The on-again, off-again corporate venturing strategy by credit card provider Visa is back on and, in a sign of confidence about its previous deals, it has followed on with another UK-based mobile payments company, Mobile Money Network (MMN).
Visa is taking a 15% stake for an undisclosed sum in MMN, with a seat on Mobile Money’s board. MMN’s other backers include mobile phone retailer Carphone Warehouse, and its co-founder Charles Dunstone, and Monitise, a technology and services company delivering mobile banking, payments and commerce networks.
Visa Europe invested in Monitise in November by taking an 8.8% stake. Monitise had a 40% stake in the MMN joint venture when it was founded in November 2010 and will have helped with an crucial introduction to MMN for Visa.
Alastair Lukies, chief executive of Monitise, said: "We are delighted by Visa Europe’s investment in the Mobile Money Network. The strategic endorsement by the world’s largest payments brand comes at an incredibly exciting time. Like Monitise, Visa is working with leading players to ensure that future mobile payment technologies are as easy, simple and secure as card-based transactions are today."
In turn, Monitise had used the corporate venturing strategy of partnering with bigger entities to help its own growth. As Guy Rigby from adviser Smith & Williamson said in a Global Corporate Venturing comment, Monitise teamed up with Morse, an information technology services company, as it needed both funding and a partner.
Working in the banking sector, Monitise needed to be taken seriously in order to achieve its success. Lukies did not just need funding, he needed to raise perceptions of size and scale from the outset and so the Minitise chief executive said "what Morse gave us was the perception that we were part of a decent-size company with £300m [$500m] turnover, a FTSE 250 listing, 2,000 staff, a good board, plus an excellent chairman and chief executive. So you could go and tell the corporate story with instant credibility."
The interconnections between Morse, Monitise, MMN and now Visa offer the chance for a global banking infrastructure to be in place – something that individually all the UK-based companies would have struggled to do on its own.
The power of networks is evident – even in a world of a frictionless payments, everyone needs contacts.