Banks and financial technology startups (in other words fintechs) represent two different worlds. They have different DNA, speak different languages, and the partnership between them may not be easy. However, it can bring many benefits. Not only for both parties involved but mainly for the customer. KB SmartSolutions (Czech Republic), a member of the Komerční banka Group, and the investment company DEPO Ventures (Czech Republic) currently launch their cooperation. Its main goal is the search for promising startups, mainly thanks to the expansion of the joint field of activity. Startups with smart solutions that could potentially complement the current portfolio of Komerční banka, under the wings of KB SmartSolutions, will be searched for not only in the Czech Republic but also beyond its borders, especially in Central and Eastern Europe. The partners also want to jointly support the local startup ecosystem and strengthen the position of startups in the region. Mutual support will also take place in the areas of sponsorship and networking.
“The cooperation between KB SmartSolutions and Depo Ventures is a logical step. Both companies are an active part of the startup ecosystem in the Czech Republic and Central Europe. That’s why we decided to join forces and not only support this ecosystem together but also use our cooperation for a more effective search for startups with smart solutions, especially fintechs. Fintechs are not our competition, as it might seem at first glance, but our natural allies. To build the banking of the future, we need to learn to cooperate with them much more and connect the best of both worlds. Thanks to cooperation, banks, and fintechs move forward faster and learn from each other,” – says Patrik Nový, Director of KB SmartSolutions.
The Bank can offer startups its know-how, resources, customer database, excellent distribution network, or management experience. It has many years of expertise in several areas, thanks to which it can help startups to build operations in a better and more effective way, link IT systems, devise more efficient distribution, better economic management, or better negotiate with suppliers. Fintech, on the other hand, can show the Bank an innovative view of the world of finance, a new way to think about everything, bring a fresh and creative view of things, and a wider scope and speed in developing an original solution thanks to being unbound by corporate rules and regulations. It can “infect” people in the Bank with his approach to doing things more flexibly and quickly.
“We are looking for customized startups for KB SmartSolutions. Our analysts monitor the entire market and look for original technological projects that fit into Komerční banka’s investment strategy. Such an individualized process, during which we actively search for startups ourselves, is more time-consuming, but at the same time more effective. It can take a long time to passively wait for a startup to register itself or appear somewhere,” – says Michal Ciffra, Partner at DEPO Ventures.
Companies that offer so-called smart solutions are in the spotlight
As the name itself suggests, KB SmartSolutions targets companies that have smart solutions and bold goals. They want to help build the banking of the future. It focuses not only on relatively well-established companies that already have, for example, the second generation of their product on the market, but also on slightly younger companies, but already at the beginning of the growth phase. Cooperation with DEPO Ventures can help, for example, with the search for suitable startups outside the borders of the Czech Republic.
“The fintech and startup ecosystem in the Czech Republic and Central Europe is getting richer and more stable every year. Organizations to support it are constantly increasing, even becoming for it actively trying. That is good. We are trying to help and build the ecosystem itself. There is plenty of money on the market, but the startup itself only has a chance to get it if it has a clear business model, goals, and scalability of the product, as well as prerequisites for expansion,” – says Patrik Nový.
The KB SmartSolutions portfolio includes four partnerships in the form of equity investments – Upvest, Roger, Lemonero, and Enviros. And in addition, two startups were created internally – Finbricks and KB Advisory. All partnerships are productive and companies grow gradually. Upvest, which offers a crowdfunding platform focused on real estate, is an example of intensive cooperation and integration with the Bank when Komerční banka gradually acquired a 96% equity stake in the company in the summer of last year. With its factoring, Roger perfectly complements Komerční banka’s product offering in the area of corporate financing. Lemonero, which focuses on financing e-shops, launched its European expansion with the help of KB SmartSolutions and Komerční banka. Finbricks has grown from an internal project to a leading player in banking aggregation. KB Advisory works closely with the leader in the field of energy and environmental consultancy Enviros. The portfolio also includes other partnerships, mainly of a distribution nature, so the scope is quite broad.
About KB SmartSolutions
KB SmartSolutions is a subsidiary of Komerční banka, a member of the Société Générale Group, that helps Komerční banka to invest in modern technologies within the financial services segment. This activity considerably contributes to the change of Komerční banka from a traditional banking institution into an innovative and technologically strong Bank of the new generation. In other words, KB SmartSolutions brings technological and product revolution into the banking sector using the motto “We build the bank of the future”. KB SmartSolutions also helps Komerční banka to provide its customers with more than a mere financial service and become a leader in the market in cooperation with dynamic fintechs and startups. It represents an important tool on the way of fulfilling one of the main visions of Komerční banka to actively push its products and services into a digital form and to make them as user-friendly and simple as possible.
Source: The press release by KB SmartSolutions dated June 13, 2023
