Meru is a non custodial wallet (SEP30) that allows our users to take advantage of benefits that Blockchain, and Stellar specifically, offers without requiring this user to be knowledgable in crypto (private/public keys, addresses, etc). With just an email/password our users will be able to deposit and withdraw local fiat currency, hold and earn interest in a strong currency (USD) and then send funds crossborder to other Meru users instantaneously and at no cost, or make payments (utility bills, air time topups). Pls see www.getmeru.com.
What problem does MERU solve?
Meru is aimed at migrants that need to send money back home (e.g. from US to Mexico or from Colombia to Venezuela) and also freelance workers living in LatinAmerica that are getting paid in USD (e.g Paypal) but have a hard time and bear high costs to actually spend their hard earned money locally.
How does Meru use Stellar?
Meru is a Stellar wallet denominated in USDC, and we use local anchors and the DEX to actually move funds and to register all transactions. We use SEP6 to connect to the different anchors, and use Circle as our main USDC account.
When a user deposits, for example, COP from their Colombian bank account, this funds are routed thru the COP anchor, who issue a COP token, that is then traded/swapped using the Stellar DEX vs USDC, which is then deposited in the user’s wallet. When a user makes a payment or withdrawal, the reverse operation happens. The USDC is traded/swapped vs the local currency token, which in turn is burned and then the corresponding fiat is deposited in the destinatary local bank account.
We have recently launched (August 2022) and are onboarding customers from Colombia, Venezuela and the USA. More countries to come soon.
When we applied to SCF10 we had not yet launched.
Up until today (10/25/2022), we have onboarded 556 users (not all of them have been active), and we have processed 981 deposit transactions and 1126 withdrawal with average ticket size of ~40 USD. Pls see an extract of our dashboard at https://whimsical.com/dashboard-10-25-2022-HgBp1iB4oAFBwuUV3ZmRnE
We launched initially in Colombia and Venezuela and have very recently added the USA. We believe there is an opportunity to capture market share of the huge Colombia to Venezuela crossborder payments and remittances and, even more importantly, flow of funds from USA to both Colombia and Venezuela.
Up until now we have not spent any money in marketing/advertising. All the user acquisition has been thru referrals and recommendations.
We are starting to actively raise a pre seed round as we have to grow our user base in the countries where we are currently present as well as increasing our regional footprint.
Also, we need to continue to develop our product with new functionality/benefits.
Revenue Model and Funding
Revenue for Meru will come from 2 sources: Transaction fees and currency exchange spread. Those are small margins hence the need to have high volumes of users/transactions and hence the need to have regional presence.
Up until now we have been bootstrapping our operation and we are burning less than 1k USD per month. This is something we can sustain until the end 2022 at which time we need to rely on external funding.
Our pricing strategy is very simple for transaction fees. We will set a small markup on fees charged to us by partners/suppliers and something similar will happen with spreads that will probably be set at +/-2% the going rate.
We are hopeful with SCF and our seed capital raising efforts to allow our monthly burn to grow at least 10x to grow our monthly active user base by more than 10x, and to grow and strengthen the development and the operations and support team.
Market and Industry Research
We are a fintech that will try to offer disruptive alternatives to incumbent financial services and remittances operators. Due to high devaluation and inflation in the LatinAmerican region, and to slow and cumbersome solutions for cross border payments and remittances, we believe there is a clear problem that we can solve, and evidence of this is the fact that we are onboarding users daily with no investment in advertising.
Yearly remittances into Latin America and the Caribbean are more than 100 billion USD (according to a recent [study by Cemla.org](https://www.cemla.org/PDF/remesaseinclusion/2021-10-remittances-to-latin-america-an d-the-caribbean-ant-the-effects-of-the-covid19.html)). Also, there were more than 12 million migrant workers in LatinAmerica in 2019 both intraregionally and also to OECD countries according to a study by IADB. Finally, and due to the remote work trend that started due to the covid-19 pandemic, there is an increasing number of LatinAmericans working for US companies as contractors or freelancers that will need a solution like the one Meru can offer. (see the related study by upwork)
All this paints a picture of a great opportunity however this is not free of risks. One of the bigger risks is related to the regulatory environment towards crypto in the region and the potentially very expensive process to get required licenses. However we believe that we are a strong and well balanced team, with the right amount of experience and youth, boldness and pragmatism to navigate this tricky environment and make Meru a success.
Other than the normal financial institutions and the incumbent players in the remittances space (WU, Moneygram, Xoom, etc) we have identified some new fintechs similar to Meru that are being launched. For example Dolarapp from Mexico, Zinli from Panama, and Zulu and Littio from Colombia.
All of them (until now) are local solutions, we still don’t see a player with regional focus.
As mentioned previously, Circle (www.circle.com) is our main USDC account. We are currently working with Metamap (https://www.metamap.com/) for our KYC/ID Verification and we also use Paycash (https://www.paycashglobal.com/?lang=en) as our partner for fiat cash deposits. We believe this are strong regional players that will allow us to have a regional footprint quickly. We are actively looking for more global/regional partners that can help us expand our value proposition and grow our regional presence and user base.
Stellar ecosystem collaborations.
Other than SDF itself, we currently have established relationships with Ultrastellar (https://ultrastellar.com/), and are in the process of establishing a business relationship with Beans (https://beansapp.com) for SEP30 services.
We are looking forward to other Stellar ecosystem collaborations/partnerships.
Marketing and Sales
Acquisition - we will advertise on Social Media and App stores to reach our target audience. Our main effort will be for people to download, register and try our app. We will also work on organic growth and referrals for potential user awareness.
Retention - We are hoping to acquire highly active users that perform transactions at least 8-10 times per month and have established email and push notification channels to current users to promote usage.
Finally, we will use Discord as a community building plaform for heavy users where we expect to help us guide the further development of Meru according to real user needs and wants.
We created a couple of test accounts for the demo:
User interface is in Spanish but it should be easy to infer what it is about.
* The amounts shown are budget requests and not (yet) granted to the projects. During the Community Vote phase, voters can indicate whether the project deserves the amount it's asking for (budget request). The total pool of XLM available for SCF#11 is 8M XLM. SDF will allocate the XLM equivalent of the specified USD budget of the submissions with the most votes in descending order of rank until the earlier of (i) the XLM Pool is fully distributed (ii) there is not sufficient XLM remaining in the XLM pool to fully fund the next ranked submission or (iii) there are no remaining eligible submissions. The USD valuation of the budget request in XLM will be calculated using the CF Stellar Lumens-Dollar Settlement Price on December 5, 2022 as administered, maintained, and reported by the cryptocurrency index provider CF Benchmarks Ltd. (using the ticker “XLMUSD_RR”) (available at https://www.cfbenchmarks.com/indices/XLMUSD_RR). Learn more in the SCF Handbook.
*The USD valuation of the award in XLM is calculated using the CF Stellar Lumens-Dollar Settlement Price on July 5th as administered, maintained, and reported by the cryptocurrency index provider CF Benchmarks Ltd. (using the ticker “XLMUSD_RR”) (available at https://www.cfbenchmarks.com/indices/XLMUSD_RR)
**The USD valuation of the award in XLM is calculated using the CF Stellar Lumens-Dollar Settlement Price on December 16, 2021 as administered, maintained, and reported by the cryptocurrency index provider CF Benchmarks Ltd. (using the ticker “XLMUSD_RR”) (available at https://www.cfbenchmarks.com/indices/XLMUSD_RR)
*The USD valuation of the award in XLM is calculated using the CF Stellar Lumens-Dollar Settlement Price on September 27, 2021 as administered, maintained, and reported by the cryptocurrency index provider CF Benchmarks Ltd. (using the ticker “XLMUSD_RR”) (available at https://www.cfbenchmarks.com/indices/XLMUSD_RR)
* The USD valuation of the award in XLM is calculated using the CF Stellar Lumens-Dollar Settlement Price on the date of transfer as administered, maintained, and reported by the cryptocurrency index provider CF Benchmarks Ltd. (using the ticker “XLMUSD_RR”) (available at https://www.cfbenchmarks.com/indices/XLMUSD_RR)