Wells Fargo on Wednesday announced the launch of its first accelerator program, which will provide funding and mentorship to young companies aiming to pioneer new financial services technology.
The bank will guide three startups in its inaugural class, offering them mentorship in an attempt to prepare them to one day serve as vendors. Each company receives between $50,000 and $500,000 for participating in the program, but unlike other existing accelerator programs, Wells Fargo’s program allows startups to remain non-exclusive.
Wells Fargo Vice Presidents Braden More, Bipin Sahni and Steve Ellis sat down with TechCrunch earlier this week to discuss the new program, which they said is focused more on innovation and growing the startups than a return on their investment.
“We’re not chasing returns here,” said More. “We want to see them to become vendors so we can see them help us.”
By allowing the companies to remain non-exclusive, More says they can grow more by pursuing other investors, which in the long run could pay off for Wells Fargo if it were to partner with the startups as vendors.
The Wells Fargo team explained the highly regulated banking industry can pose many obstacles for young companies, and startups are rarely equipped to handle the large enterprise needs of a bank or lack needed security measures. Through the accelerator program, Wells Fargo will help the companies develop the infrastructure they need to accommodate hurdles that might arise across the bank.
Sahni said the company had informally been running an accelerator-like program for years, looking out for smaller companies and helping them prepare for “prime time.” Now the bank is making it official so that it can give these startups exposure and guidance from across the company.
Although the bank did not take applications for the initial class, it will launch an application process for the next batch in the fall, when it plans to accept about 10 companies.
Written by Cat Zakrzewski,