South African consumer finance company RCS believes investing in startups is the way of the future, as local entrepreneurs can be the driving force behind innovative systems and processes that can make established institutions more relevant.
RCS is owned by one of the largest banks in Europe, BNP Paribas, and is a consumer finance business that offers customers a range of card, loan and insurance products in association with a number of leading retailers in South Africa, Namibia and Botswana.
The company is the core sponsor of the 2018 Startupbootcamp Africa programme, which chief executive officer (CEO) Regan Adams told Disrupt Africa was because it saw the benefit of what startups could bring to RCS’s innovation strategy.
“Although large businesses have the necessary resources and investment capital, startups continue to prove that speed and agility are two vital elements for success,” he said.
“Startups are nimble and are able to avoid the inflexibility that is associated with big corporates. They are creative and solution orientated with less procedures, red tape and processes which enable them to find smart solutions to business problems.”
Startups also stand to benefit from partnerships with companies like RCS, with other opportunities available aside from corporate investment.
“Valuable lessons can detail anything from internal systems and processes to marketing. In the Startupbootcamp programme, RCS and BNP Paribas Personal Finance – the global brand of RCS – has a group of core mentors from various business units within the company which assist the startups in finding solutions within their own startup,” Adams said.
“From product development, CSI, finance, marketing and PR – the programme enables startups to get up close and personal with the employees of corporates to learn more about ways of working.”
There has been much talk of the difficulties involved with securing deals with corporates, but Adams said forming partnerships for business growth had been RCS company practice for many years.
“These partnerships have evolved over the years as corporates are realising the benefits that startups encompass and the ability they have to spearhead change,” he said.
Since its involvement in the first Startupbootcamp programme last year, RCS has successfully integrated two startups into its business.
“In March, we launched our own chatbot enabling RCS to assist customers with queries fast, efficiently and when they need it, anytime of the day. The chatbot is the brainchild of a company called GotBot, a startup that was part of the programme in 2017,” Adams said.
Though he does see an increase in acquisitions of startups by corporates occurring down the line, he said conditions have to be perfect for such deals to come off.
“Many businesses have acquired startups, so it really depends on the strategy of the specific business. However, it is fair to say that the integration of the two are on the rise,” said Adams.