Stripe and Airwallex Shift From Merger Talks to Rivalry

In early 2018, a young founder faced a life-altering choice. Jack Zhang, then 34 and leading the Melbourne-based startup Airwallex, was sitting in the San Francisco home of Sequoia’s Michael Moritz. The legendary investor was urging him to accept a $1.2 billion acquisition offer from Stripe. For a company with roughly $2 million in annualized revenue, the math was staggering. Moritz argued that joining forces with Stripe’s generational founder Patrick Collison would compound into something extraordinary. Zhang, after two weeks of restless deliberation in San Francisco, initially agreed. Then he boarded a flight home.

The distance provided clarity. Back in his own office, looking at the whiteboard outlining his original vision, he changed his mind. Two of his three co-founders had also voted against the deal. The unfinished mission, to build global financial infrastructure enabling any business to operate anywhere like a local, felt more compelling than a lucrative exit. That decision now appears remarkably foresighted.

Airwallex today reports over $1.3 billion in annualized revenue, growing at 85% year-over-year, and processes nearly $300 billion in annual transaction volume. Zhang’s resolve stems from a personal history of resilience. He moved from Qingdao, China, to Melbourne at 15, navigating language barriers and family financial hardship. He worked four jobs, from bartending to farm labor, to fund a computer science degree. A subsequent, well-paid coding role at an investment bank left him unfulfilled, following a string of entrepreneurial ventures from a teenage magazine to a coffee shop.

It was that coffee business that crystallized the problem Airwallex would solve. Co-founder Max Li struggled with international payments to bean suppliers, watching transactions get frozen or delayed for weeks within the opaque correspondent banking system. “That pushed me to really look at how correspondent banking works,” Zhang explained, “how SWIFT works, and how we could build our own global money movement network.”

The company’s strategy has been one of deliberate, difficult foundation-laying. It now holds close to 90 financial licenses across 50 markets, a regulatory moat Zhang estimates is roughly double Stripe’s footprint. Securing these permits has been arduous, taking seven years in Japan alone. In some markets, Airwallex had to acquire shell companies with legacy licenses and rebuild their technology from scratch. “You can’t really vibe-code an integration with Mexico’s central bank,” Zhang noted, describing secure rooms requiring biometric scans.

This licensed infrastructure creates a distinct commercial advantage. In Japan, for example, while Stripe must immediately settle funds to a merchant’s external bank account, Airwallex can hold balances within its own ecosystem. This allows customers to create local bank accounts, issue cards, and spend funds without money ever leaving the platform. The foreign exchange economics are significant, saving merchants the typical 2-3% conversion fee and allowing them to operate globally without establishing physical entities.

Zhang calls this the “path of maximum resistance,” a framework where each hard-won license and integration creates a competitive barrier. “It took us six and a half years to get to $100 million in annual recurring revenue,” he said. “But after that, it took just over three years to get to a billion.” He argues that controlling the end-to-end workflow is fundamental. Relying on another company’s infrastructure limits problem-solving and product innovation. “Building on top of other infrastructure is simply not scalable,” he stated.

For years, the two fintechs operated in separate lanes, targeting different customers in different regions. Airwallex’s core buyer has been the CFO and treasury office in Asia-Pacific, while Stripe grew through developer adoption in the U. S. That divergence is narrowing as Stripe expands internationally and Airwallex makes a concerted push into the American market. Over half of Airwallex customers now use multiple products, typically starting with a business account.

Zhang acknowledges formidable challenges. Stripe enjoys iconic Silicon Valley status and a powerful brand with developers. “Our brand is just not there yet,” he admitted. “That’s a harder competition to win.” The rivalry is complicated by shared investors, including Sequoia, which backed Airwallex early, and Greenoaks Capital, which holds stakes in both companies. Zhang dismisses any awkwardness, noting investors are betting on a vast market.

A stark valuation gap persists. Stripe was valued at $159 billion in February, while Airwallex carried an $8 billion valuation last December. Yet Zhang points out that Stripe’s payment volume is only about six times larger, not twenty. With Airwallex’s current growth rate and a projected $2 billion in revenue within a year, it is closing the operational gap quickly.

An IPO, Zhang says, remains three to five years away. His nearer-term goals include reaching one million customers by 2030 and $20 billion in annual revenue. The company is launching AI-powered autonomous finance agents designed to execute transactions, not just analyze data. Zhang believes a decade of accumulated financial data across its platform creates a unique training set competitors cannot easily replicate.

The relationship between the two founders has cooled alongside their companies’ escalating competition. Years ago, during merger talks, Zhang and Collison were friendly. At a Greenoaks Capital gathering last year, they were in the same room. They did not speak. The long-term bet Zhang made in 2018 has set the stage for a direct and global contest, testing whether the path of maximum resistance can ultimately prevail.