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Vaasa Workshop on Machine Intelligence and Applications
University of Vaasa, 28.11.2019
Mikko Knuuttila
Raiffeisen Bank International AG
• Making people grow in the team, and growing
myself along
• Breaking ice and sometimes walls
• Being a corporate diplomat – listening, learning,
sharing
• Personal challenge: Learn to be more gracious with
myself – where to ‘invest’ 80 % where 150 %
• I have passion for architecture & design as well as art
and food scene
• I don’t like overconfidence and arrogance in people
or business
Raiffeisen Bank International AG, Austria
• Co-Founder & CEO, YellowBeam – Winner of theInnovation Garden 2018
• Group Product Owner, PSD2/Open Banking, Retail
• Liaison Officer, Corporate, Raiffeisen PolBank & RBI
• Core Project Team Member, Ambition 2020, Corporate
Unico Banking Group EEIG – 12/2012 – 7/2016, Belgium
• Manager, Committees & External Affairs
OP Financial Group – 3/2002 – 11/2016, Finland
• Network Manager, Financial Institutions
• Assistant Vice President, Cash Management
• Various positions, Payment Operations
+43 664 8888 1173
Mikko Knuuttila
1. Introduction2. Framing the topic – RBI context3. YellowBeam – internal start-up: what and how?4. YellowBeam – from MVP to Scale up and Corporate venturing5. Worlds apart – corporate vs. start-up6. Cooperation but how7. Flavor of AI ambitions in RBI8. Conclusion
TODAYS TOPICS
Leading bank in Central Eastern Europe (CEE)
▪ Leading regional player with CEE presence of over 30 years servicing
approx. 16.5 million customers
▪ Covering 14 markets (incl. Austria), thereof seven are EU members and
Serbia and Albania have candidate status
▪ Top 5 market position in 12 countries
▪ Around 47,000 employees service approx. 16.3 million customers
▪ RBI is part of the Austrian Raiffeisen Banking Group (RBG), the largest
banking group in Austria
▪ RBI‘s shares are listed in the Vienna Stock Exchange
▪ The RBG’s Regional Banks hold approx. 58.8 per cent of the share capital,
the remainder is in free float
2. Framing the topic – RBI context
Digital
Transformation
Revenue
Growth
Customer
Growth
Our targets in RBI Retail Banking
EUR +470mn
Gross Income
+2mn Active
Customers
Digital New Customers
Lower Cost/Customer
2017-2021 2017-2021 2017-2021
2. Framing the topic – RBI context
AI / MACHINE LEARNING
2. Framing the topic – RBI context
RBI Innovation Vehicles – Internal and external focus
Employee-initiated
ideas developed in a
start-up-like process
within intrapreneurship
teams
Innovation Garden Elevator Lab Elevator Ventures
Partnership program to
globally scout
innovative start-ups
and validate viability for
RBI
Minority equity
investments in start-
ups and investments in
3rd party VCs
INNOVATION BOARD
Innovation Lab
Development of new
disruptive services,
business models and
products
Key innovation body that enables RBI Group's entire innovation efforts
2. Framing the topic – RBI context
Customer needs
FAIR COSTS
FAST SERVICES
FLEXIBILITY
TRUST & SAFETY
3. YellowBeam – internal start-up: what and how?
• Remittances
• Travelling
• Online shopping
European Market
• 17 min migrants
• 26 bn remittances
• 5% to 7% cost (2017)
3. YellowBeam – internal start-up: what and how?
Our overarching goals – customer acquisition and mitigating
impact of remittances disruption
1. ACQUISITION
YellowBeam’s primary goals are clear…
…but YellowBeam will deliver much more benefits to RBI
and NWBs
2. DISRUPTION 3. BRANDING/PR 4. ORGANIZATIONAL
CHANGE
5. PROFITABILITY
…
Customer
acquisition, with
focus on migrants
Disrupt and counter
fight disruption – in
FX / remittance area
where RBI is at risk
RBI positioning as
an innovative
player across
markets (incl. WE)
Enabling learnings and
improving on the
innovation ecosystem
within RBI
Monetize by cross
sell / deliver purely
commercial value
3. YellowBeam – internal start-up: what and how?
Our learning loops
3. YellowBeam – internal start-up: what and how?
June
2019
September December
YellowBeam (YB) & Fintech- TIMELINE
August
RETAIL
July
VC
FINTECH
October
Subject to
approval of
VC & business
November
Today
January
2020
Development of joint YB & Fintech business plan
and ways of working
4. YellowBeam – from MVP to Scale up and Corporate venturing
IT
• Infrastructure
• Compatibility
• Reusability
BUSINESS/RETAIL OBJECTIVES
• Strategy to onboard acquired customers
later to RBI Group
• Working Live Product - fast time to market
• Independence from RBI as much as possible
• New Customers for RBI (to cross sell –
exclusivity)
• Infrastructure & technology synergies
• Initially customer target not profit
• Prioritized corridors / segments / products
• Key position/s with influence on business
development
VC OBJECTIVES
• Profit from Investment
• Investment based on work for
equity
• Maximum amount to be
invested
• Pipeline building – FinTech &
internal innovation
FINTECH OBJECTIVES
• Funding to scale marketing
• Possibility to acquire other
investors
• Roles & capacities from RBI
• RBI Brand as a token / avail
• Access to RBI network
(customer acquisition)
• Funding to develop existing
business
• Control of business and decision
making
• New Customers
• Profit
Respective goals of key actors
RBI GROUP
• Shareholder value
• Innovation boost
• Cultural change
• Demonstrate capability
4. YellowBeam – from MVP to Scale up and Corporate venturing
We built more than
an MVP, we created a
movement, bridge
inside and a
blueprint.
Key organizational learnings – most around complicated procedures
and corporate culture
What have we
experienced
as an internal
start-up?
How could RBI
better support
intrapreneurs?
Framework and
utilization rules are not
supporting start-up
operations
A new operating
framework is needed
ensure independency
Problematic and
lengthy on boarding
of key external
collaborators
Simplified rapid
process
Agreeing tailored
processes takes too
much time
Quick escalation path
More questions asked
than real solutions
proposed
Multiple standards and
differences not helping
scalability and rapid roll-
outs
Stakeholders
alignment &
involvement to be
made in an early stage
‚Fail and learn’ mindset
propagation in the
organization and
balancing requirements
with scope
Budget
access
Externals
onboarding
Time to market Limited openness
for flexibility and
solutions
Variety of intra-group
approaches
4. YellowBeam – from MVP to Scale up and Corporate venturing
Worlds apart – corporate vs. start-up
THEIRS vs. OURS
FIGHT WITH THE
DRAGON VS.
RIDE THE DRAGON
VALLEY OF DEATH
or UBER MOMENT5. Worlds apart – corporate vs. start-up
Change hurts…
EXPERIMENT AND
DON’T PLAY IT SAFE
FEAR OF FAILURE
RESPONSIBLE
MONEY
5. Worlds apart – corporate vs. start-up
Worlds apart…
BUILD IT
GREENFIELD, AWAY
FROM CORE
FIND FINTECHS TO
SPEED UP
FEAR OF SUCCESS
vs FEAR OF FAILURE5. Worlds apart – corporate vs. start-up
19
Strategic optionality
creates flexibility – multiply
your options in thinking
Freedom needed within a defined structure
Unless banks and
FinTechs get better at
working
together, neither will
reap the full benefits
of innovation.Source: EY Unleashing the potential of Fintech in banking 2017
6. Cooperation but how
Partner first and only then consider
building it yourself
Fit for future – build up collaboration – start small
Corporate venturing
Joint Venture
Licensing agreements
Acquisitions
DON’T LET THE
STRUCTURE or
TECHNOLOGY DRIVE
– BE HONEST TO
CUSTOMER NEED
AND GOALS
CUSTOMER IS THE
ONLY ONE TO PLEASE 6. Cooperation but how
Forms of corporate venturing
Venture building Venture sourcing
Intrapreneurs in the lead Entrepreneurs in the lead
Start from scratch Hit the ground running
Full control mode Collaboration mode
Slower time to market Faster time to market
More executive attention
needed
Less executive attention
needed
Corporate responsible for
growth
Founders responsible for
growth
CAPEX investment Venture Fund
Source: Corporate Venturing ; Dado van Peteghem & Omar Mohout, 2018 6. Cooperation but how
Pitfalls of corporate venturing
Ad hoc spray
and pray
Corporate
black hole
Purely
financial
constructions
Cool or check
the CSR box
No endgame
in mind
Source: Corporate Venturing ; Dado van Peteghem & Omar Mohout, 2018 6. Cooperation but how
AI / MACHINE LEARNING
7. Flavor of AI ambitions in RBI
AI / MACHINE LEARNING
7. Flavor of AI ambitions in RBI
AI / MACHINE LEARNING
7. Flavor of AI ambitions in RBI
IT‘S ALL ABOUT PEOPLE,
MINDSET and CULTURE
to build it.
IT‘S ALL ABOUT
CUSTOMER to get it
right.
28
Thank You!
