Bank VC units seek new technologies


Large companies interested in acquiring new technologies have long run their own venture capital firms. Intel stands as a great example of corporate VC. The chip giant has stood behind its Intel Capital unit through thick and thin. Other prominent examples include Google, Citrix, Nike and others.

Can banks now be added to that list?

The American Banker reports that, "Financial services companies with a keen eye for innovation are making venture capital investments. They're funding and incubating early-stage, high-risk technology companies. They're seeding their investments in Silicon Valley, Silicon Alley in New York City, Silicon Prairie in the Midwest and wherever else such companies are creating financial technology."

The latest example is Banco Bilbao Vizcaya Argentaria, which has plans to invest $100 million in its new BBVA Ventures unit. The best examples in the U.S are Citigroup and American Express. For Citigroup anyway, the investments have paid off. Citigroup-backed Silver Tail was sold to EMC in 2011.

Banks are massive consumers of technology, and they have every reason to seek out cutting edge forms of technology that might be useful internally. That said, the point of any VC operation is to generate a profit. I hope banks prove to be savvy on that front as well.

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