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The Rise of Corporate Venture Capital; an Australian perpective
This document discusses the rise of corporate venture capital (CVC) funds. It notes that CVC deals and funds have doubled in recent years as large companies look to invest in startups and innovative technologies. CVC provides advantages like insights into new markets and technologies, opportunities to influence industry ecosystems, and access to potential acquisition targets. The document argues that CVC can help large corporations identify disruptive innovation early and develop next-generation products and services to strengthen their businesses for the future.
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The Rise of Corporate Venture Capital; an Australian perpective
- 1. 1 Venture Forth The Riseof Corporate Venture Capital Alfred Lo Lead Principal alfred.lo@optus.com.au / @apglo
- 2. 2 KNOWLEDGE OF WHATIS P O S S I B L E I S T H E BEGINNING OF HAPPINESS “ “ - GEORGE SANTAYANA
- 3. Optus-Innov8 is acollaboration between Optus and Singtel Innov8 bringing together funding and resources for Australian tech startups
- 4. EST. 2010 To help SingtelGroup adopt open innovation, seek new growth opportunities, foray into new markets and strengthen its businesses INDEPENDENT BOARD & DECISION MAKING SINGAPORE SAN FRANCISCO TEL AVIV $200M initial fund size
- 5. SCOUT Act as atechnology and innovation scout for the group INVEST Identify and invest in promising companies which have synergistic value to the group BUILD AWARENESS Be the partner/investor of choice for startups PARTNER Develop partnerships to accelerate incubation of new ideas
- 6. Tier-1 VCs Accelerators & Incubators TelcoVCs NETWORKS ARE KEY Internal Business Units
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- 8. 8 A RECENT PHENOM.THESE WEREN’T UNICORNS.
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- 10. UNICORNS WITH CORPORATEVENTURE BACKING Baidu Google Ventures Comcast Coca-Cola Horizon Salesforce in-q-tel Samsung Ventures Visa Starbucks Singtel Innov8 Intel Capital Red Hat Salesforce Ventures Emc in-q-tel Rakuten
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- 12. 2014 Source: CB Insights USCOMPANIES HOLDING MORE CASH THAN EVER BEFORE - $1.6T AT END OF 2013 Led to surge of CVCs as companies looked for more innovative R&D solutions
- 13. 1 IN 5 VCDEALS HAS CVC IN SYNDICATE
- 14. GOOGLE VENTURES WAS THEWORLD’S MOST ACTIVE CORPORATE VC, INVESTING $2.8 BILLION INTO 122 COMPANIES TECH COMPANIES THAT SEE RAPID CHANGE IN THEIR LANDSCAPES APPRECIATE CV FUNDS
- 15. BUT IT’S NOTJUST YOUR USUAL SUSPECTS
- 17. 25 OF THE30 FIRMS THAT COMPRISE THE DOW JONES INDUSTRIAL AVERAGE HAVE A CVC UNIT PAST FOUR YEARS MORE THAN 475 CORPORATE VENTURE FUNDS HAVE STARTED, NOW 1,100 FUNDS, MORE THAN DOUBLE NUMBER IN 2009 HALF OF TOP 100 US FIRMS HAVE CVC AND 25% OF FORTUNE 500 25/30 1100 50+/100
- 19. OZ TECH FUNDINGHITS RECORD. BUT. 19Source: CB Insights $92M
- 20. LOCAL INVESTORS UNDERWEIGHT 20 Berlin:64% London: 59% Australia: 38% Other Source: CB Insights
- 21. GLOBAL FUNDS COMINGDOWN UNDER 21 US$50m US$21m US$250m US$35m US$150m US$15m US$30m
- 22. BUT FEW HAVELOCAL INVESTORS 22 US$50m US$21m US$250m US$35m US$150m US$15m US$30m
- 23. WE’RE MISSING MIDTO LATE-STAGE CAPITAL 23Source: CB Insights
- 24. LOCAL PLAYERS &OPTIONS EMERGING Equity-based Crowd Funding Platforms in AU 24
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- 26. DISRUPTIVE INNOVATION ISTHE SINGLE BIGGEST WORRY FOR FIRMS RESEARCH & DEVELOPMENT ACQUISITON TARGETS INFLUENCE INDUSTRY’S ECOSYSTEM CVC yield 3 times # patents per $ invested than in-house R&D 1/3 of CVC-backed startups acquired versus 1/10 from private VC only Identifying new markets and building up their existing businesses
- 27. ADVANTAGE OF INVOLVEMENTWITH STARTUPS AT THE EARLY STAGES, WHEN THEY CAN MOST BENEFIT FROM ACCESS TO A LARGE, ESTABLISHED CUSTOMER BASE, CREDIBILITY THROUGH BRAND ASSOCIATION AND A LARGER NETWORK OF PARTNER COMPANIES AND ADVISORS. INSIGHTS INTO NEW MARKETS & TECHNOLOGY NEXT GEN PRODUCTS & SERVICES DOMAIN EXPERTISE NEW BUSINESS MODELS FOR THE FUTURE COST SAVINGS
- 28. TECH STARTUPS AREINDUSTRY GAME CHANGERS APPETITE FOR CORPORATE VENTURE IS GROWING CVC CAN IDENTIFY DISTRUPTIVE INNOVATION EARLY > > > TAKEAWAYS
- 29. 29 Venture Forth The Riseof Corporate Venture Capital Alfred Lo Lead Principal alfred.lo@optus.com.au / @apglo