Iowa Payments Firm Dwolla Hires After Funding Round, Boosts Revenue
Dwolla CEO Brady Harris felt his business collapsed on him when he took the reins last year.
Ben Milne, the founder of fintech firm Des Moines, had taken a step back from day-to-day leadership a month earlier. The company has downsized. Then the COVID-19 pandemic began.
“It was like jumping over the beaches of Normandy during WWII and meeting your troops as the battlefield commander for the first time as you parachuted into combat,” said Harris, who started with Dwolla on March 30, 2020.
He said he had trouble sleeping for the first few weeks. Customers said they could no longer pay their monthly payments and requested rebates from Dwolla, which provides software for business-to-business payments. Harris said he cut his own salary by 15%. At his first practical meeting, he said, he asked employees to voluntarily reduce their wages from 5% to 10%.
What a difference a year makes. On Wednesday, the company said it had closed a $ 21 million funding round, the largest since Dwolla launched in 2010. Harris said Dwolla would increase its workforce from 100 to 125 by the end of the year. .
Looking back, Harris said the business was well positioned to thrive during the pandemic, as more businesses turned to online payment platforms while residents stayed at home. Dwolla doesn’t work directly with buyers, but the company has taken advantage of this by providing the back-end technology work that customer-facing businesses need.
He said instability around Dwolla stabilized last summer, when the company was able to restore wages to pre-pandemic levels.
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“Our customers, they started to roar to life again,” he said. “Their volumes started to pick up. We had just formed a very good relationship. And we have benefited since then.”
Overall, he said, Dwolla processed $ 20 billion in payments last year, up from around $ 11 billion in 2019. This year, he said the company expects to process $ 30 billion to $ 35 billion. dollars in payments. Now he expects that figure to reach “over $ 40 billion.”
Harris said Dwolla will use the funds to expand into several different areas. First, Dwolla will add employees focused on showcasing their service to more potential paying customers.
The company will also expand beyond the United States for the first time. Over the next three to six months, Harris said Dwolla will announce a partnership with a still unknown international bank, which will allow Dwolla customers to send and receive money across the U.S. border.
Dwolla is also looking to add employees who will help grow its real-time payments business. Dwolla is among fintech companies and banks using a new rail, or platform, to process funds, which can clear payments in seconds. Most businesses currently rely on the automated clearinghouse, a payment rail that can take hours or days to clear transactions.
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In addition, the company wants to recruit larger business partners to complement the company’s current client list of startups and mid-sized companies. Harris said Dwolla’s desire for bigger fish was one of the reasons he hired former Mastercard executive Dave Glaser as new president and chief operating officer in March.
Among Dwolla’s backers in the latest funding round is Next Level Ventures, a Des Moines company. Craig Ibsen, managing partner at Next Level and a member of Dwolla’s board of directors, said he was particularly excited about the company’s potential to grow its real-time payments business.
“It’s a dramatic area where a few fintechs are going,” he said. “Dwolla is truly a leader in this area.”
As Dwolla continues to hire, it’s unclear how many of those employees will be in the Des Moines metro. While about three-quarters of the company’s current employees are based in Iowa, Harris said most of Dwolla’s most recent hires have come from other parts of the country.
The company will continue to post jobs locally, but he said Dwolla employees can still work remotely.