Pillow It wants to be more than just another platform that gives access to crypto investments. The Singaporean startup, which today announces the successful completion of a $18 million Series A funding round, is on a mission to tackle financial exclusion in emerging markets around the world.
“We aim to be a one-stop home for digital asset-based financial services,” explains Arindam Roy, CEO and co-founder of Pillow. “We will enable users to earn, save, spend and monetize everything from the same platform with an easy-to-understand and cohesive user experience from within a single mobile-first interface.”
Currently, what Sisda offers to its community of 75,000 users in 60 countries is even more limited. They can use its app to buy and manage a range of digital currencies including Bitcoin and Ethereum, as well as US dollar-denominated stablecoins, as well as to switch between assets quickly and simply. SIDA also offers an investment management solution designed to reduce risk and generate income.
However, even this functionality provides many investors with a way to save and invest for the future that they do not currently have, Roy points out. For most people in many of the emerging markets they serve, access to traditional asset classes is very limited – certainly when it comes to international assets that may offer some protection from disruptions in their home economies. This is one of the reasons why the demand for digital assets is increasing so quickly in many developing countries.
“We built Cushion because we realized that people knew why they wanted to invest in digital assets, but they didn’t know how,” Roy adds. So the app provides them with a simple route to do exactly that, as well as a host of educational content to help users make better informed decisions. “We aim to create an educated class of investors,” Roy adds.
But over time, the ambition is broader. Roy points out that the same frustrations that drive many people to digital assets to save and invest apply to other areas of their personal finances. The inefficiency and ineffectiveness of financial systems in many emerging markets leaves people stranded without basic financial services – and vulnerable to economic uncertainty.
“Ultimately, the real potential of a digital currency is its ability to escape the traditional financial system,” Roy says. “If we can find ways to tokenize real-world assets and make it easier for people to pay and spend their cryptocurrency, we can give people the choice not to use their traditional financial systems.”
Getting to this point will require a cushion to add a number of new services to the savings and investment functions that the app already offers. Roy acknowledges that he will also need to build trust and understanding. His own experience, growing up in India, proved to be formative in this respect. “It took my grandparents’ generation 50 years to learn to trust banks in India, and even then they were stuck keeping money under the mattress,” he says. “We want to help today’s generation get comfortable with digital assets more quickly.”
The rapid growth of the company indicates that many people are participating in the aspirations of the pillow. Currently, for free, the app’s user base has grown by 300% since the beginning of the year, and AUM has increased fivefold. The company has taken off in large markets including Nigeria, Ghana and Vietnam in recent months.
Ultimately, Roy expects it will take three to five years to create a pillow in the overall application he wants to deliver. But fundraising today will help speed the path.
The round is led by Accel and Quona Capital, along with investors Elevation Capital and Jump Capital, and the round is based on $3 million from the cushion over the past year. Roy argues that the company does not need a lot of capital, but the support of experienced investors and an understanding of digital assets, emerging markets and the consumer market. “We wanted support from experienced people to help us move in the right direction,” he says.
Quona’s managing partner, Ganesh Rengaswamy definitely buys into the company’s vision. “Unrestricted, unlicensed money has the potential to change lives, especially in emerging markets, and can bring more people into financial systems,” he argues. “What you build as a cushion can remove friction with formal financial systems for the underprivileged, while engaging users in savings and investment behaviors.”