Consolidation requirements for corporate venture investors, regarding accounting treatment of ownership of SMEs in which they make early stage equity investments, should be reviewed, according to policy recommendations set out in “The Missing Piece”, a 62-page report on “How Corporate Venture Capital can transform UK finance and funding”, published by the British Private Equity & Venture Capital Association (BVCA).
The report also suggests that the early stage investment incentives deployed by the UK Government – the Enterprise Investment Scheme (EIS) and the Seed Enterprise Investment Scheme (SEIS) – should be tweaked in order to enable CVC investment.
Given the right policy mix, the BVCA believes that the “the UK could become an international powerhouse of CVC”. The report states: “The UK is already home to many aspects of finance and business. The UK also welcomes corporate investment in the form of the creation of developmental facilities. CVC is the missing piece of this corporate investment puzzle.”
The report provides a briefing on the nature of CVC (“a catch-all phrase used to describe a wide variety of forms of equity investment exercised by corporations”), sets out the role of CVC in the UK economy (“there is vast potential for greater corporate activity”) and includes profiles of Intel Capital, Qualcomm Ventures, Reed Elsevier Ventures, ARM, Unilever Ventures, BP Ventures, Castrol innoVentures, Cisco and Robert Bosch Venture Capital.