Corporate Venture Capital: From Venturing to Partnering

Joseph A. McCahery, Erik P.M. Vermeulen and Andrew M. Banks

in The Oxford Handbook of Venture Capital

Published in print April 2012 | ISBN: 9780195391596
Published online September 2012 | | DOI:

Series: Oxford Handbooks

 Corporate Venture Capital: From Venturing to Partnering

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This article analyzes the importance of the rise of corporate venture capital and considers the role of government venture capital. It also studies the emergence of international industry clusters relative to regional clusters. Corporate venturing is on the resurgence as large corporations increasingly look to young entrepreneurial businesses for innovation. Corporations should pursue a strategic alliance approach when making corporate venturing decisions. For instance, allying directly with start-up companies or, indirectly, with traditional venture capitalists could lead to a win-win situation, provided that the incentives of the parties are aligned. Governments should co-invest in venture capital funds with one or more corporate investors. By doing so, governments pursue two main goals: co-investment signals the trustworthiness of venture capital initiatives and promotes the emergence of a sector-specific venture capital market.

Keywords: corporate venture capital; strategic alliance; corporate venturing; government investments

Article.  13949 words. 

Subjects: Economics ; Financial Markets

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