Gaule: Give a brief description of the purpose of your venture, when it was formed and how the process occurs in your organisation.
Williamson: Castrol InnoVentures is a strategic venture arm set up to explore business opportunities beyond lubricants. We deploy a number of different approaches, including traditional corporate venture investment in early to growth-stage technology companies but also build businesses through acquisition, incubation and through partnering and collaboration. We were formed in July 2011 and report to a governance structure headed by the Castrol chief executive.
Gaule: What are the focus areas you are looking to develop using venturing in Castrol?
Williamson: We focus our activity on four key areas. The first is next generation engineering, looking at new and emerging internal combustion engine technologies primarily focused around performance and efficiency. Second is intelligent operations, focusing on our industrial and marine customer base and looking for technologies and business models to enable them to improve their operations and efficiencies – remote monitoring and analytics is a major theme there. Third, we invest in new technologies which promote greater sustainability in the waste cycle of our products in auto and industrial, and also in hybridisation. Last, a major focus is on smart mobility – in particular ways we can uncover to make the car ownership experience much less hassle and more enjoyable. In so doing we are exploring and investing in new digital business models.
Gaule: Outline the strategic and financial benefit you bring to your investments.
Williamson: Strategically we bring access to very strong relationships with OEMs [original equipment manufacturers] and a distribution network in the automotive after-market that is unparallelled. The same goes for the industrial maintenance and marine sectors. The Castrol brand is the premier global lubricant brand and our reach extends into all BRIC [Brazil, Russia, India, China] and high-growth markets and well beyond. Financially, clearly we offer funding and potentially access to further benefits of the balance sheet over time.
Gaule: Give us a brief overview of the people in the team.
Williamson: We have a diverse range of high-calibre individuals on the team and have a good combination of people from within the Castrol business who know their way around and can leverage the scale and capability within, and external recruits who bring a fresh set of skills and capabilities not held within the core business. An example would be the recruitment of Jonathan Tudor, our venture director, who brings great expertise in venture investment from his previous experience in corporates, portfolio companies and funds in the past.
Gaule: How are you working with partners to source new ideas and investment opportunities?
Williamson: Our strategic focus means we can proactively scan for companies in the spaces in which we have interest – and we routinely work with other corporate venturers and also the venture capital funds to source deals. One source of dealflow is our fund investment in Pangaea, which has been successful in giving transparency to a wide range of technologies in which we can then co-invest as we see fit.
Gaule: How are you seeing the corporate venturing and venture capital environment changing?
Williamson: Simply more corporate venturers and more funds chasing fewer strong propositions. As we move east it will be interesting to see how the markets develop further.
Gaule: What has been your most interesting recent deal?
Williamson: We invested in Pangaea earlier this year – a materials technology fund which gives us real transparency on some really exciting new ideas.