- For innovative cultures to thrive there must be a willingness to fail and an understanding that it’s okay to be wrong most of the time. In other words, not an environment of fear.
- Great companies are formed in down markets, including Adobe, Broadcom, Chevron, Digital Equipment, HP, Microsoft, Rambus, Skype, Texas Instruments, Westinghouse.
- Today, many entrepreneurs and companies look at the China and India markets first, not the U.S.
- These days, businesses should tilt toward risk-taking behavior.
- Most great, disruptive businesses were considered dumb ideas by most VCs; expect a lot of rejection and certainly not unanimous acceptance.
- According to Ray Kurzweil, “The next 20 years of technological change will be equivalent to the past 100 years.” That means shorter forecast horizons and perpetual “future shock.”
- What DFJ looks for in investment opportunities: Passionate entrepreneurs with unique ideas that can change the world.
- Startup success depends on disruption: financial turmoil, new channels, or disruptive technology.
- Entrepreneurs are becoming more globally distributed all the time.
- Technology adoption rates are skyrocketing: hot new services like Hotmail, Skype (DFJ invested in both) and ICQ all achieved 8 - 14 million users in their first 12 - 18 months.
Steve hasn’t watched TV or read the newspaper in over 20 years. He thinks the way the media presents news is disruptive to concentration and focus. He also stayed away from politics until recently. I knew there was a reason why I liked the guy.
March 30, 2009
Corporate Venture Capital: Claudia Fan Munce, IBM Venture Capital Group
STANFORD, CALIFORNIA -- As the global economy keep sputtering, corporate venture capital offers a glimmer of investment hope for startups. In corporate venture capital, companies hook up startups with a vast global network of customers, offer business and marketing strategies and at times provide financing. The upside for startups: much quicker growth and powerful partners. The upside for companies: access to new technology and the chance to acquire or form long-run partnerships with the best young companies. As the markets for IPOs and acquisition swooned, corporate VCS invested in 21% of the nearly 4,000 startup deals in 2007. See USA Today story: "Companies Give Startups Billions in Venture Capital"
While some economic sectors stagnate and companies go belly up, corporate VCs keep hammering away at innovation, and help to keep the U.S. and global economies fresh and dynamic, says a U.S. Department of Commerce report last year called "Corporate Venture Capital: Seeking Innovation and Strategic Growth." Another report on the corporate VC realm, by Wharton management professor Gary Dushnitsky and New York University management professor Zur Shapira, has found that corporate VCs invest in more mature and stable startups, while also using larger "syndicates" (a band of venture firms backing a startup) than traditional venture capital firms. ("Entrepreneurial Finance Meets Organizational Reality: Comparing Investment Practices by Corporate and Independent Venture Capitalists.")
A key figure in the corporate VC world is Claudia Fan Munce, (photo, left) v.p. of corporate strategy at IBM and managing director of the IBM Venture Capital Group. A Stanford MBA with an M.S. in electrical engineering from Santa Clara University, Munce and her crew work with more than 1,300 startups and other venture-backed business partners in the U.S., Asia, Latin America and other regions. The IBM venture group seems to be everywhere. (See Drew Clark, another IBM Venture Capital Group executive, on a recent online panel with Tom Foremski, the business journalist/blogger at SiliconValleyWatcher.) IBM's technology tale is wellknown. But an equally critical and less-explored element of its success has been its long-run global management and business strategies across borders, from projects on global innovation to its Smarter Planet holistic approach to business. Munce, a Taiwan native who grew up in Brazil, illustrates the global business and cultural vision demanded of 21st-century executives and entrepreneurs. She spoke with Cool Global Biz at the Global Technology Symposium conference at Stanford University late last week.