Investor Information

Company overview.

We were incorporated in Delaware, United States in August 2019. Our development center and principal office is located in Buenos Aires, Argentina. Just like other digital players like Mercado Libre, Globant, Olx, Despegar, Auth0 and Uala do. Since our inception we have provided consumer-to-consumer online money transfers. From 2022, we will also offered other services within the money transfer business. From 2021 to 2025, we chose to focus solely on Latin America.

We use various trademarks and trade names in our business, including "Xcoop", "Xpay", "Xbiz" and "Xcard", which we have registered in the Argentina and in various other countries. This page also contains trademarks and trade names of other businesses that are the property of their respective holders. We have omitted the ® and ™ designations, as applicable, for the trademarks we name in this page.

Our customers use Xcoop to send money to family and friends in 67 countries. Since August 29, 2019, our customers have used Xcoop to send $2.22 million. According to the World Bank, international consumer money transfer volume totalled $554 billion worldwide in 2020 and is forecasted to decline to approximately $470 billion by 2021. Our modern online and mobile platforms disrupt traditional forms of money transfer and deliver our customers a convenient, fast and cost-effective way to send money.

Our typical customers left their home countries and moved to the other country to seek better employment opportunities and to support their family and friends back home. Our customers represent a broad range of professions and education levels, but share common traits in that they have bank accounts and actively use the Internet or mobile devices. They maintain close ties to home and regularly use Xcoop to help their family and friends in their home countries afford basic, and sometimes dire, needs for food, shelter, healthcare and other critical, non-discretionary expenses.

We earn and maintain our customers’ trust by providing a high level of service through convenient, fast and cost-effective money transfers. Xcoop’s money transfers are initiated online and can be sent at any time, from any Internet-enabled location. Recipients receive money in the manner they prefer and to which they are individually or culturally accustomed, at major banks and leading retailers or e-wallets. We believe we process and complete money transfer transactions as fast as, or faster than, our competitors, and our customers and their recipients can view the status of their transactions in real time, providing them peace of mind. Our business model allows us to provide our customers with cost-effective money transfers because we do not pay originating agent commissions and the majority of our transfers are funded directly from bank accounts, which lowers our cost of sales.

Our solutions are built on our proprietary technology which, combined with our risk management capabilities and global disbursement network, constitute our operating platform. Our technology enables easy-to-use online and mobile sender interfaces, effective risk management and seamless integration with our disbursement partners’ systems. We have developed extensive partnerships with major banks and leading retailers who form our global disbursement network across 75 countries and deliver a high quality of service through regionally-recognized, trusted brands.

We generate revenue from transaction fees charged to customers. Service fees vary by country, type of funding source, disbursement currency and send amount, but do not vary by method of disbursement, how the transaction was initiated (via computer or mobile device) or the location of the customer.

We believe our business model is often characterized by predictable and recurring revenue from our large and growing base of new and repeat customers. We have achieved significant revenue growth as our customer base has expanded. From 2019 to 2020, our revenue increased from $ 0.00 million to $ 0.05 million, representing a 374.77% CAGR. We incurred net losses of $ 1 million in 2020, primarily as a result of long-term investments in our service innovation, solutions and marketing programs to increase brand awareness.

Industry overview.

Global remittances are projected to decline sharply by about 20 percent in 2021 due to the economic crisis induced by the COVID-19 pandemic and shutdown. The projected fall, which would be the sharpest decline in recent history, is largely due to a fall in the wages and employment of migrant workers, who tend to be more vulnerable to loss of employment and wages during an economic crisis in a host country. Remittances to low and middle-income countries (LMICs) are projected to fall by 19 percent to $445 billion, representing a loss of a crucial financing lifeline for many vulnerable households.

Traditionally, the global money transfer market has been served by a few large players, many small regional players, traditional banks and informal person-to-person money transfer service providers that evade regulation. The large industry players primarily service senders who fund with cash, which requires an extensive network of originating agents in the countries and significant infrastructure in receiving locations. This antiquated model of predominantly cash-to-cash money transfer has not evolved meaningfully in more than 100 years and has been plagued by one or more of the following problems: slow transaction processing; non-transparent fees; opaque exchange rates; and an inconvenient offline money transfer experience, including limited store hours, long wait times, complicated manual forms and sometimes unsafe locations. With the widespread adoption of online and mobile channels and a steady increase in the proportion of the banked population among the foreign-born community in the countries, we believe there is a significant opportunity to disrupt the traditional forms of money transfer and provide a better customer experience.

Our Solutions

Our solution is designed to offer customers a convenient, fast and cost-effective way to send money to family and friends at any time, from any Internet-enabled location. Our operating platform allows us to provide innovative solutions to the challenge of transferring funds internationally, as described below.

Origination

All Xcoop money transfers originate online, without the costs or inconvenience of initiating a transaction at a physical agent location or bank. Our money transfer services are available over the Internet or through a mobile device on our app and others websites. Funding

Funding

Our clients have the option of financing a money transfer with a bank account, credit card or debit card. We also have agents that accept cash. More than 80% of our gross shipping volume is financed by bank accounts through the Automated Clearing House, or ACH, system. ACH transactions are less expensive to finance cash, credit or debit card transactions, since ACH does not include the variable fees associated with these transactions.

Transaction Processing.

Throughout the entire money transfer process, we offer a high level of risk management, regulatory oversight and compliance, and customer service. Our trading platform is designed to track each of these requirements. From the start of a transaction, our platform allows us to quickly and smoothly assess the risk profile of the transaction without introducing undue friction into the customer experience. To minimize payment and the risk of fraud, we require several requirements to be met in order for a prospect to use our services. We have developed our technology to test each transaction's compliance, anti-money laundering, acceptable use, fraud, and financing risk in seconds.

Disbursement

Our customers can transfer money to 67 countries, including many major recipient countries, such as China, Egypt, France, Germany, India, Mexico, Nigeria, Pakistan, Philippines and the Vietnam. Our disbursement options include direct deposit into recipient bank accounts in all countries we serve, cash pick-up at our disbursement partner locations in most countries we serve. These convenient options are made available through established partnerships with major banks and leading retailers that form our global disbursement network.

Our competitive strengths.

The majority of our employees are from first- or second-generation immigrant families and personally understand the importance and impact of our service on our customer base. Our first-hand knowledge of our customers' needs enhances our ability to innovate and design solutions that solve their challenges. This customer-centric culture and mission-driven approach permeates our organization, defines the fabric of our company and drives our focus on serving our customers. We believe we have the following competitive strengths:

Compelling value proposition.

We provide significant value to our customers through a unique combination of convenience, speed and cost-effective pricing of our services. We also provide transparency to our customers with simple fees and locked-in foreign exchange rates so our customers clearly understand the fee they will pay and the exact amount their recipients will receive before submitting a transaction.

Proprietary risk management system.

Our proprietary risk management system serves as the backbone of our technology platform, balancing a low-friction customer experience with low transaction loss rates, which have been 50 basis points or lower as a percentage of gross sending volume on an annual basis since 2020.

Valuable customer insight.

Our customers initiate money transfers through online devices, creating a body of digital, transaction-related data that affords us deep insight into repeat customer behavior. This data provides us with revenue visibility, allows us to quantify the value of each customer and enables us to continually improve our overall customer experience.

Marketing expertise.

e believe our expertise in customizing our marketing to culturally diverse target markets provides us with a competitive advantage in attracting new customers to Xcoop and retaining existing customers. In addition, the fact that our customers originate transfers online enables us to directly attribute new customers to specific marketing campaigns and optimize future marketing investment.

Established global disbursement capabilities.

Our network of major banks and leading retailers, assembled relationship by relationship over more than 20 months, is comprised of trusted local brands who offer high-quality service. We believe our speed of deposit is superior to that of our competitors and it would be difficult for a new competitor to replicate the breadth and quality of service our disbursement network provides.

Efficient regulatory compliance.

We have designed our technology platform to operate efficiently in a highly complex and continuously evolving regulatory environment. Our technology and compliance expertise enable a low-friction customer experience in a highly-regulated environment, which new market entrants would likely find difficult to replicate.

Our growth strategy.

Our growth strategy is focused primarily on attracting and retaining customers in the markets we currently serve. We intend to aggressively grow our business through the following strategies:

Attract and retain customers.

Our customers tend to behave predictably, and we are therefore able to increase and optimize our marketing investment to acquire new customers at a cost that is a fraction of their estimated lifetime values. We will continue to selectively invest more in targeted marketing campaigns to acquire new customers. We will also focus on enhancing our service and continue developing new features, including expanding and enhancing our capabilities, to improve our customers experience and further strengthen brand loyalty.

Establish new partnerships and improve current.

We will continue to establish new marketing partnerships to improve awareness of our money transfer services with potential customers. By increasing the number of disbursement partners and improving the quality of service from existing partners, we believe we can increase the relevance of our service and improve our value proposition for our target customers.

Expand into new markets.

We will continue to leverage the experience and expertise gained from our success in current markets to identify attractive, new origination and recipient markets for our services.

Develop adjacent services.

As part of our long-term strategic plan, we intend to explore opportunities to leverage our technology and money transfer network to unlock new revenue streams in adjacent markets.

Risks affecting us.

Our business, financial condition and results of operations are subject to numerous risks and uncertainties. These risks include, among others, that:

  • We have incurred significant operating losses in the past, and we may not be able to sustain our recent revenue growth and generate sufficient revenue to achieve or maintain profitability.
  • We have a limited operating history in an evolving industry, which makes it difficult to evaluate our future prospects and may increase the risk that we will not be successful.
  • If we fail to attract new customers or retain our existing customers, our business and revenue will be harmed.
  • Inaccurate forecasts of our new customer growth could result in our expenses exceeding our revenue and ultimately harm our business.
  • If the revenue generated by new customers differs significantly from our expectations, or if our customer acquisition costs or costs associated with servicing our customers increase, we may not be able to recover our customer acquisition costs or generate profits from this investment.
  • Our quarterly operating results fluctuate and may not predict our future performance accurately. Variability in our future performance could cause our stock price to fluctuate or decline.
  • Failure to maintain sufficient capital could harm our business, financial condition and results of operations.
  • We may not be able to secure additional financing in a timely manner, or at all, to meet our future capital needs, which could impair our ability to execute on our business plan.
  • We generate a substantial portion of our revenue from money transfers in Latin America, and the failure to continue to generate such revenue, due to economic, political or regulatory factors beyond our control, could harm our business, financial position and results of operations.
  • Our revenue could be harmed by fluctuations in foreign exchange rates and other risks related to foreign exchange.
  • We face intense competition and, if we are unable to compete effectively, our business, financial condition and results of operations could be harmed.
  • New or existing technologies could gain wide adoption and supplant our services and features and harm our revenue and financial results.
  • We face payment and fraud risks that could harm our business, financial condition and results of operations.
  • Our business is subject to a wide range of laws and regulations intended to help detect and prevent illegal or illicit activity and our failure, or the failure of one of our disbursement partners or payment processors, to comply with those laws and regulations could harm our business, financial condition and results of operations.
  • Our business is subject to a variety, many of which are unsettled and still developing, and many of which may contradict one another due to conflicting regulatory goals. Failure to comply with these laws could subject us to claims or otherwise harm our business.

Contact us.

For more information about Xcoop, our business plan or investing, contact us. Our investor relations team will answer all your questions.