Corporate Venture and Strategic Capital

Corporate venture capital is minority investment in external start-ups by operating companies, made from the balance sheet or through a dedicated unit. It differs from independent venture in one fundamental way: the investor has a second objective. Beyond financial return, a corporation may want a window on technology, a supplier, a distribution partner, demand for its own products, an option to acquire, or protection against disruption. That second objective is corporate venture's strength and its main source of trouble.