Banks invest in data-sharing startup
(23 May 2016 – Australia) Two of Australia’s “Big Four” banks, along with Qantas have invested in a Sydney-based startup that has designed a allowing organisations and governments to securely exchange data.
National Australia Bank and Westpac joined Qantas investing a combined A$10.5 million into Data Equity’s capital raising round.
NAB acquired its stake through its startup investment fund, NAB Ventures, while Westpac's venture capital fund, Reinventure Group purchased its shares. Qantas Loyalty acquired the airline’s stake.
The deal is Qantas' first investment in a technology startup in the airline's 95-year history and the first investment by NAB Ventures, the bank's VC fund established last year by chief executive Andrew Thorburton.
Westpac has been assisting Data Republic with the design of its security protocols and is also working with the startup to develop the world's first "data banking" service. This will allow the bank’s corporate clients to securely separate and store customer information on dedicated bank-grade security infrastructure while conducting broader data exchanges.
Westpac chief strategy officer Gary Thursby said Data Republic "delivers bank-grade security protocols and governance to the storage and management of data".
Speaking to Fairfax Media, Jonathan Davey, executive general manager at NAB Labs, said the financial sector is "at the very early stages of how effectively we all use data and banks are immature around the use of data we have today. But the amount of data sharing will continue to increase. Therefore, investing in a platform that has the right legal and governance frameworks to be able to leverage those changes is important. We believe this investment will put us at forefront of the whole data revolution."
Qantas Loyalty CEO Lesley Grant said Qantas has "seen the benefit that customer-led innovation can provide to businesses and their customers" and "co-investing in Data Republic with NAB and Westpac provides a great opportunity for further innovation".
"Data Republic was created as a legal structure first. This was in place before we wrote a line of code," says co-founder Paul McCarney.
"People trust their money with banks in the knowledge it will not get stolen but money is ultimately data until it gets into your wallet."
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