An Investor View: Kabir Kumar, Head of Policy and Ecosystem Building, Omidyar Network
As a philanthropic investment firm, Omidyar Network supports entrepreneurs and their innovative ideas through impact investing and philanthropic grants. Our hybrid model allows us to partner with the most innovative changemakers, regardless of whether they lead for–profit or nonprofit organizations.
We deploy patient capital to scale innovative solutions in the marketplace, while our grants checkbook lets us expand understanding and positively influence the environment around it.
We advocate for a regulatory environment that supports sustainable and responsible financial inclusion and work to advance the financial sector as a whole. We believe that actors in the financial ecosystem are interdependent. The work of regulators can ease the path to market for new technologies, and new technologies can advance the financial inclusion goals of governments.
From this perspective, we believe that an Industry Sandbox can add value by:
a. Facilitating better product assessment by innovators: An Industry Sandbox can enable easier and cheaper validation of product features and benefits in a live test bed before going to market or entering a regulatory sandbox. As more companies access testing resources, their pipeline for FinTech investors can increase and attract more investors.
b. Encouraging portfolio companies to test new ideas faster: Having a designated testing platform can move product development to pre-production testing faster. For investors, this means economies of scale can be created by opening up a testing environment to multiple portfolio companies at once.
c. Gauging regulatory implications of a product: An environment with coaching startups on their authorisation requirements, screening for product compliance, and curated early-stage conversations between entrepreneurs and regulators could be a RegTech solution in itself, which can drive efficiency in regulating FinTech and confidence from an investor’s perspective.
Enabling ideas cross-pollination: An Industry Sandbox should be a place to interact and share ideas with a wide variety of stakeholders, which can spark a demonstration effect and significantly accelerate market learning curve for participants.
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