Santander Expands, Spins Off FinTech VC Fund

Banco Santander is spinning off its FinTech venture capital fund into a new entity called Mouro Capital and is doubling its investment in the operation to $400 million, the Spanish financial giant announced on Friday (Sept. 11).

“The decision to spin out its investment arm is another milestone in Santander’s four-year, 2019-2022, $23.6 billion digital and technology investment plan. The group is accelerating its digital and commercial transformation to maintain its operational excellence, while constantly improving the customer experience and innovative services it brings to customers,” today’s news release from Santander states.

The news release continues: “Mouro Capital aims to bring its FinTech expertise, global network and strong track record in successful investments to early- and growth-stage startups globally. The fund will continue to deploy capital across Europe and the Americas, primarily leading investment rounds with initial investments of up to $15 million and further follow-on reserves.”

According to the bank, the fund now operating as Mouro Capital has returned 1.75x cash-on-cash multiple across its portfolio. The internal rate of returns since inception has been between 25 percent and 30 percent.

The new fund will keep its predecessor’s leader, General Partner Manuel Silva Martinez.

“By becoming more autonomous, we will gain in agility, attract entrepreneurial talent to the investment team and further align to our entrepreneurs’ success,” he said in a prepared statement. “We are eager to keep on delivering strategic value to Santander, enhancing our partnership and working with our portfolio companies to support the bank in shaping FinTech innovation.”

Ana Botín, Banco Santander executive chairman, said in today’s release: “The creation of our FinTech venture capital fund in 2014 has allowed Santander to lead the industry in implementing new technologies, including blockchain, offering better services to our customers as a result. Innoventures has almost doubled the cash invested, despite being relatively young for a venture capital fund. Our goal is to build on that success, and by increasing our investment, while giving greater autonomy to the fund, we can be even more agile and further accelerate the digital transformation of the group.”