Girish Nadkarni instigated the refounding of Switzerland-based industrial company ABB’s corporate venturing unit slightly more than four years ago.
Nadkarni, managing director of ABB Technology Ventures, said “We were sitting on a lot of cash and due to the financial crisis the venture capital community was sitting on its hands not doing a lot of investing. Like most large companies, we too suffered from the not-invented-here problem and setting this up would address a whole bunch of issues. We now have a tremendous amount of acceptance internally. Leading start-ups as well as major venture capital firms invite us to lead or co-lead.”
He added: “My job is to make ABB more paranoid, like Andy Grove’s book titled Only the Paranoid Survive. Big companies like ABB, Siemens and Schneider have to be paranoid. Historically our competitors were the likes of Alstom, Schneider and Honeywell. Our future competition is not just coming from traditional competition but certain companies like Cisco, Google, Microsoft, Oracle and Procter & Gamble, not to mention thousands of start-ups all over the globe.”
Before setting up ABB Technology Ventures, Nadkarni was senior vice-president of ABB’s robotics division. He also worked at venture capital firm View Group, and as an entrepreneur at start-ups vSimplify and Uniprise. Among other roles, he has worked at industrial conglomerate GE, financial group Prudential and law firm Shearman & Sterling. He has an MBA from Harvard Business School and studied law as well as economics and statistics at University of Mumbai.
Nadkarni added: “One trend worth discussing is that many companies with technologies which have industrial applications are preferring to first tap the consumer market, often selling their technology as games and toys or to gaming companies. We see a lot of this in robotics and its related technologies in particular.”
What is the future of your sectors?
Nadkarni said: “Given ABB’s vast interests, we pursue many sectors. For renewables, that sector is clearly hurting as development has taken longer and much more capital than expected. While financial venture capital firms cannot be expected to do the development on their own, corporates like us either have realised that it is too difficult for us without substantial government help, or have stayed on the sidelines. The lack of support for the marine industry from major UK companies is a case in point. As a consequence, we are seeing more start-ups focusing on increasing efficiency of wind and solar farms, rather than developing new technologies. In other industrial sectors, we find that market risk is a bigger problem than technology risk.”