Oanda nabs $100 million in venture funds

Discussion in 'Forex' started by Davdse, Sep 17, 2007.

  1. Davdse


    Online currency trading site Oanda only takes in about one one-hundredth of a percent in revenue off of each trade, according to Chief Technology Officer Michael Stumm.

    But, since the site can clear around $10 billion in trades on a big day, it's a somewhat attractive business, he adds.

    Founded in 1995, Oanda has effectively become the E*Trade for currency speculators and traders. Customers log onto the site and try to earn money by betting on the rise of the euro, for example, or the decline of the dollar.

    "Truth in advertising, the vast majority of the people at this time lose money at it," Stumm said. "But there are quite a few people who consistently make money. The main mistake people make is that they are not conservative enough."

    The company is now hoping to expand by moving up the food chain in the banking world. New Enterprise Associates (NEA), a Silicon Valley VC firm often associated with semiconductors and clean technology, has invested $100 million in the firm. Oanda will use the money to beef up its balance sheet. And with that amount on the books, the hope is that Oanda will be able to attract more business, handle larger transactions with more ease, and qualify to perform other services in various jurisdictions.

  2. Thanks for the post, mate.
  3. DbaFx


    Maybe they'll use some of that capital to eliminate the current string of outages that have been occuring over the last couple of months.