Corporate venture capital is hot again. U.S. funding levels spiked in Q1 2014 to nearly $3 billion. Public tech companies are sitting on massive cash balance sheets and their venture groups are involved in some of the largest VC financings happening today (Cloudera’s $900M Series F rounds saw Intel Capital lead and Google Ventures participating).
But as more corporate VCs jump into the tech investment landscape, the reality is that not all of them are created equal. So we wanted to evaluate corporate VCs using the same algorithms (Investor Mosaic) and metrics we use to assess traditional or pure-play venture capital firms to see how they stack up.
This analysis specifically breaks down the tech corporate venture ecosystem and covers both macro and firm-level insights. The full list of corporate VCs evaluated are listed at the bottom of this brief.
Specifically, it is broken down as follows:
- Financing trends among corporate VCs
- The most active corporate venture groups
- Who’s most active at the early-stage?
- Analyzing the top CVC-backed exits – and when they got in
- Which corporate VCs have the strongest network?
Financing trends among technology corporate VCs
Q1 2014 saw tech corporate venture capital investors participate in 157 deals globally totaling $2.98 billion. With more CVCs getting active and several huge CVC-syndicated late-stage deals, funding participation in Q1 2014 by tech corporate venture investors increased 174% compared to the same quarter last year and a whopping 300% compared to Q1 2011.
The most active corporate venture groups – Intel Capital leads
In corporate venture, a handful of investors are notably more active than the rest. Topping the list of most active corporate venture arms since the start of 2011 was Intel Capital, which invested in over 230 unique companies over the period. Not far behind were Google Ventures and Qualcomm Ventures – which have both invested in over twice (4x in the case of Google Ventures) as many companies as the next most active investor, Salesforce.
The chart below shows the 20 most active corporate venture capital investors by unique company between Q1’11 and Q1’14, highlighting just how much more active the top 3 are versus others.
Who is most active at the early stage? Google Ventures
Peeling back the data, Google Ventures by far ranks as the most active early-stage CVC – investing in over 150 companies at the early-stage. 65% of Google Ventures’ early-stage investments have come at the seed-stage – putting the CVC among the most active seed investors across the entire venture capital ecosystem (corporate and pure-play).
Analyzing the top CVC-backed exits – and when they got in
There are 8 corporate venture capital arms that have registered 10+ exits since the start of 2008. Intel Capital has by far notched the highest amount of exits, with more than twice as many as second-place Google Ventures (which began operations in 2009). The visualization below highlights the 5 largest exits by valuation at the time of exit by each of the 8 CVCs over the period.
By sheer size of exit, Google Ventures stands out with five exits already at or near $1B including HomeAway, Meraki and The Climate Corporation. Interestingly, Salesforce -which did not make the ranking – has quietly built a large pre-IPO portfolio of private company investments and so looks poised to have some sizable exits. Also of note, while the largest recent exits of 12 top VCs including Greylock, Sequoia, Accel and Benchmark primarily concentrate among consumer tech, enterprise tech finds itself prominently among the largest CVC exits over the period including Fusion IO and Ruckus Wireless.
Of course, the biggest gains in venture accrue to investors who got in earliest (and who maintain ownership over time). Peeling back the list of exits among these CVCs, it’s apparent that the corporate venture firms as a whole tend to first invest in their largest exits at the mid-stage.
Which corporate venture arms have the strongest network?
In venture capital, networks are a critical driver of VC performance. The quality of a VC’s network helps them get access to better dealflow and deal information, find syndicate partners, and help their companies find follow-on investment or exit opportunities.
A VC’s network is often highlighted as part of their value-add when talking to entrepreneurs, but of course, not everyone’s network is the same. So we used CB Insights Investor Mosaic to calculate a ‘network centrality’ score to identify the 10 tech corporate venture investors (out of 61) that have the best, strongest investment networks.
Based on the data, Google Ventures ranks highest. Five other CVCs ranked in the top decile including Qualcomm Ventures, Comcast Ventures, Salesforce and Time Warner Investments.
Based on Google Ventures’ investment syndicate, Kleiner Perkins Caufield & Byers and Andreessen Horowitz appear at the top of the list. Andreessen Horowitz has syndicated the most deals with GV at the early-stage while Kleiner and GV have teamed up on financings across the maturity spectrum from Angellist to Shape Security to Secret. The table below highlights the top 10 most networked CVCs and their top 3 co-investors by total deals.
List of all tech corporate VCs in this analysis
The following corporate VCs were used in this analysis. Tech corporate VCs were defined as those who met two criteria:
- Over 80% of their investments were into tech categories, i.e., internet, mobile, software, hardware/electronics)
- Made over 5 unique tech company investments in the last 2 years
- Must be a separately identifiable corporate venture unit, i.e. corporations investing periodically in private companies but with no delineated corporate VC unit are not included. Corporate-affiliated funds with LP commitments are also not included.
- AMD Ventures
- American Express
- American Express Ventures
- AOL Ventures
- Bertelsmann Asia Investments
- Bertelsmann Digital Media Investments
- Blackberry Partners Fund
- Bloomberg Beta
- BMW i Ventures
- Citi Ventures
- Comcast Ventures
- CyberAgent Ventures
- Dell Ventures
- DG Incubation
- Docomo Capital
- GE Ventures
- Google Ventures
- GREE Ventures
- Hearst Ventures
- Intel Capital
- ITOCHU Technology Ventures
- Kaplan Ventures
- kbs+ Ventures
- KDDI (Mugen Labo & Open Innovation Fund)
- Liberty Global Ventures
- Microsoft Ventures
- Mobile Internet Capital
- Motorola Mobility Ventures
- Motorola Solutions Venture Capital
- Nissay Capital
- Nokia Growth Partners
- NTT DoCoMo Ventures
- Orange-Publicis Venture Fund
- Point B Capital
- Qualcomm Ventures
- Reaktor POLTE
- Recruit Strategic Partners
- Reed Elsevier Ventures
- Samsung Ventures
- SanDisk Ventures
- SAP Ventures
- Siemens Venture Capital
- SingTel Innov8
- SK Telecom Ventures
- Softline Venture Partners
- Steamboat Ventures
- Swisscom Ventures
- Telefonica Ventures
- Telstra Ventures
- TELUS Ventures
- Tengelmann Ventures
- Time Warner Investments
- UMC Capital
- Verizon Ventures
- Vodafone Ventures
This report was created with data from CB Insights’ emerging technology insights platform, which offers clarity into emerging tech and new business strategies through tools like:
- Earnings Transcripts Search Engine & Analytics to get an information edge on competitors’ and incumbents’ strategies
- Patent Analytics to see where innovation is happening next
- Company Mosaic Scores to evaluate startup health, based on our National Science Foundation-backed algorithm
- Business Relationships to quickly see a company’s competitors, partners, and more
- Market Sizing Tools to visualize market growth and spot the next big opportunity