Nationwide launches £50 million fintech venture fund

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The building society is looking to make a range of strategic investments in fintech startups over the next five years

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Nationwide has launched a £50 million venture fund, targeting strategic, early-stage investments in fintech startups working in a selection of core areas. In return, startups will get support from senior Nationwide staff for things like marketing.

The areas the venture arm will focus on with this £50 million fund will be:

  • House and home: Looking at all aspects of how people live their lives in and out of the home
  • Personal data and identity: Exploring secure verification, validation and storage of data
  • Financial wellness: Driving financial inclusion and wellbeing now and into the future
  • Communities and society: People coming together to achieve more than they could as individuals
  • Banking as a platform: Exploring the changing role of financial services as consumers evolve
  • Operational efficiency: Promoting efficiency and sustainability by investing members money wisely
  • New segments: Exploring other areas where we can bring the benefit of mutuality

The venture team is comprised of four people split between London and Swindon at the moment, with support from the rest of the business. Nationwide will be looking to run a range of events in the future to find and promote its new investments. It is focusing on seed to Series A funding rounds and will look to take between 5-15% equity.

Speaking to Computerworld UK, Emma Huntington who heads up Innovation and Venturing at Nationwide said that the aim is to invest in companies that deliver benefits to members over profit alone.

"It is a different model, we could use these companies as suppliers or look to acquire them, but that's not what we want to do. So it is a mutual partnership," she said. "We specifically work with early-stage companies so that we can work with these smart and energetic founders. We think we can really learn from that and support them in areas they may not be as strong in."

"We absolutely have a five-year vision on this and very much expect to follow on where appropriate," she added.

Nationwide isn't the first or only bank to launch a fintech venture fund. Barclays runs a UK ventures arm and a London accelerator. HSBC set up its Strategic Innovation Investments arm in 2014 to invest in Series C+ rounds. Santander InnoVentures was launched with $100 million in 2014 to invest in fintech companies.

Nationwide's first investment comes in proptech startup Acasa, which builds software to help tenants of shared housing to split bills and avoid sending each other passive aggressive notes. Its mobile app streamlines the process of moving in, managing and moving on for residents, utility companies and landlords.

Huntington said this investment "perfectly represents what we are looking for in our investments, which is small equity stakes in businesses innovating in ways that improve our members' lives."

Nick Katz, CEO of Acasa, told Computerworld UK: "The culture fit and the fit in terms of alignment around vision, mission and purpose across both organisations was uncanny. Nationwide have a long term outlook on helping people through their property journey which fits exactly in line with our thinking, product and view on where we want to continue building the Acasa business over time." 

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