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The aim of Corporate Venturing is to offer established businesses the opportunity to invest in strategically relevant new business ventures being led by entrepreneurs with fresh new ideas on how to tackle a particular market. They bring with them fresh new business models that have been liberated from the trappings of older business models, which otherwise involve entrenched viewpoints, stagnant government regulations, and waning value propositions.
Investing with Corporate Venture Capital (CVC) gives the established business not only an equity stake in these new ventures, but also some level of visibility into, and influence over, them. The benefits of this can transfer back into the business in many forms, from purely financial, to the integration of key insights and capabilities, to becoming the foundation for reinventing the business entirely. As such, Corporate Venturing is a powerful form of insurance against long-term disruption — allowing the established business to become a part of what is doing the disrupting rather than a victim of the disruption. Indeed, as shown in the GR5 Growth Strategy Roadmap, it is an important strategic growth vehicle that can be used for pursuing a wide range of Value Creation strategies.
There are a number of possible approaches a business can take to Corporate Venturing, ranging widely in scope, scale, effort, and payback. We have mapped out each of these approaches with their corresponding investment process and risk / reward characteristics into a comprehensive CVC Landscape Map.
Drawing from both the CVC Landscape Map and our own executive experience in Corporate Development, we guide clients in establishing an appropriate strategy for Corporate Venturing that is best suited to their business and its long-term goals. Fundamental to this are the internal mechanisms needed to facilitate Corporate Venturing, and the processes for enabling the new ventures to launch and scale effectively.
The Corporate Venturing Engagement typically follows these steps:
- We begin by listening to you so as to understand your goals for Corporate Venturing.
- We then explain the different strategies for Corporate Venturing as they apply to both your existing markets and to new markets. This can highlight important ways in which you can leverage Corporate Venturing as a key growth tool.
- Next, we coach you through selecting the most appropriate strategy to Corporate Venturing for your organization and its particular goals.
- Thereafter we help you develop the necessary internal mechanisms and processes for facilitating the venturing effort, and for making it operate as smoothly as possible, whether that involves setting up an independent Corporate Venturing arm, or an embedded Corporate Venturing function.
- If desired, we can also provide custom training and workshops on Corporate Venturing.
- As desired, we can remain engaged with you to help you execute specific venturing initiatives. This might include, for example, defining your investment thesis, scouting for new ventures, structuring term sheets, conducting due diligence, closing deals, and so forth.
- We are also available to serve on the Board of Advisers of new ventures when desired.
To learn more about engaging us for Corporate Venturing consulting, refer to our Management Engagement page.