Standard Bank Moves Into The Platform Business

Standard Bank announced back in 2021 that they wanted to launch a platform business.

With One Hub, that journey is well underway.

But what exactly is a platform business, and what are the implications of this decision?

I'll be asking Jonathan Lamb, who heads up Standard Bank's CIB Platform Businesses, exactly that on 23rd September, as part of the future of biometric discussion.

But if you can't wait until then, here is a short explainer....

What is a platform business anyway?

If you are wondering what a platform bank is, you're not alone, as it is still somewhat ethereal and may mean different things to different people.

I found it helpful to think about a few non-banking platform examples first.

Take Airbnb, for instance.

Their "platform" allows homeowners to rent their properties out for short holiday-lets to anyone in the world.

I use the platform regularly, and It has just been of phenomenal value because it's removed some of the most significant entry barriers, such as marketing, distribution, cash collection, customer validation and security.

Kindle for publishers is another excellent platform. If you want to author a book, Amazon will guide you through the whole process, so the only thing you have to worry about is the writing.

And Salesforce is my third example. Less known perhaps than Kindle and Airbnb, but they are the market leader in customer relationship management software.

They were able to outperform Microsoft, SAP and Oracle, not because their 'product' was so much better, but because they partnered with third parties, who built additional solutions onto the Salesforce chassis.

DocuSign, for example, was quick to add its e-signature solution to the Salesforce marketplace, which allowed customers to seamlessly move from pipeline management to contract sign-offs at the flick of a switch.

Platform businesses are all similar in that they create a marketplace that allows other businesses to increase their distribution, reduce costs/friction and/or reduce business risks.

And the platform provider often benefits most of all.

By providing a 'generic' infrastructure, which others can use for their own purposes, they are able to create highly scaleable businesses, where marginal costs reduce significantly for each additional customer that is added to their platform.

Airbnb, for example, now has a valuation that matches the whole hotel industry, which is remarkable when you consider they don't own a single room.

It shouldn't be a surprise that many, perhaps even the majority of today's most valuable companies, are, in fact, platform businesses.

Alibaba, Facebook, Netflix, Amazon, Google, Salesforce, Airbnb....are just some of the names that spring to mind.

It, therefore, makes logical sense that Standard Bank should exploring platform businesses.

In fact, it would be commercial suicide not to because the entity that monopolises this opportunity first is going to become incredibly hard to dislodge.

What Could A Platform Business, Run By A Bank Look Like?

Back in 2021 I imagined something like this...

A savvy FinTech working in partnership with Standard Bank, building a standalone software-as-a-service offering that automates the majority of the house buying steps, and ultimately aims to offer the fastest and cheapest all-in conveyancing package on the market.

Well, Standard Bank has partnered with the incredibly tech-savvy iiDentifii, to offer biometric identity authentication directly to their business customer base.

Ok, so not quite the saas home buyers offering I'd imagined, but this is a critical first step that can absolutely enable others to build these types of services.

Sounds Like Paradise. Will It Work?

I don't know, but the opportunities are vast.

There are hundreds if not thousands of benefits that a platform play could bring to Standard Bank, its customers and indeed society at large.

And if they find the right offerings, they improve their potential to scale, with falling marginal costs, improved customer satisfaction, less disintermediation, better brand presence, more diversity and the more regular ability to create adjacent opportunities.

So how are they fairing just a year or so into their platform journey?

I'm hoping to find out when I interview Gur Geva, the CEO of iiDentifii.

As one of the first fintechs to use Standard Bank's One Hub marketplace, I'm looking forward to learning both about their journey to date and expectations about the future.

Is this fintech + incumbent marry-up a match made in heaven?

How have they dealt with the typical compliance and risk concerns that startups can typically ignore?

Why did iiDentifii choose to use One Hub for distribution when they could deal directly with their target customer base?

And how will biometric identity solutions change our lives over the coming decade?

I can't wait to find out on the 23rd!

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