Mark Radcliffe, partner at law firm DLA Piper, spoke to Harshul Sanghi, managing partner of American Express Ventures, the investment arm of payment services provider American Express, at the Global Corporate Venturing Symposium today about its origins, the business environment of Silicon Valley, and future trends in digital commerce and e-commerce.
“Writing a cheque is the easiest part of corporate venturing,” said Sanghi, who explained that American Express Ventures seeks to add strategic value on two fronts, both to the business unit and to its portfolio companies. “We draw up a roadmap for achieving a portfolio of opportunities over a period of 12 to 24 months.”
American Express Ventures was set up by American Express in the aftermath of the 2008/09 financial crisis, after the company’s CEO visited Silicon Valley and saw what the likes of internet company Google and computer manufacturer Apple were doing.
“American Express Ventures was set up in Silicon Valley to plug into the innovation ecosystem,” said Sanghi, who describes Silicon Valley as a place with “a different culture, different people, a different currency and different language.”
The objective of the unit’s activities is to help achieve the digital transformation of American Express, moving it away from being a payments company to one that chiefly enables e-commerce.
“Loyalty, the whole buying process, discovery, the transaction itself” are all areas of interest, said Sanghi. “Underlying all that is data and security.”
Sanghi believes that in five years’ time, corporate venturing will have become established across industries in a similar way to risk managers and data scientists.
In terms of future trends in digital commerce and ecommerce, Sanghi said “the future is about personalisation and user experience. Cloud computing and analytics allow the seamless delivery of services, and for those to be highly personalised.”
Business models, Sanghi added, are moving to “everything-as-a-service,” amid a general move from a ‘buy’ to a ‘rental’ economy. “Every device will have functionality built in, and we want to be there to be part of that.”