There were glowing tributes paid at the Global Corporate Venturing and Innovation (GCVI) Summit’s to Harvard professor Clayton Christensen, who died late last month, for his seminal work on disruptive innovation in his book, The Innovator’s Dilemma.
Christensen’s work, along with University of California professor Henry Chesbrough’s theory of open innovation a few years later, laid much of the intellectual foundation for how and why corporations needed to look more closely at external startups and find better ways to work with and understand them. For the next generation of management talent, people are eagerly awaiting Inside Out, by Mach49’s chief executive, Linda Yates, published in autumn.
Before that, however, Young Sohn, chief strategy officer at Samsung, delivered a keynote at the GCVI Summit, as he became the new chairman of the GCV Leadership Society and in front of an audience of more than 800 people.
Having helped the company become market leader in multiple industries as a fast follower, Sohn now said he was having to evolve to maintain that position, while allowing it to remain agile enough to capture mega-trends and new opportunities through multiple venturing and innovation strategies.
When receiving a GCV Lifetime Achievement Award presented by Greg Heibel, partner at law firm Orrick, on the first morning of the Summit, Sue Siegel said corporations were using buy, build and partnering strategies informed and supported by their venturing units, which were “here to stay”.
Scott Sandell, managing general partner of one of the world’s oldest and largest VC firms, New Enterprise Associates, agreed, and in his interview with Dave Flanagan, vice-president and senior managing director of Intel Capital, said “bad experiences” with corporates were now a distant memory.
But more money and investors from different backgrounds bring challenges.
Scott Kupor, managing partner at VC firm Andreesen Horowitz, said in his chat with DLA Piper partner Mark Radcliffe: “The idea that capital is no longer a scarce resource is prevalent today and that was not the case up until a decade ago…. What else do we bring to entrepreneurs in addition to financial capital?”
In this new world of venture investing, being able to bring customers and help develop an entrepreneur’s products and services can be as valuable to building a scale-up that a corporation wants to buy.
The second day of the Summit began with Kaloyan Andonov from GCV Analytics sharing insights gleaned from the World of Corporate Venturing annual data review and survey covering how the blurring of public and private capital markets is creating the investment trends for the new decade.
But this month will bring more immediate challenges. The US government’s effort to change the regulatory landscape for VC came to a head on the 13.
The US Treasury Department last month issued its final rules implementing the Foreign Investment Risk Review Modernization Act and they went into effect on February 13 to give the Committee on Foreign Investment in the United States (CFIUS) greater powers.
Jeff Farrah at the US trade group National Venture Capital Association said: “CFIUS’s power was demonstrated in recent high-profile cases that forced Chinese investors to divest of holdings in Grindr, PatientsLikeMe and Musical.ly. The combination of CFIUS interest in data rich companies and [its] expanded authority over non-controlling investments means the [committee] will be a player in the startup ecosystem.”
But as the US tightens its inward investment rules, its largest companies are expanding their venturing units internationally with Microsoft – the second largest by market capitalisation – setting up a new UK office in London under Matthew Goldstein, a GCV 2018 Rising Star. For this year’s winners check out globalcorporateventuring.com and see the party pictures inside.
The top 100 Global Corporate Venturing Rising Stars and Emerging Leaders celebrated their awards at a gala ceremony at the Monterey Aquarium the night before the Summit started.
The winners were selected from almost 20,000 industry professionals tracked by GCV and nominated by heads of units and their peers.
Ashu Sharma was ranked first in the GCV Rising Stars category, awarded to those with less than five years in the corporate venturing industry, reflecting his work on India’s breakthrough venture exit when Walmart acquired Flipkart for $16bn. In picking up his award, Sharma thanked the entrepreneurs.
Kim Armor came first in the GCV Emerging Leaders category, which goes to those with more than five years under their belt in the corporate VC space. She praised her colleagues as well as GCV data and analytics for helping the unit’s success.
And that sums up much of the industry – high emotional quotient to reflect that individual success is built, as Sir Isaac Newton noted centuries ago, by standing on the shoulders of giants and requiring team work to build much that is worthwhile.
