Corporate Venture Capital

Corporate venture capital (CVC)

This is venture capital funding provided by major corporations to startup companies with a high potential for growth.

Funding is typically sourced through the capital budget of the corporation, as compared to that sourced from investors in the case of the independent venture capital fund. These corporate venture capital arms either invest in ventures that have some level of strategic synergies with their company’s business or they invest because of financial objectives.

The latter may make sense for privately held companies, but many would argue that financial returns should not be the objective of the publicly traded company. This is because, in theory, the public company investors’ interest is in the firm’s core business, and not necessarily in riskier venture investing. Should they be, they would likely be better served to invest directly through a venture capital fund or other private equity vehicles which is focused on such investments.

CVC bring administrative support, infrastructure, management and marketing expertise, and technology to the venture.

Like angel groups and venture capital funds, corporate venture capital arms invest in startups in all stages of development, from seed to the expansion, growth and mezzanine levels. Generally, their desired liquidation event is not an IPO. As indicated above, they tend more toward the acquisition of the startup.

FundingSage’s Listing of CVC Funds

Several of these CVC Funds are spotlighted on our FundingSage Startup Investor Spotlight. Learn more about potential CVC investors there!

301 Inc. (General Mills Venture Arm)

Abbvie Biotech Ventures

Airbus Ventures

Alexandria Venture Investments

Amgen Ventures

Ascension Health Ventures

Astellas Venture Management

AXA Strategic Ventures

Baidu Capital

BASF Venture Capital America, Inc.

Bertelsmann Digital Media Investments

BlueCross BlueShield Venture Partners

BMW i Ventures

Boehringer Ingelheim Ventures

capitalG

Chevron Technology Ventures

CISCO

Comcast Ventures

ConocoPhillips Technology Ventures

Danone Ventures

Dow Ventures

DSM Venturing B.V.

eighteen94 Capital (Kellogg’s VC Fund)

Fosun RZ Capital

GE Ventures

GM Ventures

GV (Google Ventures)

IBM Venture Capital

InMotion Ventures (England)

Intel Capital

Johnson & Johnson Development Corp

Juniper Networks Ventures

Kaiser Permanente Ventures

Kearny Venture Partners

Legend Capital

Lenovo Capital & Incubator Group

Lilly Ventures

Media Tek Ventures

Medtronic Venture Capital

Merck Global Health Innovation Fund, LLC

Merck Ventures

Merieux Developpement

M12 (Microsoft Corporation)

Mitsubishi UFJ Capital

Motorola Solutions Venture Capital

MP Healthcare Venture Management

Nike Innovation + Fuel Lab

Novartis Venture Funds (Switzerland)

Novo Ventures

NTT DoCoMo Capital

NVIDIA GPU Ventures

Olympus

Pfizer Venture Investments

Proctor and Gamble Ventures

Qualcomm Ventures

Quintiles Transnational Corp (NovaQuest Capital Management)

Rakuten Ventures (Japan)

Robert Bosch Venture Capital

Roche Venture Fund

S.R. One, Limited (GSK)

SAIC Capital

Salesforce

Samsung Venture Investment

Sanofi Genzyme BioVentures

Sapphire Ventures

Shell Technology Ventures

Sony Innovation Fund

Swisscom Ventures (Cloud Innovation Lab)

Synchrony Financial

Takeda Research investment

Tate & Lyle Ventures

Telstra Ventures (Australia)

Tengelmann Ventures

Third Point Ventures

Toyota AI Ventures

T-Venture Holding

Unilever Technology Ventures

UPS Strategic Enterprise Fund

Verizon Ventures

Volvo Venture Capital

ZX Ventures (AB Inbev Venture Group) (backed by Anheuser-Busch InBev)

Definitioner

Venture Capital / Venture Capitalist

LLC

Limited Liability Company

Corporate Venture

An investment from one corporation in another, typically at an early stage for strategic reasons.⁷

Related Articles

Early Stage Financing: 3 Things Early Stage Companies Shouldn’t Go Cheap On!

Early Stage – Startup Funding Life Cycle

6 Startup Lessons Learned from Previous Mistakes

Funding

This term is used synonymously with the words “financing” and “capital.” It refers to the amount of money that is needed for a business endeavor. For example, a new business owner may seek a certain amount of funding for their startup company. This “raised” capital can be used to launch their endeavor as well as to sustain their company until monetary profit can be generated.⁴

Venture Capital Funds

Venture capital funds pool and manage money from investors seeking private equity stakes in small and medium-size enterprises with strong growth potential.⁵

Venture Capital

Investment capital made available to high growth, scalable startups, typically beginning at the early stage, from a fund supported by accredited investors.⁶

Venture

Venture is often used for referring to a risky start-up or enterprise company.⁵

Startup

A startup is a new business venture / enterprise in its initial or early stages of development. These stages include the concept, seed, early, growth and mezzanine stages.⁶

Equity

Ownership in the capital of a Company. In corporations, it is called “stock”; in limited partnerships or LLCs, it is called “interests” or “units.”³
This designation is given to a stockholder’s ownership in a company. The amount of ownership is obtained when an individual or corporation purchases one or more shares of stock (equity shares). The more equity purchased, the greater the ownership.⁴

Public Company

A company that has securities that have been sold in a registered offering and that are traded on a stock exchange or NASDAQ. Must be a Reporting Company under SEC rules. Often used incorrectly to describe companies that are only Reporting Companies and that have not conducted a registered offering under Securities Act.³
Under SEC rules, a company that decides to go “public” offers their securities (stock, bonds, liabilities) to be sold in a registered public offering. Through the sale of such assets, a corporation can raise capital for their company, employees, or executive staff. These public offerings are often traded on a stock exchange.⁴

Private Equity

A company ownership position that is not listed and cannot be traded on a public securities exchange. Issuance, ownership and exchange of private securities are regulated differently from those of public securities under federal and state law.¹
Equity securities of companies that have not “gone public” (are not listed on a public exchange). Private equities are generally illiquid and thought of as a long-term investment. As they are not listed on an exchange, any investor wishing to sell securities in private companies must find a buyer in the absence of a marketplace. In addition, there are many transfer restrictions on private securities. Investors in private securities generally receive their return through one of three ways: an initial public offering, a sale or merger, or a recapitalization.³
Private equities are equity securities of unlisted companies. Private equities are generally illiquid and thought of as a long-term investment. Private equity investments are not subject to the same high level of government regulation as stock offerings to the general public. Private equity is also far less liquid than publicly traded stock.⁵

Liquidation

When a business is bankrupt or terminated, its assets are sold and the proceeds pay creditors. Anything left over is distributed to shareholders.²
1) The process of converting securities into cash. 2) The sale of the assets of a company to one or more acquirers in order to pay off debts. In the event that a corporation is liquidated, the claims of secured and unsecured creditors and owners of bonds and preferred stock take precedence over the claims of those who own common stock.³
This is an event that represents the complete or partial closing of a company. In a liquidation event, a company’s assets and material goods (securities) are converted into cash and/or distributed for sale to pay off existing corporate debt.⁴
Liquidation is the sale of the assets of a portfolio company to one or more acquirers when venture capital investors receive some of the proceeds of the sale.⁵

IPO

Initial Public Offering.

IPO (Initial Public Offering)

(IPO) The sale or distribution of a stock of a portfolio company to the public for the first time. IPOs are often an opportunity for the existing investors (often venture capitalists) to receive significant returns on their original investment. During periods of market downturns or corrections, the opposite is true.³
(IPO)This is a private corporation’s first-time sale or allocation of a stock that is made available to the public. IPOs can be distributed to both young and established companies who seek to expand or warrant public trading.⁴

Incubator

An organization established to support the development of startup companies with intermediate term access, (1 - 3 years) to facilities, (office and lab space), resources and development programs, potentially including mentoring. Incubators differ from accelerators in that the latter typically focus on acceleration of growth in a shorter defined period whereas the former is focused on the development of the company and its product over a longer time period.⁶

Corporate Venture Capital

Corporate venture capital is a subsidiary of a large corporation which makes venture capital investments.⁵

Related Articles

What is Corporate Venture Capital?

Where Should You Incorporate Your Startup? Delaware!

Board Observer Rights: What are They and Why Are They Important to Investors?

Corporation

A legal entity structure for businesses enterprises which are typically chartered by a state or the federal government, under which ownership is held by shareholders.⁶

Related Articles

14 Types of Information Investors May Request as Part of their Due Diligence Checklist for Your Startup

Next Step, Screening Meeting with the Angel Group; Are You Prepared?

Series LLC – yes or no?

Capital

Financial capital is a term that can refer to the money exchanged between entrepreneurs and investors during a business deal. Entrepreneurs need to raise capital for their startups while investors can provide them with the needed capital (or funding). Financial capital usually comes with interest, and new business owners can use their financial capital in purchasing real capital (or machinery or equipment) for their new business.⁴

Acquisition

A process under which a company acquires the controlling interest of another company.⁶

Related Terms Buyout | Merger Related Articles Founders: Do You Have An Exit Strategy?

INFOGRAPHICS

INFOGRAPHICS

Corporate venture capital (CVC)

CVC bring administrative support, infrastructure, management and marketing expertise, and technology to the venture.

Popular Posts (Past Month)