Corporate venturing has become a key strategy for companies looking to stay competitive, drive innovation and create new markets. Staying ahead of evolving trends in the field is crucial, as it empowers C-suite executives to steer their organisations toward a successful future.
Here are six of the most notable recent developments in corporate venturing:
CVC Has Become More Resilient
Unlike previous crises like the dot-com bubble in 2000 and the Global Financial Crisis in 2008, the CVC landscape during the COVID-19 pandemic showed remarkable resilience. Global CVC investment reached record highs in 2020, with deal volumes only slightly below the peak of 2019.
This resilience is due to several factors, including a growing recognition among corporations that scaling back on CVC investment damages market trust. Corporations have realised that innovative start-ups are essential for staying competitive in a world marked by rapid societal and cultural changes. In response to these changes, CVC has become a strategic imperative for corporations looking to drive innovation and mitigate risks.
Focus on Sustainability
Speaking of societal changes, sustainability and corporate social responsibility are becoming integral to corporate venturing. The C-suite is increasingly directing resources toward ventures that promote social impact. Investments in clean energy, circular economy initiatives, and social enterprises are not only ethically responsible but also align with consumer preferences and market trends.
Digital Transformation
Corporate venturing is pivoting towards digital transformation. Companies are investing in startups that offer digital solutions, such as AI, IoT, and blockchain, to gain a competitive edge. C-suite leaders must recognize the importance of staying ahead of the digital curve to remain relevant in their respective industries.
Global Expansion
Another notable trend is the global expansion of corporate venturing efforts. Companies are increasingly looking beyond their domestic markets to invest in startups and innovations worldwide. This global approach helps organisations tap into new markets, diversify their portfolios, and gain a competitive advantage on a global scale.
According to dealroom.co, Europe’s share of global VC is at a record 19% in 2023, with the United Kingdom and Germany leading the way. Israel and Africa are also emerging as robust CVC markets, with impressive deal values and growth.
Open Innovation
Open innovation is reshaping the corporate venturing landscape. Companies are increasingly embracing open innovation models, where external partners, including startups, academia, and research institutions, are invited to contribute to the innovation process. This collaborative approach allows for a broader range of ideas and perspectives, driving more meaningful and disruptive innovations.
Collaboration Over Competition
In the past, companies often viewed each other as rivals, but this mindset is changing. Corporations are increasingly teaming up with startups, other corporations, and even competitors to achieve shared goals. This cooperative approach allows companies to leverage their combined resources, expertise, and market reach to drive innovation and tackle industry challenges effectively.
In summary, corporate venturing is evolving rapidly to meet the demands of a dynamic business landscape. The recent trends in this field emphasise the importance of adaptability and forward-thinking for C-suite leaders. By recognising and adapting to these trends, companies can position themselves for long-term success and sustainable growth.
