Day Zero to Greatness Series: A fireside chat with Co-founder of Airwallex, Lucy Liu

A Fireside Chat with the co-founder of Airwallex, Lucy Liu, on scaling global tech companies and capitalising on ideas.

Sarah Kimmorley

Vice President
August 29, 2023
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It has never been easier to build a business thanks to the accessibility of advanced technologies, ready availability of risk-prone capital, and the world’s first truly global market. And while many people dream of building a business, they often don’t know where to start. Or perhaps they have spotted an opportunity, but the struggle to put it into clear, precise terms.

Co-founder of Airwallex, Lucy Liu, joined Antler to discuss how and where the best ideas emerge, and how to capitalise on them to seize an opportunity to build the next wave of global tech companies.

Watch the full video or read the transcript from the discussion below:

The following script has been lightly edited for length and clarity.

Bede Moore (00:00:07):

Without further ado, thank you to all of you who have joined the call thus far. Very punctual I might say. I am delighted to introduce the co-founder and President of Airwallex, Lucy Liu to the call. Lucy is a revered figure in the Australian startup ecosystem by way of the incredible growth that we have seen with Airwallex over the last few years. She established her industry credentials as an investment consultant with the China International Capital Corp, China’s first joint venture investment bank. She is an incredibly successful and inspiring founder who was selected for Forbes 30 Under 30 in Asia in 2017, and now she manages the ongoing business operations of one of Australia’s most impressive and successful FinTech exports Airwallex, welcome Lucy.

Lucy Liu (00:01:07):

Hi everyone, pleasure to be here.

Bede Moore (00:01:10):

Thank you. Thanks for joining us in what wouldn’t have been possible I think in the pre-COVID world. Delighted that you’re in fact joining us tonight, not from Melbourne but in fact from Shanghai. This is an exciting feature that we can now hold these truly global events. Thanks for coming on. I’m glad to hear that you’ve obviously been safe and well, and what I’d like to do to start the call is to kick off with the birth story of Airwallex. From my understanding the company was founded in late 2015 by you, by Jack Zhang, Jacob Dai, Ki-lok Wong, and Max Li. We were just talking before in the call and you were friends at university but were friends, shall we say who were not actually attending their lectures. Just probably how all of the best businesses start. And in fact, that’s how the idea developed right in a coffee shop in Docklands, or at least that’s what we were discussing. Can you recall the exact moment when you were all sitting down and talking about what was this light bulb idea for Airwallex? Can you paint that picture for us?

Lucy Liu (00:02:29):

Yeah, sure. So I think like you said in 2015, my co-founders Jack and Max started a cafe in Melbourne Docklands, and it’s actually a side business for both of them because Jack was working for ANZ at that time and Max was a professional architect. While they were running this business, they had to import goods such as coffee cups, labels, all sorts of things for their cafe from China. And during the process, I think they realised that expensive foreign rates and other things were hurting their profit margin. We never really thought about that before because all of us were working in institutional banking world where everything is calculating pips, or for those who don’t know it’s like 0.01%, whereas in the retail world FX margin is four or 5%.

Lucy Liu (00:03:39):

And Jack at that time thought there must be a better way of doing it using technology to solve this problem especially for SMEs. He actually discussed this idea with Jacob, who’s our CTO, for a couple of months and around that time I just finished my job at CICC. Everyone’s just quit their jobs and we decided to make this work. There wasn’t really a light bulb but most of it was just having the idea and we want to actually devote our time to it. We couldn’t possibly do that if everyone’s still having a full-time job. I guess that’s the start of Airwallex.

Bede Moore (00:04:34):

84% of people on the line considering becoming an entrepreneur in your footsteps, what was the moment where you said, “I’m quitting my job. I just need to quit my job and do this.”

Lucy Liu (00:04:49):

Well for me, I think it was very easy because I was already unemployed. I was actually taking a career break. For others, I think it was… First of all, we were able to secure some funds from our friends and family and also personal money. At least I think we knew that we could afford to do this for like six to 12 months without external funds, which is, I guess why I think everyone just took a leap of faith and Xi Jing, Jacob, I just always refer to him his Chinese name, was a serial entrepreneur. He already had like four or five startups. Some of them worked well that he sold. Some didn’t work well. At that time, that particular one was failing pretty heavily, so he actually just wrapped that up and decided to join us.

Bede Moore (00:06:02):

Amazing. Basically the business started out as a way for cheaper and faster ways to make cross border payments. With that as the kernel of the basic idea, how did you go about understanding whether this was really the right idea and whether it was something worth pursuing?

Lucy Liu (00:06:29):

Yeah, sure. I think the first product we have was like an invoicing platform where the supplier can send an invoice cross border to someone on the country and then to pay for that invoice. And I think at that time we didn’t really have very comprehensive understanding of compliance, of how the product will actually work. Our first product actually didn’t work. But I think while we were talking to different potential clients and also at that time we were also raising our series A, from Tencent and from other investors. We actually found more opportunities in the enterprise space even though we started targeting SMEs to start with. I think at a time the team was quite small, which would help us actually to shift our direction and priorities pretty quickly. We actually started developing API based on our initial international payments product. We were able to get pretty good traction from that. From there on, we actually revisited our SME offering, so now we actually have solutions and products for businesses of all sizes.

Bede Moore (00:07:59):

It’s a really interesting point, you say that the first product didn’t work and I’m sure that there are many people on the call who have been in precisely that situation that you launch something and for some reason it doesn’t work. How do you think you know when you’ve found a problem that’s worth solving? Because we always tell entrepreneurs that what they’re looking for is they need to find something where there’s demand. You’re looking for demand. Is it a painful problem? Is it a popular problem? Is it a frequent problem? Is it urgent, growing, unavoidable? All of these are ways of describing demand. How did you know that that was something that you’d found? Was it just through this experience that Jack had had, or did you start seeing market signals to tell you?

Lucy Liu (00:08:50):

Yeah, so I think the initial trend was obvious… The reason that we started with invoicing was because it was actually for offline businesses trying to transact globally but actually while we were developing the products, we realized that a lot of businesses are born online these days. So, whether it’s a Shopify eCommerce website or, online educational firm, or a freelancing from. Actually I think while we were in the early days of Airwallex we quickly realised that the world is becoming more digitised and it’s also becoming more globalized. In a sense that if you have access to the internet, you can possibly have the whole world as your potential customers. Then we looked at our product and thought, “Do we have the right infrastructure in place, or are we just merely building an application?” And the answer is obviously that the infrastructure also needs some innovation and it also needs some disruption. We actually spent around nearly two years building the foundation of our Airwallex backend, which is why I think a lot of people didn’t really even know what we do until we were a unicorn because a lot of it was on the back end but I think in the long run having that infrastructure in place actually allowed us to scale more quickly and we were able to quickly roll out new products and anything that could meet the demand of the market.

Bede Moore (00:10:35):

Yeah. I think it’s an amazing story that, and I think it demonstrates how effective you have all been as leaders that you could build investor confidence in team commitment to go and build that infrastructure and then obviously become one of the fastest ever unicorns. It is a truly remarkable story. I do want to go out to the crowd now and get a poll of those of you who are on the call. How many of you think that you might have spotted a viable business opportunity like the Airwallex founders did back in 2015? Very interesting to see what comes out here. We’ll give everybody another five, four, three, two, one. Oh, yes I like the beep. That was awesome.

Bede Moore (00:11:35):

Wow! Fully 59 people on the call. Well that’s very impressive. I can just say that, once again if there’s that many of you out there, the apply link is in the call. I think that it would be interesting to know of those of you who’d actually put this out there. One of the biggest issues preventing people from starting companies is the attitude, and Lucy you said that for you it was a natural thing because your role at CICC come to an end. But I think that often people the reason that they don’t want to do it is because they don’t have a good idea. Our view is, we’re living in this age of opportunity, right? And really there are ideas everywhere and opportunities everywhere being created by digitization, by the internet. Before the four of you had sat down in the coffee store thinking about Airwallex, had it been on your mind to go and become an entrepreneur anyway, or was this the thing that really dragged you into it?

Lucy Liu (00:12:54):

I think I wanted to be an entrepreneur without going into details of what that word actually means to anyone. I wanted to start something of my own because my previous role it wasn’t… As a job, it was a very good employment but I could potentially see what my career will look like if I stayed there for another five or 10 years. I think that for me is not something that’s very exciting, or challenging and I think similarly for a lot of people who joined Airwallex from bigger institutions that’s how they felt.

Lucy Liu (00:13:43):

Yeah, so I think it really depends on everyone’s situation but for me it was a no-brainer. I wanted to be an entrepreneur and I want to build something of my own and whatever that success may look like down the track but I think at least at that point in time five years ago, that was what was on my mind, which is why I took the career break to start with. It was actually a very interesting opportunity I think because the others were all on the technical side and I was on the business side. I think in that sense it’s actually a very complimentary partnership that we had.

Bede Moore (00:14:36):

I think this is a really interesting point. You had already been cultural… You’d already been thinking how I want to become an entrepreneur.

Lucy Liu (00:14:46):

Mm-hmm (affirmative).

Bede Moore (00:14:47):

And even to the point of considering taking a career break to make it possible. Had you engaged in a process to start thinking about had you not become friends with Jack and the others? Had you already been running a process of what ideas could I do? What are the possibilities in front of me?

Lucy Liu (00:15:09):

Yeah, sure. Because I was in investment consultant, so naturally I would think about things that are online, industries just pure finance, or investment, or things like that. But without having the technical knowledge, a lot of times it’s very hard for a non-tech person to think about tech ideas, if that makes sense. Which is why a lot of people actually talk… When I talked to them, they like, “How do you find a tech co-founder?” Because it’s always tech co-founders looking for business people and business people are looking for tech co-founders.

Lucy Liu (00:15:54):

Yeah, so I think it definitely was… I had all sorts of weird ideas at that time. I can’t really even recall all of them but I think what made me commit to Airwallex was having the technical support from my other founders. And also I think FinTech, it’s finance it’s technologies and it’s not too foreign to me. I think it’s something that I can still understand, especially on the FX trading and those things I like. I found the business side I will understand it. And from the application and user case I still understand it. So it’s not something that’s completely new to me. However, the tech side is definitely something that’s different.

Bede Moore (00:16:48):

Yeah. I think this is one of the hard things coming from a commercial background and most people when they’re coming in are often coming from, either a domain background or a commercial background, and that there’s this concern of, am I going to be able to find a technical co-founder? And so often we have this situation where people say, “Hey, I culturally really want to become an entrepreneur but I can’t spot a business.” And so we’ve really thought a lot about this and the ways that you can spot ideas, like are you looking in white space? Are you finding a genuine invention and doing something entirely new? Which I think is what makes Airwallex so valuable is this infrastructure is really doing something new and novel.

Bede Moore (00:17:33):

But there are easier things out there and typically, it’s can I replicate, or resuscitate another business idea? Or can I create the picks and shovels of a macro trend that’s occurring? Or, can I tinker with something and apply it in a different way to a new industry? I think these are the ingredients to going and getting started. But the next question that people have, and this is what I’m interested here in your case. You all knew that there was this opportunity for cross border transactions. When you looked around the table at each other, how did you know or what gave you the confidence that you were the right team to go and put it into place to implement it?

Lucy Liu (00:18:27):

I think in any partnership, the first thing is always trust. You trust your co-founders. And I think in terms of expertise, we had Jack on the FX side, we have Jacob on the tech side and I brought to the table, I’m experienced in investment, raising funds and anything that’s not coding. I think as a starting team, we were pretty… I think we were already a pretty good size. I always admire people who start a business by themselves because you can’t possibly have every skillset on a table as a single founder. I think as a team we also had our personal network to tap into. Kellogg came on board together as with the founding team. He used to work with Jack in that.

Lucy Liu (00:19:33):

I think in terms of resources and skill sets, we were in a pretty good position back then and obviously over time, we had to hire more senior executives. We had to hire more core management team. What hasn’t changed is the trust that the co-founders had for each other and our ability to adapt and learn new things was pretty amazing. I think every year our strategy changed a little bit because there was something new in the market and we discovered something that was worth pursuing as an opportunity. Our strategy is very comprehensive now compared to what it used to be.

Bede Moore (00:20:31):

I love that. Yeah, it always seems so simple at the beginning and then you’re like, “Oh, no. We need to add this. We need to do this.” I’m intrigued by your comment about trust because I think it is a really important one and I think… Actually you see in so many companies where you have that founder breakups it’s because they probably haven’t really prepared for what they’re actually going to have to go through, which is a very long tough journey together. Describe maybe some of the conversations that you had between each other to give you yourself that sense of trust? Was it just because they were the other three people who weren’t attending lectures and you thought, oh they must be good people if they’re not attending lecture, or was there more to it?

Lucy Liu (00:21:21):

I think Jack and Max already did a few projects together so they knew each other’s personality, even though they had all the fights in the early days. They were still come to some kind of resolution to any ideas, or any conflicts that they had. Just knowing each other for a really long time and knowing the other person’s personality is very important. Jacob and Max knew each other since high school, and Jack and Max, all of them were friends for a really, really long time. It’s interesting because sometimes I give the example of people in a dating relationship. They don’t really know about each other until they start living with each other. It’s like friends don’t really know about each other until we start working together as well because it’s just a completely different relationship.

Lucy Liu (00:22:25):

But over the past four or five years, we’re really… Because we spend so much time with each other and looking at how we make decisions and as the company grow, I think the trust has developed over time as well because without even talking too much to each other, we still knew what’s the best business decision. Another thing is probably not taking things too personally. We’re still very good friends outside of work but at the end of the day, business is business and we all want what is the best for Airwallex I think that’s where the trust comes from as well.

Bede Moore (00:23:23):

So — you’re all in Docklands, and decided you’ve got an idea. There’s some demand, you’ve got a team, you trust each other and then you said, “Let’s get to work.” What did that look like immediately? How do you go from here’s our idea to now this is a business. What were those first few steps did the team.

Lucy Liu (00:23:52):

The first thing is obviously getting all the… Have the company set up, rent an office somewhere even though it’s tiny. All the other equipments really and think about… It’s such a long time ago. I think pretty early on we knew that we had to go into fundraising mode even though we had the stash of cash from friends and family because one is having obviously… A lot of times they also force you to look at how to be a proper business because even our creative investor told us that you need to set up employee ESOP, which is Employment Stock Option Plan. You need to have a proper company structure. You need to have all these things in place. Do legal due diligence, finance due diligence even though we were only three months old back then.

Lucy Liu (00:25:00):

So, I think pretty early on we had a structure that was in a way scalable, even though one day… Now we now have like 10, 11 companies around the world. It still operates as the first original structure that we had. But I think we wouldn’t have done that if we didn’t fundraise so early on. I’m pretty clueless about how to set up proper VC backed company.

Bede Moore (00:25:37):

There’s actually, and I’m going to just jump to it now. There’s some questions in the Q & A actually asking about this and there’s a couple, so I’ll address them generally. People are saying, “Hey, if I don’t know wealthy people, or if I don’t have a big network, what are some steps that I can take to build that network and to understand whether or not I’m sitting on an idea that might be investible for VC?”

Lucy Liu (00:26:09):

I think there are a lot of very early stage VCs these days. At least a lot more than when Airwallex first started in Australia I think. We had to raise money from China because the VCs in Australia was… The industry was just starting. Sorry. I think there’s actually very good support and one of the things that we benefited from was actually put it participating in corporate, not incubators but they were programs that were set up to help startups get on their feet. It’s quite similar to the services and opportunities that, and so all of other incubators provide. When we went into MasterCard stock pass and they actually gave us access to the MasterCard innovation team, innovation labs and we were able to learn a lot on the product and infrastructure. Not so much on the funding, even though we took some money from MasterCard but I think the main thing for us at that time was really knowing whether our product was… There is a good product market fit because obviously MasterCard conducts a lot of research.

Lucy Liu (00:27:36):

I think looking at how bigger corporates target a market is actually quite important as a startup. Also looking at how you can do it differently or better because you’re smaller, you’re nimble, and you’re able to get things done pretty quickly. Another thing is investible idea. I think it’s also think from the perspective of the investors. What they are looking for is quite simple. They look for return. So, whether your business can be something that generates return is the most simple way about thinking it. Sometimes I do run into founders where they think the market is very, very big and they think they’re going to take 20, 30% of the market share, which is in a way you’d rather have a really, really giant pie and you only own a piece of it than a really, really small cupcake and then you take the whole cupcake.

Lucy Liu (00:28:42):

I think whatever idea you have, it has to be able to evolve into something a lot bigger in order for it to be investible. I think industry is also something that’s very, very important because all of the VCs that we talked to were investing in FinTech specifically. So, if you talk to someone who invests in Meditech about FinTech obviously they’re not interested. Finding the right lead investor and the right person to talk to is very, very important. Even if it was sending BPs out to them could work. I know for a fact that some of my VC friends look at 500 or more companies every year. So, they’re actually out there actively looking for startups to invest into.

Bede Moore (00:29:44):

This brings us to an interesting point because, and I’m certain that this was not the case for you but potentially it’s one of the things that you managed to develop as you were working in the MasterCard incubator for example. One of the things that we commonly hear when people are trying to come up with businesses is what we describe as a Trojan Horse mentality, which is where they talk about what they’re going to do when the business is fully formed. How exciting it is once… What the business will look like once it’s already established its market position, and not about what is this one ingenious thing that you are going to do that actually gets you through the gate. And this is I think what is the part that gets initial investors excited, is when you’ve discovered that one tiny innovation that suddenly opens the market and makes the broader aspiration of the business believable. What was that for you? What was the thing that when you had those initial investment conversations people said, “Okay, this is really serious. These people know about something new.”

Lucy Liu (00:31:03):

Yeah. I think for us obviously it’s not the application layer. If you look at it, it’s another way of doing remittance, or as some amplified version of any remittance tool, or what, you know Western Union. It’s actually building our own payment network and we went extensively into how we do our FX pricing, how we discover the best FX price and pass it through to our customers. There was a lot of diagrams and very complicated flow charts to actually educate the investors about what exactly we’re doing. I think you’re exactly right. It’s not about what you do when your business is fully formed is, it’s how you get there and demonstrating that you have the right knowledge, and you have the right team to do it.

Lucy Liu (00:32:03):

And investors can’t possibly know everything that is happening in the world, and if they know exactly what you’re talking about on the product in the tech side then probably it’s not that innovative to start with. We actually spent many hours going through the backend and doing demos, and doing a lot of the talking about how we target, for example one currency and how we replicate that in different markets. They will always come back and say, “Can you actually describe how that works?” To make sure that you actually know what you’re about. I think it’s nice to have a chart that goes like that, exponentially for all your growth but the detail is actually what makes it different. I think showing the pipeline, showing you know exactly what you’re talking about is probably my suggestion to people who want to win over their conversations with investors.

Bede Moore (00:33:16):

I really love this point actually and I think it sounds really simple but I think it defines great companies, which is that if everybody can very quickly understand what it is you’re doing and that there is nothing novel or nothing innovative about it, your chance really of being a global tech company are slim. And unless you can develop that, you’re going to struggle. I think that that’s a really useful test for anybody out there who is thinking about building their business. So often I feel like businesses are generated because people have just received their latest delivery of pizza and they find it customary experience, not particularly on the delivery and they’re like, “Let’s build a logistics network because that sucked as a customer experience.” And the likelihood that they know enough and they can do something innovative is just very, very low.

Bede Moore (00:34:13):

So, this idea of are you able to tell investors something different about a new industry is really, really important. You’ve obviously also been able to do that now for five years in a row and leading up to this unbelievable news. Congratulations over the last couple of weeks of $250 million capital raise. A huge clap. That is really incredibly impressive. I think it is one of the biggest by an Australian startup on record, right? So I’m very, very impressed. And you did it even despite the COVID pandemic, which is all the more incredible. Can you tell us what this was like? Firstly, what it was like raising money during this period? And how it affected your team and how if at all… Obviously, it hasn’t mattered too much, but how if at all it changed your thinking, your strategy, the way that you were considering your business options?

Lucy Liu (00:35:23):

So, we actually kicked off the process late last year before COVID-19 happened. So, I think a lot of the main conversations and we were able to secure a lead investor in January, so a lot of conversation had already happened. The rest was just having co-investors and actually the legal and the finance due diligence done. So, I think for us, we were quite lucky. We were very worried that the investors won’t give us the money during February and March. Because until it hits our bank account is not there. But, I think the logic is that even during this period of time investors they’re probably more cautious around their decisions. So they probably wouldn’t invest in too many new businesses. But given that we’re in Series B and we have existing investors returning to support us it happened quite smoothly for us luckily. I think by now it’s mainly around metrics it’s around the numbers, the economics, and the finance side. As well, the new products and things that we’re doing are still quite important but it’s about how much revenue you can generate from that new product that matters. So, I think it’s a little bit different to when we were raising fund as a Series A or a Series B company.

Bede Moore (00:36:59):

That’s great because we had a question from one of our viewers Yasmin earlier. And she submitted a question and said, “Look, can you maybe tell us the difference between raising a crazy round like a quarter of a billion dollars and the difference between that and how you raise a round from high net worth individuals, angels, early stage venture fund? What’s the difference in conversation, the difference in approach? How would you describe the difference between those two?”

Lucy Liu (00:37:36):

So, I think in the early days you will still present some numbers, but they’re very likely to be very accurate. And, I think it’s more about whether the business is viable, the idea can scale. It’s about whether you can have the right team in place. So, a lot of it is around what it could be but by the time we’re at Series B you have to first of all have a track record. You actually have to demonstrate historically what you have done and what achievements you have. And then for any upcoming… Like I said, it’s very metric focused and it’s very much about the numbers. We actually have all sorts of Excel sheets and a lot of it is around showing that. Thanks to Uber everything is about unit economics now, so how much planning you have done, and in terms of new products what sort of additional income stream is going to add to your business. And it’s all sorts of analysis that we did.

Lucy Liu (00:38:54):

It’s in a way a lot more logical as well. It’s about a percentage growth. It’s about the share prices direct conversion from whatever money you make. But obviously, it’s still about the percentage growth you’re able to achieve. And then you converted that using mathematical models. So, I think in a way, it’s more like a business decision compared to when in the early days it’s more about relationships. It’s about how well you know the person and whether they are able to support you, have again trust in you for you to deliver. One of the things that our angel investor actually said to me is, “Angel investment is a very high risk job.” Because they actually absolutely ask for… Expect no return most of the time. And they’re there to help you and I think in that sense… Obviously, by the time he told me that it’s already Series B so he made some return on his investment. But he said for most of the time they actually don’t expect anything whereas, your Series B investor definitely expect a lot from you.

Bede Moore (00:40:19):

I’m sure. And, I think what that shows, or what that demonstrates is that the earlier stage it is about building relationships. It’s about building trust, the trust of investors that you are going to be able to deliver on the aspirations and the forecast of the business. It’s a very different set of considerations than later stage, later series investments.

Lucy Liu (00:40:47):


Bede Moore (00:40:50):

I’m interested… One of the things that’s come out recently in the light of COVID is some stats suggesting that VC investment in Australia at least for the March quarter it was in fact roughly equal with what it had been in the year before. And I think that’s probably because the vast majority of those deals predate actually COVID hitting. I’m interested to know though you’ve obviously, just done this incredible round. Do you have a sense of concern or optimism? What are you thinking about? What does the next 12 to 18 months look like for you? Or is the view in Airwallex now that you have a war chest to really go out now and build a global company?

Lucy Liu (00:41:43):

So, I think the majority of our strategy is still the same in terms of international expansion and our new offices, licenses, product launches because most of our products are online. So, it’s not really being affected by COVID and people staying home. Compared to an offline business it might be very, very different. But, I think looking at us, our portfolio of clients actually is from all sorts of industries. In terms of eCommerce, they definitely experience a lot of challenges, mainly on the supply chain side. So it’s not really that they don’t have any business online, it’s they don’t have any stock to sell. So for that part obviously, we did prioritize a lot of our e-commerce offerings because it will take them some time to recover. But obviously, on education, gaming, digital side we’re seeing a lot of increase in their activities. So some of our product features and, I guess resources have been diverted to that industry in particular. But I do think there will be some challenges around how the general economy recovers from COVID. We actually had a lot of inquiries from traditional businesses around how they can shift their payments from offline to online. So it’s actually been quite interesting for us.

Bede Moore (00:43:42):

It’s very interesting. I think obviously, nobody really knows. But within that context, do you have a view of… Obviously you’re, I think fastest ever unicorn in Australia. You’ve shattered all of these records. What’s the next big thing, the milestone that is the thing that you now are personally, or the business is targeting that it’s going to get you really excited that actually is the main goal of the business?

Lucy Liu (00:44:15):

So, I think we’ve been very APAC focused for the last four years. We’re trying to enter into the Europe and US markets, which is very competitive. Actually, the US market is very domestic in a sense because it’s big enough for any domestic company to succeed without expanding overseas. So, I think what the next big win for us is actually to expand outside of APAC. Jack was planning on moving to the US for half a year but that is not happening for a while now. But I think a lot of things are still happening, it’s just slower. But obviously it’s a very different market, but we’re very confident about it because I think Asia in a sense is already very difficult. Europe, I think the main challenge is on the marketing and on the business side, it’s not really on the infrastructure side. It’ll be interesting to see how we compete against some of the local players in those markets because in terms of offerings we do have very strong presence in APAC. If any businesses are looking to expand outside of Europe and US, we are a very good option. We have more coverage to compete in those markets with any domestic players is going to be very, very hard.

Bede Moore (00:45:56):

Well, it’s good for those of us who are at the point of business formation to know that it remains tough, even once you’re a multiple unicorn. That’s perhaps not so comforting for some, but for others it’s good to know that it’s kind of equally difficult at all stages.

Lucy Liu (00:46:15):

Where it is difficult it means there are opportunities is the thing is pitching for investors. If it’s hard it means… If it’s done it’s a good opportunity.

Bede Moore (00:46:29):

That’s true. So look, I want to get us… We’ve had a huge number of Q&A come in. And a lot of it focused really on the early days of Airwallex and how you built the business. But I do want to summarise, because I think you had some really amazing messages in there that are often overlooked. But very definitive particularly in the early days. The first kind of comment that I really liked was this idea of looking for niche areas, whether it’s automation or innovation that you know a lot about and where you are even teaching investors. Because that’s when you know that you’re actually doing something that is distinctive. And obviously, distinctive often means value.

Bede Moore (00:47:14):

The second thing that we talked about and it was part of the birth story of Airwallex is that Jack particularly had seen this demand in his own experience of running the café, the demand for the thing that you wanted to go and build. And then finally, what I really took out of the earlier conversation is the amount of weight that all of you placed on the trust factor between you as a team. And, I think that those are three really important ingredients in the creation of any business at the earlier stage. Is there anything else that you’d kind of add to those three overarching comments that you’ve made?

Lucy Liu (00:48:02):

I think maybe one more is still around the team. I think people is what makes the business. We’re 400 people now. We still do a lot of hiring ourselves and I think knowing how you can hire the best and learn to fire people is also quite interesting. As founders, I think especially towards the later stages it’s placing the right people in the right positions that really makes a lot of difference to the success of the business.

Bede Moore (00:48:45):

Excellent. Well with that, I’m going move then to a few of our Q&As. And it’s really interesting. There’s some really big themes. I’m going to try and group people’s questions in some of the themes. And let’s start with the one that’s obviously on everybody’s mind at the moment, particularly with COVID is raising money. There’s a couple of questions around raising money that are interesting. The first is, “If I don’t have a network, how do I build one?” And then the second thing is, “When do I know how to raise money? Should I be going out and trying to raise money immediately? Or do I spend some of my own money to create a little bit of something before I raise? How does an entrepreneur know when to go to market and who to speak to?”

Lucy Liu (00:49:39):

So, I think one is on when. I think it really depends on the business. For us, we went to the market so early because we knew we needed a lot of money to build a foundation of what we were doing. And, I think particularly around the R&D costs and hiring people. The founders didn’t take any salary for a really long time, but obviously, we have to pay others. You can’t expect everyone to take sweat equity and work. A lot of people do take a considerable salary cut to join us especially in the early days. But regardless, you still have to pay for the people. Because given the size of the team that we needed at that time we went to the market pretty early on. And it was also because, I think if you don’t know anyone, it doesn’t hurt to ask.

Lucy Liu (00:50:43):

Surely, someone knows something about the VC world. Or even do your own research around who are the main players in the market and what they typically invest in, looking at their track record, what they invested in before. Is it something related to the industry that you’re in right now? And just reach out if you don’t know them directly because there are a lot of meetups. There are a lot of events that are run by investors. And, I think even for us, we did our research because we don’t have the time to talk to every single investor. And we particularly, looked for ones that can support our growth. So VCs that invested globally, so they know about not only the domestic market but also about the international market. So, I think finding the right investor and narrow it down to a group and their contacts are on LinkedIn or on their website. It doesn’t hurt to ask for an introduction. Or just talk to them directly.

Bede Moore (00:52:01):

Agreed. I think this is a thing that obviously we deal with very frequently. And I’d add a couple of things to that. I think first is that you need to be out and networking and that’s something that even if you don’t have a big network you can do that. As Lucy said, “There are a lot of places… Or at least there were before COVID to go and meet people to meet angels and you need to make use of that.” I think the thing that most people don’t realise is that any experienced investor is in the market in order to invest money and so you can have a straightforward conversation to ask them, “Hey, are you interested to invest? What sorts of deals do you invest in? What sort of check sizes do you normally invest? When was the last time you invested?” These are all really important questions and if an investor doesn’t really want to give you that information, they’re probably not that serious as an investor because most people are out there to deploy capital, right?

Lucy Liu (00:53:01):

Yeah, I agree 100%. I think a lot of people think investors are scary people and they actually don’t want to invest. But actually, a lot of times, all of my VCs friends are short of good projects to invest in. They’re actually very actively looking for new opportunities and there’s a competition between VCs as well. So it’s a competitive market for them to always find new things to invest in. You can just very upfront ask the questions that we’ve just said. And quickly find out whether they are the right type of investors to pitch.

Bede Moore (00:53:42):

Awesome. I’ve got two other questions, one of which is from George, which is, I think very relevant in the case of Airwallex. And he asks, “How important is a startup’s location to capitalize on a good idea? Should an entrepreneur consider moving base or moving their home to another ecosystem to improve their chance? Or do you think that it really ultimately is down to the unit, the team that builds the company?”

Lucy Liu (00:54:23):

So, I think location is definitely very important because it’s directly linked to the talent pool that you have. Take Airwallex as an example, the founders now spend only a quarter of our times in Melbourne. And one is because we have a very senior management group of leaders in Melbourne. Two, is because in terms of the talent pool… Let’s just say we’ve interviewed a lot of people in the market. And we need another network to tap into. But in saying that, we spent so much time in Melbourne it’s also because our personal network is in Melbourne. And we are able to attract talent directly from our ex-colleagues, friends, university friends. I think it’s one, to look at where your market is, but two is also to look at where your strength is. Because if you’re moving to a completely new location, you’re going to need time to build your own network and relationships. If you don’t have those in place it’s very hard.

Lucy Liu (00:55:39):

So for example, a lot of people will move to Shenzhen or Beijing in China, if they are starting a new fintech business or Beijing in particular because that’s where the regulator is. So actually, we chose Shanghai. One, is because we know more people here. And two, I actually have a home here. So, I think it’s also to look into how well you know that location. As well as what that location can actually bring for you. So you don’t want to be in a position where you’re all by yourself. Just because there is an ecosystem doesn’t mean that it’s-

Bede Moore (00:56:21):

That you can tap it.

Lucy Liu (00:56:22):

That you can tap into it directly.

Bede Moore (00:56:29):

I think that’s very wise advice. I think there is a really big trade-off. It’s kind of what we’ve been talking about with fundraising. A lot of early stage fundraising is about building networks. And if you displace yourself to another market that’s the trade-off is that you don’t have the stronger networks. Here’s another question. A very, very different kind of area, which is, for people like you who always thought about going and being entrepreneurs you understand that there is an incredible risk of doing this. That you know you might do three or four companies all of which fail before you’re successful. And considering that there is this risk, and there is a high chance of failure does that affect how an entrepreneur should consider when to go full steam on a business? Should they wait until they’ve achieved product market fit before looking for funds and building a full-time team? Or should they just get into it and start moving straight away and taking risks straight away?

Lucy Liu (00:57:45):

First of all, there’s a lot of timing issues. If you wait too long, the opportunity might be gone or might be done by other people. You can’t possibly think that you’re the only one who can think of this. My personal view is being an entrepreneur or whatever having a startup should never be a side hustle. Just because if you’re not 100% devoted to it how can you possibly make it work? Because thinking back in our first year, all of the founders basically did nothing but just doing Airwallex. Even for us, we felt like we didn’t have enough time. And we were stretched very thin, and we were doing so many things at the same time. If you only have half of your time, then for me, it’s just you might miss that timing and you might miss the perfect opportunity to do it to start with.

Lucy Liu (00:58:55):

But in terms of product market fit, like I said our first product didn’t work. And obviously… Not that there’s no market for it. I think SMEs definitely need invoicing capabilities but we didn’t have the right platform to launch it. For example, if we’re already a very successful SAS platform with millions of SMEs using us, then maybe launching a product like that would have very good traction very quickly. But because we didn’t have any customers, it’s going to take us a really, really long time in order for us to have that network effect. And scouting for funds and building a full time team, again, I think it really depends on the situation you’re in. Whether you need quite a considerable amount of money to build your business to start with. And team-wise, I think in that sense, you can actually be more flexible because you need to hire in advance. So thinking about what you potentially would need in six or 12 months’ time will actually determine how quickly you hire.

Bede Moore (01:00:19):

Lucy, we only have time for one more question and selfishly, I’m going to make it mine. I think every entrepreneur out there has at some point in their early career had an interaction with another entrepreneur where that person has said to them a piece of incredibly wise advice that has just turned out to be true on an ongoing basis and is like a guiding star to the way that they continue to operate. What was it for you? What did somebody say to you early when you were starting to build the business that has turned out to be really true and which continues to guide the way that you are building Airwallex into a global business?

Lucy Liu (01:01:05):

I think this was back in early 2016 when we were only thinking about, again the invoice and the FX side of things. And someone, actually our angel investor said to me, “You have to think about the user case. Potentially, who’s going to be using it? Where is this product actually going to appear?” And which is why I think we didn’t even think we’re a payments company back then. We think we are a FX platform. We think we are a tool for SMEs but it’s not big enough and you actually have to think a lot larger and think about exactly what is the user scenario and think from that perspective how you are going to build the other product. And, I think that actually works in many cases for many people because a lot of founders can get very hung up on a single idea without thinking about the bigger picture.

Bede Moore (01:02:11):

That is very good. Thank you. I’m glad I got to ask that question. Well, before we conclude with tonight’s event, thank you very much for attending. Airwallex and you are offering a special deal to anyone who has attended tonight’s call, which is a bonus $100 into their Airwallex account if they sign up for a virtual Airwallex borderless card, which I think was recently launched. Once your account is approved and you start using the card, you’ll be able to use the bonus $100 immediately. I’m going to ask Sarah to put that into the chat now for anybody to access it. Thank you, that’s very generous. Thank you for giving us your time this evening and your advice. I know for so many of us it is really a pleasure to hear from somebody with so much experience now raising money across multiple series and building one of the most successful tech companies globally. So thanks very much for your time and best of luck over the rest of the year.

Lucy Liu (01:03:23):

Thank you very much. Thank you.

Bede Moore (01:03:25):

Great. Thanks, Lucy.

The most driven founders are joining Antler - the world's day zero investor - to solve important problems. Apply to join Antler in Australia, or sign up here to access insights and resources to help you on your founder journey.

This article was originally published in 2021 on Medium.

Sarah Kimmorley

Vice President

Sarah is responsible for scaling Antler’s presence in Australia by delivering operational efficiencies and frameworks across the firm. Sarah is also responsible for Antler Australia’s marketing and brand presence, partnerships and business development, and people and culture. Before joining Antler, Sarah was the General Manager at Business Insider Australia and Gizmodo Media Group, leading four globally renowned digital media brands in Australia.

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