A Corporate Venturing Unit at EVIS

Abstract

Corporate Venturing, is a recurrently researched mechanism for corporates to stay innovative. However, the difficulty of establishing a Corporate Venturing Unit, becomes apparent in the literature. ENGIE Ventures and Integrated Solutions (EVIS) also resorts to external CV activities, in order to cope with the pace of technological innovations in the predominantly classical energy industry making it an interesting case to conduct the research. The first part of the research consisted of research endeavors into external CV objectives, in order to develop a version of the intended external CV objectives for a CVU at EVIS. This has been done by conducting a thorough literature review. Consequently, these insights were used as a foundation to conduct internal interviews at EVIS in order to develop a set of intended CV objectives for a CVU at EVIS. The second part, researching the factors, started with a literature study, resulting in the development of a conceptual framework of factors. This conceptual framework has been used as a foundation for a total of nine external interviews. Ultimately, the insights of both the internal interviews and external interviews are processed into implications for EVIS. For the CV objectives intended for a CVU at EVIS, strategic objectives should outweigh the financial objective, where the following strategic objectives are specifically mentioned in order of importance: Strategic corporate renewal and a window on new technology, business models and capabilities – Promoting ENGIE’s innovative and entrepreneurial image – Developing an innovative and entrepreneurial culture within the corporate – Leveraging internal capabilities, competencies and ideas to create new business – Accelerating innovation though ventures – Creating deal flow for corporate M&A. For the financial objective, the interviewees at EVIS indicated the room for potential loss-making investments and ambiguity towards whether every investment should be financially viable. However, external interviews provided a different insight: every investment should show good financial returns, purely looking at the investment financials. Furthermore, the factors that should be considered in order for a CVU to engage in external CV activities, based on literature and external interviews, have been approached by categorizing them into five categories: Factors internal to the CVU, factors in the relation between the CVU and the corporate parent, between the CVU and external ventures, between the CVU and spin-offs and between the CVU and external investment partners. The following factors have been found to be most crucial to consider for a CVU engaging in external CV activities: balancing strategic and financial objectives, the CVU’s team composition and compensation, the autonomy of a CVU and the degree of autonomy it provides to ventures, collaborative investments together with financial and strategic co-investors, and specific activities of a CVU with spin-offs (e.g. motivation to spin-off, involvement of external investors, etc.). However, most importantly, there is no one size fits all for the factors identified. Hence, each CVU should make its own decisions with regard to the identified factors, in order to create the most suited circumstances for their CVU.