CBA have announced they plan to launch 25 new businesses over the next five years through their fully owned subsidiary, X15 Ventures. In partnership with KPMG who will provide advice on the ventures, and Microsoft, who will contribute to the engineering platforms, CBA intends to capitalize on their brand, security protocols, and available funds to create innovative new businesses outside the traditional banking sphere.
X15 Ventures Managing Director, Toby Norton-Smith, commented on the news “X15 allows us to open the door and partner more easily with entrepreneurs than ever before. 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.”
The news comes at somewhat of a crossroads for the big banks who are starting to realise they need to adapt to emerging consumer trends in order to stay relevant in the changing banking market.
With the rise of Afterpay and fall of the credit card, CBA looks as though they are pulling out all the stops to meet current consumer trends. The bank announced last week the launch of Klarna to Australia through the CommBank mobile banking app, a ‘Buy-Now, Pay-Later’ model which has proved successful in Europe.
Fortunately for us consumers, the disparity of power that has been evident for some time between the big banks and their customers, may be shifting with new digital and neo banks putting up a fight for market share. These online banks don’t have the overheads of branches and employee costs that the established banks must account for, and can offer competitive banking interest rates and even home loans, completely online.
It appears that CBA isn’t the only company jumping on the venture capitalist bandwagon, with Woolworths launching a venture capitalist department of their own, W23, last year. Woolworths, who appear to see value in the health-conscious and time-poor consumer segment, have already invested $30m last year into ready-to-cook meal company, Marley Spoon.
Bronte Moore is a business journalist at Emerald Financial whilst also completing a JD at the University of Melbourne.
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