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How to pitch to a Corporate Venture Capitalist (=VC in a big corporation)

Workshop withPenny SchifferJonathan Grahm

Why come to our workshop?You will learn how much a corporate VC can add to your business and what theyd expect from you

How you can approach a corporate VC and work with them successfully

What to avoid when pitching to a corporate VC

2AgendaIntroduction (14:15-14:45)Why should a startup work with a corporate (venture)?Whats happening in the VC world?Pitching to a corporate VC: Strategic fic / Leverage of assetsPreparation of pitches (14:45-15:30)Pitching-Session (15:30-16:00)

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Agenda: Ziele, Ergebnisse, AblaufWhy should a startup work with a corporate (venture)?1.Whats happening in the VC world?2.Base Case: OUSBase Case: SAPBase Case: FINBase Case: SWSBase Case: FazitPitching to a corporate VC: Strategic fic / Leverage of assets3.IntroductionDefinition: Whats Corporate Venture Capital (CVC)?CVC is a subset of venture capital, whereby a corporate is investing directly to take minority stakes in external start-ups

vs.

Corporate Venturing refers to when a company supports innovation and new projects internally5Who are we?Swisscom Ventures (SCV)Founded in 2005Team in Zurich, Lausanne, and Palo Alto, USA80 MCHF invested in 24 participations:3 Venture Capital funds6 Swisscom spin-offs15 external startupsTypical portfolio company:6 years old, 45 employees, $10m revenues6

Penny Schiffer & Jonathan Grahm23.03.2013Folgeauftrag M2M Ventures

Why should Swisscom work with Startups?20% FreiheitLange Workshop-> Why should Swisscom Work with Startup (Pro's)-> Auch erlaubt zu Beantworten: Why should Swisscom not work with Startup (Con's)

23.03.2013Folgeauftrag M2M Ventures

Why should a Startups work with us?23.03.2013Folgeauftrag M2M VenturesLow acceptance over large vendorsLong decision cycles with many influencers, complex teams and changing responsibilitiesTough negotiationsSlow execution

Agenda: Ziele, Ergebnisse, Ablauf11Why should a startup work with a corporate (venture)?1.Whats happening in the VC world?2.Base Case: OUSBase Case: SAPBase Case: FINBase Case: SWSBase Case: FazitPitching to a corporate VC: Strategic fic / Leverage of assets3.IntroductionFinancial VCs (Historical)Advent of the CVC: There are more active corporate venture programs (750) than active financial venture capital firms (>400)US$M Under ManagementStageFinancial VCs (Consolidated)SeedA RoundC Round101005001,000Super-Angels number of start-ups exploding but quality going down=> Innovation is everywhere + no longer consolidatedDeal scouting will become harder with new Gatekeepers (incubators, accelerators, government)Corporates needs are not met and are looking for faster, cheaper, better access to innovation => Creating of Corporate VCsBefore start-ups died or thrived but now there are lots of zombies who are in or should be pivoting14

Agenda: Ziele, Ergebnisse, Ablauf15Why should a startup work with a corporate (venture)?1.Whats happening in the VC world?2.Base Case: OUSBase Case: SAPBase Case: FINBase Case: SWSBase Case: FazitPitching to a corporate VC: Strategic fic / Leverage of assets3.Introduction

Innovation cultureValue captureStrategic growthFinancial returnsWindow on technologyBusiness scopeStrategic ties to corporateAggressive BusinessbuildEarly-stagetech./businessdevelopmentStrongWeakObjectives for the CVC: Combining financial and strategic benefitsStrategic benefitsAccelerated time-to-market for product launchesInsight on new potentially disruptive technologies and trendsOrganizational learningsPR and reputation benefits16Financial benefitsMinimum target: self-funding status (evergreen fund)16Investment Process: Different Challenges for Startup and Investor171Lead generation 2Due diligence3Business development4ExitSelecting the right startupsAdding value to investeesInvestmentInvestorStartupSelecting the right VCLeveraging the Assets of a VCWhats in it for YOU?Strategic benefitsCorporate can become your first customer / referenceAccess to the customer base Know how from the corporate, e.g. product/ software development(Sponsored) Infrastructure19Financial benefitsDirect: VC investmentIndirect: Access to other VCs19

> 6 Mio

> 1.7 Mio

20000Innovation Management:Corporates are moving from innovation project to start-up + innovation co-creation

Revisiting Build/Buy/Partner decision-makingRedefining core vs. non-core7

Cases

iZettle, the social payments company, creates services for person-to-person and business-to-consumer commerce. The first service includes a free iPhone app and a mini chip card reader that lets anyone take card payments anytime, anywhere.12

No need for having different paper loyalty cards in your wallet anymore. Poinz App brings all your loyalty cards to your smartphone device. 21Cases are not portfolio companies of Swisscom ventures.Amdocs, Alcatel Lucent, Ericsson