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Perspectives On Corporate Venturing

There are many advantages and benefits to this type of corporate partnership, for both the corporate and start-up sides. Relationship building is key to this two-way partnership between corporate investors and the start-up, as is lessons learned and adding value. The acceleration of innovation through new technology can also be a significant benefit to the venture.

Innovating Advantages

What is corporate venturing? According to ChatGPT, corporate venturing is a business strategy in which large companies create or invest in small start-up businesses to gain access to new products, technologies, markets, and talent. Corporate venture capital (CVC) refers to when a company invests its own funds into startups with the expectation of financial returns.

Through this process, there can be many advantages for the corporation as well as the start-up in terms of innovation. For one thing, there is access to new markets. Corporate venturing allows companies to gain access to new markets and customers. This can open up potential opportunities for growth, as well as provide a platform for launching innovative products and services.

There is also the potential for increased innovation. By engaging in corporate venturing, companies can spur their own internal innovation processes by leveraging external resources such as venture capital firms or entrepreneurs with specialized skill sets that may be unavailable internally. This can create an environment conducive to rapid prototyping and product development cycles, allowing for faster time-to-market of new products and services.

Other benefits include improved financial return. Through corporate venturing, companies are able to benefit from the upside potential of investing in early stage start-ups while mitigating much of the risk associated with more traditional investments through diversification strategies such as co-investment partnerships or shared ownership models between multiple investors/corporations.

Through corporate venturing, businesses can also enhance their capabilities and innovation research and development, acquiring valuable intellectual property rights or technology assets that enable them to develop competitive advantages over competitors who lack similar capabilities or resources. This could range from exclusive deals on patents/licenses related to software development tools all the way through strategic acquisitions of start-ups offering disruptive technologies within a specific market sector.

Engaging Partnerships

During our Start-up Partnership Roundtable, the community took a look back at past partnerships and understanding lessons learned from failures and successes. Chris Varley, Principal, Goodyear Ventures, The Goodyear Tire & Rubber Company, and Scot Wingo, CEO, Spiffy, sparked the conversation focused on blending faster/cheaper and bigger/better within a structure that works for each entity. The session dove into examining new partnerships with evolved systems of engagement. The overall goal: To ensure that each partnership is viewed as a unique collaboration while infusing each combined initiative with overall established wisdom.

Both corporate and start-up also need to focus on readiness, flexibility, communication and collaboration. Resources must be made available to the corporate venturing team to succeed in its mission, as both the corporate and start-up sides find a common language as they set strategy, define the investment approach, and create other organizational elements for a roadmap to success.

See Milan Ivosevic at FEI 2023

Milan Ivosevic, VP of R&D and Innovations, CooperSurgical, joins this year’s FEI (Front End of Innovation) conference. In the seminar, “Corporate Venturing: End-to-End Product Innovation Framework,” an integrated end-to-end framework of innovation and new product delivery process will be presented. The framework consists of the two principal parts: 1. Opportunity incubation― innovation spiral and 2. Product delivery― stage-gate execution. The leading premise is that a holistic understanding of sequential dependency and causal interplay between key building blocks along the entire voyage from inspiration to desired outcome could significantly increase the odds for success when engaged in entrepreneurial innovations in an enterprise environment.

Key Takeaways

  • The proposed end-to-end product innovation approach is an enterprise tested conceptual framework which help us understand cadence of interdependent steps essential for retiring main risks while building confidence toward desired outcomes.
  • A rigorously and holistically incubated solution based on human-centered design principles maximizes our chances for predictable product development and makes commercial success more attainable.
  • No one can guarantee victory in a novel and innovative entrepreneurial pursuit, however, systematically and iteratively answering the right questions at the right stage of a solution inception could maximize the odds for success and help discover potential flaws before significant time and resources are spent.
  • We are ready to move to product development when we produce adequate evidence and build sufficient confidence that the solution is desirable, feasible, scalable and business viable.

See Milan Ivosevic, VP of R&D and Innovations, CooperSurgical at FEI 2023 (Front End of Innovation). Front End of Innovation returns May 16-18 in Boston, MA.

Contributor

  • Matt Kramer

    Matthew Kramer is the Digital Editor for All Things Insights & All Things Innovation. He has over 20 years of experience working in publishing and media companies, on a variety of business-to-business publications, websites and trade shows.

 
 

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