Walgreens.
7-Eleven.
Patagonia.
MassMutual.
What do these companies have in common? They've all recently formed venture capital fund/firms. Corporate venture capital accounted for almost $5 billion in the first half of 2014, a jump of 45% from last year and the highest level since the dot-com era, according to the recent article "Firms Boost Their Spending on Startups" on WSJ.com.
In the recent article "What's Really Driving the Boom in Corporate VC Firms" On Inc.com, the reasons for this phenomenon are primarily strategic - supplementing corporate innovation, and to "acquire talent and innovative products and service more cheaply than their own research and development."
My concern is that a $10 billion investment rate for corporate venture capital is going to contribute to greater competition for deals, higher valuations and too much capital in the venture capital ecosystem. To me this is just additional evidence that the venture capital market may be at the beginning of a bubble.
WSJ.com article: http://online.wsj.com/articles/firms-boost-their-spending-on-startups-1407194891
Inc.com article: http://www.inc.com/jeremy-quittner/corporate-venture-capital-drives-innovation-for-big-companies.html
7-Eleven.
Patagonia.
MassMutual.
What do these companies have in common? They've all recently formed venture capital fund/firms. Corporate venture capital accounted for almost $5 billion in the first half of 2014, a jump of 45% from last year and the highest level since the dot-com era, according to the recent article "Firms Boost Their Spending on Startups" on WSJ.com.
In the recent article "What's Really Driving the Boom in Corporate VC Firms" On Inc.com, the reasons for this phenomenon are primarily strategic - supplementing corporate innovation, and to "acquire talent and innovative products and service more cheaply than their own research and development."
My concern is that a $10 billion investment rate for corporate venture capital is going to contribute to greater competition for deals, higher valuations and too much capital in the venture capital ecosystem. To me this is just additional evidence that the venture capital market may be at the beginning of a bubble.
WSJ.com article: http://online.wsj.com/articles/firms-boost-their-spending-on-startups-1407194891
Inc.com article: http://www.inc.com/jeremy-quittner/corporate-venture-capital-drives-innovation-for-big-companies.html
