As traditional venture capital stumbles, corporate investors are filling the gap—reshaping startup finance and redrawing the boundaries between industry and innovation.
Corporate investment in startups surged in 2025, defying a sluggish funding environment and underscoring how determined large companies have become to keep pace with rapid technological change. From artificial intelligence to advanced energy systems, corporate venture capital (CVC) has emerged as one of the most resilient — and influential — forces in the startup ecosystem.
More than 3,068 corporations invested in startups last year, a 29% increase on the year before, surpassing the high-water mark reached during the pandemic-era boom. The scale of their involvement was particularly evident at the top end of the market. Nearly all of the largest funding rounds of 2025 were backed by corporate investors, and almost all were in artificial intelligence.
By contrast, traditional venture capital remains well below its 2021 peak in volume and value.
A $40bn funding round for OpenAI in March, led by Microsoft and SoftBank, was the year’s standout. Meta followed with a $14.3bn investment in Scale AI and a $10bn round for Databricks. Corporate capital has become not merely additive but often decisive.
US technology firms have been especially active. Nvidia, now the world’s most valuable company with a market capitalisation exceeding $5tn, participated in some 83 startup funding rounds during the year, with a cumulative value of $26.3bn. The chipmaker’s investments ranged from AI software firms such as Cursor, Poolside and Cohere, which use Nvidia’s products, to energy companies including Commonwealth Fusion Systems and TerraPower, whose technologies could one day power the data centres that Nvidia’s chips depend on.
This breadth of activity illustrates the logic behind corporate venture investing. Unlike traditional venture capitalists, corporate backers are not simply chasing financial returns; they are cultivating ecosystems. Investments help secure supply chains, shape technical standards and provide early access to technologies that could determine future competitiveness.
Most corporate investors, of course, operate on a far smaller scale than Nvidia. The typical corporate venture fund manages less than $100m. Yet the strategic rationale is broadly similar across sectors and geographies
The rise of corporate capital is also reshaping the broader venture landscape. The number of corporate-backed deals has climbed steadily since 2023, reaching 5,038 in 2025. The total value of those deals rose to $229bn, up 75% year on year.
Corporate venture capital has taken a larger role in the startup funding ecosystem. Roughly one in every five startup funding rounds includes a corporate investor, and more than half of all the dollars invested in startups come from funding rounds with a corporate backer.
One reason is simple arithmetic. Large corporations are flush with cash. The US’s biggest technology firms alone sit on hundreds of billions of dollars in reserves, while large energy and industrial companies such as Saudi Aramco and Toyota also command formidable balance sheets. Globally, corporate cash holdings are estimated at more than $8tn — roughly the combined GDP of India and Japan.
There is an argument that corporations could be doing more to direct these reserves towards startup investments. It is still rare for a corporate investment arm to have more than $1bn under management, while some of the world’s largest VC funds, such as Tiger Global Management, Sequoia and Andreessen Horowitz, all manage more than $50bn.
Japan offers a glimpse of what happens when that cash is mobilised. Following government efforts to encourage corporate investment, the number of Japanese companies backing startups has more than doubled since 2018, while the number of startups has risen to 25,000 from 10,000. More than half of all funding rounds there include a corporate investor.
Yet corporate venture capital is not without its weaknesses. Investment arms remain vulnerable to shifts in corporate strategy; a change in chief executive can abruptly end a carefully built programme. Many units also struggle with the mismatch between corporate planning cycles and the seven-to-10-year horizon of venture investing. As a result, a large share of corporate venture teams remain relatively young.
Still, the evidence suggests that persistence pays off. Startups backed by corporate investors are, on average, more likely to survive and to achieve stronger exits than their peers.
Corporations, for their part, gain early access to innovation, new markets and potential acquisition targets. Around a third of companies end up acquiring one of the startups they have invested in.
Even more common is doing business with startups in the investment portfolio. Of the 43% of companies polled in this year’s GCV Keystone Benchmarking survey, more than half of the portfolio startups go on to have some kind of business relationship with a corporate unit. Anecdotally, we know of several companies with an “attach rate” of more than 80%. These partnerships can generate substantial commercial returns in cost savings and new business.
The most sophisticated corporate venture units do more than just write cheques. They amplify portfolio value through dedicated business development or “platform” teams focused on insights, partnerships, integration and internal advocacy. According to our GCV Keystone Benchmarking survey, more than a third have formal structures to connect startups with business units in the parent company.
Corporate venture capital, once seen as a fashionable sideline, is becoming a core strategic tool. In a world where technological advantage erodes quickly, investing early — and often — may be the only way for large firms to stay ahead.
For executives weighing whether — and how — to build or refine a corporate venture arm, the full GCV Keystone Benchmarking report offers something far more valuable than anecdotes or trend spotting. It provides a data-driven view of what actually works: how the most effective CVCs are structured, where they sit inside the organisation, how investment teams are incentivised and what ‘good’ performance looks like in terms of TVPI, IRR and strategic return. Drawing on detailed disclosures from hundreds of corporate investors worldwide, the report allows leaders to benchmark themselves against peers, identify blind spots and make informed decisions about how to design or evolve a venture programme that delivers both financial returns and long-term strategic advantage.
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