Venture Client as a discipline

Venture Client as a discipline

Kyle Basler-Reeder, who leads Global Open Innovation at ExxonMobil, over time has developed a sort of flowchart to address anybody who comes into his office and asks to become more external.

Here are the questions that help you frame how to proceed:
- How much time do you have?
- How much budget do you have
- What about IP?
- What about TRL?

And here are the questions to assess the impact:
- Do you have an implementation plan?
- If the pilot works, what is the projected value at scale?
- What are the chances of success?

Top tips:
- Shoot on goals. Knock at doors as much as you can
- Bring Business Units in the room from Day 1
- Involve first units with higher organisational readiness
- Build guidelines/templates to fast track legal/procurement/IT
- First do internal landscaping: half of the time the solution is already inside your organisation
- Leading Open Innovation means leading cultural change

Why Public Sector might be an incredible Shaper of Market

Why Public Sector might be an incredible Shaper of Market


Procurement is often perceived as highly boring and bureaucratic. But it is a massive opportunity. Public sector spending, in the UK only, is about 400 billion pounds a year. In Europe we are talking about trillions of euros.

Nowadays the public sector is facing more challenges than ever before (after Covid, climate emergence, child and social care, security, …) and it has to do it with tight finances. Public organizations have to deliver better, cheaper, and quicker outcomes.

How does the public sector spend money? In the UK 21% of tenders have a single bidder. Why? It is really hard to engage with the public sector, particularly if we refer to innovation.

Rather than prescribing, public organizations should be much more open to the market with the problems they want to solve. They should lower the barriers to entry, bring innovation in and work with diverse suppliers (startups, scaleups, academic span-outs, corporate open innovation depts, …).

Public Procurement is not about being first, being an inventor, rather be an intelligent client. If you try to do something from scratch, it always costs more. On the contrary, you can derisk by bringing innovation from outside.It Given the budget they have, the Public Sector can really help shaping the innovation ecosystems.

That’s the reason why the Innovation Procurement Empowerment Centre (IPEC) – a Connected Places Catapult project - introduced a Special Award as part of Startup Ecosystem Stars Awards 2024 aimed to recognize and celebrate the most innovative initiatives within the public sector.

This and more in this Mind the Chat with Rikesh Shah - Head of IPE and former Head of Open Innovation at Transport for London (TFL).

How to succeed in Open Innovation? Follow the 5 Rs Model

How to succeed in Open Innovation? Follow the 5 Rs Model

During the CIOs Roundtable of the Scaleup Summit we organized this month in Madrid together with IE University, we sat with Diego Díaz Pilas (Global Head of Ventures & Technology, Iberdrola), Sandra Blázquez (Head of Open Innovation, Repsol), Giorgio Veronesi (Executive Director ICT – Innovation & Digital Technologies, SNAM)
Irene Gomez (CEO Wayra & Open Innovation Director, Telefónica), Telmo Pérez Luaces (Chief Innovation & New Business, ACCIONA) and Rafael Fernández (Innovation Director, Ferrovial) to discuss the pain points in running Open Innovation inside large corporations over the years.

Together with Professor Ricardo Perez we extracted the 5 Rules an Open Innovation Manager needs to follow to navigate the change both of internal (read reorg) and external conditions (recession):

- Relevance (internal and external): you need to communicate the value you provide, both outside and inside the company

- Rejection: you need to navigate through rejections and find alternative ways to get things done

- Resilience: you need to survive reorgs, adverse market conditions, ...

- Returns: you need to show results. Start with quick wins.

- Repeatability: you need to produce results at scale

Ricardo Perez and Alberto Onetti went through the 5 Rs Framework during this Mind the Chat. Enjoy.

What’s the difference between CVCs and VCs?

What’s the difference between CVCs and VCs?


“We do the same job as VCs and at the end we have the same ultimate goal: helping invested startups to succeed. But we pursue different intermediate objectives.”

“It is impossible for CVCs to be the best financial performers. Our ambition should be to be the best strategic fund. That means to gather strategic market intelligence and get partnerships able to have an impact (i.e. business contribution)”.

This is the vision of Johann Boukhors, Managing Director at ENGIE Ventures, the CVC arm of the French multinational utility company launched back in 2014. They evolved their strategy down the way.

“We no longer invest in third party funds. We did in the past to build up the network. It is the right way to enter into new geographies (such as China and India). But currently we invest only directly. We prefer cherry picking”.
Engie Ventures' sweet spot remains Series A, with initial tickets from 1 to 5 millions. Why?

“We do not invest too early (we invest only when the future of the company is already set) nor too late (the strategy has not yet been fully defined).”

Because at the end “CVCs are like chefs. They work on something that is not ready yet”.

Inside the CampX model

CampX was launched back in 2020. Labelled as Accelerator, it is actually a Venture Client platform, or, as Niklasson Helene, VP Innovation Ecosystems & Partnership and Head of CampX calls it, a “testing tool” or “validation machine” for onboarding solutions from startups. Selected startups in very focused areas enter into a POV (Proof of Value). If it is successful, solutions are integrated in technology platforms or services and scaled internally. Since the launch, 80 projects have been validated and about 10-15% of them are currently in the integration phase. The internal target is to run about 50 ongoing projects across the 4 locations (Gothenburg, Lyon, Greensboro, and Bangalore) where Volvo Group has its R&D sites (CampX is under the CTO office).
In 2022 a Venture Builder was added, and in 2023 an Incubator. Both are deployed only at the Gothenburg R&D facility, but if they prove successful, the CampX team is hoping to roll it out to other sites.

The Venture Builder, led by Karin Falck, is the landing point for internal ideas and IP that are vetted through subsequent iterations. Thus far 4 projects have been developed, 2 deployed internally and 2 span- out.
The Incubator programme - led by Robert Jan van Vug - gives some 30 startups access to the company’s testing labs, workshops and prototyping space for two years. It’s focused on seed/early stage startups that would otherwise be years away from being mature enough for a joint project with Volvo Group.

Championing Entrepreneurship for Positive Impact

Championing Entrepreneurship for Positive Impact


Celebrating his recent award as the Corporate Startup Star 2023, the interview with Anthony Virapin, Worldwide Leader, Entrepreneurship for Positive Impact at Microsoft, summarizes the main pillars of what Microsoft is uniquely doing in the promotion of entrepreneurship and startup collaboration. We cover first some of the highlights of Microsoft - Open AI partnership.
We then delve deeper in the Entrepreneurship for Positive Impact program Anthony and his team have been running: metrics, some success stories and its future development.

How to spun out a 200 million business

How to spun out a 200 million business

As the CEO of the System Business Group at BOE, the world’s largest display manufacturer, George Yao led a team in the research and development of the iGallery: a groundbreaking product composed of a digital art display terminal and a content platform.
To facilitate the advancement of this business, a subsidiary under the BOE Group - initially named BOE Art Cloud - was established.
After three years of exploration, it became evident that this innovative business required substantial divergence from BOE’s existing operations in terms of technology, product development, business models, and company operations. Furthermore, they recognized the necessity of integrating additional resources from external partners.
To foster the continued growth of this venture and give its team greater independence and freedom to pursue innovation, and following in-depth discussions with Mr. Chen Yanshun, Chairman of BOE, at the end of 2019 the company was spun out (and rebranded as BOE EWIN).
In 2020, BOE EWIN successfully attracted strategic investments from multiple external investors, resulting in BOE relinquishing its controlling stake in the company.
Since then, BOE EWIN has experienced rapid growth in the creative and health display sectors by combining culture and technology. Eye-friendly displays are a must considering that almost 50% of Chinese students suffer of myopia.
Digital museums and culture shows are a huge area of development (metaverse like applications).
For BOE group the ultimate goal is to support ecosystem companies able to develop applications for displays.
This and more in this Mind the Chat with George Yao, Founder and CEO of BOE EWIN.

Innovation is a cosmetic word for making change happen

Innovation is a cosmetic word for making change happen


Sometimes we use the term "innovation" too loosely. We label things as "innovation pipeline" when it's just a development pipeline.

Benji Coetzee, Chief Strategy & Development Officer at KPN, knows this all too well. She oversees KPN's innovation activities, including CVC (KPN Ventures) and Venture Client (Liaison Management), and understands that innovation teams are not decision-makers but rather the impartial voice of reason. They provide the tools for change but are not accountable for it. However, if they can't convince executives to believe in the narrative, nothing will happen. It's all or nothing. And while it's almost impossible to measure the absolute impact of innovation (“There are so many dividends you can extract over time and are very difficult to measure: Product, Business, Time, Churn, Margins, Culture, Brand Value, ... "), KPIs are still important, even the "stupid" ones. So let's not call it "innovation," let's call it "change projects”.

"Are you in or out? That's the ultimate question. You can't be half pregnant".

How to merge CVC and Venture Client: 5 Golden Rules

Launched in 2017, Cemex Ventures, the corporate venture capital and open innovation arm of Cemex, the Mexican multinational building materials giant. Below the 5 highlights of the Mind the Chat with Gonzalo Galindo, Head of Cemex Ventures.

1. “What is the value of CVC? Our investment in Synhelion is a good case. They were using solar heat for producing synthetic fuel. We saw other aspects of their technology that might be relevant for us. Specifically the opportunity to use it for producing cement. Working with them we figured out other aspects of the cement production process. Not just us at Cemex Ventures. We involved a lot of people inside Cemex and helped them open their eyes. And now we do things differently. Until you don’t see different ways of doing things, you continue to do things as you always have done. And doing so you will never change.”

2. “We invest off-balance sheet. It doesn't make any sense to encapsulate our open innovation activities within a certain capital allocation. We decided to go case by case also because we address different issues and dynamics that have different capital needs.”

3. “We very rarely give a check for the sake of investing in the company. With the check we hand a collaboration agreement. We invest more than the 10-15M we deploy every year. We add R&D and engineering capabilities and work alongside the portfolio companies for 3 to 7 years.”

4. “Innovation in itself is irrelevant, if its purpose is not clear. It took years to understand and define what type of innovation arm we are”

5. “Innovation is not cheap. You need to partner, partner, partner.”

Forget 2024. What to expect in 2025

Forget 2024. What to expect in 2025

It’s quite late to predict the new Technology Trends for 2024. Therefore we asked Nikhil Malhotra, Global Head, Makers Lab at Tech Mahindra what to expect in 2025. Below some of his bets:

- GenAI hype: it will go down
- AI Sustainability: AI in its current avatar is not sustainable.
- Quantum Production Use Cases: specifically in Cybersecurity, Cryptography and Optimization
- Bio Medecine: it is up for a big change, triggered by customization of Human Genome sequencing and nanorobotics
- Metaverse industrial applications: the decline was only on the consumer side

And a wish:

- Let's stop making Technology and Innovation “anti-nature”. “For a long period of time in the human race we tried everything against nature. Maybe there is time in the next 2-3 years that we start to take the essence of technology and move with nature.”

Plus the Indian answer to ChapGPT.

- Nikhil tells us about the story of Project Indus, i.e. how India built its own large language model (LLM) from the ground up (accepting a challenge launched by Sam Altman during his last trip to India).

Volkswagen: a CVC without the C

Volkswagen: a CVC without the C

Last October Volkswagen AG launched its first venture capital fund, to initially invest 300 million euros with a focus on decarbonization. Other funds might follow.

The fund is structured as a conventional VC and is totally independent. Volkswagen is currently the only LP (beyond the GPs) but the plan is to open it to external investors.

The decision to launch a VC more than a CVC aimed at reducing the organisational “inertia” and getting access to the most interesting startups. It has been a long journey (over 2 years) to convince the board, get the approval by the Antitrust, and internal governance (particularly rules for consolidation of results).

They target late stage companies (the sweet spot is series C). Why? We are not so experienced to work with early stage/high risk startups and prefer to work with companies with meaningful business size.

“We are still taking advantage of the C”. Volkswagen Group Innovation plays as an interface between the funds and the business units. The goal is to provide the fund with technical expertise, gather the needs from business and support the onboarding of the portfolio companies (the KPI is 20-30% of the portfolio).

This and more (including the outcomes of the first year of Venture Client activities) in the Mind the Chat with Nikolai Ardey, Executive Director Volkswagen Group Innovation.

Venture Client applied to local clusters: the experience of Castilla y León

Venture Client applied to local clusters: the experience of Castilla y León

We have been collaborating with Naturgy as part of the project Mind the Bridge runs in the Castilla y León region to support the global extension of the local innovation ecosystem. Specifically we support the best startups to find strategic and business opportunities with global corporations and the local established companies to find mature solutions to their innovation needs. One of the first outcomes is the collaboration between Naturgy with Silicon Valley startup OpenSpace re: the remote supervision of construction sites.

We sat with Alejandro Sánchez Alarcón (Corporate Venturing) to go through the innovation journey of Naturgy. Below some highlights from the Mind the Chat with Alejandro:

- Established corporations are not designed for fast iterations. The best thing we can do is to be translators.
- It is key to being part of the innovation ecosystems. But it takes time.
- Intrapreneurship doesn’t aim at creating the next Google rather building an ecosystem of people with the right mindset and entrepreneurial attitude.
- The goal of CVC is creating a portfolio of strategic options.

The perpetual Reinvention of the Open Innovation Models

Open Innovation is now living the age of Hybridization: models do evolve and sometimes merge. Telefónica has been one of the companies entering the Open Innovation arena in the early days. The evolution of Wayra from Corporate Accelerator into a hybrid entity across CVC and Venture Client is a good example of this trend.

“We are obsessed with showing the results of our Innovation activities both outside and inside Telefónica.” says Agustin Moro, Director of Innovation Services at Telefónica. Thus far they have produced over 700 million in revenue and 200 million in cost savings.

Here are the 5 tips of Agustin to Open Innovation managers:

- Set clear goals and expectations and socialize/communicate them internally
- Be relevant
- Be consistent and keep up also when results are not coming
- Don’t take shortcuts
- Be ready to hack the system since “doing Open Innovation is not just investing. It is changing the corporate culture”

How to boost local industrial ecosystems

How to boost local industrial ecosystems

SPRI, an agency of the Basque Government, has emerged as a benchmark for providing practical and impactful support to foster the growth of the innovation ecosystem in the Basque Country.
With a comprehensive range of services encompassing early-stage startup mentoring, business development support for later-stage tech companies, and access to curated corporate innovation opportunities, SPRI has empowered hundreds of Basque tech companies to achieve remarkable growth.
SPRI’s support also includes equity investments through multiple Venture Capital funds they manage to Basque startups. Just in 2022, they disbursed €28,8 millions to 27 startups in the following industries: ICT, Aeronautics, Biotech, Renewable Energy.
To further facilitate the global expansion of Basque startups, SPRI manages 4 Business and Innovation Centers across the Basque Country and maintains 16 global trade offices in strategic
locations overseas.
Through its unwavering commitment to nurturing innovation and providing tailored support, SPRI has played a pivotal role in rejuvenating the Basque Country's industrial ecosystem and propelling future growth.

Corporate Venture Building: 5 Tips

Corporate Venture Building: 5 Tips

1) It takes time: to produce value a venture needs from 7 to 10 years. Set your expectations accordingly

2) You need the right people: The typical corporate thinking doesn’t work. Hire for potential, not based on experience. Our team on average has 5-7 years of experience.

3) Don’t overestimate your (corporate) unfair advantage: it is very hard to materialise (“Why should you prefer your siblings to your friends?”)

4) Don’t budget Venture Building as recurring activities: We pitch all new ventures as an extra-budget. We don’t want to create automatisms.

5) There is no alternative to innovate: new ventures should be properly budgeted. But if you don’t risk your money now, you will end up to M&A something later at a very higher cost.

Here are the highlights of the conversation with Daniel Szabo, CEO Korber Digital. With Alberto Onetti Daniel goes through the structured process to Venture Building they have in Korber and the results (and lesson learned) from the ventures launched (FactoryPal, InspectifA, Vaibe).