SILICON VALLEY, Calif. ( MainStreet) -- American Express ( AXP) plans to start with word on the street to figure out which start-ups are worthy of its investment for innovations in digital commerce.
The company could invest up to $100 million, says Harshul Sanghi, who was appointed a managing partner of the card company's Enterprise Growth Group in September.
American Express plans to invest as much as $100 million in early stage companies dedicated to digital commerce.
The multiyear initiative looks to invest in companies improving on the company's loyalty and reward programs, point-of-sale technology in management and fee-based services, security and fraud detection, cloud-based services and data analysis. American Express plans to contribute minority investments to these companies. It does not have plans to acquire the start-ups, a spokeswoman says. The initiative will be managed by Sanghi, who is already developing partnerships with technology and venture communities. He was in a similar role at Motorola ( MOT). American Express formed the group last year to focus on expanding its traditional card and travel businesses further into alternative mobile and online payments. "As we enter the next chapter in our history, we recognize the need to work with emerging technology companies to inspire change, encourage innovation and ultimately deliver the best products and services to our customers," said Dan Schulman, group president, in a statement. The company plans to focus initially on technology companies in North America, but will expand that to a global search over time. "This is one of those moments where we feel the landscape of payments is changing and we look at ourselves playing in the broader digital commerce space. There is a lot of convergence taking place," Sanghi says. Asked how start-up companies can submit their business plans, Sanghi replied that the company will look first at word-of-mouth referrals through various network channels and in the venture community. Over time American Express will likely establish more direct forms of communication with companies. Until then, "I'm in the Valley and pretty accessible," he adds. -- Written by Laurie Kulikowski in New York. To follow Laurie Kulikowski on Twitter, go to: http://twitter.com/#!/LKulikowski To submit a news tip, send an email to: email@example.com.