Truist creates a venture capital wing, invests in startup payments firm Veem
Truist, the new name of the merged BB&T and SunTrust, created a venture capital division to invest in companies that the bank thinks will help it serve its customers, the bank announced Wednesday.
Truist Ventures is the successor to a BB&T effort to invest in budding financial firms, combined some investments from the SunTrust side of the merger. The effort will be led by Vanessa Indriolo Vreeland, a former executive at SunTrust and Fifth Third.
“We’re nimble and we can move really quickly to make investments in companies,” Vreeland said in an interview. The division will look for businesses that can be complimentary to things the bank does.
“We’re asking: Where are there ancillary technologies or services that we could provide to our clients so that we could touch them digitally?” Vreeland said.
Truist Ventures also announced its first investment Wednesday, leading a $31 million fundraising round for the payments firm Veem. The San Francisco-based startup helps small businesses transfer money internationally.
There will be no cap on the investments the venture capital wing can make, according to Dontá Wilson, Truist’s head of digital, client experience, analytics and marketing.
The bank will look to find a diverse set of a portfolio companies to help accelerate the bank’s digital transition. Wilson said Truist Ventures was a “critically important” part of the bank’s technology strategy.
Tech arms race
The announcement only adds to the ongoing technological arms race in the banking industry, as millions of consumers move their banking entirely online.
With Bank of America and others spending billions of dollars on technology, the fear of being outclassed in technology was a major motivation behind the 2019 merger of SunTrust and BB&T.
Without a full suite of apps and technology on par with their larger peers, executives feared that two regional banks could lose out to a handful of national banks who could invest on a larger scale.
The combined bank announced last year that an innovation and technology center for the bank would be based in Charlotte, in the newly renamed Truist Center in uptown.
The building was formerly known as the Hearst Tower before the bank purchased it last year for $455.5 million. The building now serves as the bank’s headquarters.