Corporate Innovation

Eindhoven Startup Alliance Founders 1-1's: Hans Klomp, ABN Amro Disrupt Or Be Disrupted

Kate Brunton
July 18, 2018

In this interview with Hans Klomp, we explore the collaboration between ABN AMRO and HighTechXL in Econic, a new kind of hub for banking innovation. Although on the face of it, banks may not have much to do with high-tech hardware startups, they actually play an important role in developing the ecosystems that foster innovation and entrepreneurship, such as the Eindhoven Startup Alliance.

In this interview with Hans Klomp, we explore the collaboration between ABN AMRO and HighTechXL in Econic, a new kind of hub for banking innovation. Although on the face of it, banks may not have much to do with high-tech hardware startups, they actually play an important role in developing the ecosystems that foster innovation and entrepreneurship, such as the Eindhoven Startup Alliance.

 

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Hans Klomp is a finance specialist in MBO’s, acquisitions, and fast-growing companies at ABN AMRO (or “banker”, as I good-naturedly call him). Recently he also took on the role of program manager for Econic, a joint HighTechXL and ABN AMRO initiative.

Although I refer to him as such, Hans is anything but your “average” banker. His energy is infectious. He frequently gets so excited during strategy meetings that he has to stand up and walk around, as if to “walk off” the built-up intensity.

Non-average bankers are most at home in non-average work environments, like Econic. As I write this, I’m sitting at our Econic office on the Vestdijk in downtown Eindhoven. As usual, the space is buzzing with activity – the meeting rooms are full, people are scattered all over the open office area, and one of the “Launchpad” teams is deep in the middle of a 1-1 coaching session with ABN AMRO management and our HighTechXL innovation experts. At this very office we hosted a 24-hour hackathon with TU/e students and members of the Expat Spouses Initiative community, where we built product prototypes for six innovation teams.

 

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Anxiety on the Home Front

Looking around the office, it’s hard to believe that less than six months ago, none of this was here. How did we accomplish so much in so little time? The answer lies in the sense of anxiety that ABN AMRO feels looking towards the future.

The names “Apple” and “Google” are infamous within the banking industry; they’ve become associated with impending doom. “They could put us out of business tomorrow, if they wanted to,” Hans explains. “But there are also small companies entering the market. It’s very important to be aware about what is going on, not only in the banking industry but also in the domains related to banking and those of our customers.”

Typically, the threats that banks face have to do with automation, and “disruption” from innovative startups trying to steal banks’ market share. A good example of this disruption can be found in peer-to-peer lending services such as Zopa. Websites like Zopa bring individual borrowers and lenders together, bypassing traditional banks. The idea is that each party in the deal walks away with a better rate: Lenders receive more interest than they would get from a bank savings account, while borrowers pay less than they would on a bank loan.

The challenges that ABN AMRO faces for the future also have to do with how the bank approaches new trends. One of these up-and-coming trends is the sharing economy (check out this interesting article on TechCrunch). “We are trying to become more aligned with the sharing economy,” Hans explains. “And the question we have to ask ourselves is: Are we an owner of an asset or do we just share one?”

“Another challenge we face is security,” he continues. “Nowadays, everyone owns a smartphone – an almost unlimited and undefeatable device that is opening doors to new dimensions and new niche markets, but also demands more flexibility from our services. As a fairly unexplored and essentially private item, it poses a paradox for security. Especially when it comes to banking and in particular mobile banking.” Luckily, one of HighTechXL’s alumni startups, IDNXT, is actually helping ABN AMRO to solve its security issues in the Econic Launchpad program.

“A final issue is blockchain,” Hans explains. “How will future transactions be done? How will they be secured? We are anxious to be a part of this new trend and make sure that we are able to beat or join it.”

 

Disrupt or Be Disrupted

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In the animal world, it’s “eat, or be eaten”. In the banking world, it’s “disrupt or be disrupted”. ABN AMRO has chosen the offensive: They are disrupting at full throttle, and they’re starting with themselves.

ABN AMRO has teamed up with HighTechXL to build an “open innovation ecosystem”: Econic. It’s where startup meets bank, and generally where cool things happen. In open innovation, ideas are driven from both outside and inside the bank. In the “inside out” innovation route, we’ve set up the Econic Innovate ABN AMRO program. In this four-phase program, ABN AMRO employees are empowered to generate and drive ideas within the bank. Successful teams are coached through all four phases of their development, and receive full support from “ambassadors” – members of ABN AMRO management.

In the open innovation model, collaboration with external parties becomes increasingly important, especially in the “outside in” innovation route. In the outside in route, we’ve set up the Econic Launchpad program, where we work together with successful external (startup) companies. The bank serves as a base or platform for the startups, providing structured access to the industry, expertise, and network, in order to “launch” the startups’ business development. For us, it’s a way to leverage the innovation power of external parties, and at the same time, accelerate our own innovation processes.

 

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Since Econic was officially opened in June, we’ve held four ideation workshops, generated over 1300 viable ideas, coached six teams through the first phase in the Innovate ABN AMRO program (“ideation”), and started partnerships with four scale-up teams through the Launchpad Program. Now that the initial six teams have moved on to the “concept” phase, we’ve added on the next generation of 10 more ideation teams. Keep December 1st in your calendars: At this second “Battle of Innovation”, the Launchpad teams will present the results of their collaboration efforts, and the Innovate ABN AMRO teams will vie for a spot in the next phase of the program.

 

The Backbone of Society

The innovation programs at Econic are the result of a longer and larger collaboration between ABN AMRO and HighTechXL. ABN AMRO is a founding member of the Eindhoven Startup Alliance, and has therefore agreed to support the development of young high-tech hardware companies in the Eindhoven region. You might be tempted to ask the question, “What does a bank have to do with accelerating hardware startups?”

The connection has to do with the role that banks can and should play in society. “Banks are still part of the backbone of society,” states Hans with pride. It’s true: Society wouldn’t be able to function without banks. By gaining savings and giving out credit, banks keep the wheels of the economy turning. But Hans sees the role of banks going a step further: “We should increasingly be playing a central role in building entrepreneurial ecosystems, not only being part of it, but also really facilitating economic progress. In my view one of the main issues in surviving as a ‘traditional’ bank is that society should perceive the bank as part of the success of that society, instead of only being part of the backbone of society.”

Some say that the future of the traditional bank is to become a platform, in a trend towards “open banking”. ABN AMRO is certainly heading in this direction with the Econic Launchpad program. By providing a channel for entrepreneurs to grow their business in the Launchpad program, ABN AMRO can play an important role in growing the high-tech entrepreneurial ecosystem in Eindhoven, and thus contribute to the region’s overall economic prosperity.

Hans offers his thoughts: “What I’m particularly proud of is that we can offer young entrepreneurs a platform. They can stand on the shoulders of giants and get connected to a broad network of companies and people to provide the optimal setting for success. This is something that really fits us, because we have the network and people to be able to do this.”

 

More Than FinTech

But can a bank form a mutually beneficial partnership with a high-tech hardware company? The answer is, “yes, and they already have”. After all, innovation in a bank is broader than just fintech.

ABN AMRO is acting as a launching customer for Amber Mobility, a HighTechXL alumni startup that is completely changing how we view cars and car ownership. Through the combination of their mobile app and their ultra-efficient, modular electric car designed specifically to be shared, the high-tech automotive company provides its users with the ultimate freedom: Guaranteed Mobility. It’s all the benefits of car ownership, without all the cost and hassle to the owner.  And their first users are ABN AMRO employees, in what they’re calling their “Corporate Mobility” program.

In this collaboration, Amber will deploy an initial 10 BMW i3’s at ABN AMRO’s Eindhoven office. The cars will serve around 40 employees for business trips. The employees will use the Amber app to make trip reservations, receive trip tickets, unlock and start their assigned car, and keep track of their trip history.

Amber’s goal of giving individual transportation a radical upgrade in efficiency and ease of use fits with ABN AMRO’s sustainability strategy. The bank has said that they want to become energy neutral by 2020, which is no small feat for a company with around 20,000 employees. In addition, many companies that  ABN AMRO serves are also struggling with mobility for their employees, not to speak of finding parking solutions. The Amber Corporate Mobility program helps the bank to “kill two birds with one stone”, so to speak: It reduces greenhouse gas emissions, and solves parking issues. 

 

Corporate Mobility

The collaboration with Amber Mobility isn’t the only way in which ABN AMRO is “mobilizing” itself on the innovation front. Together with HighTechXL, they’re also driving a cultural revolution among the bank’s employees.

“Typically, we only benefit from about 70% of the capacity and capability of our employees,” Hans laments. “Now with Econic, we’re able to really leverage the power and potential of our people. It’s terrific seeing the gradual transformation within the people themselves.”

I can also relate to this sentiment. If I remember correctly, several months ago, the first ideation session participants arrived in typical “banking” attire, fully prepared to be bored out of their minds for the next few hours. Their first surprise came when they found that the entire session would be conducted in English, and that they had to get up in front of other people and “pitch”.

But since that day, they’ve ditched much more than their suits and ties – they’ve adopted a completely new attitude, and a “can-do” mentality that’s refreshing to see. Their satisfaction with their jobs has also increased, which is extremely important for ABN AMRO. A typical measure of an organization’s success is in the number of employee advocates – people who spontaneously engage in promoting their organization to others.

 

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A History of Innovation

As far as I know, no one has ever come to Econic and not left feeling inspired. A couple of months ago, we received a visit from ABN AMRO’s CEO Gerrit Zalm. He had a time slot of a few hours to spend at the Eindhoven branch, and he chose to spend most of it at Econic.

 

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But innovation at ABN AMRO didn’t start with Econic. Hans reflects the bank’s history: “It started around 10 years ago. When I started working with ABN AMRO, we had our dialogs house. We had the “dialogues house” with external parties by which we tried to gain knowledge and skills and adapt the to our business model. These were the first steps. But our innovation mindset accelerated only the last few years, because of the challenges we are facing. That’s why we started Econic.”

 

It’s a Long Road

Like EY, ABN AMRO is leading the way for the other founding members of the Eindhoven Startup Alliance by taking it upon themselves to instigate new innovation practices within their own organization. They’re also taking the idea a step further, by offering a platform for external startups to cooperate and grow within the bank.

However, It’s one thing to be inspired by Econic, but unfortunately, it’s another to follow up with the “dirty work” that makes things happen within the bank. Too often, the “social loafing” phenomenon kicks in, where people become less likely to take initiative because they think that someone else will. In Econic, there are a few people within the bank who are doing the dirty work that has made our success possible. We consider them to be true heroes of innovation, and we’d like to recognize them here: Congratulations PatrickHans, and Frans! Keep up the good work.

 

Check out ABN AMRO’s interview with HighTechXL on stage at XL Day, September 22nd:

 

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