Seamless, the fintech and e-commerce international event series, returned to Germany for its second annual Europe-centric event. Moving from Berlin to Munich, Seamless Europe looked to attract over 4,000 attendees as it showcased innovative solutions and ideas.
Relocating to the Neue Messe München exhibition centre in Eastern Munich, Seamless Europe 2024 provided content spread across four stages, areas for networking, a ‘start-up village’ showcasing some exciting new companies from across Europe, alongside over 50 exhibitors, with an aim to showcase the best of what Europe has to offer.
Kicking off day one of the event, both Tobias Gotthardt, State Secretary of the Bavarian State Ministry for Economic Affairs, and Clemens Baumgärtner, Consultant for Labor and Economics, State Capital of Munich, welcomed attendees while praising local efforts for growth and the local startup ecosystem.
Decoding embedded finance
During the first panel session of the day, panellists discussed the significant potential and opportunity presented by embracing embedded finance.
Embedded finance offerings bring benefits to both the consumers and companies that leverage them, said James Simcox, chief product officer and MD of international at Equals Money. “We see Klarna all the time in checkouts. That’s not a financial service company providing that service directly. They’re doing it through Klarna, enabling you as a consumer to use that buy now pay later product while sitting in that checkout experience.
“Klarna is disgracefully successful, they’re the biggest fintech in Europe right now, and they’re helping their customers increase the basket size by around 60 per cent. It’s not just giving a benefit to the consumer, it’s also benefiting the retailer or checkout that’s using that product.”
Matthias Schmudde, head of payment and securities clearing and settlement at Deutsche Bundesbank, explained the importance of competition in finance. “If you look at credit card companies, that market is dominated by Mastercard and Visa. This is also true for e-commerce payments with PayPal and Klarna, which I believe are the two main providers now, and digital wallets, through Apple Pay and Google Pay.
“From our point of view as a central banker, it’s always important to have a lot of competition and a variety of choices. It’s important to have the possibility to deal with companies with roots in Europe, so we don’t have to rely on companies from other continents.”
Know your market
Next, the conversation shifted to market strategies and the importance of personalisation for e-commerce companies. Christian Maaß, chief digital officer and managing director at Thomann Music, explained why the company did not ever aim to evolve into a marketplace, despite the enormous success of the likes of Amazon.
“Our value chain is to create a musician. We are selling instruments, but we want to build you and establish you as a musician. You don’t care about the best price – we don’t want to have every instrument in our stock, because selling you the cheapest guitar doesn’t create good value because it doesn’t create the sound you want.
“Rather than investing in marketplaces, we invest in communication, creators and our own content channels. You need to be able to answer all of the customer’s questions. People don’t buy an instrumental violin with just one click. There are many touch points – the customer journey can start nine to 12 months before they make a decision. During that time, they could contact us eight times.”
Peter Pernot-Day, head of strategic and corporate affairs for North America and Europe at SHEIN, also commented: “Stepping back and looking at the entire industry, e-commerce has grown 66 per cent over the last 10 years. However, it only accounts for around 20 per cent of retail sales. That suggests that there is an enormous opportunity in the market for companies which are often mislabeled as ‘innovative’. I think what’s been lacking is creativity.
“That means looking at technology and finding innovative ways to do business. It means looking at technical transformation not as trying to copy or emulate other models, but to find something new that excites customers. What we need as an industry is a creativity boost.”
Selecting the best strategy for your product
Alvaro Morilla, global e-commerce commercial lead at Nestlé, also explained that a product alone can mean different strategies are required: “For us at Nestlé, 18 per cent of our sales are online. Online includes direct-to-consumer, which works really well for some brands. For example, Nespresso has a very strong subscription business which covers 80 per cent of their sales. This is because you know when you need the product, and you need it every month. For other brands, such as chocolate, direct-to-consumer doesn’t work at all.”
Debora Mendola, regional managing director at Transcom, added: “Our clients are not only asking to reduce their costs, but also to put their customers at the centre of the journey to provide the best possible experience. This includes a combined solution that can go in the same direction. This can, of course, create a community that is itself a promoter of your products and services, which bolsters growth. Our role is to combine all of our clients’ needs and make sure that out clients arrive to their customers in the best possible way.”
Making private markets as accessible as ETFs
Later, Robin Binder, CEO of NAO, took to the stage to discuss the disparity between investing in public and private markets: “I think 90 per cent of the people here have brokerage apps to buy ETFs and other stocks super easily, quickly and transparently.
“If you compare this with private markets, I was investing a lot in private markets when I was an institutional investor and the process is similar to how public markets were 20 years ago. It is really manual: you receive tons of documents; you have to sign subscription documents; you have to send a hard copy to the transfer agent etc.
“With these processes, it was not possible to invest small amounts because it’s super expensive operationally. Some players did start digitalising these processes, but nevertheless, it remained a digital version of an old-fashioned process.”
Binder also revealed that NAO recognised this as an issue, and how it approached the space to provide a more accessible solution. “We looked at brokerage companies and saw that four or five years ago, they started to fractionalise stocks and put them in the custody security accounts of the banks. We asked why it wasn’t possible to fractionalise the private markets.
“So we now enable people to co-invest smaller amounts, and then we aggregate them completely digitally with our SPVs and we act as one big buyer. As soon as the net asset value of these private market products gets published, we fractionalise them and allocate them.”
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