Venturing to Succeed

Posted: 28 Oct 2009

See all articles by Rob van Basten Batenburg

Rob van Basten Batenburg

affiliation not provided to SSRN

Gordon C. Murray

University of Exeter Business School

Julian Birkinshaw

London Business School

Multiple version iconThere are 2 versions of this paper

Date Written: 2002

Abstract

When large firms invest in newly created smallbusinesses, they are engaging in corporate venturing.Corporate venturinghas a cyclical popularity, most recently reaching great heights during thedot-com surge of the 1990s.Following this period, declines in U.S.corporate venturing have occurred due to collapses in technology stocks,wariness of Internet-based businesses, and failures among high-profilecorporations. Research has attempted to use the venture capital (VC) model to betterexplain the success and failure of corporate venturing in the 1990s.Basedon interviews with executives in 50 venture units in eight different countries,and questionnaires from executives at an additional 50 units, success factorsof corporate venturing models have been identified. These include developingclear goals and structures to deliver them, building specialized capabilities,separating venture units, linking back to parent companies once established,obtaining high-level sponsorship, and linking corporate venturing to a broadercorporate agenda. The present research indicates a gradual decline in corporate venturing, inpart because of struggling world economies and the collapse of internet-relatedbusinesses.However, many corporations still support corporate venturing,seeing it as a means of innovation and growth.Many large firms willcontinue corporate venturing, understanding that investment in technologicalchange provides their firm with protection from the threat of disruptivetechnological change. (AKP)

Keywords: Venture capital, Survival rates, Organizational goals, Corporate ventures

Suggested Citation

Batenburg, Rob van Basten and Murray, Gordon C. and Birkinshaw, Julian, Venturing to Succeed (2002). Business Strategy Review, Vol. 13, Issue 4, p. 10-17 2002. Available at SSRN: https://ssrn.com/abstract=1495519

Rob van Basten Batenburg (Contact Author)

affiliation not provided to SSRN

No Address Available

Gordon C. Murray

University of Exeter Business School ( email )

Streatham Court
Rennes Drive
Exeter EX4 4PU
United Kingdom
+44 777 522 0857 (Phone)

HOME PAGE: http://business-school.exeter.ac.uk/staff/profile.php?id=34

Julian Birkinshaw

London Business School ( email )

Sussex Place
Regent's Park
London, London NW1 4SA
United Kingdom

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