By Ezra Carlson, who is an innovation and corporate venturing consultant and recently completed his doctorate at the Cranfield School of Management. This article partly draws on his research at Cranfield.
Collaborating with VCs and other companies can be a way of taking the risk out of early-stage investments in breakthrough tech.
Corporate venturing is a tool that has become increasingly popular with companies as a lower-cost way to tap into innovation outside the organisation.
There is some debate about whether corporate venturing should be focused on strategic or financial goals, but a fair amount of evidence – such as the work of Dushnitsky and Lennox – indicated that a strategic approach gives companies the most value. The new knowledge and capabilities companies gain from working with innovative startups more than counterbalances the negatives (incompatible goals, misaligned incentives, conflict).
However, while many executives know that strategic venturing is central to their firms’ long-term success they still struggle to put this into action, especially when it comes to making early-stage investments in novel technologies based on new scientific discoveries.
These are some of…
