Why a decentralised CVC model works for ABB

Since 2009, ABB has invested over $450m in electrification and automation technology startups, initially managing its investments through one central unit, ABB Technology Ventures, independent from its business areas. But, five years ago, ABB moved to a decentralised model where each business area makes investment decisions with its own CVC teams. We recognised that meaningful innovation is best managed by decision-makers who are closer to the customers.

The largest business area is Electrification, accounting for more than half of ABB. At ABB Electrification Ventures, we not only invest in high-potential startups but also treat them as business partners. With a dedicated team and a close tie-in with the operating divisions, it’s a model built on proximity to product expertise, customer needs and market shifts.

Since 2021, ABB Electrification Ventures has invested more than $80m in 15 startups including power router developer DG Matrix, energy intensity management platform Ndustrial and distributed energy trading service GridBeyond.

We work very closely with our operating divisions, and that connection is critical. Having buy-in from them means that once we invest in a startup, we can help it build meaningful relationships across ABB.

Want to hear more on decentralised CVC?

Anton Kotov, head of corporate strategy and M&A at ABB Group, will be at the GCV Symposium on June 19th to discuss in more detail why ABB moved to a decentralised model and what results the group is getting from this approach.

The shift from a centralised to an embedded strategy

Historically, ABB’s venture activities sat at the corporate group level, covering broad themes instead of the business areas’ specific priorities. The move to embed CVC within the Electrification business area reflected not only a company-wide strategic reset but also a recognition that innovation in this area would benefit from tighter integration.

By aligning with our operating divisions’ strategies and operating rhythms, the Electrification Ventures team is gaining better insight into future value creation and the ability to operationalise investments in a way that standalone CVC units often struggle to achieve.

When a startup brings on a corporate investor, there’s usually an expectation of added value beyond capital. With our embedded structure, we can actually deliver on that promise. The operating divisions feel accountable for the investment, and that collective ownership drives stronger support for the startup.

Commercial scaling: from pilot to global reach

One of the biggest advantages of ABB Electrification Ventures’ model is its ability to help startups scale commercially — something that’s often difficult in industrial markets with long sales cycles, complex customer requirements and strict compliance standards.

Startups often underestimate how hard it is to scale in our world. You’re not just selling a product — you’re becoming part of a critical system. That means proving reliability, integration and long-term support. We can help bridge that gap.

Our ventures team acts as a conduit between startups and ABB’s global commercial infrastructure. So, once startups have validated their technologies through pilot projects or internal use cases, Electrification Ventures can help them access ABB’s customer base, channel partners and system integrators.

We can open doors, but more importantly, we can help the startups walk through them. We know how our customers buy, and we know what it takes to make a product “industrial grade”. That’s where our support really accelerates the path to scale, and it extends beyond introductions.

Startups often benefit from integration support, technical mentorship, compliance guidance and co-development opportunities that make them more attractive as suppliers or strategic partners. For startups to scale in electrification, they need more than just funding. Startups need to be ready to partner with big industrial customers, and that’s exactly the type of value we provide.

Strategic focus: powering tomorrow’s infrastructure

Data centres are not only the fastest-growing segment served by ABB Electrification, but they are also the world’s most rapidly expanding energy consumers. At this scale, every square meter, degree of heat and millisecond of uptime matters. This is where startups can make a real difference. From software AI-powered energy optimisation tools to hardware solutions tackling power density, distribution losses and cooling—there’s room to innovate.

ABB is solving these challenges and actively partnering with startups that bring speed, agility and bold ideas. A great example is our recent investment in DG Matrix, which addresses the power density challenge developing solid-state power electronics for high-performance computing and AI data centres.

Looking ahead

Some might worry that being closely integrated with a business unit means a venture team can only focus on startups with technologies that deliver in the immediate or near term. But this is not necessarily true. In its early phase, our ventures team focused on companies that closely aligned with our current offerings, often at later stages of maturity. That is now changing with an increasing number of investments in earlier-stage startups and more disruptive technologies.

We are also evolving our investment strategy, engaging more deeply with our operating divisions to ensure alignment with long-term customer needs.

One of our biggest improvements is on the strategic side. We’re now working closely with each operating division to identify where the market is going and where our customers are likely to buy in the future. That insight helps us invest in areas with real future value.

The model we put in place five years ago is now running at full capacity, executing four to six new investments per year in ABB Electrification. Our goal now is to be best-in-class — and that means staying focused on strategy, execution and creating real industrial impact through our investments.

Mads Moeller is Head of ABB Electrification Ventures