Societe Generale’s new sustainability-focused incubator creates a “win-win relationship” for startups, the bank, and its clients.
Through its Global Markets Incubator, SocGen has honed a way to fast-track innovation, build relationships with cutting-edge startups, and take a leading role in sustainable finance.
SocGen has a clever way to tap into the buzzy ESG technology industry.
This year’s cohort includes firms focused on financial carbon metrics, impact investing, biodiversity, and more. The “win-win relationship” gives entrepreneurs access to SocGen experts and feedback, while the bank benefits from “rapid progress and the deployment of innovative solutions.”
The incubator – which SocGen originally launched in 2018 – ultimately allows it to test tools that it can eventually offer to its clients or use for its own corporate responsibility goals, as environmental, social, and governance (ESG) concerns continue to be a hot topic for regulators, board members, and customers alike.
“Whether the challenge is climate change, positive impact or governance-related matters, the GMI’s program offers a very exciting opportunity to work with top-of-the-class companies and develop out-of-the-box thinking,” according to the bank’s head of GMI, Antoine Connault.
Since 2018, more than 50% of cohort companies have entered a commercial relationship with SocGen, Connault told Insights Distilled. For example, Entelligent’s climate science and AI for Alpha’s deep learning techniques are embedded into the bank’s quantitative strategies, while Opensee helps it efficiently visualize and manage its risk metrics, and Nephelai improves its trade booking processes.
GMI allows SG to “constantly benefit from frontrunning technology innovation, combine our expertise with that of founders and innovation-led companies, and feed our buy/build strategy,” Connault told Distilled. Chosen companies, meanwhile, get to “tap into our expertise, network, reach” in a partnership “that is much more than a usual vendor/client relationship and supports their growth.”
This kind of hyper-focused incubator program gives financial firms like SocGen a way to tap into emerging technologies in a deliberate and time-boxed way, speeding up the partnership process.
Similarly, Banco Santander recently teamed up with Microsoft on a contest for startups that are using AI to have a positive impact.
For other techniques that FinServs can deploy to build better relationships with ScaleUps, read our report here.