The following is a snapshot of the data we have collected on investment activity over the past three months. To verify reported deals, we contact about 300 corporate investors each quarter – these comprise roughly 18% of the global CVCs we cover, but account for most of the deals that are made public.
Amid the Covid-19 pandemic, a nearly global lockdown and an economic downturn in sight, it would be a crass understatement to call the first quarter an eventful start to the year.
In this first quarter, GCV Analytics tracked 768 funding rounds involving corporate venturers, representing a nearly 5% decrease from the 811 rounds recorded in Q1 2019. The estimated total investment dollars stood at $24.16bn, down 32% from the $37.1bn recorded during the same period last year.
The US hosted the largest number of funding rounds (313), while Japan came in second with 118 deals, India third with 55 deals and China fourth with 44 deals.
Compared with the previous quarter, there was a slight increase in deal count, from 768. Estimated total investment, plummeted by about 43% from $42.3bn.
Emerging enterprises from the IT, health, business services and fintech sectors proved the most attractive for corporate venturers, accounting for at least 87 deals each. The top funding rounds by size, however, were raised mostly by companies from the transport and IT sectors.
The most active corporate investors, in turn, came from the financial services, IT, media and health sectors.
The leading investors by number of deals were diversified internet conglomerate Alphabet, telecoms firm SoftBank and electronics manufacturer Samsung. The list of corporate venturers involved in the largest deals by size was headed also by Alphabet, internet company Tencent and automotive retailer AutoNation.
Most of the corporate investors taking minority stakes during the first quarter were investors that had done at least one previous deal before (74%). However, out of every four (26%) of corporates was disclosing its first minority stake deal in this quarter. Since 2018, there appears to have been a trend of newcomers to venturing – whether with a specific unit or not – comprising roughly a fifth to a fourth of all corporate investors. In previous years the proportion of first-time corporate investors was consistently lower than 20%. We are yet to see if this trend will continue during a downturn.