Since 2014, the firm has placed a renewed focus on building its corporate venturing capabilities: this area of its business is complemented by PwC’s long-standing experience and expertise in advising on private equity and mergers and acquisitions activity.
PwC’s shift of emphasis was marked by the recruitment of former Unilever Ventures director Mark Muth to its London corporate finance team. Muth, who also has experience at GE Ventures, now works alongside US-based PwC peer John Riggs.
PwC’s decision to increase the importance it places on its corporate venturing arm could perhaps not have been better timed. The company’s MoneyTree report, produced in association with US trade body the National Venture Capital Association, showed that 2015 saw the highest rate of corporate venturing since the start of the century, with $7.5bn invested in the US alone.
Over the past 12 months, PwC has recognised the significance of the work carried out by Muth and Riggs in the corporate venturing unit among the rest of the team.
When he joined PwC, Muth said his plans were for the firm to “get involved in the front end of the corporate venture capital establishment”. This has meant a strong focus on companies which do not yet have a corporate venturing business, encouraging them to think through potential strategies in advance and ultimately helping them decide whether starting up a venturing unit is in their best interests.
Such an approach is intended to avoid the type of problems frequently created by the ad-hoc manner in which many businesses have, according to Muth, gone about setting up VC investments in the past. But of course, PwC’s services do not end at the creation of venturing units: they cover all aspects of implementing and running such businesses, from advice on tax structures and alignment with existing corporate interests to assessment of legal risks and help in overcoming regulatory hurdles.
PwC said corporate venturing would only increase in importance over the coming few years as companies face more disruptive competition. Riggs said: “Innovation takes many different forms and the most successful companies employ several operating models such as open innovation, corporate venturing, incubators, accelerators and design thinking to drive results.
“Corporate venturing has become a key component in many companies’ quest for growth. By investing in other innovative companies, organisations can access cutting-edge technologies, discover novel products and experiment with different business models.”
