Powerlist 2014: Claudia Fan Munce, IBM Venture Capital

Long a key influencer in the world of corporate venturing, Claudia Fan Munce, managing director at US-listed technology company IBM’s Venture Capital Group, has been one of the leaders driving the growth of corporate venturing.

Fan Munce said in a speech at our Symposium that the Watson fund designed to expand its new business unit was tasked with rallying the venture capital (VC) ecosystem to stimulate start ups to develop on the platform. She said: “[IBM management] asked the IBM Venture Group, me and my partners, to go out and talk to the best of the best VCs that invest in the enterprise IT space and ask them: ‘We have this platform, what do you think we should do in order to bring your best portfolio company to consider this as a potential platform, either to build a new application for a new marketplace or enhance your existing functions, to expand the marketplace?’

“The feedback that came back was, obviously, they want to bring these vertical applications and the horizontal of that scale, the enabling of the current partner to give them a sandbox, so they can start experimenting with the capabilities. The venture industry has always looked at the corporate as a potential channel to market, rather than as an anchor client, a pilot, or a partner, so we also had a lot of feedback, in terms of leveraging the brand, leveraging the marketing engine.”

Fan Munce, one of the founder members of IBM Venture Capital and managing director since 2004, said she had initially resisted being moved to the group. Prior to her role with the venturing group, Fan Munce was head of technology transfer and licensing for IBM Research after joining the unit in1985, and she refers to herself with pride as “a 28-year IBMer”. Fan Munce holds a master’s degree in electrical engineering and computer.

She recalled in an interview for last year’s Powerlist: “It was not an easy decision to move. I fought it. I said to them any thing you want we can build here.”

However, she now says it became clear a decision to interact with start-ups through venture capital showed “tremendous foresight” on the part of IBM.

Now the group has gained plaudits and expanded through the creation of SmartCamps to connect more directly with entrepreneurs and the wider venture ecosystem.

Fan Munce said: “IBM’s model really has not changed at all. We are not looking to get a financial return through equity, but we are looking for top-line revenue growth through innovative partnerships with startups.

Slowly things have evolved. Now the idea of corporate venture arms has really come into its own. Many groups, including Harvard Business School, have said how innovative the IBM model was. Now it has become a standard strategy for corporations.”

In fact some of the hottest venture capitalists turn to the company for help, in areas such as geographic reach, which even the most successful financial investors cannot rival corporations for science from Santa Clara University and an MBA from Stanford University.

Fan Munce was on the board of the Latin America Venture Capital Association for many years and is the first chairman of Global Corporate Venturing’s editorial advisory board.

Fan Munce also recalled in last year’s interview she started her career at IBM instead of computer rival Hewlett-Packard partly because IBM’s internship programme paid less than a dollar more. She joked: “For a poor studenta dollar per hour was a big difference.”