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Santander Group is doubling its investment in fintech after spinning out its innovation funding arm.
The Spanish bank will allocate $400m (£312m) to investing in fintech startups through Mouro Capital, which replaces Innoventures. The new venture capital fund will be managed autonomously, according to Santander.
Innoventures was launched in 2014, with an initial $100m fund which increased to $200m in two years.
Setting up the new innovation arm is part of Santander’s digital and technology investment plan that began last year. In April 2019, the bank said it will spend €20bn on digital and technology over the next four years, to improve customer experiences, increase loyalty and lower the cost of delivery. At the time, it said it wanted to reduce annual operating costs by €1.2bn.
Ana Botín, Santander executive chairman, said: “The creation of our fintech venture capital fund in 2014 has allowed Santander to lead the industry in implementing new technologies, including blockchain, offering better services to our customers as a result.
“Innoventures has almost doubled the cash invested, despite being relatively young for a venture capital fund,” she said. “Our goal is to build on that success, and by increasing our investment, while giving greater autonomy to the fund, we can be even more agile and further accelerate the digital transformation of the group.”
Manuel Silva Martínez, the general partner of Mouro Capital who will lead the fund, said that by becoming more autonomous, it will gain in agility and attract entrepreneurial talent to the investment team. “We are eager to keep on delivering strategic value to Santander, enhancing our partnership and working with our portfolio companies to support the bank in shaping fintech innovation,” he said.
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Santander Innoventures was an early investor in fintechs such as Ripple, Tradeshift and Upgrade, which have reached unicorn status in being worth more than $1bn.
The bank is transforming rapidly, with investments in operations, technology and people. In June, it announced it was adding 3,000 people to its global IT team as part of its €20bn four-year digital and technology transformation. The new hires, from across the world, will help the bank transform its offerings to meet the demands of customers in the age of digital banking.
Last year, the bank recruited a chief platform officer directly from Google. The appointment of Aiaz Kazi is an example of a bank hoping to emulate Google in how it delivers banking services.
In the UK, Santander has spent more than £150m on a campus in Milton Keynes that will became the company’s UK technology hub.