Temenos Complete $559 Million Acquisition of Low-Code Firm Kony – What’s Next?

This week, Swiss-based banking software company Temenos officially completed its $559 million acquisition of Kony, a leading low-code app platform provider. IDN talks with two Kony execs to explore what’s next – for Kony, its customers and the low-code and fintech sectors.

Tags: AI, banking, DBX, fintech, low-code, integration Kony, Quantum, Temenos,

Bill Bodin, Kony
Bill Bodin

"With Kony, developers don’t need to acquire special skills to do some pretty amazing things."

Carlos Carvajal, Kony
Carlos Carvajal

"This [acquisition] is a validation of Kony Quantum and our full-featured approach to low-code"

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This week, Swiss-based banking software company Temenos officially completed its ‘highly strategic’ acquisition of Kony, a leading low-code app platform provider.


Temenos CEO Max Chuard called the Kony acquisition ‘highly strategic,’ noting that adding Kony to its portfolio  “will allow us to grow both our US and our digital front office business faster while being highly accretive and synergistic to the rest of our business.”


In detail, Chuard noted that Kony provides “a digital front office product that has already been successful in the US market and is connected to most third-party cores.” Kony also brings “a significant amount of exciting functionality and ease of generating customer journeys and experiences.”


Kony’s cloud-based Digital Banking Experience product (Kony DBX) is seen as a great fit to enhance Temenos’ own cloud-based digital banking SaaS software, Temenos Infinity, according to execs from both firms.


Kony DBX has accelerated product cycles and increased agility for banks and fintech users by making it easier for developers and IT to design and deliver modern apps with engaging user experiences, according to Kony execs. As an example, some Kony’s banking customers have achieved a more than 20% increase in mobile deposits, a 64% increase in mobile credit card payments – while reducing abandonment rate from 20% to as low as 3%.


The Kony DBX banking software is an outcome from the Kony Quantum end-to-end low-code software platform for design, test, integration and delivery. 


Inside the Kony / Temenos  Deal with Kony’s CMO Carlos Carvajal and CTO Bill Bodin


So what happens next – to Kony and its current customers. And what does the acquisition, which valued Kony at more than a half-billion-dollar, say about the growing low-code and fintech sectors?

To find out, IDN discussed the deal with Kony’s CMO Carlos Carvajal and CTO Bill Bodin.


The acquisition is “an amazing validation of the facets we bring together to make digital banking amazing and seamless,” Carvajal told IDN. “The things Kony has done over the past 3-4 years to build out our IP is a validation of Kony Quantum and our full-featured approach to low-code.


”Temenos has strong synergies with Kony DBX, In fact, we have joint customers and they use us for custom front end [code or UI design],” Carvajal told IDN. “Also, recently, we have received really strong traction with IDC and Forrester for digital banking, so they took notice.”


Moreover, while Temenos execs were initially drawn to Kony’s success with digital banking, once they looked under the covers at the core Kony Quantum low-code platform, Temenos’ interest truly heated up, he added. <


“Only after discussions started did [Temenos] really understand all the value we have with the Kony Quantum platform. They became aware that in fact: There is no Kony DBX without our underlying core [Quantum] platform.”


On that score, Carvajal how Quantum powers many critical DBX features - low-code visual development, simple-to-deliver integration, support for omnichannel apps and PWA (Progressive Web Apps) capabilities. 


As a result of this fuller understanding of Kony Quantum, Carvajal told IDN Temenos has promised “continuous investment” in Quantum. “They realize it is really a force multiplier.” As a result, other industries beyond banking will also derive benefits from the acquisition, he added.


Kony engineers are also excited about the Kony-Temenos deal, according to CTO Bodin.


Temenos CEO Max Chuard and Kony CEO Tom Hogan announce the Temenos/Kony deal during the recent Kony’s Accelerate user conference.

“This is a validation of our team’s vision and execution for Kony’s platform for accelerating app design, development and delivery – for banking and other industries,” he told IDN.


Bodin himself is also excited at prospects to build out the Kony Quantum platform’s newest emerging features. 


“What really excites me is the [Temenos] deal is an affirmation of our architecture and the many services  Kony excels in to deliver a great developer experience and a superior customer journey.” 


He pointed to trends today in fintech, where banks and credit unions continue to prioritize their app spending on projects that will deliver high customer engagement and a great customer journey. Temenos found tremendous value-add capabilities in Kony Quantum’s architecture to fill these needs.


“We are already optimized for mobile, laptop, web and omnichannel – for both developers and [app] users. So, Temenos loves we have a patented framework that can deliver all of these,” Bodin said.

Beyond these capabilities, Bodin also mentioned Kony Quantum’s support for blockchain, AI, AR [augmented reality] as differentiators. “It not just that we have these services, “Bodin said, “It’s that we’ve designed them into the platform to all work together in a way so that it’s easy for developers to build and deliver that differentiated user experience customers are looking for.”


Underlying this ease-of-use, he added, is Kony’s long-term investment over the years in no-code / low-code design for UIs, apps and even backend integration.


“We let developers quickly compose compelling front ends and easily integrate apps with complex backend banking systems. With Kony, developers don’t need to acquire special skills to do some pretty amazing things. It was all a double-win I think, as Temenos saw it, ”Bodin added.


Both Kony execs were also excited about prospects for leveraging some of Kony’s support for proactive AI and agile development. 


Bodin explained one example of proactive.


“On a minute-to-minute basis, we are already using AI to guide users to best practices in design and other features. For example, Kony Quantum’s AI offers several ‘autonomous processes’ which span the entire lifecycle – to assist developers, IT ops and even backend integrators, he said.


“In Kony Quantum, we architecturally look at the component a developer is using, and then we can pop up other [artifacts].” Bodin added. It can, for example, show examples similar to the component in use, what any set of object services might be doing, what type of forms and support a developer needs, and so on, he added.


Kony also offers helpful features such as dynamic spell checking, project cleanups, properly-enforced security and even ways to resourcefully use all available artifacts.  “It’s all designed to get you quickly to a PoC [proof of concept] or even a full-blown app,” Bodin said  


Exciting Prospects for Kony Quantum  - Real-Time AI, DevOps, Customer Journey

Kony’s AI capability stems from a reference architecture that can work ‘syntactically’ with components, objects and services. It’s a bit like situational AI or mapping, as Bodin described it. “When it was time to layer in AI, we wanted it to respond to meet the precise situation the developer was in – in real-time,” he said. That means no use of pre-scripted wizards or fuzzy logic. 


“While DBX was the primary technology that caught Temenos attention, it turns out that DBX is not just one thing – it’s a combination of everything in [Quantum] platform.”


Among those capabilities, Carvajal listed: visual assembly and low-code, support for APIs and microservices, easy backend integration, DevOps-ready workflows and AI.  “The key here is that [Kony] Quantum engineering aggregates them all in into a unified, efficient platform,” he added.  


Leveraging the Kony technology, Temenos Infinity can be delivered on-premise, in any cloud or as a SaaS offering and has 700 published APIs for third-party integration. Temenos Infinity can be easily implemented on any core banking system or integrated with the company’s  Temenos T24 Transact core banking product.


When IDN asked Carvajal about the prospect for Kony layoffs or elimination of products, he replied. “The acquisition is not about efficiencies. It is about a vision to drive massive growth in the company.”


At the time of the acquisition, Kony had approximately 1,500 employees.