It's been about 4-1/2 months since American Express launched its Digital Commerce initiative, a new program designed to invest $100 million in start-ups focused on digital commerce.
I recently sat down with Harshul Sanghi, Managing Partner at American Express Ventures, who heads up the Enterprise Growth Group, a new unit to expand mobile and online payment services beyond the credit-card company's traditional businesses. Sanghi is also in charge of selecting the start-ups that receive investments.
Here are some highlight answers from our interview (slightly edited):
- Since the payment landscape has been evolving, AmEx decided to create an initiative to look at start-ups to help transform American Express and its mobile division. Rather than grow and innovate through acquisitions, AmEx wanted to put together a concerted effort and team in place. That's one of the reasons AmEx set up a Palo Alto office, just to meet with start-ups.
- The $100 million comes out of American Express' balance sheet. There are no third-party investors.
- Unlike some corporate venture capitalists, such as Intel Ventures and Google Ventures, AmEx isn't focused on financial investments but rather strategic ones. Our prime focus is to look at the strategic fit and to add value to the start-up by allowing them to leverage the AmEx platform. We want to provide a strategic advantage to the start-ups and want to have a clear line of site of a commercial relationship down the road.
- So far AmEx has looked at about a couple hundred companies. There have been no investments made to date, but there is a short list.
I'm not going to give it all away. Watch the rest of the interview to learn more, particularly how Sanghi would measure success two years from now.