reach its target of 600 million customers.
Hose told CoinDesk:
“We’ve actually worked closely with them so we can facilitate payments to their mobile wallets and send money to any phone in the company. They have infrastructure locally, we help facilitate more usage of the infrastructure.”
One reason for this traction may be that, unlike many bitcoin startups (which focus on digital currency), Hose said Coins uses the blockchain as a “transfer protocol”, or a means to the end of serving the underserved in its target markets.
Hose further explained that Coins customers don’t have to carry exposure to bitcoin’s volatility, since they have the option to hold funds in Philippine pesos or digital currency.
“We’re big bitcoin fans, but people who are unbanked, they can’t afford volatility,” Hose said.
In statements, participating investors like Ganesh Rengaswamy, partner at Accion Frontier Inclusion Fund manager Quona Capital, spoke broadly about how they believe digital currencies could play a role in promoting financial inclusion.
Rather than go for disruption, Hose credited Coins’s growth in part to its willingness to embrace working with larger partners.
“The reason that we’ve built so many partnerships is you need to work with the banks. You need to work with telcos, governments, non-profit organizations and bring everyone to the table,” he said
So far, Hose argues this has allowed Coins to find creative ways to serve customers. For instance, he noted how his startup now enables “cardless withdrawals” at 450 ATMs. Rather than use a debit card, Coins users can enter an SMS code and gain access to cash.
“They get cash out right out away. It’s 24/7, it’s the most convenient remittance you will find. This is rain or shine,” Hose continued.
Elsewhere, Hose has expanded to services that might seem unconventional in more developed markets. This includes offering door-to-door cash delivery and service at local convenience store chains, which he asserts are all part of a larger strategy.
“For us, it’s not about getting press, we have a mission to reach as many customers as possible.”
Disclosure: CoinDesk is a subsidiary of Digital Currency Group, which has an ownership stake in Coins.
Image via Pete Rizzo for CoinDesk