Ethos AI

Jun 11, 2019

Companies  / 11 June 2019, 12:00pm / Kabelo Khumalo Patrice Motsepe’s listed investment vehicle African Rainbow Capital’s share price on Monday surged 6 percent after the company said it was inundated with requests from strategic partners over its flagship investment, TymeBank. Photo: Karen Sandison African News Agency (ANA) JOHANNESBURG – Patrice Motsepe’s listed investment vehicle African Rainbow Capital’s (ARC) share price on Monday surged 6 percent after the company said it was inundated with requests from strategic partners over its flagship investment, TymeBank. ARC also said Ethos Artificial Intelligence (AI) had invested R200 million in the digital bank with Ethos now owning 8 percent of the bank. In a separate transaction, ARC will invest R100m into Ethos AI Fund. Johan van Zyl, co-chief executive of ARC, said that ARC was pleased with how TymeBank’s management was executing the agreed strategy. “Together with these co-investors and partners, we can significantly enhance TymeBank’s products and services to the benefit of its clients. This would be to the benefit of clients. If we achieve this, we are likely to on-board new clients over a sustained period of time and therefore meet the objectives of our business case,” Van Zyl said. The Ethos AI Fund was launched in 2018, with a successful first close of R600m, and a final target size of R1 billion. Roger Grobler, the Ethos AI Fund partner, said the Ethos AI Fund invests in businesses that will benefit disproportionately from AI, primarily in the form of algorithmic decision making. “Together with ARC and TymeBank management, we believe that by leveraging AI’s algorithmic capabilities, we can enable TymeBank to rapidly scale its business with more appropriate products, at a lower cost and with superior service levels,” Grobler said. TymeBank has enjoyed early success since going live in February as the country's first fully digital bank with more than 400000 clients having signed up for bank accounts. The bank has now set a target 2 million clients over the next three years, with 1.3 million active client accounts to enable it to break-even. TymeBank chairperson Coen Jonker said a key strategic pillar of the bank's success is its access to and use of unique technology. “This has made TymeBank a significant contender in the market. This investment from the Ethos AI Fund will strengthen our focus on technology and it will likely cement our current leadership position as the lowest cost banking service provider to consumers,” Jonker said. ARC, which also has a significant interest in Alexander Forbes, said it still had a R700m war chest for further acquisitions after spending R348m in the first three months of the year in new investments. ARC said its telecommunications company Rain was on track to launch a 5G network by the end of the year. BUSINESS REPORT