Best Innovation Program 2020: Mastercard’s Start Path

  • Financial organizations, large and small, are looking for ways to continuously innovate.
  • Tearsheet's Best Innovation Program Award is designed to celebrate all the work being done in the space.
Best Innovation Program 2020: Mastercard’s Start Path

In this episode, we’re announcing the winner of Tearsheet’s first annual Best Innovation Program Award. We ranked innovation programs on four attributes: creativity, innovative thinking, customer value and results.

Mastercard’s Start Path program won this year’s award. To discuss how Start Path works inside and outside Mastercard, we have Amy Neale, the head of Start Path, joining us on the podcast today.

She’ll discuss how Mastercard defines innovation, how Start Path is organized and what the flows look like, and who the program is designed for. Amy describes why Mastercard chose this model of innovation and provides a few examples of success stories of fintech startups that graduated the Start Path program.

Tearsheet would like to thank Mastercard and the other companies and teams that applied for the Best Innovation Program award.

Submissions for Tearsheet’s 2020 Best Bank/Fintech Partnership Award are open now.

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The following excerpts were edited for clarity.

Mastercard’s innovation attribute

Innovation is something we think about every day. It’s no surprise that the home for Start Path is Mastercard Labs, which is focused on all of Mastercard’s innovation activity. Innovation has been part of my career all through my journey — from technology to the startup engagement work I do everyday.

When I think of innovation, it’s about defining a creative process. We like to think about the importance of creating process around three aspects: desirability, feasibility, and viability. It has to be something that the end user desires. Design thinking and user experience — all that great stuff is tied up in desirability. Feasibility is about the technology doing what we want it to do and ultimately, can it do it at scale? Viability is about testing about whether something can scale from a technology point of view — sure, but is there a business case for it?

Start Path, the program

The program is tailored to ensuring Mastercard thinks about the outside in, that we recognize that working in partnership is a very important component to our innovation strategy. It’s about finding the best startups around the globe and finding a solid way to engage those startups using Mastercard’s reach, network, and expertise to add value and collaborate.

We’ve been going for six years. The program we run today has been an evolution of understanding what works for all sides of this engagement activity. It’s an ongoing program and we stand up three to four waves of the program each year. We have a rolling evaluation process that balances understanding the quality of a startup against its strategic fit with Mastercard. It’s a six month long program.

How the innovation program is structured

We realized early on that for a large corporate like us, the very best type of startup for us to work with is already on a path to scale. It already has a product in market, has early customers, and has raised some venture capital. This realization has led to the way we structured the entire program. Companies at this stage need a very specific set of support and there are things they don’t need. A company that’s already raised a significant seed or Series A is unlikely to move its team to a new location. So, we made the program entirely virtual in nature, which means a company can take part wherever they are.

We have a global team based out of a few locations: Europe, US, Asia, and the Middle East and Africa. It means we can work with companies in hot spots as well as in places that are less familiar. Each company is assigned a sponsor from the core Start Path team. That sponsor designs a variety of activities to work with a startup over six months. Then, we use the sponsor as a project manager, connector, and advisor over the course of the program.

Measuring the success of an innovation program

The first we look at to see if we’re doing a good job is whether we’re sourcing the right companies. Are we able to identify the right strategic companies and attract them to work with us? As we’ve been able to demonstrate results, we’ve become a partner of choice.

On the other side, we look at the impact of what we’ve been able to tangibly produce with our companies. We are also really interested in learning and understanding what’s going on around the globe.

Success numbers

We have unicorns in the portfolio and the portfolio has gone on to raise about $1.6 billion in capital post-program. Just yesterday, one of our companies in the cyber space was acquired. We think we’re pretty good at finding winners.

Like other corporates, we’re excited when we see startups that come through the program and go on to consume some of our assets. So, of course, we have companies that have become customers of ours. We have Civico in Colombia, Railsbank in Europe and Revolut who everyone knows — there are a bunch of companies that have gone on to issue cards. That’s an obvious result for us, but only one that we’re focused on.

Start Path success stories

One trend we’re tracking closely is open banking, particularly in Europe with PSD2 regulation coming in. We’re interested in new companies trying to take advantage of open banking, but Mastercard has also brought some of our own open banking solutions to market to support some of our more traditional customers.

There’s a startup company based out of the UK called Konsentus. Through the Start Path program, we’ve created a joint go to market approach with their solution tied to some of our own open banking solutions. Konsentus is very much focused on the fraud part of open banking — FIs want to make sure third party providers accessing their customers’ data are not fraudulent. We’re delighted to work closely with them.

Another super example is a US company called Goodworld. We met Dale — a fantastic female founder (a big priority for us, as well) — over a year ago. They are tackling the donations space — payments to charity. We stood up a collaboration between Goodworld and our Strategic Growth business. Working in partnership, we’ve created a joint approach to making donations as seamless as possible for the donor. We launched with Goodworld just at the end of 2019.

In India, we’ve been working with a company called Signzy. The company uses artificial intelligence to smooth out onboarding. Authentication is a big issue in financial services. We’ve been working closely with Signzy to make sure we can bundle our assets together to meet the needs of our customers.


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