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What is internal and external Corporate Venturing: definition and examples

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What is internal and external Corporate Venturing: definition and examples - Corporate VenturingAt a time when the entrepreneurial ecosystem is in full evolution and in which innovation becomes an element that provides differentiation and competitiveness, Corporate Venturing was born . A new form of corporate entrepreneurship that many companies are beginning to apply to streamline innovation processes through direct connection with entrepreneurs and startups, which allows them to attract talent, technology and new business models.

The data provided by the Boston Consulting Group reveals that the ROI of companies that use Corporate Venturing in their R&D processes is 2.6% higher than the average. In Spain it is still a very new process, but in the United States more than 57% of companies have already incorporated it as one more methodology.

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Find out what Corporate Venturing is and how companies apply this new tool for innovation.

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Index of contents

What is Corporate Venturing


Corporate Venturing is a new hybrid innovation model. It combines the research actions of companies with the best of the current ecosystem of entrepreneurs and startups.

This method aims to promote an open innovation system and is in line with the current trend of Open Innovation, through which companies seek innovation and talent, both within and outside their organizations.

Objectives of Corporate Venturing


The main objectives of a Corporate Venturing strategy are:

➡️ Explore new technologies and business models with the intention of developing new strategic ideas.

➡️ Renew the corporate culture of the company, looking for a business environment closer to entrepreneurs.

➡️ Attract new talents.

➡️ Develop a more attractive brand for the company’s stakeholders (partners, suppliers, clients, society in general, etc.).

➡️ Incorporate new capabilities to reach new markets and / or products.

➡️ Reduce problem solving times through the application of agile methodologies.

Corporate Venturing tools


To promote and accelerate innovation, Corporate Venturing performs a diagnostic process and applies the most appropriate tools, both internal, Internal  Corporate Entrepreneurship, and external, External Corporate Venturing . All of this through incubators, accelerators and even investment and the purchase of startups.

Some of the tools that Corporate Venturing proposes to use to promote innovation in companies are:

➡️  Hackatons: intensive sessions of two days of work in which a business problem is exposed to a group of about 50 participants, who come together to find the best solution.

➡️  Challenges for employees:  the business challenge is made known to a group of participants through a digital platform so that they find a solution. These groups can be made up of companies, individuals, research groups, etc.

➡️  Incubation of ideas:  the company generates an idea selection process for the subsequent validation of the business model, providing mentors and physical workspaces. 

➡️  Partnership:  strategic agreements between the startup and the company to share resources and transfer knowledge. 

➡️  Venture Capital: creation of a Venture Capital Company belonging to the company and with the capacity to invest capital in exchange for equity of startups with validated business models. 

➡️  Acquisition of startups: search for startups that meet certain criteria of technology, maturity and team.


Internal Corporate Venturing (Corporate Entrepreneurship)

We speak of Internal Corporate Venturing when the tools and resources used by the company to develop its innovation arise from the organization itself, either from its R&D departments or from the creation of technological startups itself.

External Corporate Venturing (Corporate Entrepreneurship)

We refer to External Corporate Venturing when we talk about the external collaboration that companies require to have sufficient capacity to drive their innovation. For example, having the technology developed by startups, accelerators or incubators to apply it in their innovation and development processes.


Examples of Corporate Venturing

In Spain we can talk about the fact that large companies are beginning to see clearly that innovation, through maintaining the connection with the world of startups, is increasing, let’s see some examples:

  • Mercadona: with its Lanzadera accelerator it takes clear positions in this market.
  • BBVA: With its acquisition strategy in the Fintech sector, it is sending a clear message that the old world is catching up.

Internationally, there is also one of the most famous examples, that of Google, which with its Corporate Venturing, has invested in more than 350 startups in recent years.

IEBS Corporate Venturing


The IEBS business school is the first digital business school in Spain to introduce the Corporate Venturing method. It has done so to create IEBS Corporate Venturing , a  consulting and innovation service that seeks to help organizations in their innovative process through different tools related to the entrepreneurial ecosystem and startups.

Pascual Parada, director of IEBS Corporate Venturing, assures that “this year 2017 will be the strengthening of the collaboration between startups and consolidated companies”.

The application of Corporate Venturing allows IEBS to advise companies in the exploration of new technologies and business models, evolving their own corporate culture towards a new context that prioritizes  creativity, innovation, agility, risk management and recruitment of talent.  

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Through the application of Corporate Venturing, particular strategies are defined for each client (a technique called Venturing Strategy), which must be integrated with the global strategy of each company.

With this initiative, which is part of the strategic plan in the areas of innovation and entrepreneurship, the school reinforces its intention to continue betting on innovation and the development of the entrepreneurial ecosystem.

You can discover with this Webinar «How to Innovate through Corporate Venturing?

Do you think your startup can promote innovation in companies?

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Download for free the first eBook «The Corporate Venturing Guide» in Spain. And if you have a startup or are looking to innovate through the entrepreneurial ecosystem, you are interested in knowing the services that IEBS offers on   Corporate Venturing.

 

IEBS Corporate Venturing

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