Corporate venture’s identity crisis: More capital, less clarity

Corporate venture capital has turned out to be a steady hand in an otherwise cyclical VC market, reaching record highs in new activity in 2025, and with the first couple of months showing this could go further still.

At the same time, our data suggest something more interesting — and slightly more uncomfortable — is happening. Beneath the headline growth numbers, the model is changing in ways that raise questions about what corporate investing is really for.

Start with the obvious: corporate appetite for venture has not waned. Our annual World of Corporate Venturing survey showed that more than 3,000 corporations made at least one startup investment last year. Some 46 CVC units were launched in 2025, while several established units raised new funds. On the surface, that looks like confidence returning.

Look closer, though, and you can see several structural shifts.

More corporations are taking LP stakes in external VC funds. It is a neat solution to the problem of gaining exposure to many different frontier technologies without building in-house expertise across every domain. Often these LP investments run side-by-side with the company’s own direct investments and are highly complementary.

At the same time, companies increasingly lean into the “platform development” side of their interactions with startups. The superpower that corporations bring to venture is the ability to link startups into industries and markets. They can provide access to testing and distribution in a way that can materially accelerate the growth trajectory of startups.

It is encouraging to see corporate venture units embracing this unique ability that they bring. But all of this also raises an uncomfortable question — if the smartest way to access innovation is to outsource it, and corporations are best equipped to make a difference on the practical application side — what is the point of running an equity investment operation at all?

Indeed, we are seeing some units — like Maersk recently — shift away from equity investments to focus on venture clienting operations, where they become early customers for startups without investment. Others, such as Rehau, Holcim and Progreso X, start with venture clienting with equity investment following later.

At the other end of the scale, in the really large AI-related corporate venturing deals — Microsoft, Amazon and Nvidia taking a stake in OpenAI or Meta taking a stake in Scale AI for example — the investment comes via the corporate parent rather than the corporate venture unit. Microsoft has M12 as a venture arm, Nvidia has NVentures and Amazon has several funds. But the big transactions that are skewing all the recent charts on corporate venture activity are not coming through the dedicated venture arm but directly from the balance sheet. They include access to compute capacity and chips and they read more like private equity or M&A deals than the exploratory work of CVC.

In the rest of the CVC industry we’ve seen a persistent shift to earlier-stage deals with corporate investors backing seed and pre-seed rounds. It can be read as a sign of maturity for the sector, with corporate investors becoming more comfortable backing unproven technologies. But there is a less flattering interpretation. Many corporates have simply been priced out of late-stage rounds and are moving earlier by necessity rather than conviction.

The argument for taking equity stakes in startups has traditionally been about control and insight. These strategic benefits are notoriously difficult to quantify. While some corporate venture units, such as Citi Ventures run by Arvind Purushotham, cite a specific calculation that their portfolio has generated $200m in measurable benefits for the financial services group, others struggle to put together proof points of what they are bringing to the organisation. Storytelling and anecdotes remain the key way in which corporate investors maintain that internal buy-in.   

The truth is, we can see clearly that having corporate investors benefits startups, with lower insolvency rates and higher exit likelihoods for those with corporate backers. But we have struggled to show exactly how startup investing, on aggregate, benefits companies.

It is not that benefits don’t exist, but if they cannot be articulated, it is difficult for businesses to sustain faith in this concept.  

The models growing in popularity are ones that diverge from the classic understanding of corporate venture.  

Where we have seen a really robust interest in corporate investing is at software and technology companies — often relatively young businesses like Databricks and Workday or cryptocurrency companies such as Coinbase. It can sometimes feel like a curiosity that a company still receiving venture investment is turning around and using some of that to build its own startup portfolio. But these companies are not using CVC for the traditional eyes and ears insights. They are very deliberately using it to shape markets.

Mark Brooks wrote about CVC as a tool to “bend markets” in an opinion piece which resonated deeply with the CVC community. Pepe Pascual, former head of Cencosud’s venture unit, added to insights that corporations would often value CVC being used more aggressively and strategically to undermine competitors and create unfair market advantages. A more passive “insights” operation may not fit the bill for companies.

The other area where we have seen a sustained enthusiasm for corporate venture is Asia. Most of the big fund recapitalisations we saw last year were at Japanese companies, including Fujitsu, Mitsui Chemicals, TDK, Olympus, Hitachi and Toyota. Japanese conglomerate Mitsubishi set up one of the largest new CVC units of the year when it created MC Global Innovation, allocating $700m to the vehicle. South Korean games company Krafton formed a fund to invest in India. Chinese state-run oil and gas company Sinopec formed a $690m fund to invest in hydrogen.

The US remains a formidable force in corporate venture capital but the largest area of activity swung to Asia some time ago. One salient point about Asian CVC is that its rise comes as a result of government nudges and incentives, part of a coordinated push to embed innovation in the corporate sector.

This raises a slightly provocative thought. If corporate venture capital is expanding not just through market forces but through policy support, it begins to look less like a financial activity and more like industrial strategy by other means.

Taken together, these trends point to a model that is both more important and more ambiguous than before. Corporate venture is scaling up, professionalising and delivering more consistent outcomes. But it is also fragmenting — between direct investing and LP exposure, between partnership-only and equity stakes, between use as a industrial policy tool or a business ecosystem play.

For practitioners, the takeaway is not that the model is broken. Far from it. But the old assumptions about CVC no longer hold.

That makes the unanswered questions more pressing. Is this about leading innovation, or keeping up with it? And as corporates write ever larger cheques — whether directly or via funds — are they shaping the venture market, or quietly adapting to it?

The answers are unlikely to be comfortable. But they will define the next phase of corporate venturing.

GCV subscribers can access the full World of Corporate Venturing report here: