Most of the corporate investors taking minority stakes in the second quarter of 2021 were investors that have done at least one deal before (74%). It is, thus, noteworthy that one out of every four (26%) corporates was disclosing their first minority stake deal in the past quarter. And the proportion of these “first-timers” appears to have stayed around 20% through most quarters since the beginning of 2018, as the GCV Analytics chart below illustrates. In previous years, like in 2017, the proportion of first-time corporate investors was consistently lower than 20%.
There is, however, one caveat which must be borne in mind. It is hard to estimate how many are actual newcomers to the corporate venturing game, as some of them may have done other occasional minority stake deals in emerging enterprises but not announced them publicly.
What are the implications of all this? Corporate venturing – understood in its broadest sense as minority stake investing in emerging companies – appears to have become a key innovation tool to be employed by ever more corporations around the globe, rather than by just a few global corporate leaders. While some of these newcomers may be merely occasional investors in startups or, conversely, more frequent than the data suggest, it is very unlikely that the pattern we observe so consistently be just accidental, in a time when valuations have reached peaks unseen since the dot-com bubble and despite the shock of the covid-19 pandemic.
