Deutsche Bank Aims to Disrupt FinTech with Startup Factory

Deutsche Bank is entering the FinTech space with the launch of its startup factory, Breaking Wave.

While Breaking Wave is in Deutsche Bank’s offices in London, it has its own brand, physical space and email server. The move is designed to attract new hires that would typically choose to work for up-and-coming FinTechs or tech giants such as Microsoft, Apple, Google or Facebook over a financial institution.

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“They have an unfair advantage,” Thomas Nielsen, who oversees new ventures at the German lender, said of FinTech companies. “And by the way, they’re building better products than we do. They’re solving a problem that needs solving and they’re doing it faster and better than most of the big companies do, which annoys the heck out of me.”

Nielsen added that Breaking Wave will set itself apart from other FinTechs by focusing on larger companies that do business across borders. The factory will boast the benefits of a FinTech, while being backed by Deutsche.

Yet despite being funded by Germany’s largest bank, Breaking Wave will have a maximum number of 75 employees, who will test new ideas, and develop new products and concepts for Deutsche and its clients. Projects, however, won’t be staffed with more than 15 people until it’s “validated from a commercial and technology perspective,” said Nielsen.

In addition to its FinTech moves in the U.K., Deutsche revealed in September that it had launched “Blue Water Fintech Space” in China, which will provide clients with new ideas though digital transformation workshops, proof of concept roadshows, acceleration and incubation of FinTech projects, as well as looking into solutions focused on AI, robotic solutions, biometric technology and Internet of Things.

And in September the bank announced that it had taken a 4.9 percent stake in German-based FinTech Deposit Solutions, which provides open banking technology that allows more than 100 banks across 18 countries to offer customers products from third-party banks. This is an extension of Deutsche’s existing relationship with Deposit Solutions. Since 2017, the bank has been operating its “Zinsmarkt” offering using technology supplied by Deposit. ZinsMarkt has already processed about €2 billion ($2.2 billion) in deposits.