New York-listed industrial conglomerate General Electric (GE) still limps on, but after $500bn in value destruction over little more than 20 years the “downfall of America’s industrial giant is a cautionary tale for all big firms,” according to this week’s Economist.
The rump is a little smaller again after GE agreed to sell its investments in 11 startups to 40 North Ventures, a venture affiliate of Standard Industries. It also reunites the portfolio companies, Aras, Carbon, Catalant, Desktop Metal, Enbala, Menlo Micro, Nexar, Proterra, Tamr, Upskill and Volta, with Marianne Wu (pictured), former president of GE Ventures.
GE in November had agreed to sell 16 health care investments to an affiliate of Leerink Revelation Partners at the time Wu left. She then joined 40 North as co-managing director with Marc van den Berg.
Van den Berg said: “We are on the cusp of a modern industrial revolution, and venture capital is uniquely positioned to help catalyze that change.
“The addition of these 11 remarkable companies supports 40 North Ventures’ mission to bring disruptive change to established industries and to empower innovators eager to reimagine these sectors.”
Wu added: “I am looking forward to reuniting with these transformative companies, given the time I spent working with them at GE Ventures.”
She did not add comment to two Wall Street Journal reporters, Thomas Gryta and Ted Mann, on their book, Lights Out, that seeks to find out how “success theatre” blinded them to achieving their strategic vision. The challenges GE and other traditional conglomerates have faced is in contrast to the private equity model they have tried to copy in part.
Blackstone, KKR, Carlyle, TPG and Apollo and other alternative asset managers sailed through the global financial crisis and have dry powder to invest more through the latest one.
Which structure Standard Industries is trying to emulate – GE or Blackstone – might foretell part of its future.
