Why Pillow Thinks Digital Assets Will Unleash Emerging Markets

Pillow wants to be more than just a platform providing access to crypto investments. The Singaporean startup, which today announces a successful $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 holistic home for digital asset-based financial services,” says Arindam Roy, CEO and co-founder of Pillow. “We will enable users to earn, save, spend and invest from the same platform with a consistent, easy-to-understand user experience from a single mobile-first interface.”

Currently, what Pillow offers to its community of 75,000 users in 60 countries is 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 quickly and easily trade assets. Pillow also offers an investment management solution designed to limit risk and generate income.

However, even this feature gives many investors a way to save and invest for the future that they currently don’t have, Roy points out. For most people in many of the emerging markets it serves, access to conventional asset classes is very limited – especially when it comes to international assets that could provide some protection against market turbulence. their original economies. This is one of the reasons why the demand for digital assets is growing so rapidly in many developing countries.

“We founded Pillow because we realized that people knew why they wanted to invest in digital assets, but they didn’t know how,” Roy adds. The app therefore offers them an easy way to do just that, as well as a range of educational content to help users make more informed decisions. “We aim to create an educated class of investors,” adds Roy.

Over time, however, the ambition is broader. The same frustrations that drive many people to use digital assets to save and invest apply to other areas of their personal finances, Roy points out. Inefficient and inefficient financial systems in many emerging markets leave people without basic financial services and vulnerable to economic uncertainty.

“Ultimately, the true potential of digital currency is that it can allow you to escape the conventional 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 digital currencies, we can give people the choice not to use their traditional financial systems.”

To get to that point, Pillow will need to add a number of new services to the savings and investing functionality its app already offers. It will also be necessary to build trust and understanding, concedes Roy. His own experience growing up in India is formative in this regard. “It took 50 years for my grandparents’ generation to learn to trust banks in India, and until then they had to keep money under the mattress,” he says. “We want to help today’s generation get to grips with digital assets much faster.”

The company’s rapid growth suggests that many people share Pillow’s aspirations. Currently free, the app’s user base has grown 300% year-to-date and assets under management have increased fivefold. The company has launched in recent months in major markets including Nigeria, Ghana and Vietnam.

Ultimately, Roy expects it to take three to five years to integrate Pillow into the overall app he wants to offer. But today’s fundraising will help accelerate the trajectory.

The round is led by Accel and Quona Capital, alongside investors Elevation Capital and Jump Capital, and builds on Pillow’s $3 million launch round a year ago. It’s not so much capital the company needs, Roy argues, but support from investors with experience and understanding of digital assets, emerging markets and the consumer market. “We wanted support from people with the expertise to help us move in the right direction,” he says.

Quona’s managing partner, Ganesh Rengaswamy, certainly agrees with the company’s vision. “Money without borders and without permission has the power to change lives, especially in emerging markets, and it can draw more people into financial systems,” he says. “What Pillow is building can remove the friction of formal financial systems for the underserved, while incentivizing users to engage in saving and investing behaviors.”