AC Lion Digital Executive Search’s Post

Learning from the best in new-venture building can transform your approach to success. Recent research from McKinsey Digital reveals that ventures with expert strategies in place can achieve 3.4 times more revenue in their fifth year compared to those without. Here are some key insights from the article: 1. Adopt a disciplined portfolio approach: Experts spread their investments across multiple ventures, averaging six new ventures in five years, compared to fewer than two for novices. This strategic spread increases the chances of hitting market needs effectively. 2. Secure dedicated funding: Committing financial resources upfront is crucial. Experts are significantly more likely to have dedicated funding, leading to larger, more scalable ventures. 3. Balance independence with core connection: While leveraging the core organization's assets is beneficial, experts grant new ventures independence to navigate their own paths, often exploring entirely new industries. 4. Ensure C-suite support: A C-suite sponsor can be a game-changer. Experts are likelier to have dedicated leaders focusing on venture creation, ensuring strategic alignment and support. 5. Build a dedicated team: Forming a specialized team with expert talent is pivotal for growth. Experts often have flexible compensation to attract top talent and foster skills within their teams. 6. Look beyond internal capabilities: Successful builders often acquire businesses or form partnerships to fill capability gaps, significantly boosting revenue potential. Read McKinsey's full article if you want to learn more: https://lnkd.in/dbkns6yU

McKinsey posted a nice article about how CEOs strategically leverage corporate venture building to achieve rapid and significant growth for their companies. My Takeaways: 1. Priority of Corporate Venture Building Many CEOs see the creation of new business units as a key strategy for remaining competitive in the long term. Nearly half of the CEOs surveyed consider this initiative one of their top three priorities, as it can create additional revenue streams and strengthen innovation capacity. 2. Growth through Investment Companies that invest at least 20% of their capital in building new ventures often grow faster than their competitors. This strategy allows them to respond to emerging market trends, such as generative AI and sustainable technologies, and build a lead in innovation. 3. Need for Specialized Resources To successfully build ventures, companies need specialized personnel, capital, and a culture that embraces the risks of innovation. It’s crucial to combine internal talent with external support to enable effective venture development. 4. Success Criteria and Structure McKinsey emphasizes that successful companies define clear criteria and structures for corporate venture building. This includes dedicated venture-building teams that work independently while leveraging resources from the parent company. 5. Risks and Challenges Venture-building projects are often high-risk and can quickly fail if they lack strategic alignment or scalability. A well-defined process that incorporates early prototyping and market feedback can help mitigate risks and increase chances of success. 6. Long-term Value CEO-led ventures contribute not only to revenue growth but also help companies develop new technologies and business models, keeping them at the forefront of technological and economic developments. McKinsey stresses that companies treating venture building as a long-term strategy, rather than a short-term experiment, significantly improve their chances of success. Leaders must be willing to invest in infrastructure, talent, and time to drive sustainable innovation forward. Full Article: https://lnkd.in/dG_3K-Z8 Want to learn more about it, happy to have a chat about how we from QAI Ventures help corporates to work & invest in Startups. Thanks Marius Almstedt and Alexandra Beckstein for sharing.

Corporate investment accelerates startup growth by leveraging financial resources, strategic alignment, and expertise. Startups benefit from reduced bankruptcy risks, increased valuations, and rapid technology deployment. Collaboration, clear communication, and flexibility are key to success.

When seeking strategic investors to scale their startups, many founders mistakenly overestimate the value these corporations can bring. Large corporations are inherently designed for efficiency and focus on their core business operations. This oversight can create significant hurdles for startups seeking to leverage strategic investors. Here's why: Overestimation of Synergy Value: Founders often anticipate substantial synergies between their startup and the strategic investor's existing business. However, realizing these synergies can be challenging due to the investor's focus on core operations and potential conflicts of interest. Barriers to Integration: Large corporations have established processes and structures that may not be conducive to integrating a startup effectively. This can lead to delays, communication breakdowns, and ultimately, a failure to realize the anticipated value. Dilution of Control: Strategic investments often involve equity stakes, which can dilute the founder's ownership and control over the startup earlier and blocking future required equity funding rounds. This can hinder decision-making and innovation, particularly if the investor's interests diverge from the startup's long-term vision. To mitigate these risks, founders should: Conduct thorough due diligence: Carefully assess the strategic investor's track record in supporting startups and their commitment to the founder's vision. Negotiate clear terms and conditions: Define specific performance metrics, exit strategies, and mechanisms for resolving disputes. Maintain a strong independent board: Ensure that the startup's interests are represented and that decision-making remains aligned with the company's long-term goals. By carefully considering these factors, founders can make informed decisions about strategic investments and maximize the potential for successful collaboration. Thanks Frederic Pampus in confirming this challenge from CVC perspective and the structured approach to overcome it.

A National Bestseller and Financial Times Business Book of the Month, The Venture Mindset offers crucial strategies for navigating today's rapidly changing world, making smarter decisions, and transforming traditional organizations into innovation hubs. In The Venture Mindset, Stanford University Professor Ilya Strebulaev —who has spent over two decades researching venture capitalists’ decision-making—and Alex Dang, an executive with experience at companies like Amazon and McKinsey, share nine key principles. These insights come directly from the venture capitalists' ability to identify emerging trends, build world-changing businesses like Google, SpaceX, and Zoom, and make decisive choices about when to act or when to pull back. This book covers essential lessons, including: - Why dissent should be encouraged and consensus questioned. - The primary barrier to innovation in corporate environments. - How to determine when to shut down a failing initiative. - A pivotal question that changes how VCs evaluate opportunities. - Why failure is not just an option, but a necessity for success. Packed with compelling stories and scientific rigor, the book equips readers to thrive in an era where industries, companies, and careers can be disrupted overnight. It’s more than just a survival guide—it shows you how to identify opportunities and achieve extraordinary success. At BWG Capital, we believe in the power of innovative thinking and bold decisions. In our view, The Venture Mindset is a must-read for anyone seeking to understand how venture capitalists think and make decisions. The authors deliver practical, well-researched insights that extend beyond startups and investors, providing valuable guidance for leaders navigating uncertainty and driving innovation. The combination of real-world examples and thorough research makes the book both engaging and highly informative. What stands out is how it challenges conventional thinking and encourages readers to embrace risk and failure as key components of growth. We highly recommend it for anyone looking to make bold, strategic moves in today’s fast-paced business landscape.

Very meaningful article on how venture building is becoming common practice also among Corporations. A couple of take-aways: - The organizations that have developed the capabilities to programmatically build new ventures see the most success per business. These expert venture builders have double the success rate of organizations with less mature venture-building capabilities and generate larger revenues from their new business ventures. - Companies that make venture building a standard part of the growth strategy find that having a dedicated venture-building team helps these initiatives thrive. These teams typically have both clear responsibilities and incentives in place for scaling new ventures. - Sustainability-focused ventures are now the second-most commonly expected opportunities to follow. Sustained interest in these ventures coincides with recent technological advancements, such as cleaner materials, and are most concentrated within the energy and materials sector. Feel free to contact me if you wish to discover the hidden treasures within your organization that you could turn into a successful new venture.

What do you think: How do Venture Capital firms invest? A framework that helps in identifying high-potential innovations is to ask yourself: 🚀 "Who Loses, Who Chooses, Who Profits, Who Pays" 🚀 This framework offers clarity on whether an innovation is truly scalable and sustainable. Here’s how it applies to finding the most promising opportunities: ✅ Who Chooses? The decision-maker is critical. The ideal innovation empowers the party that has the authority to choose it. For example, a B2B SaaS product that solves a pain point for the department leader with the purchasing power—or a consumer product that the end user loves enough to buy without friction. ✅ Who Pays? The best ventures align the payer with the chooser. If the decision-maker is also bearing the cost, it signals a strong alignment of incentives. Think of enterprise tools purchased by a department head whose team directly benefits—or subscription apps consumers willingly pay for. ✅ Who Profits? A sustainable business ensures that the benefits flow directly to the payer/chooser. When value is tangible and immediate, adoption accelerates, churn decreases, and word-of-mouth drives growth. A strong profit loop for the user often creates a natural profit loop for the company. ❌ Who Loses? Every innovation creates disruption. But high-potential ventures minimize losses or offset them with greater gains. If the party losing out is a competitor or an outdated process, it’s a sign of a healthy market shift. If the cost disproportionately falls on a customer segment or partner, the business might face resistance or backlash. In venture, we’re always looking for innovations that make life easier for the chooser/payer and demonstrate a clear win-win-win dynamic. When the party who chooses also pays—and sees tangible value—they become your strongest advocates. This alignment often separates fleeting trends from enduring solutions! 💡 What questions are you asking when making investment decisions? #VentureCapital #Alignment #SwissStartups Emerald Technology Ventures

Your product will not be enough to secure investment. When venture capitalists and angel investors evaluate startups, they look at much more than just your idea. 1. It starts with you—the founders. → Investors often bet on the jockey, not the horse. They want to know if the team behind the startup has the knowledge, skills, and determination to steer the company to success. → A Harvard Business Review survey revealed that 95% of venture capitalists prioritise the core founding team before making an investment decision. 2. Your product needs to stand out. → Investors ask tough questions: Does your product have a competitive edge? Is it scalable? What’s the unique selling proposition? → A product with growth potential gets them excited, but only if it’s positioned to capture market share. 3. Speaking of market share—size matters. → Even if your product is unique, it needs a large enough market to generate significant revenue. → Investors will scrutinise the market opportunity to ensure there’s a broad audience ready to buy. 4. Your financials need to add up. → Valuation isn’t just a number; it’s a reflection of both tangible and intangible factors. → Investors want to know how much equity they’re getting for their capital and if the company’s financial health is sound. 5. Who’s already invested matters too. → Existing investors can either be a vote of confidence or a red flag. → If too many investors hold significant equity, it might deter others from coming on board. Investors aren’t just writing a check - they’re backing a vision, a team, and a strategy. Are you ready to meet their expectations?

📥 ... did you find [i8upd8] in your inbox yesterday? As always, we shared 8 updates about corporate innovation. Well, 8 plus 1 this time ;) 〰 Can Innovation Speak The Language Of Finance? How can innovators bridge the gap between innovation and finance? Here's Tristan, Dan and David sharing how to navigate the inherent uncertainty of their work to gain leadership support and secure budget https://lnkd.in/epDiJGzw 〰 Venturing Beyond The Hype - How To Build Viable Ventures In A Down Market Corporate venture building is going through a reckoning. As interest rates rise and the cost of funds goes up, the willingness of organizations to invest in ventures is stalling. Not a bad thing, if these encourage venture builders to make fundamental changes to the way they operate says Sebastian https://lnkd.in/exUBjQe4 〰 The One Thing High Impact Product Teams Have In Common With organizations asking why product teams are important and what to expect from them, here's Matt suggesting how can product teams demonstrate a contribution to organizational goals https://lnkd.in/eriuKUsK 🔅 Instead of polarized approach with incremental R&D on the one endand high-risk CVC at the other, a better, middle way is the "growth driver model" that partners corporations with outside investors https://lnkd.in/gcntQtKe 🔅 In this podcast, hear from Mann+Hummel’s Charles Vaillant and Ellie Amirnasr, re the pitfalls of applying traditional KPIs too early in new business ventures and advocating for non-financial progress metrics https://lnkd.in/eQP4hiAy 🔅 Chief Innovation Officers tend to find themselves stuck in a role riddled with contradictions, limited authority, and near-impossible expectations. Here's Stephen Parkins examining why the role is so difficult https://lnkd.in/ePii4SjQ 🔅 The Responsible Research and Innovation (RRI) framework by Gina O'Connor / Tania Bucic helps innovators decide when to proceed and when to hold back on releasing a new technology into the world https://lnkd.in/eM-GQ59j 🔅 Everyone knows you can’t build a startup without proper validation. But validation is not the best word to describe what you really need to do and which results you can expect from it https://lnkd.in/eHATvMP8 🔅 Famous brands that have either disappeared into history share three commonalities. It's about bad execution, not about a lack of insight https://lnkd.in/etQJ_2RV

I'm excited to share my latest blog post on the economic impact of venture capital!📈💡 In this post, I delve into the paper "The Economic Impact of Venture Capital: Evidence from Public Companies" by Will Gornall and Ilya Strebulaev. The paper compares the impact of the venture capital industry on the top public companies in the US versus other large, developed countries (the other G7) using the 1970s ERISA reforms in the US as a natural experiment. The results are staggering! Post-ERISA reform, venture-backed companies that went public account for 77% of total US market capitalization, 50% of revenue, 92% of R&D spending, and 93% of patent value. The authors estimate that 78% of the top 300 US public companies likely would not have achieved such success without the regulatory changes initiated in the 1970s. It's clear that venture capital plays a crucial role in fueling the innovation sector and driving economic growth. Check out my blog post for more insights! #venturecapital #innovation #economicgrowth