Analysis of Corporate Venture Capital from an Investor Perspective

52 Pages Posted: 29 May 2019

See all articles by Nadine Ladnar

Nadine Ladnar

FOM University of Applied Sciences - ESSEN

Alexander Zureck

FOM University of Applied Sciences - ESSEN; Masaryk University - Department of Economics

Date Written: April 25, 2019

Abstract

Corporate venture capital (CVC) is on the rise. About 300 investments carried out by Google show the current relevance of CVC. Existing literature is focused on specific topics influencing the success of CVC and on the objectives pursued with CVC. In this paper, these factors are concluded. It is described what should be the main drivers to invest CVC. Moreover, this paper provides an answer to the question what is the best way to invest CVC, especially when it comes to structuring. It can be derived from a literature-based method that CVC is of particular importance for companies with a high need for innovation in a competitive environment. A second finding is that founding a CVC unit investing indirectly in venture capital (VC) funds first and after a certain amount of time, investing directly leads companies to success. While investing, corporate investors can use incentives in order to avoid principal-agent issues.

Keywords: Corporate Venture Capital; Chemical Industry

JEL Classification: G24

Suggested Citation

Ladnar, Nadine and Zureck, Alexander, Analysis of Corporate Venture Capital from an Investor Perspective (April 25, 2019). Available at SSRN: https://ssrn.com/abstract=3378213 or http://dx.doi.org/10.2139/ssrn.3378213

Nadine Ladnar (Contact Author)

FOM University of Applied Sciences - ESSEN ( email )

Leimkugelstarsse 6
Essen, 45141
Germany
+491605956716 (Phone)

Alexander Zureck

FOM University of Applied Sciences - ESSEN ( email )

Leimkugelstarsse 6
Essen, 45141
Germany

Masaryk University - Department of Economics ( email )

Lipova 41a
Brno, 60200
Czech Republic

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