Tech Transformers

Banks have missed out on startups: CommerzVentures

Banks too focused on themselves: CommerzVentures MD
Banks too focused on themselves: CommerzVentures MD

Banks were too focused on protecting themselves from a repeat of the global financial crisis that they missed many investment opportunities offered by key startups, the managing director of CommerzVentures told CNBC.

Speaking on the sidelines of London's unBound startup conference on Tuesday, Patrick Meisberger, managing director of Commerzbank's venture capital arm, said that banks left a market gap after the crash.

"After the financial crisis, (banks) concentrated on reducing their risk, being really internally focused while missing out a little bit on what's happening in the early stage startup companies," Meisberger said.

Jurgen Ziewe | Getty Images

"So now they are addressing that and for example, like Commerzbank, building up their venture capital units to get access to this market and find ways to cooperate with those companies," he explained.

CommerzVentures is keeping an eye on innovations in fintech -- the software and technology that helps companies manage their money -- having recently invested in startups involved in short-term business lending and insurance. Now they're looking out for asset management software, compliance and security products.

"That's definitely an area where we see a lot of need, especially in traditional banks," he said.

He argues that startups will be open to buyouts, given the risks of going public. He pointed to financial services company Square which saw its private $6 billion valuation cut in half upon its market debut, when it was valued at $2.9 billion.

Wearables market ripe for takeovers: Misfit Founder

"It's getting much more difficult for these kind of companies to IPO, so of course the exit course of validity is by being acquired by existing players, (and planning) strategic exits," he said.

But it's key to get in early, Meisberger explained, saying that he'd probably hold off from investing beyond series B or C funding rounds.

"Especially in the late-stage segments, valuations are exaggerated and we would refrain from investing in that phase," Meisberger said.