Australia’s Commonwealth Bank to back 25 start-ups
The Commonwealth Bank of Australia (CBA), the country’s largest bank, has launched a new incubator called X15 Ventures with KPMG and Microsoft. The incubator will back 25 Australian start-ups across a five-year period, paid for by the bank’s $1 billion annual technology investment fund.
Home-In, a virtual concierge service trying to “simplify the complex process of buying a home”, and Vonto, a free business data and analytics app, are the first two start-ups to secure CBA’s backing and land a place in the newly set up incubator.
“X15 will enable us to innovate more quickly, and continue to offer the best digital experience for our customers,” says CBA’s CEO Matt Commyn. Having made past attempts to innovate within the bank, CBA is now innovating externally through the incubator, a wholly owned subsidiary of the bank.
“[The incubator] allows us to open the door and partner more easily with entrepreneurs than ever before,” says newly-appointed MD of the incubator Toby Norton-Smith. “Under its umbrella, we will create an environment for new businesses to flourish, we’ll empower Australia’s innovators and bring new solutions to market designed to empower customers as never before.”
He adds: “Businesses will be nurtured and developed as start-ups but will have the scale and reach of CBA behind them to achieve rapid growth.”
The first two fintechs onboarded – Home-In and Vonto – focus on home buyers and businesses, which are logical investments for CBA, a bank with business and mortgage customers. The creation of an external incubator can be seen as a move by the bank to subsume some of its potential competitors.
But as the largest bank in the country, CBA is also offering fintechs an attractive leaping point off which they can establish bulky initial customer bases.
Microsoft Australia’s MD Steven Worrall commented on the incubator launch: “I believe that the next wave of major technology breakthroughs will come from partnerships such as this, bringing together our deep technical capabilities and absolute clarity about the business challenges that need to be addressed.”