\u201cCorporate innovation takes time,\u201d Mathieu reflects. While in a startup the entire company is a sandbox where experiments can be run hot and fast, the situation is different for traditional corporate organizations. \u201cInstead of focusing on why innovation cannot work in your organization, focus instead on how you can create a sandbox environment to test your boldest ideas within a controlled environment. Creating such a sandbox environment allows the organization to test out innovations without going straight to the deep end, allowing for bolder and more frequent innovation experiments,\u201d concludes Mathieu.<\/p>\n\n\n\n
\u201cCorporate innovation takes time,\u201d Mathieu reflects. While in a startup the entire company is a sandbox where experiments can be run hot and fast, the situation is different for traditional corporate organizations. \u201cInstead of focusing on why innovation cannot work in your organization, focus instead on how you can create a sandbox environment to test your boldest ideas within a controlled environment. Creating such a sandbox environment allows the organization to test out innovations without going straight to the deep end, allowing for bolder and more frequent innovation experiments,\u201d concludes Mathieu.<\/p>\n\n\n\n
\u201cThis is, however, just half of the solution,\u201d he adds. For organizations to fully embrace an innovation culture, there must be mechanisms and processes in place to manage this inflow of ideas. Some companies use idea boxes while others utilize hackathons, or the 80\/20 rule made famous by Google. All these represent mechanisms by which ideas are solicited from employees, presented to management, filtered and supported or killed off quickly to keep the innovation momentum going. By adopting a fail-fast failure-tolerant innovation culture, organization leaders can inspire employees to think beyond their scope of work to help the company break into new levels of innovation.<\/p>\n\n\n\n
\u201cCorporate innovation takes time,\u201d Mathieu reflects. While in a startup the entire company is a sandbox where experiments can be run hot and fast, the situation is different for traditional corporate organizations. \u201cInstead of focusing on why innovation cannot work in your organization, focus instead on how you can create a sandbox environment to test your boldest ideas within a controlled environment. Creating such a sandbox environment allows the organization to test out innovations without going straight to the deep end, allowing for bolder and more frequent innovation experiments,\u201d concludes Mathieu.<\/p>\n\n\n\n
\u201cThe first step of innovation is ideation, and for ideation to happen, there must be curiosity,\u201d says Mathieu. Most corporations falter at this step because established cultures and norms do not allow for the presentation of ideas, most of which will inevitably fail. As failure is often frowned upon in traditional corporate settings, employees tend to keep their ideas to themselves lest they are labeled a failure, which can affect their performance rating or promotion prospects. \u201cA culture of innovation must start at the top. Management needs to say it is okay to fail, as long as we fail fast and we are failing in the quest for innovation,\u201d says Mathieu.<\/p>\n\n\n\n
\u201cThis is, however, just half of the solution,\u201d he adds. For organizations to fully embrace an innovation culture, there must be mechanisms and processes in place to manage this inflow of ideas. Some companies use idea boxes while others utilize hackathons, or the 80\/20 rule made famous by Google. All these represent mechanisms by which ideas are solicited from employees, presented to management, filtered and supported or killed off quickly to keep the innovation momentum going. By adopting a fail-fast failure-tolerant innovation culture, organization leaders can inspire employees to think beyond their scope of work to help the company break into new levels of innovation.<\/p>\n\n\n\n
\u201cCorporate innovation takes time,\u201d Mathieu reflects. While in a startup the entire company is a sandbox where experiments can be run hot and fast, the situation is different for traditional corporate organizations. \u201cInstead of focusing on why innovation cannot work in your organization, focus instead on how you can create a sandbox environment to test your boldest ideas within a controlled environment. Creating such a sandbox environment allows the organization to test out innovations without going straight to the deep end, allowing for bolder and more frequent innovation experiments,\u201d concludes Mathieu.<\/p>\n\n\n\n
\u201cThe first step of innovation is ideation, and for ideation to happen, there must be curiosity,\u201d says Mathieu. Most corporations falter at this step because established cultures and norms do not allow for the presentation of ideas, most of which will inevitably fail. As failure is often frowned upon in traditional corporate settings, employees tend to keep their ideas to themselves lest they are labeled a failure, which can affect their performance rating or promotion prospects. \u201cA culture of innovation must start at the top. Management needs to say it is okay to fail, as long as we fail fast and we are failing in the quest for innovation,\u201d says Mathieu.<\/p>\n\n\n\n
\u201cThis is, however, just half of the solution,\u201d he adds. For organizations to fully embrace an innovation culture, there must be mechanisms and processes in place to manage this inflow of ideas. Some companies use idea boxes while others utilize hackathons, or the 80\/20 rule made famous by Google. All these represent mechanisms by which ideas are solicited from employees, presented to management, filtered and supported or killed off quickly to keep the innovation momentum going. By adopting a fail-fast failure-tolerant innovation culture, organization leaders can inspire employees to think beyond their scope of work to help the company break into new levels of innovation.<\/p>\n\n\n\n
\u201cCorporate innovation takes time,\u201d Mathieu reflects. While in a startup the entire company is a sandbox where experiments can be run hot and fast, the situation is different for traditional corporate organizations. \u201cInstead of focusing on why innovation cannot work in your organization, focus instead on how you can create a sandbox environment to test your boldest ideas within a controlled environment. Creating such a sandbox environment allows the organization to test out innovations without going straight to the deep end, allowing for bolder and more frequent innovation experiments,\u201d concludes Mathieu.<\/p>\n\n\n\n
Besides focusing on this set of criteria, Mathieu also advises corporations to have a dedicated innovation team that stewards the entire corporate venture capital process. With such a team in place, it is easier to handle issues like culture clashes, startup onboarding, commercial agreements, IP protection, among other issues that are bound to arise.<\/p>\n\n\n\n
\u201cThe first step of innovation is ideation, and for ideation to happen, there must be curiosity,\u201d says Mathieu. Most corporations falter at this step because established cultures and norms do not allow for the presentation of ideas, most of which will inevitably fail. As failure is often frowned upon in traditional corporate settings, employees tend to keep their ideas to themselves lest they are labeled a failure, which can affect their performance rating or promotion prospects. \u201cA culture of innovation must start at the top. Management needs to say it is okay to fail, as long as we fail fast and we are failing in the quest for innovation,\u201d says Mathieu.<\/p>\n\n\n\n
\u201cThis is, however, just half of the solution,\u201d he adds. For organizations to fully embrace an innovation culture, there must be mechanisms and processes in place to manage this inflow of ideas. Some companies use idea boxes while others utilize hackathons, or the 80\/20 rule made famous by Google. All these represent mechanisms by which ideas are solicited from employees, presented to management, filtered and supported or killed off quickly to keep the innovation momentum going. By adopting a fail-fast failure-tolerant innovation culture, organization leaders can inspire employees to think beyond their scope of work to help the company break into new levels of innovation.<\/p>\n\n\n\n
\u201cCorporate innovation takes time,\u201d Mathieu reflects. While in a startup the entire company is a sandbox where experiments can be run hot and fast, the situation is different for traditional corporate organizations. \u201cInstead of focusing on why innovation cannot work in your organization, focus instead on how you can create a sandbox environment to test your boldest ideas within a controlled environment. Creating such a sandbox environment allows the organization to test out innovations without going straight to the deep end, allowing for bolder and more frequent innovation experiments,\u201d concludes Mathieu.<\/p>\n\n\n\n
Besides focusing on this set of criteria, Mathieu also advises corporations to have a dedicated innovation team that stewards the entire corporate venture capital process. With such a team in place, it is easier to handle issues like culture clashes, startup onboarding, commercial agreements, IP protection, among other issues that are bound to arise.<\/p>\n\n\n\n
\u201cThe first step of innovation is ideation, and for ideation to happen, there must be curiosity,\u201d says Mathieu. Most corporations falter at this step because established cultures and norms do not allow for the presentation of ideas, most of which will inevitably fail. As failure is often frowned upon in traditional corporate settings, employees tend to keep their ideas to themselves lest they are labeled a failure, which can affect their performance rating or promotion prospects. \u201cA culture of innovation must start at the top. Management needs to say it is okay to fail, as long as we fail fast and we are failing in the quest for innovation,\u201d says Mathieu.<\/p>\n\n\n\n
\u201cThis is, however, just half of the solution,\u201d he adds. For organizations to fully embrace an innovation culture, there must be mechanisms and processes in place to manage this inflow of ideas. Some companies use idea boxes while others utilize hackathons, or the 80\/20 rule made famous by Google. All these represent mechanisms by which ideas are solicited from employees, presented to management, filtered and supported or killed off quickly to keep the innovation momentum going. By adopting a fail-fast failure-tolerant innovation culture, organization leaders can inspire employees to think beyond their scope of work to help the company break into new levels of innovation.<\/p>\n\n\n\n
\u201cCorporate innovation takes time,\u201d Mathieu reflects. While in a startup the entire company is a sandbox where experiments can be run hot and fast, the situation is different for traditional corporate organizations. \u201cInstead of focusing on why innovation cannot work in your organization, focus instead on how you can create a sandbox environment to test your boldest ideas within a controlled environment. Creating such a sandbox environment allows the organization to test out innovations without going straight to the deep end, allowing for bolder and more frequent innovation experiments,\u201d concludes Mathieu.<\/p>\n\n\n\n
For the UL fund, he looks for three things in a startup before considering an investment.<\/p>\n\n\n\n
Besides focusing on this set of criteria, Mathieu also advises corporations to have a dedicated innovation team that stewards the entire corporate venture capital process. With such a team in place, it is easier to handle issues like culture clashes, startup onboarding, commercial agreements, IP protection, among other issues that are bound to arise.<\/p>\n\n\n\n
\u201cThe first step of innovation is ideation, and for ideation to happen, there must be curiosity,\u201d says Mathieu. Most corporations falter at this step because established cultures and norms do not allow for the presentation of ideas, most of which will inevitably fail. As failure is often frowned upon in traditional corporate settings, employees tend to keep their ideas to themselves lest they are labeled a failure, which can affect their performance rating or promotion prospects. \u201cA culture of innovation must start at the top. Management needs to say it is okay to fail, as long as we fail fast and we are failing in the quest for innovation,\u201d says Mathieu.<\/p>\n\n\n\n
\u201cThis is, however, just half of the solution,\u201d he adds. For organizations to fully embrace an innovation culture, there must be mechanisms and processes in place to manage this inflow of ideas. Some companies use idea boxes while others utilize hackathons, or the 80\/20 rule made famous by Google. All these represent mechanisms by which ideas are solicited from employees, presented to management, filtered and supported or killed off quickly to keep the innovation momentum going. By adopting a fail-fast failure-tolerant innovation culture, organization leaders can inspire employees to think beyond their scope of work to help the company break into new levels of innovation.<\/p>\n\n\n\n
\u201cCorporate innovation takes time,\u201d Mathieu reflects. While in a startup the entire company is a sandbox where experiments can be run hot and fast, the situation is different for traditional corporate organizations. \u201cInstead of focusing on why innovation cannot work in your organization, focus instead on how you can create a sandbox environment to test your boldest ideas within a controlled environment. Creating such a sandbox environment allows the organization to test out innovations without going straight to the deep end, allowing for bolder and more frequent innovation experiments,\u201d concludes Mathieu.<\/p>\n\n\n\n
\u201cWhy did UL start a venture capital arm?\u201d we asked Mathieu. \u201cOver time, UL simply could not keep up with all the advances in the technologies it inspects and certifies. Starting a VC arm was the natural progression to the direction we were taking to become a more innovative company,\u201d he explains. But, according to Mathieu, VC is not as simple as just putting together some money and throwing it at startups. The process of investing in and onboarding startups is often fraught with challenges such as culture clashes, poor returns and outright lack of fit as the startup evolves. He notes that while financial returns are important, they should not form the main agenda when investing in startups for innovation purposes.<\/p>\n\n\n\n
For the UL fund, he looks for three things in a startup before considering an investment.<\/p>\n\n\n\n
Besides focusing on this set of criteria, Mathieu also advises corporations to have a dedicated innovation team that stewards the entire corporate venture capital process. With such a team in place, it is easier to handle issues like culture clashes, startup onboarding, commercial agreements, IP protection, among other issues that are bound to arise.<\/p>\n\n\n\n
\u201cThe first step of innovation is ideation, and for ideation to happen, there must be curiosity,\u201d says Mathieu. Most corporations falter at this step because established cultures and norms do not allow for the presentation of ideas, most of which will inevitably fail. As failure is often frowned upon in traditional corporate settings, employees tend to keep their ideas to themselves lest they are labeled a failure, which can affect their performance rating or promotion prospects. \u201cA culture of innovation must start at the top. Management needs to say it is okay to fail, as long as we fail fast and we are failing in the quest for innovation,\u201d says Mathieu.<\/p>\n\n\n\n
\u201cThis is, however, just half of the solution,\u201d he adds. For organizations to fully embrace an innovation culture, there must be mechanisms and processes in place to manage this inflow of ideas. Some companies use idea boxes while others utilize hackathons, or the 80\/20 rule made famous by Google. All these represent mechanisms by which ideas are solicited from employees, presented to management, filtered and supported or killed off quickly to keep the innovation momentum going. By adopting a fail-fast failure-tolerant innovation culture, organization leaders can inspire employees to think beyond their scope of work to help the company break into new levels of innovation.<\/p>\n\n\n\n
\u201cCorporate innovation takes time,\u201d Mathieu reflects. While in a startup the entire company is a sandbox where experiments can be run hot and fast, the situation is different for traditional corporate organizations. \u201cInstead of focusing on why innovation cannot work in your organization, focus instead on how you can create a sandbox environment to test your boldest ideas within a controlled environment. Creating such a sandbox environment allows the organization to test out innovations without going straight to the deep end, allowing for bolder and more frequent innovation experiments,\u201d concludes Mathieu.<\/p>\n\n\n\n
\u201cWhy did UL start a venture capital arm?\u201d we asked Mathieu. \u201cOver time, UL simply could not keep up with all the advances in the technologies it inspects and certifies. Starting a VC arm was the natural progression to the direction we were taking to become a more innovative company,\u201d he explains. But, according to Mathieu, VC is not as simple as just putting together some money and throwing it at startups. The process of investing in and onboarding startups is often fraught with challenges such as culture clashes, poor returns and outright lack of fit as the startup evolves. He notes that while financial returns are important, they should not form the main agenda when investing in startups for innovation purposes.<\/p>\n\n\n\n
For the UL fund, he looks for three things in a startup before considering an investment.<\/p>\n\n\n\n
Besides focusing on this set of criteria, Mathieu also advises corporations to have a dedicated innovation team that stewards the entire corporate venture capital process. With such a team in place, it is easier to handle issues like culture clashes, startup onboarding, commercial agreements, IP protection, among other issues that are bound to arise.<\/p>\n\n\n\n
\u201cThe first step of innovation is ideation, and for ideation to happen, there must be curiosity,\u201d says Mathieu. Most corporations falter at this step because established cultures and norms do not allow for the presentation of ideas, most of which will inevitably fail. As failure is often frowned upon in traditional corporate settings, employees tend to keep their ideas to themselves lest they are labeled a failure, which can affect their performance rating or promotion prospects. \u201cA culture of innovation must start at the top. Management needs to say it is okay to fail, as long as we fail fast and we are failing in the quest for innovation,\u201d says Mathieu.<\/p>\n\n\n\n
\u201cThis is, however, just half of the solution,\u201d he adds. For organizations to fully embrace an innovation culture, there must be mechanisms and processes in place to manage this inflow of ideas. Some companies use idea boxes while others utilize hackathons, or the 80\/20 rule made famous by Google. All these represent mechanisms by which ideas are solicited from employees, presented to management, filtered and supported or killed off quickly to keep the innovation momentum going. By adopting a fail-fast failure-tolerant innovation culture, organization leaders can inspire employees to think beyond their scope of work to help the company break into new levels of innovation.<\/p>\n\n\n\n
\u201cCorporate innovation takes time,\u201d Mathieu reflects. While in a startup the entire company is a sandbox where experiments can be run hot and fast, the situation is different for traditional corporate organizations. \u201cInstead of focusing on why innovation cannot work in your organization, focus instead on how you can create a sandbox environment to test your boldest ideas within a controlled environment. Creating such a sandbox environment allows the organization to test out innovations without going straight to the deep end, allowing for bolder and more frequent innovation experiments,\u201d concludes Mathieu.<\/p>\n\n\n\n
\u201cIf you are building the next Instagram or dog walking app, we are not interested,\u201d says Mathieu. By having this laser-like focus, the firm has been able to go through seventy acquisitions without losing sight of its core mission. For executives considering innovation, it is essential first to define a clear mission statement and then use this as a guiding principle when acquiring or partnering with startups. Doing this will save the firm both money and time while ensuring maximization of opportunity cost through avoidance of timewasting ventures.<\/p>\n\n\n\n
\u201cWhy did UL start a venture capital arm?\u201d we asked Mathieu. \u201cOver time, UL simply could not keep up with all the advances in the technologies it inspects and certifies. Starting a VC arm was the natural progression to the direction we were taking to become a more innovative company,\u201d he explains. But, according to Mathieu, VC is not as simple as just putting together some money and throwing it at startups. The process of investing in and onboarding startups is often fraught with challenges such as culture clashes, poor returns and outright lack of fit as the startup evolves. He notes that while financial returns are important, they should not form the main agenda when investing in startups for innovation purposes.<\/p>\n\n\n\n
For the UL fund, he looks for three things in a startup before considering an investment.<\/p>\n\n\n\n
Besides focusing on this set of criteria, Mathieu also advises corporations to have a dedicated innovation team that stewards the entire corporate venture capital process. With such a team in place, it is easier to handle issues like culture clashes, startup onboarding, commercial agreements, IP protection, among other issues that are bound to arise.<\/p>\n\n\n\n
\u201cThe first step of innovation is ideation, and for ideation to happen, there must be curiosity,\u201d says Mathieu. Most corporations falter at this step because established cultures and norms do not allow for the presentation of ideas, most of which will inevitably fail. As failure is often frowned upon in traditional corporate settings, employees tend to keep their ideas to themselves lest they are labeled a failure, which can affect their performance rating or promotion prospects. \u201cA culture of innovation must start at the top. Management needs to say it is okay to fail, as long as we fail fast and we are failing in the quest for innovation,\u201d says Mathieu.<\/p>\n\n\n\n
\u201cThis is, however, just half of the solution,\u201d he adds. For organizations to fully embrace an innovation culture, there must be mechanisms and processes in place to manage this inflow of ideas. Some companies use idea boxes while others utilize hackathons, or the 80\/20 rule made famous by Google. All these represent mechanisms by which ideas are solicited from employees, presented to management, filtered and supported or killed off quickly to keep the innovation momentum going. By adopting a fail-fast failure-tolerant innovation culture, organization leaders can inspire employees to think beyond their scope of work to help the company break into new levels of innovation.<\/p>\n\n\n\n
\u201cCorporate innovation takes time,\u201d Mathieu reflects. While in a startup the entire company is a sandbox where experiments can be run hot and fast, the situation is different for traditional corporate organizations. \u201cInstead of focusing on why innovation cannot work in your organization, focus instead on how you can create a sandbox environment to test your boldest ideas within a controlled environment. Creating such a sandbox environment allows the organization to test out innovations without going straight to the deep end, allowing for bolder and more frequent innovation experiments,\u201d concludes Mathieu.<\/p>\n\n\n\n
\u201cWhenever we go looking for startups or other businesses to invest in, we first ensure the companies we approach align with our core mission statement,\u201d Mathieu says. This is a key insight for corporations that may get distracted by all the incredible technologies developing across different industries. While it is essential to explore developments in lateral industries, it is important to remain a mission-driven organization to sustain current momentum and keep current customers satisfied. In the case of UL, focusing on investing in startups that augment or complement its current mission statement ensures the firm\u2019s competitive advantage remains intact and continues to strengthen.<\/p>\n\n\n\n
\u201cIf you are building the next Instagram or dog walking app, we are not interested,\u201d says Mathieu. By having this laser-like focus, the firm has been able to go through seventy acquisitions without losing sight of its core mission. For executives considering innovation, it is essential first to define a clear mission statement and then use this as a guiding principle when acquiring or partnering with startups. Doing this will save the firm both money and time while ensuring maximization of opportunity cost through avoidance of timewasting ventures.<\/p>\n\n\n\n
\u201cWhy did UL start a venture capital arm?\u201d we asked Mathieu. \u201cOver time, UL simply could not keep up with all the advances in the technologies it inspects and certifies. Starting a VC arm was the natural progression to the direction we were taking to become a more innovative company,\u201d he explains. But, according to Mathieu, VC is not as simple as just putting together some money and throwing it at startups. The process of investing in and onboarding startups is often fraught with challenges such as culture clashes, poor returns and outright lack of fit as the startup evolves. He notes that while financial returns are important, they should not form the main agenda when investing in startups for innovation purposes.<\/p>\n\n\n\n
For the UL fund, he looks for three things in a startup before considering an investment.<\/p>\n\n\n\n
Besides focusing on this set of criteria, Mathieu also advises corporations to have a dedicated innovation team that stewards the entire corporate venture capital process. With such a team in place, it is easier to handle issues like culture clashes, startup onboarding, commercial agreements, IP protection, among other issues that are bound to arise.<\/p>\n\n\n\n
\u201cThe first step of innovation is ideation, and for ideation to happen, there must be curiosity,\u201d says Mathieu. Most corporations falter at this step because established cultures and norms do not allow for the presentation of ideas, most of which will inevitably fail. As failure is often frowned upon in traditional corporate settings, employees tend to keep their ideas to themselves lest they are labeled a failure, which can affect their performance rating or promotion prospects. \u201cA culture of innovation must start at the top. Management needs to say it is okay to fail, as long as we fail fast and we are failing in the quest for innovation,\u201d says Mathieu.<\/p>\n\n\n\n
\u201cThis is, however, just half of the solution,\u201d he adds. For organizations to fully embrace an innovation culture, there must be mechanisms and processes in place to manage this inflow of ideas. Some companies use idea boxes while others utilize hackathons, or the 80\/20 rule made famous by Google. All these represent mechanisms by which ideas are solicited from employees, presented to management, filtered and supported or killed off quickly to keep the innovation momentum going. By adopting a fail-fast failure-tolerant innovation culture, organization leaders can inspire employees to think beyond their scope of work to help the company break into new levels of innovation.<\/p>\n\n\n\n
\u201cCorporate innovation takes time,\u201d Mathieu reflects. While in a startup the entire company is a sandbox where experiments can be run hot and fast, the situation is different for traditional corporate organizations. \u201cInstead of focusing on why innovation cannot work in your organization, focus instead on how you can create a sandbox environment to test your boldest ideas within a controlled environment. Creating such a sandbox environment allows the organization to test out innovations without going straight to the deep end, allowing for bolder and more frequent innovation experiments,\u201d concludes Mathieu.<\/p>\n\n\n\n
\u201cWhenever we go looking for startups or other businesses to invest in, we first ensure the companies we approach align with our core mission statement,\u201d Mathieu says. This is a key insight for corporations that may get distracted by all the incredible technologies developing across different industries. While it is essential to explore developments in lateral industries, it is important to remain a mission-driven organization to sustain current momentum and keep current customers satisfied. In the case of UL, focusing on investing in startups that augment or complement its current mission statement ensures the firm\u2019s competitive advantage remains intact and continues to strengthen.<\/p>\n\n\n\n
\u201cIf you are building the next Instagram or dog walking app, we are not interested,\u201d says Mathieu. By having this laser-like focus, the firm has been able to go through seventy acquisitions without losing sight of its core mission. For executives considering innovation, it is essential first to define a clear mission statement and then use this as a guiding principle when acquiring or partnering with startups. Doing this will save the firm both money and time while ensuring maximization of opportunity cost through avoidance of timewasting ventures.<\/p>\n\n\n\n
\u201cWhy did UL start a venture capital arm?\u201d we asked Mathieu. \u201cOver time, UL simply could not keep up with all the advances in the technologies it inspects and certifies. Starting a VC arm was the natural progression to the direction we were taking to become a more innovative company,\u201d he explains. But, according to Mathieu, VC is not as simple as just putting together some money and throwing it at startups. The process of investing in and onboarding startups is often fraught with challenges such as culture clashes, poor returns and outright lack of fit as the startup evolves. He notes that while financial returns are important, they should not form the main agenda when investing in startups for innovation purposes.<\/p>\n\n\n\n
For the UL fund, he looks for three things in a startup before considering an investment.<\/p>\n\n\n\n
Besides focusing on this set of criteria, Mathieu also advises corporations to have a dedicated innovation team that stewards the entire corporate venture capital process. With such a team in place, it is easier to handle issues like culture clashes, startup onboarding, commercial agreements, IP protection, among other issues that are bound to arise.<\/p>\n\n\n\n
\u201cThe first step of innovation is ideation, and for ideation to happen, there must be curiosity,\u201d says Mathieu. Most corporations falter at this step because established cultures and norms do not allow for the presentation of ideas, most of which will inevitably fail. As failure is often frowned upon in traditional corporate settings, employees tend to keep their ideas to themselves lest they are labeled a failure, which can affect their performance rating or promotion prospects. \u201cA culture of innovation must start at the top. Management needs to say it is okay to fail, as long as we fail fast and we are failing in the quest for innovation,\u201d says Mathieu.<\/p>\n\n\n\n
\u201cThis is, however, just half of the solution,\u201d he adds. For organizations to fully embrace an innovation culture, there must be mechanisms and processes in place to manage this inflow of ideas. Some companies use idea boxes while others utilize hackathons, or the 80\/20 rule made famous by Google. All these represent mechanisms by which ideas are solicited from employees, presented to management, filtered and supported or killed off quickly to keep the innovation momentum going. By adopting a fail-fast failure-tolerant innovation culture, organization leaders can inspire employees to think beyond their scope of work to help the company break into new levels of innovation.<\/p>\n\n\n\n
\u201cCorporate innovation takes time,\u201d Mathieu reflects. While in a startup the entire company is a sandbox where experiments can be run hot and fast, the situation is different for traditional corporate organizations. \u201cInstead of focusing on why innovation cannot work in your organization, focus instead on how you can create a sandbox environment to test your boldest ideas within a controlled environment. Creating such a sandbox environment allows the organization to test out innovations without going straight to the deep end, allowing for bolder and more frequent innovation experiments,\u201d concludes Mathieu.<\/p>\n\n\n\n
Mathieu Guerville heads up the venture capital arm of UL, a company that has been around for over a century and that is deeply entrenched in the safety testing niche. \u201cThe safety industry has evolved from people being worried about getting electrocuted by their kettle to people worrying about cyber threats,\u201d he says, \u201cand so having been stuck in its ways for all those years, UL has had to redefine what safety means and what it means to assess safety.\u201d This reassessment and realignment led the firm to start UL Ventures, which invests in startups involved in the safety assessment and testing field. From his experience heading up this unit, Mathieu shares what he believes are key elements corporations must adopt to foster corporate innovation within their ranks.<\/p>\n\n\n\n
\u201cWhenever we go looking for startups or other businesses to invest in, we first ensure the companies we approach align with our core mission statement,\u201d Mathieu says. This is a key insight for corporations that may get distracted by all the incredible technologies developing across different industries. While it is essential to explore developments in lateral industries, it is important to remain a mission-driven organization to sustain current momentum and keep current customers satisfied. In the case of UL, focusing on investing in startups that augment or complement its current mission statement ensures the firm\u2019s competitive advantage remains intact and continues to strengthen.<\/p>\n\n\n\n
\u201cIf you are building the next Instagram or dog walking app, we are not interested,\u201d says Mathieu. By having this laser-like focus, the firm has been able to go through seventy acquisitions without losing sight of its core mission. For executives considering innovation, it is essential first to define a clear mission statement and then use this as a guiding principle when acquiring or partnering with startups. Doing this will save the firm both money and time while ensuring maximization of opportunity cost through avoidance of timewasting ventures.<\/p>\n\n\n\n
\u201cWhy did UL start a venture capital arm?\u201d we asked Mathieu. \u201cOver time, UL simply could not keep up with all the advances in the technologies it inspects and certifies. Starting a VC arm was the natural progression to the direction we were taking to become a more innovative company,\u201d he explains. But, according to Mathieu, VC is not as simple as just putting together some money and throwing it at startups. The process of investing in and onboarding startups is often fraught with challenges such as culture clashes, poor returns and outright lack of fit as the startup evolves. He notes that while financial returns are important, they should not form the main agenda when investing in startups for innovation purposes.<\/p>\n\n\n\n
For the UL fund, he looks for three things in a startup before considering an investment.<\/p>\n\n\n\n
Besides focusing on this set of criteria, Mathieu also advises corporations to have a dedicated innovation team that stewards the entire corporate venture capital process. With such a team in place, it is easier to handle issues like culture clashes, startup onboarding, commercial agreements, IP protection, among other issues that are bound to arise.<\/p>\n\n\n\n
\u201cThe first step of innovation is ideation, and for ideation to happen, there must be curiosity,\u201d says Mathieu. Most corporations falter at this step because established cultures and norms do not allow for the presentation of ideas, most of which will inevitably fail. As failure is often frowned upon in traditional corporate settings, employees tend to keep their ideas to themselves lest they are labeled a failure, which can affect their performance rating or promotion prospects. \u201cA culture of innovation must start at the top. Management needs to say it is okay to fail, as long as we fail fast and we are failing in the quest for innovation,\u201d says Mathieu.<\/p>\n\n\n\n
\u201cThis is, however, just half of the solution,\u201d he adds. For organizations to fully embrace an innovation culture, there must be mechanisms and processes in place to manage this inflow of ideas. Some companies use idea boxes while others utilize hackathons, or the 80\/20 rule made famous by Google. All these represent mechanisms by which ideas are solicited from employees, presented to management, filtered and supported or killed off quickly to keep the innovation momentum going. By adopting a fail-fast failure-tolerant innovation culture, organization leaders can inspire employees to think beyond their scope of work to help the company break into new levels of innovation.<\/p>\n\n\n\n
\u201cCorporate innovation takes time,\u201d Mathieu reflects. While in a startup the entire company is a sandbox where experiments can be run hot and fast, the situation is different for traditional corporate organizations. \u201cInstead of focusing on why innovation cannot work in your organization, focus instead on how you can create a sandbox environment to test your boldest ideas within a controlled environment. Creating such a sandbox environment allows the organization to test out innovations without going straight to the deep end, allowing for bolder and more frequent innovation experiments,\u201d concludes Mathieu.<\/p>\n\n\n\n
The traditional corporate environment is hardly fertile ground for innovation. With entrenched thinking, rigid management structures, and an established way of doing things, it is often difficult to convince employees to embrace innovation. In some cases, where the competition is usurping a company\u2019s market share, innovation is usually more of an act of survival than a preemptive strike. However, companies that have a strong market position may end up resting on their laurels, exposing them to rapid disruption from forward-thinking competitors or startups. To avoid being disrupted, traditional corporations must embrace corporate innovation.<\/p>\n\n\n\n
Mathieu Guerville heads up the venture capital arm of UL, a company that has been around for over a century and that is deeply entrenched in the safety testing niche. \u201cThe safety industry has evolved from people being worried about getting electrocuted by their kettle to people worrying about cyber threats,\u201d he says, \u201cand so having been stuck in its ways for all those years, UL has had to redefine what safety means and what it means to assess safety.\u201d This reassessment and realignment led the firm to start UL Ventures, which invests in startups involved in the safety assessment and testing field. From his experience heading up this unit, Mathieu shares what he believes are key elements corporations must adopt to foster corporate innovation within their ranks.<\/p>\n\n\n\n
\u201cWhenever we go looking for startups or other businesses to invest in, we first ensure the companies we approach align with our core mission statement,\u201d Mathieu says. This is a key insight for corporations that may get distracted by all the incredible technologies developing across different industries. While it is essential to explore developments in lateral industries, it is important to remain a mission-driven organization to sustain current momentum and keep current customers satisfied. In the case of UL, focusing on investing in startups that augment or complement its current mission statement ensures the firm\u2019s competitive advantage remains intact and continues to strengthen.<\/p>\n\n\n\n
\u201cIf you are building the next Instagram or dog walking app, we are not interested,\u201d says Mathieu. By having this laser-like focus, the firm has been able to go through seventy acquisitions without losing sight of its core mission. For executives considering innovation, it is essential first to define a clear mission statement and then use this as a guiding principle when acquiring or partnering with startups. Doing this will save the firm both money and time while ensuring maximization of opportunity cost through avoidance of timewasting ventures.<\/p>\n\n\n\n
\u201cWhy did UL start a venture capital arm?\u201d we asked Mathieu. \u201cOver time, UL simply could not keep up with all the advances in the technologies it inspects and certifies. Starting a VC arm was the natural progression to the direction we were taking to become a more innovative company,\u201d he explains. But, according to Mathieu, VC is not as simple as just putting together some money and throwing it at startups. The process of investing in and onboarding startups is often fraught with challenges such as culture clashes, poor returns and outright lack of fit as the startup evolves. He notes that while financial returns are important, they should not form the main agenda when investing in startups for innovation purposes.<\/p>\n\n\n\n
For the UL fund, he looks for three things in a startup before considering an investment.<\/p>\n\n\n\n
Besides focusing on this set of criteria, Mathieu also advises corporations to have a dedicated innovation team that stewards the entire corporate venture capital process. With such a team in place, it is easier to handle issues like culture clashes, startup onboarding, commercial agreements, IP protection, among other issues that are bound to arise.<\/p>\n\n\n\n
\u201cThe first step of innovation is ideation, and for ideation to happen, there must be curiosity,\u201d says Mathieu. Most corporations falter at this step because established cultures and norms do not allow for the presentation of ideas, most of which will inevitably fail. As failure is often frowned upon in traditional corporate settings, employees tend to keep their ideas to themselves lest they are labeled a failure, which can affect their performance rating or promotion prospects. \u201cA culture of innovation must start at the top. Management needs to say it is okay to fail, as long as we fail fast and we are failing in the quest for innovation,\u201d says Mathieu.<\/p>\n\n\n\n
\u201cThis is, however, just half of the solution,\u201d he adds. For organizations to fully embrace an innovation culture, there must be mechanisms and processes in place to manage this inflow of ideas. Some companies use idea boxes while others utilize hackathons, or the 80\/20 rule made famous by Google. All these represent mechanisms by which ideas are solicited from employees, presented to management, filtered and supported or killed off quickly to keep the innovation momentum going. By adopting a fail-fast failure-tolerant innovation culture, organization leaders can inspire employees to think beyond their scope of work to help the company break into new levels of innovation.<\/p>\n\n\n\n
\u201cCorporate innovation takes time,\u201d Mathieu reflects. While in a startup the entire company is a sandbox where experiments can be run hot and fast, the situation is different for traditional corporate organizations. \u201cInstead of focusing on why innovation cannot work in your organization, focus instead on how you can create a sandbox environment to test your boldest ideas within a controlled environment. Creating such a sandbox environment allows the organization to test out innovations without going straight to the deep end, allowing for bolder and more frequent innovation experiments,\u201d concludes Mathieu.<\/p>\n\n\n\n
The Silicon Valley Venture Capital Academy offers a unique opportunity to learn the investment strategies that top Silicon Valley venture capitalists use when investing in disruptive startups. The five-day immersion program includes learning sessions led by seasoned Silicon Valley venture capitalists, networking opportunities, and hands-on VC-led workshops.<\/p>\n","post_title":"Three Digital Transformation Innovations Disrupting Venture Capital","post_excerpt":"","post_status":"publish","comment_status":"open","ping_status":"closed","post_password":"","post_name":"three-digital-transformation-innovations-disrupting-venture-capital","to_ping":"","pinged":"","post_modified":"2020-02-08 14:52:57","post_modified_gmt":"2020-02-08 22:52:57","post_content_filtered":"","post_parent":0,"guid":"https:\/\/siliconvalley.center\/blog\/three-digital-transformation-innovations-disrupting-venture-capital\/","menu_order":0,"post_type":"post","post_mime_type":"","comment_count":"0","filter":"raw"},{"ID":660,"post_author":"1","post_date":"2018-08-15 19:11:00","post_date_gmt":"2018-08-16 02:11:00","post_content":"\n
The traditional corporate environment is hardly fertile ground for innovation. With entrenched thinking, rigid management structures, and an established way of doing things, it is often difficult to convince employees to embrace innovation. In some cases, where the competition is usurping a company\u2019s market share, innovation is usually more of an act of survival than a preemptive strike. However, companies that have a strong market position may end up resting on their laurels, exposing them to rapid disruption from forward-thinking competitors or startups. To avoid being disrupted, traditional corporations must embrace corporate innovation.<\/p>\n\n\n\n
Mathieu Guerville heads up the venture capital arm of UL, a company that has been around for over a century and that is deeply entrenched in the safety testing niche. \u201cThe safety industry has evolved from people being worried about getting electrocuted by their kettle to people worrying about cyber threats,\u201d he says, \u201cand so having been stuck in its ways for all those years, UL has had to redefine what safety means and what it means to assess safety.\u201d This reassessment and realignment led the firm to start UL Ventures, which invests in startups involved in the safety assessment and testing field. From his experience heading up this unit, Mathieu shares what he believes are key elements corporations must adopt to foster corporate innovation within their ranks.<\/p>\n\n\n\n
\u201cWhenever we go looking for startups or other businesses to invest in, we first ensure the companies we approach align with our core mission statement,\u201d Mathieu says. This is a key insight for corporations that may get distracted by all the incredible technologies developing across different industries. While it is essential to explore developments in lateral industries, it is important to remain a mission-driven organization to sustain current momentum and keep current customers satisfied. In the case of UL, focusing on investing in startups that augment or complement its current mission statement ensures the firm\u2019s competitive advantage remains intact and continues to strengthen.<\/p>\n\n\n\n
\u201cIf you are building the next Instagram or dog walking app, we are not interested,\u201d says Mathieu. By having this laser-like focus, the firm has been able to go through seventy acquisitions without losing sight of its core mission. For executives considering innovation, it is essential first to define a clear mission statement and then use this as a guiding principle when acquiring or partnering with startups. Doing this will save the firm both money and time while ensuring maximization of opportunity cost through avoidance of timewasting ventures.<\/p>\n\n\n\n
\u201cWhy did UL start a venture capital arm?\u201d we asked Mathieu. \u201cOver time, UL simply could not keep up with all the advances in the technologies it inspects and certifies. Starting a VC arm was the natural progression to the direction we were taking to become a more innovative company,\u201d he explains. But, according to Mathieu, VC is not as simple as just putting together some money and throwing it at startups. The process of investing in and onboarding startups is often fraught with challenges such as culture clashes, poor returns and outright lack of fit as the startup evolves. He notes that while financial returns are important, they should not form the main agenda when investing in startups for innovation purposes.<\/p>\n\n\n\n
For the UL fund, he looks for three things in a startup before considering an investment.<\/p>\n\n\n\n
Besides focusing on this set of criteria, Mathieu also advises corporations to have a dedicated innovation team that stewards the entire corporate venture capital process. With such a team in place, it is easier to handle issues like culture clashes, startup onboarding, commercial agreements, IP protection, among other issues that are bound to arise.<\/p>\n\n\n\n
\u201cThe first step of innovation is ideation, and for ideation to happen, there must be curiosity,\u201d says Mathieu. Most corporations falter at this step because established cultures and norms do not allow for the presentation of ideas, most of which will inevitably fail. As failure is often frowned upon in traditional corporate settings, employees tend to keep their ideas to themselves lest they are labeled a failure, which can affect their performance rating or promotion prospects. \u201cA culture of innovation must start at the top. Management needs to say it is okay to fail, as long as we fail fast and we are failing in the quest for innovation,\u201d says Mathieu.<\/p>\n\n\n\n
\u201cThis is, however, just half of the solution,\u201d he adds. For organizations to fully embrace an innovation culture, there must be mechanisms and processes in place to manage this inflow of ideas. Some companies use idea boxes while others utilize hackathons, or the 80\/20 rule made famous by Google. All these represent mechanisms by which ideas are solicited from employees, presented to management, filtered and supported or killed off quickly to keep the innovation momentum going. By adopting a fail-fast failure-tolerant innovation culture, organization leaders can inspire employees to think beyond their scope of work to help the company break into new levels of innovation.<\/p>\n\n\n\n
\u201cCorporate innovation takes time,\u201d Mathieu reflects. While in a startup the entire company is a sandbox where experiments can be run hot and fast, the situation is different for traditional corporate organizations. \u201cInstead of focusing on why innovation cannot work in your organization, focus instead on how you can create a sandbox environment to test your boldest ideas within a controlled environment. Creating such a sandbox environment allows the organization to test out innovations without going straight to the deep end, allowing for bolder and more frequent innovation experiments,\u201d concludes Mathieu.<\/p>\n\n\n\n
The Silicon Valley Venture Capital Academy offers a unique opportunity to learn the investment strategies that top Silicon Valley venture capitalists use when investing in disruptive startups. The five-day immersion program includes learning sessions led by seasoned Silicon Valley venture capitalists, networking opportunities, and hands-on VC-led workshops.<\/p>\n","post_title":"Three Digital Transformation Innovations Disrupting Venture Capital","post_excerpt":"","post_status":"publish","comment_status":"open","ping_status":"closed","post_password":"","post_name":"three-digital-transformation-innovations-disrupting-venture-capital","to_ping":"","pinged":"","post_modified":"2020-02-08 14:52:57","post_modified_gmt":"2020-02-08 22:52:57","post_content_filtered":"","post_parent":0,"guid":"https:\/\/siliconvalley.center\/blog\/three-digital-transformation-innovations-disrupting-venture-capital\/","menu_order":0,"post_type":"post","post_mime_type":"","comment_count":"0","filter":"raw"},{"ID":660,"post_author":"1","post_date":"2018-08-15 19:11:00","post_date_gmt":"2018-08-16 02:11:00","post_content":"\n
The traditional corporate environment is hardly fertile ground for innovation. With entrenched thinking, rigid management structures, and an established way of doing things, it is often difficult to convince employees to embrace innovation. In some cases, where the competition is usurping a company\u2019s market share, innovation is usually more of an act of survival than a preemptive strike. However, companies that have a strong market position may end up resting on their laurels, exposing them to rapid disruption from forward-thinking competitors or startups. To avoid being disrupted, traditional corporations must embrace corporate innovation.<\/p>\n\n\n\n
Mathieu Guerville heads up the venture capital arm of UL, a company that has been around for over a century and that is deeply entrenched in the safety testing niche. \u201cThe safety industry has evolved from people being worried about getting electrocuted by their kettle to people worrying about cyber threats,\u201d he says, \u201cand so having been stuck in its ways for all those years, UL has had to redefine what safety means and what it means to assess safety.\u201d This reassessment and realignment led the firm to start UL Ventures, which invests in startups involved in the safety assessment and testing field. From his experience heading up this unit, Mathieu shares what he believes are key elements corporations must adopt to foster corporate innovation within their ranks.<\/p>\n\n\n\n
\u201cWhenever we go looking for startups or other businesses to invest in, we first ensure the companies we approach align with our core mission statement,\u201d Mathieu says. This is a key insight for corporations that may get distracted by all the incredible technologies developing across different industries. While it is essential to explore developments in lateral industries, it is important to remain a mission-driven organization to sustain current momentum and keep current customers satisfied. In the case of UL, focusing on investing in startups that augment or complement its current mission statement ensures the firm\u2019s competitive advantage remains intact and continues to strengthen.<\/p>\n\n\n\n
\u201cIf you are building the next Instagram or dog walking app, we are not interested,\u201d says Mathieu. By having this laser-like focus, the firm has been able to go through seventy acquisitions without losing sight of its core mission. For executives considering innovation, it is essential first to define a clear mission statement and then use this as a guiding principle when acquiring or partnering with startups. Doing this will save the firm both money and time while ensuring maximization of opportunity cost through avoidance of timewasting ventures.<\/p>\n\n\n\n
\u201cWhy did UL start a venture capital arm?\u201d we asked Mathieu. \u201cOver time, UL simply could not keep up with all the advances in the technologies it inspects and certifies. Starting a VC arm was the natural progression to the direction we were taking to become a more innovative company,\u201d he explains. But, according to Mathieu, VC is not as simple as just putting together some money and throwing it at startups. The process of investing in and onboarding startups is often fraught with challenges such as culture clashes, poor returns and outright lack of fit as the startup evolves. He notes that while financial returns are important, they should not form the main agenda when investing in startups for innovation purposes.<\/p>\n\n\n\n
For the UL fund, he looks for three things in a startup before considering an investment.<\/p>\n\n\n\n
Besides focusing on this set of criteria, Mathieu also advises corporations to have a dedicated innovation team that stewards the entire corporate venture capital process. With such a team in place, it is easier to handle issues like culture clashes, startup onboarding, commercial agreements, IP protection, among other issues that are bound to arise.<\/p>\n\n\n\n
\u201cThe first step of innovation is ideation, and for ideation to happen, there must be curiosity,\u201d says Mathieu. Most corporations falter at this step because established cultures and norms do not allow for the presentation of ideas, most of which will inevitably fail. As failure is often frowned upon in traditional corporate settings, employees tend to keep their ideas to themselves lest they are labeled a failure, which can affect their performance rating or promotion prospects. \u201cA culture of innovation must start at the top. Management needs to say it is okay to fail, as long as we fail fast and we are failing in the quest for innovation,\u201d says Mathieu.<\/p>\n\n\n\n
\u201cThis is, however, just half of the solution,\u201d he adds. For organizations to fully embrace an innovation culture, there must be mechanisms and processes in place to manage this inflow of ideas. Some companies use idea boxes while others utilize hackathons, or the 80\/20 rule made famous by Google. All these represent mechanisms by which ideas are solicited from employees, presented to management, filtered and supported or killed off quickly to keep the innovation momentum going. By adopting a fail-fast failure-tolerant innovation culture, organization leaders can inspire employees to think beyond their scope of work to help the company break into new levels of innovation.<\/p>\n\n\n\n
\u201cCorporate innovation takes time,\u201d Mathieu reflects. While in a startup the entire company is a sandbox where experiments can be run hot and fast, the situation is different for traditional corporate organizations. \u201cInstead of focusing on why innovation cannot work in your organization, focus instead on how you can create a sandbox environment to test your boldest ideas within a controlled environment. Creating such a sandbox environment allows the organization to test out innovations without going straight to the deep end, allowing for bolder and more frequent innovation experiments,\u201d concludes Mathieu.<\/p>\n\n\n\n
The Silicon Valley Venture Capital Academy offers a unique opportunity to learn the investment strategies that top Silicon Valley venture capitalists use when investing in disruptive startups. The five-day immersion program includes learning sessions led by seasoned Silicon Valley venture capitalists, networking opportunities, and hands-on VC-led workshops.<\/p>\n","post_title":"Three Digital Transformation Innovations Disrupting Venture Capital","post_excerpt":"","post_status":"publish","comment_status":"open","ping_status":"closed","post_password":"","post_name":"three-digital-transformation-innovations-disrupting-venture-capital","to_ping":"","pinged":"","post_modified":"2020-02-08 14:52:57","post_modified_gmt":"2020-02-08 22:52:57","post_content_filtered":"","post_parent":0,"guid":"https:\/\/siliconvalley.center\/blog\/three-digital-transformation-innovations-disrupting-venture-capital\/","menu_order":0,"post_type":"post","post_mime_type":"","comment_count":"0","filter":"raw"},{"ID":660,"post_author":"1","post_date":"2018-08-15 19:11:00","post_date_gmt":"2018-08-16 02:11:00","post_content":"\n
The traditional corporate environment is hardly fertile ground for innovation. With entrenched thinking, rigid management structures, and an established way of doing things, it is often difficult to convince employees to embrace innovation. In some cases, where the competition is usurping a company\u2019s market share, innovation is usually more of an act of survival than a preemptive strike. However, companies that have a strong market position may end up resting on their laurels, exposing them to rapid disruption from forward-thinking competitors or startups. To avoid being disrupted, traditional corporations must embrace corporate innovation.<\/p>\n\n\n\n
Mathieu Guerville heads up the venture capital arm of UL, a company that has been around for over a century and that is deeply entrenched in the safety testing niche. \u201cThe safety industry has evolved from people being worried about getting electrocuted by their kettle to people worrying about cyber threats,\u201d he says, \u201cand so having been stuck in its ways for all those years, UL has had to redefine what safety means and what it means to assess safety.\u201d This reassessment and realignment led the firm to start UL Ventures, which invests in startups involved in the safety assessment and testing field. From his experience heading up this unit, Mathieu shares what he believes are key elements corporations must adopt to foster corporate innovation within their ranks.<\/p>\n\n\n\n
\u201cWhenever we go looking for startups or other businesses to invest in, we first ensure the companies we approach align with our core mission statement,\u201d Mathieu says. This is a key insight for corporations that may get distracted by all the incredible technologies developing across different industries. While it is essential to explore developments in lateral industries, it is important to remain a mission-driven organization to sustain current momentum and keep current customers satisfied. In the case of UL, focusing on investing in startups that augment or complement its current mission statement ensures the firm\u2019s competitive advantage remains intact and continues to strengthen.<\/p>\n\n\n\n
\u201cIf you are building the next Instagram or dog walking app, we are not interested,\u201d says Mathieu. By having this laser-like focus, the firm has been able to go through seventy acquisitions without losing sight of its core mission. For executives considering innovation, it is essential first to define a clear mission statement and then use this as a guiding principle when acquiring or partnering with startups. Doing this will save the firm both money and time while ensuring maximization of opportunity cost through avoidance of timewasting ventures.<\/p>\n\n\n\n
\u201cWhy did UL start a venture capital arm?\u201d we asked Mathieu. \u201cOver time, UL simply could not keep up with all the advances in the technologies it inspects and certifies. Starting a VC arm was the natural progression to the direction we were taking to become a more innovative company,\u201d he explains. But, according to Mathieu, VC is not as simple as just putting together some money and throwing it at startups. The process of investing in and onboarding startups is often fraught with challenges such as culture clashes, poor returns and outright lack of fit as the startup evolves. He notes that while financial returns are important, they should not form the main agenda when investing in startups for innovation purposes.<\/p>\n\n\n\n
For the UL fund, he looks for three things in a startup before considering an investment.<\/p>\n\n\n\n
Besides focusing on this set of criteria, Mathieu also advises corporations to have a dedicated innovation team that stewards the entire corporate venture capital process. With such a team in place, it is easier to handle issues like culture clashes, startup onboarding, commercial agreements, IP protection, among other issues that are bound to arise.<\/p>\n\n\n\n
\u201cThe first step of innovation is ideation, and for ideation to happen, there must be curiosity,\u201d says Mathieu. Most corporations falter at this step because established cultures and norms do not allow for the presentation of ideas, most of which will inevitably fail. As failure is often frowned upon in traditional corporate settings, employees tend to keep their ideas to themselves lest they are labeled a failure, which can affect their performance rating or promotion prospects. \u201cA culture of innovation must start at the top. Management needs to say it is okay to fail, as long as we fail fast and we are failing in the quest for innovation,\u201d says Mathieu.<\/p>\n\n\n\n
\u201cThis is, however, just half of the solution,\u201d he adds. For organizations to fully embrace an innovation culture, there must be mechanisms and processes in place to manage this inflow of ideas. Some companies use idea boxes while others utilize hackathons, or the 80\/20 rule made famous by Google. All these represent mechanisms by which ideas are solicited from employees, presented to management, filtered and supported or killed off quickly to keep the innovation momentum going. By adopting a fail-fast failure-tolerant innovation culture, organization leaders can inspire employees to think beyond their scope of work to help the company break into new levels of innovation.<\/p>\n\n\n\n
\u201cCorporate innovation takes time,\u201d Mathieu reflects. While in a startup the entire company is a sandbox where experiments can be run hot and fast, the situation is different for traditional corporate organizations. \u201cInstead of focusing on why innovation cannot work in your organization, focus instead on how you can create a sandbox environment to test your boldest ideas within a controlled environment. Creating such a sandbox environment allows the organization to test out innovations without going straight to the deep end, allowing for bolder and more frequent innovation experiments,\u201d concludes Mathieu.<\/p>\n\n\n\n
While VC in the United States is enjoying one of its best run rates in recent history<\/a>, the reality is that disruption begins from edge case scenarios. While most traditional VC firms chase after unicorns and billion dollar exits using a 150-year-old funding framework, there will emerge new digital-first VC firms that will tap into the massive potential of startups that do not fit this investment pattern. As with the story of taxicab companies resting on their laurels and ignoring the frustrated masses only to be disrupted by digital-first Uber, here is presented a situation where the venture capital industry has become ripe for disruption, and the companies that disrupt it will be the next billion-dollar or even trillion-dollar VC companies of tomorrow.<\/p>\n\n\n\n The Silicon Valley Venture Capital Academy offers a unique opportunity to learn the investment strategies that top Silicon Valley venture capitalists use when investing in disruptive startups. The five-day immersion program includes learning sessions led by seasoned Silicon Valley venture capitalists, networking opportunities, and hands-on VC-led workshops.<\/p>\n","post_title":"Three Digital Transformation Innovations Disrupting Venture Capital","post_excerpt":"","post_status":"publish","comment_status":"open","ping_status":"closed","post_password":"","post_name":"three-digital-transformation-innovations-disrupting-venture-capital","to_ping":"","pinged":"","post_modified":"2020-02-08 14:52:57","post_modified_gmt":"2020-02-08 22:52:57","post_content_filtered":"","post_parent":0,"guid":"https:\/\/siliconvalley.center\/blog\/three-digital-transformation-innovations-disrupting-venture-capital\/","menu_order":0,"post_type":"post","post_mime_type":"","comment_count":"0","filter":"raw"},{"ID":660,"post_author":"1","post_date":"2018-08-15 19:11:00","post_date_gmt":"2018-08-16 02:11:00","post_content":"\n The traditional corporate environment is hardly fertile ground for innovation. With entrenched thinking, rigid management structures, and an established way of doing things, it is often difficult to convince employees to embrace innovation. In some cases, where the competition is usurping a company\u2019s market share, innovation is usually more of an act of survival than a preemptive strike. However, companies that have a strong market position may end up resting on their laurels, exposing them to rapid disruption from forward-thinking competitors or startups. To avoid being disrupted, traditional corporations must embrace corporate innovation.<\/p>\n\n\n\n Mathieu Guerville heads up the venture capital arm of UL, a company that has been around for over a century and that is deeply entrenched in the safety testing niche. \u201cThe safety industry has evolved from people being worried about getting electrocuted by their kettle to people worrying about cyber threats,\u201d he says, \u201cand so having been stuck in its ways for all those years, UL has had to redefine what safety means and what it means to assess safety.\u201d This reassessment and realignment led the firm to start UL Ventures, which invests in startups involved in the safety assessment and testing field. From his experience heading up this unit, Mathieu shares what he believes are key elements corporations must adopt to foster corporate innovation within their ranks.<\/p>\n\n\n\n \u201cWhenever we go looking for startups or other businesses to invest in, we first ensure the companies we approach align with our core mission statement,\u201d Mathieu says. This is a key insight for corporations that may get distracted by all the incredible technologies developing across different industries. While it is essential to explore developments in lateral industries, it is important to remain a mission-driven organization to sustain current momentum and keep current customers satisfied. In the case of UL, focusing on investing in startups that augment or complement its current mission statement ensures the firm\u2019s competitive advantage remains intact and continues to strengthen.<\/p>\n\n\n\n \u201cIf you are building the next Instagram or dog walking app, we are not interested,\u201d says Mathieu. By having this laser-like focus, the firm has been able to go through seventy acquisitions without losing sight of its core mission. For executives considering innovation, it is essential first to define a clear mission statement and then use this as a guiding principle when acquiring or partnering with startups. Doing this will save the firm both money and time while ensuring maximization of opportunity cost through avoidance of timewasting ventures.<\/p>\n\n\n\n \u201cWhy did UL start a venture capital arm?\u201d we asked Mathieu. \u201cOver time, UL simply could not keep up with all the advances in the technologies it inspects and certifies. Starting a VC arm was the natural progression to the direction we were taking to become a more innovative company,\u201d he explains. But, according to Mathieu, VC is not as simple as just putting together some money and throwing it at startups. The process of investing in and onboarding startups is often fraught with challenges such as culture clashes, poor returns and outright lack of fit as the startup evolves. He notes that while financial returns are important, they should not form the main agenda when investing in startups for innovation purposes.<\/p>\n\n\n\n For the UL fund, he looks for three things in a startup before considering an investment.<\/p>\n\n\n\n Besides focusing on this set of criteria, Mathieu also advises corporations to have a dedicated innovation team that stewards the entire corporate venture capital process. With such a team in place, it is easier to handle issues like culture clashes, startup onboarding, commercial agreements, IP protection, among other issues that are bound to arise.<\/p>\n\n\n\n \u201cThe first step of innovation is ideation, and for ideation to happen, there must be curiosity,\u201d says Mathieu. Most corporations falter at this step because established cultures and norms do not allow for the presentation of ideas, most of which will inevitably fail. As failure is often frowned upon in traditional corporate settings, employees tend to keep their ideas to themselves lest they are labeled a failure, which can affect their performance rating or promotion prospects. \u201cA culture of innovation must start at the top. Management needs to say it is okay to fail, as long as we fail fast and we are failing in the quest for innovation,\u201d says Mathieu.<\/p>\n\n\n\n \u201cThis is, however, just half of the solution,\u201d he adds. For organizations to fully embrace an innovation culture, there must be mechanisms and processes in place to manage this inflow of ideas. Some companies use idea boxes while others utilize hackathons, or the 80\/20 rule made famous by Google. All these represent mechanisms by which ideas are solicited from employees, presented to management, filtered and supported or killed off quickly to keep the innovation momentum going. By adopting a fail-fast failure-tolerant innovation culture, organization leaders can inspire employees to think beyond their scope of work to help the company break into new levels of innovation.<\/p>\n\n\n\n \u201cCorporate innovation takes time,\u201d Mathieu reflects. While in a startup the entire company is a sandbox where experiments can be run hot and fast, the situation is different for traditional corporate organizations. \u201cInstead of focusing on why innovation cannot work in your organization, focus instead on how you can create a sandbox environment to test your boldest ideas within a controlled environment. Creating such a sandbox environment allows the organization to test out innovations without going straight to the deep end, allowing for bolder and more frequent innovation experiments,\u201d concludes Mathieu.<\/p>\n\n\n\n While VC in the United States is enjoying one of its best run rates in recent history<\/a>, the reality is that disruption begins from edge case scenarios. While most traditional VC firms chase after unicorns and billion dollar exits using a 150-year-old funding framework, there will emerge new digital-first VC firms that will tap into the massive potential of startups that do not fit this investment pattern. As with the story of taxicab companies resting on their laurels and ignoring the frustrated masses only to be disrupted by digital-first Uber, here is presented a situation where the venture capital industry has become ripe for disruption, and the companies that disrupt it will be the next billion-dollar or even trillion-dollar VC companies of tomorrow.<\/p>\n\n\n\n The Silicon Valley Venture Capital Academy offers a unique opportunity to learn the investment strategies that top Silicon Valley venture capitalists use when investing in disruptive startups. The five-day immersion program includes learning sessions led by seasoned Silicon Valley venture capitalists, networking opportunities, and hands-on VC-led workshops.<\/p>\n","post_title":"Three Digital Transformation Innovations Disrupting Venture Capital","post_excerpt":"","post_status":"publish","comment_status":"open","ping_status":"closed","post_password":"","post_name":"three-digital-transformation-innovations-disrupting-venture-capital","to_ping":"","pinged":"","post_modified":"2020-02-08 14:52:57","post_modified_gmt":"2020-02-08 22:52:57","post_content_filtered":"","post_parent":0,"guid":"https:\/\/siliconvalley.center\/blog\/three-digital-transformation-innovations-disrupting-venture-capital\/","menu_order":0,"post_type":"post","post_mime_type":"","comment_count":"0","filter":"raw"},{"ID":660,"post_author":"1","post_date":"2018-08-15 19:11:00","post_date_gmt":"2018-08-16 02:11:00","post_content":"\n The traditional corporate environment is hardly fertile ground for innovation. With entrenched thinking, rigid management structures, and an established way of doing things, it is often difficult to convince employees to embrace innovation. In some cases, where the competition is usurping a company\u2019s market share, innovation is usually more of an act of survival than a preemptive strike. However, companies that have a strong market position may end up resting on their laurels, exposing them to rapid disruption from forward-thinking competitors or startups. To avoid being disrupted, traditional corporations must embrace corporate innovation.<\/p>\n\n\n\n Mathieu Guerville heads up the venture capital arm of UL, a company that has been around for over a century and that is deeply entrenched in the safety testing niche. \u201cThe safety industry has evolved from people being worried about getting electrocuted by their kettle to people worrying about cyber threats,\u201d he says, \u201cand so having been stuck in its ways for all those years, UL has had to redefine what safety means and what it means to assess safety.\u201d This reassessment and realignment led the firm to start UL Ventures, which invests in startups involved in the safety assessment and testing field. From his experience heading up this unit, Mathieu shares what he believes are key elements corporations must adopt to foster corporate innovation within their ranks.<\/p>\n\n\n\n \u201cWhenever we go looking for startups or other businesses to invest in, we first ensure the companies we approach align with our core mission statement,\u201d Mathieu says. This is a key insight for corporations that may get distracted by all the incredible technologies developing across different industries. While it is essential to explore developments in lateral industries, it is important to remain a mission-driven organization to sustain current momentum and keep current customers satisfied. In the case of UL, focusing on investing in startups that augment or complement its current mission statement ensures the firm\u2019s competitive advantage remains intact and continues to strengthen.<\/p>\n\n\n\n \u201cIf you are building the next Instagram or dog walking app, we are not interested,\u201d says Mathieu. By having this laser-like focus, the firm has been able to go through seventy acquisitions without losing sight of its core mission. For executives considering innovation, it is essential first to define a clear mission statement and then use this as a guiding principle when acquiring or partnering with startups. Doing this will save the firm both money and time while ensuring maximization of opportunity cost through avoidance of timewasting ventures.<\/p>\n\n\n\n \u201cWhy did UL start a venture capital arm?\u201d we asked Mathieu. \u201cOver time, UL simply could not keep up with all the advances in the technologies it inspects and certifies. Starting a VC arm was the natural progression to the direction we were taking to become a more innovative company,\u201d he explains. But, according to Mathieu, VC is not as simple as just putting together some money and throwing it at startups. The process of investing in and onboarding startups is often fraught with challenges such as culture clashes, poor returns and outright lack of fit as the startup evolves. He notes that while financial returns are important, they should not form the main agenda when investing in startups for innovation purposes.<\/p>\n\n\n\n For the UL fund, he looks for three things in a startup before considering an investment.<\/p>\n\n\n\n Besides focusing on this set of criteria, Mathieu also advises corporations to have a dedicated innovation team that stewards the entire corporate venture capital process. With such a team in place, it is easier to handle issues like culture clashes, startup onboarding, commercial agreements, IP protection, among other issues that are bound to arise.<\/p>\n\n\n\n \u201cThe first step of innovation is ideation, and for ideation to happen, there must be curiosity,\u201d says Mathieu. Most corporations falter at this step because established cultures and norms do not allow for the presentation of ideas, most of which will inevitably fail. As failure is often frowned upon in traditional corporate settings, employees tend to keep their ideas to themselves lest they are labeled a failure, which can affect their performance rating or promotion prospects. \u201cA culture of innovation must start at the top. Management needs to say it is okay to fail, as long as we fail fast and we are failing in the quest for innovation,\u201d says Mathieu.<\/p>\n\n\n\n \u201cThis is, however, just half of the solution,\u201d he adds. For organizations to fully embrace an innovation culture, there must be mechanisms and processes in place to manage this inflow of ideas. Some companies use idea boxes while others utilize hackathons, or the 80\/20 rule made famous by Google. All these represent mechanisms by which ideas are solicited from employees, presented to management, filtered and supported or killed off quickly to keep the innovation momentum going. By adopting a fail-fast failure-tolerant innovation culture, organization leaders can inspire employees to think beyond their scope of work to help the company break into new levels of innovation.<\/p>\n\n\n\n \u201cCorporate innovation takes time,\u201d Mathieu reflects. While in a startup the entire company is a sandbox where experiments can be run hot and fast, the situation is different for traditional corporate organizations. \u201cInstead of focusing on why innovation cannot work in your organization, focus instead on how you can create a sandbox environment to test your boldest ideas within a controlled environment. Creating such a sandbox environment allows the organization to test out innovations without going straight to the deep end, allowing for bolder and more frequent innovation experiments,\u201d concludes Mathieu.<\/p>\n\n\n\n Pattern-investing has created an opportunity for alternative funding in the form of equity crowdfunding. As retail investors become better educated and better connected to startups through digital crowdfunding platforms like Wefunder and Indiegogo Equity, more of these non-unicorn startups are turning to crowdfunding. With the introduction of Regulation Crowdfunding<\/a> by the SEC, startups and investors can build more sustainable and mutually-beneficial funding relationships that are not heavily influenced by the pressure that comes with traditional VC money. In this way, digital transformation, as with other industries, has put the power of investing squarely in the hands of the masses, creating a powerfully disruptive disintermediation trend that has the potential to disrupt traditional VC.<\/p>\n\n\n\n While VC in the United States is enjoying one of its best run rates in recent history<\/a>, the reality is that disruption begins from edge case scenarios. While most traditional VC firms chase after unicorns and billion dollar exits using a 150-year-old funding framework, there will emerge new digital-first VC firms that will tap into the massive potential of startups that do not fit this investment pattern. As with the story of taxicab companies resting on their laurels and ignoring the frustrated masses only to be disrupted by digital-first Uber, here is presented a situation where the venture capital industry has become ripe for disruption, and the companies that disrupt it will be the next billion-dollar or even trillion-dollar VC companies of tomorrow.<\/p>\n\n\n\n The Silicon Valley Venture Capital Academy offers a unique opportunity to learn the investment strategies that top Silicon Valley venture capitalists use when investing in disruptive startups. The five-day immersion program includes learning sessions led by seasoned Silicon Valley venture capitalists, networking opportunities, and hands-on VC-led workshops.<\/p>\n","post_title":"Three Digital Transformation Innovations Disrupting Venture Capital","post_excerpt":"","post_status":"publish","comment_status":"open","ping_status":"closed","post_password":"","post_name":"three-digital-transformation-innovations-disrupting-venture-capital","to_ping":"","pinged":"","post_modified":"2020-02-08 14:52:57","post_modified_gmt":"2020-02-08 22:52:57","post_content_filtered":"","post_parent":0,"guid":"https:\/\/siliconvalley.center\/blog\/three-digital-transformation-innovations-disrupting-venture-capital\/","menu_order":0,"post_type":"post","post_mime_type":"","comment_count":"0","filter":"raw"},{"ID":660,"post_author":"1","post_date":"2018-08-15 19:11:00","post_date_gmt":"2018-08-16 02:11:00","post_content":"\n The traditional corporate environment is hardly fertile ground for innovation. With entrenched thinking, rigid management structures, and an established way of doing things, it is often difficult to convince employees to embrace innovation. In some cases, where the competition is usurping a company\u2019s market share, innovation is usually more of an act of survival than a preemptive strike. However, companies that have a strong market position may end up resting on their laurels, exposing them to rapid disruption from forward-thinking competitors or startups. To avoid being disrupted, traditional corporations must embrace corporate innovation.<\/p>\n\n\n\n Mathieu Guerville heads up the venture capital arm of UL, a company that has been around for over a century and that is deeply entrenched in the safety testing niche. \u201cThe safety industry has evolved from people being worried about getting electrocuted by their kettle to people worrying about cyber threats,\u201d he says, \u201cand so having been stuck in its ways for all those years, UL has had to redefine what safety means and what it means to assess safety.\u201d This reassessment and realignment led the firm to start UL Ventures, which invests in startups involved in the safety assessment and testing field. From his experience heading up this unit, Mathieu shares what he believes are key elements corporations must adopt to foster corporate innovation within their ranks.<\/p>\n\n\n\n \u201cWhenever we go looking for startups or other businesses to invest in, we first ensure the companies we approach align with our core mission statement,\u201d Mathieu says. This is a key insight for corporations that may get distracted by all the incredible technologies developing across different industries. While it is essential to explore developments in lateral industries, it is important to remain a mission-driven organization to sustain current momentum and keep current customers satisfied. In the case of UL, focusing on investing in startups that augment or complement its current mission statement ensures the firm\u2019s competitive advantage remains intact and continues to strengthen.<\/p>\n\n\n\n \u201cIf you are building the next Instagram or dog walking app, we are not interested,\u201d says Mathieu. By having this laser-like focus, the firm has been able to go through seventy acquisitions without losing sight of its core mission. For executives considering innovation, it is essential first to define a clear mission statement and then use this as a guiding principle when acquiring or partnering with startups. Doing this will save the firm both money and time while ensuring maximization of opportunity cost through avoidance of timewasting ventures.<\/p>\n\n\n\n \u201cWhy did UL start a venture capital arm?\u201d we asked Mathieu. \u201cOver time, UL simply could not keep up with all the advances in the technologies it inspects and certifies. Starting a VC arm was the natural progression to the direction we were taking to become a more innovative company,\u201d he explains. But, according to Mathieu, VC is not as simple as just putting together some money and throwing it at startups. The process of investing in and onboarding startups is often fraught with challenges such as culture clashes, poor returns and outright lack of fit as the startup evolves. He notes that while financial returns are important, they should not form the main agenda when investing in startups for innovation purposes.<\/p>\n\n\n\n For the UL fund, he looks for three things in a startup before considering an investment.<\/p>\n\n\n\n Besides focusing on this set of criteria, Mathieu also advises corporations to have a dedicated innovation team that stewards the entire corporate venture capital process. With such a team in place, it is easier to handle issues like culture clashes, startup onboarding, commercial agreements, IP protection, among other issues that are bound to arise.<\/p>\n\n\n\n \u201cThe first step of innovation is ideation, and for ideation to happen, there must be curiosity,\u201d says Mathieu. Most corporations falter at this step because established cultures and norms do not allow for the presentation of ideas, most of which will inevitably fail. As failure is often frowned upon in traditional corporate settings, employees tend to keep their ideas to themselves lest they are labeled a failure, which can affect their performance rating or promotion prospects. \u201cA culture of innovation must start at the top. Management needs to say it is okay to fail, as long as we fail fast and we are failing in the quest for innovation,\u201d says Mathieu.<\/p>\n\n\n\n \u201cThis is, however, just half of the solution,\u201d he adds. For organizations to fully embrace an innovation culture, there must be mechanisms and processes in place to manage this inflow of ideas. Some companies use idea boxes while others utilize hackathons, or the 80\/20 rule made famous by Google. All these represent mechanisms by which ideas are solicited from employees, presented to management, filtered and supported or killed off quickly to keep the innovation momentum going. By adopting a fail-fast failure-tolerant innovation culture, organization leaders can inspire employees to think beyond their scope of work to help the company break into new levels of innovation.<\/p>\n\n\n\n \u201cCorporate innovation takes time,\u201d Mathieu reflects. While in a startup the entire company is a sandbox where experiments can be run hot and fast, the situation is different for traditional corporate organizations. \u201cInstead of focusing on why innovation cannot work in your organization, focus instead on how you can create a sandbox environment to test your boldest ideas within a controlled environment. Creating such a sandbox environment allows the organization to test out innovations without going straight to the deep end, allowing for bolder and more frequent innovation experiments,\u201d concludes Mathieu.<\/p>\n\n\n\n Venture capital is pattern based. It is perhaps the reason why VCs are called lemmings. This pattern-based behavior is not without cause. Most VCs are tasked by investors to find the best investment opportunities and act fast on them. No VC wants to be known as the one that passed on the next Facebook or Google. However, this pattern-investing has created a systemic issue with traditional venture capital that is ripe for disruption. While most VCs look for prototypical unicorns, the vast majority of startups will not achieve a billion-dollar valuation<\/a>, or a short exit horizon<\/a>, a prerequisite of most VC firms.<\/p>\n\n\n\n Pattern-investing has created an opportunity for alternative funding in the form of equity crowdfunding. As retail investors become better educated and better connected to startups through digital crowdfunding platforms like Wefunder and Indiegogo Equity, more of these non-unicorn startups are turning to crowdfunding. With the introduction of Regulation Crowdfunding<\/a> by the SEC, startups and investors can build more sustainable and mutually-beneficial funding relationships that are not heavily influenced by the pressure that comes with traditional VC money. In this way, digital transformation, as with other industries, has put the power of investing squarely in the hands of the masses, creating a powerfully disruptive disintermediation trend that has the potential to disrupt traditional VC.<\/p>\n\n\n\n While VC in the United States is enjoying one of its best run rates in recent history<\/a>, the reality is that disruption begins from edge case scenarios. While most traditional VC firms chase after unicorns and billion dollar exits using a 150-year-old funding framework, there will emerge new digital-first VC firms that will tap into the massive potential of startups that do not fit this investment pattern. As with the story of taxicab companies resting on their laurels and ignoring the frustrated masses only to be disrupted by digital-first Uber, here is presented a situation where the venture capital industry has become ripe for disruption, and the companies that disrupt it will be the next billion-dollar or even trillion-dollar VC companies of tomorrow.<\/p>\n\n\n\n The Silicon Valley Venture Capital Academy offers a unique opportunity to learn the investment strategies that top Silicon Valley venture capitalists use when investing in disruptive startups. The five-day immersion program includes learning sessions led by seasoned Silicon Valley venture capitalists, networking opportunities, and hands-on VC-led workshops.<\/p>\n","post_title":"Three Digital Transformation Innovations Disrupting Venture Capital","post_excerpt":"","post_status":"publish","comment_status":"open","ping_status":"closed","post_password":"","post_name":"three-digital-transformation-innovations-disrupting-venture-capital","to_ping":"","pinged":"","post_modified":"2020-02-08 14:52:57","post_modified_gmt":"2020-02-08 22:52:57","post_content_filtered":"","post_parent":0,"guid":"https:\/\/siliconvalley.center\/blog\/three-digital-transformation-innovations-disrupting-venture-capital\/","menu_order":0,"post_type":"post","post_mime_type":"","comment_count":"0","filter":"raw"},{"ID":660,"post_author":"1","post_date":"2018-08-15 19:11:00","post_date_gmt":"2018-08-16 02:11:00","post_content":"\n The traditional corporate environment is hardly fertile ground for innovation. With entrenched thinking, rigid management structures, and an established way of doing things, it is often difficult to convince employees to embrace innovation. In some cases, where the competition is usurping a company\u2019s market share, innovation is usually more of an act of survival than a preemptive strike. However, companies that have a strong market position may end up resting on their laurels, exposing them to rapid disruption from forward-thinking competitors or startups. To avoid being disrupted, traditional corporations must embrace corporate innovation.<\/p>\n\n\n\n Mathieu Guerville heads up the venture capital arm of UL, a company that has been around for over a century and that is deeply entrenched in the safety testing niche. \u201cThe safety industry has evolved from people being worried about getting electrocuted by their kettle to people worrying about cyber threats,\u201d he says, \u201cand so having been stuck in its ways for all those years, UL has had to redefine what safety means and what it means to assess safety.\u201d This reassessment and realignment led the firm to start UL Ventures, which invests in startups involved in the safety assessment and testing field. From his experience heading up this unit, Mathieu shares what he believes are key elements corporations must adopt to foster corporate innovation within their ranks.<\/p>\n\n\n\n \u201cWhenever we go looking for startups or other businesses to invest in, we first ensure the companies we approach align with our core mission statement,\u201d Mathieu says. This is a key insight for corporations that may get distracted by all the incredible technologies developing across different industries. While it is essential to explore developments in lateral industries, it is important to remain a mission-driven organization to sustain current momentum and keep current customers satisfied. In the case of UL, focusing on investing in startups that augment or complement its current mission statement ensures the firm\u2019s competitive advantage remains intact and continues to strengthen.<\/p>\n\n\n\n \u201cIf you are building the next Instagram or dog walking app, we are not interested,\u201d says Mathieu. By having this laser-like focus, the firm has been able to go through seventy acquisitions without losing sight of its core mission. For executives considering innovation, it is essential first to define a clear mission statement and then use this as a guiding principle when acquiring or partnering with startups. Doing this will save the firm both money and time while ensuring maximization of opportunity cost through avoidance of timewasting ventures.<\/p>\n\n\n\n \u201cWhy did UL start a venture capital arm?\u201d we asked Mathieu. \u201cOver time, UL simply could not keep up with all the advances in the technologies it inspects and certifies. Starting a VC arm was the natural progression to the direction we were taking to become a more innovative company,\u201d he explains. But, according to Mathieu, VC is not as simple as just putting together some money and throwing it at startups. The process of investing in and onboarding startups is often fraught with challenges such as culture clashes, poor returns and outright lack of fit as the startup evolves. He notes that while financial returns are important, they should not form the main agenda when investing in startups for innovation purposes.<\/p>\n\n\n\n For the UL fund, he looks for three things in a startup before considering an investment.<\/p>\n\n\n\n Besides focusing on this set of criteria, Mathieu also advises corporations to have a dedicated innovation team that stewards the entire corporate venture capital process. With such a team in place, it is easier to handle issues like culture clashes, startup onboarding, commercial agreements, IP protection, among other issues that are bound to arise.<\/p>\n\n\n\n \u201cThe first step of innovation is ideation, and for ideation to happen, there must be curiosity,\u201d says Mathieu. Most corporations falter at this step because established cultures and norms do not allow for the presentation of ideas, most of which will inevitably fail. As failure is often frowned upon in traditional corporate settings, employees tend to keep their ideas to themselves lest they are labeled a failure, which can affect their performance rating or promotion prospects. \u201cA culture of innovation must start at the top. Management needs to say it is okay to fail, as long as we fail fast and we are failing in the quest for innovation,\u201d says Mathieu.<\/p>\n\n\n\n \u201cThis is, however, just half of the solution,\u201d he adds. For organizations to fully embrace an innovation culture, there must be mechanisms and processes in place to manage this inflow of ideas. Some companies use idea boxes while others utilize hackathons, or the 80\/20 rule made famous by Google. All these represent mechanisms by which ideas are solicited from employees, presented to management, filtered and supported or killed off quickly to keep the innovation momentum going. By adopting a fail-fast failure-tolerant innovation culture, organization leaders can inspire employees to think beyond their scope of work to help the company break into new levels of innovation.<\/p>\n\n\n\n \u201cCorporate innovation takes time,\u201d Mathieu reflects. While in a startup the entire company is a sandbox where experiments can be run hot and fast, the situation is different for traditional corporate organizations. \u201cInstead of focusing on why innovation cannot work in your organization, focus instead on how you can create a sandbox environment to test your boldest ideas within a controlled environment. Creating such a sandbox environment allows the organization to test out innovations without going straight to the deep end, allowing for bolder and more frequent innovation experiments,\u201d concludes Mathieu.<\/p>\n\n\n\n Venture capital is pattern based. It is perhaps the reason why VCs are called lemmings. This pattern-based behavior is not without cause. Most VCs are tasked by investors to find the best investment opportunities and act fast on them. No VC wants to be known as the one that passed on the next Facebook or Google. However, this pattern-investing has created a systemic issue with traditional venture capital that is ripe for disruption. While most VCs look for prototypical unicorns, the vast majority of startups will not achieve a billion-dollar valuation<\/a>, or a short exit horizon<\/a>, a prerequisite of most VC firms.<\/p>\n\n\n\n Pattern-investing has created an opportunity for alternative funding in the form of equity crowdfunding. As retail investors become better educated and better connected to startups through digital crowdfunding platforms like Wefunder and Indiegogo Equity, more of these non-unicorn startups are turning to crowdfunding. With the introduction of Regulation Crowdfunding<\/a> by the SEC, startups and investors can build more sustainable and mutually-beneficial funding relationships that are not heavily influenced by the pressure that comes with traditional VC money. In this way, digital transformation, as with other industries, has put the power of investing squarely in the hands of the masses, creating a powerfully disruptive disintermediation trend that has the potential to disrupt traditional VC.<\/p>\n\n\n\n While VC in the United States is enjoying one of its best run rates in recent history<\/a>, the reality is that disruption begins from edge case scenarios. While most traditional VC firms chase after unicorns and billion dollar exits using a 150-year-old funding framework, there will emerge new digital-first VC firms that will tap into the massive potential of startups that do not fit this investment pattern. As with the story of taxicab companies resting on their laurels and ignoring the frustrated masses only to be disrupted by digital-first Uber, here is presented a situation where the venture capital industry has become ripe for disruption, and the companies that disrupt it will be the next billion-dollar or even trillion-dollar VC companies of tomorrow.<\/p>\n\n\n\n The Silicon Valley Venture Capital Academy offers a unique opportunity to learn the investment strategies that top Silicon Valley venture capitalists use when investing in disruptive startups. The five-day immersion program includes learning sessions led by seasoned Silicon Valley venture capitalists, networking opportunities, and hands-on VC-led workshops.<\/p>\n","post_title":"Three Digital Transformation Innovations Disrupting Venture Capital","post_excerpt":"","post_status":"publish","comment_status":"open","ping_status":"closed","post_password":"","post_name":"three-digital-transformation-innovations-disrupting-venture-capital","to_ping":"","pinged":"","post_modified":"2020-02-08 14:52:57","post_modified_gmt":"2020-02-08 22:52:57","post_content_filtered":"","post_parent":0,"guid":"https:\/\/siliconvalley.center\/blog\/three-digital-transformation-innovations-disrupting-venture-capital\/","menu_order":0,"post_type":"post","post_mime_type":"","comment_count":"0","filter":"raw"},{"ID":660,"post_author":"1","post_date":"2018-08-15 19:11:00","post_date_gmt":"2018-08-16 02:11:00","post_content":"\n The traditional corporate environment is hardly fertile ground for innovation. With entrenched thinking, rigid management structures, and an established way of doing things, it is often difficult to convince employees to embrace innovation. In some cases, where the competition is usurping a company\u2019s market share, innovation is usually more of an act of survival than a preemptive strike. However, companies that have a strong market position may end up resting on their laurels, exposing them to rapid disruption from forward-thinking competitors or startups. To avoid being disrupted, traditional corporations must embrace corporate innovation.<\/p>\n\n\n\n Mathieu Guerville heads up the venture capital arm of UL, a company that has been around for over a century and that is deeply entrenched in the safety testing niche. \u201cThe safety industry has evolved from people being worried about getting electrocuted by their kettle to people worrying about cyber threats,\u201d he says, \u201cand so having been stuck in its ways for all those years, UL has had to redefine what safety means and what it means to assess safety.\u201d This reassessment and realignment led the firm to start UL Ventures, which invests in startups involved in the safety assessment and testing field. From his experience heading up this unit, Mathieu shares what he believes are key elements corporations must adopt to foster corporate innovation within their ranks.<\/p>\n\n\n\n \u201cWhenever we go looking for startups or other businesses to invest in, we first ensure the companies we approach align with our core mission statement,\u201d Mathieu says. This is a key insight for corporations that may get distracted by all the incredible technologies developing across different industries. While it is essential to explore developments in lateral industries, it is important to remain a mission-driven organization to sustain current momentum and keep current customers satisfied. In the case of UL, focusing on investing in startups that augment or complement its current mission statement ensures the firm\u2019s competitive advantage remains intact and continues to strengthen.<\/p>\n\n\n\n \u201cIf you are building the next Instagram or dog walking app, we are not interested,\u201d says Mathieu. By having this laser-like focus, the firm has been able to go through seventy acquisitions without losing sight of its core mission. For executives considering innovation, it is essential first to define a clear mission statement and then use this as a guiding principle when acquiring or partnering with startups. Doing this will save the firm both money and time while ensuring maximization of opportunity cost through avoidance of timewasting ventures.<\/p>\n\n\n\n \u201cWhy did UL start a venture capital arm?\u201d we asked Mathieu. \u201cOver time, UL simply could not keep up with all the advances in the technologies it inspects and certifies. Starting a VC arm was the natural progression to the direction we were taking to become a more innovative company,\u201d he explains. But, according to Mathieu, VC is not as simple as just putting together some money and throwing it at startups. The process of investing in and onboarding startups is often fraught with challenges such as culture clashes, poor returns and outright lack of fit as the startup evolves. He notes that while financial returns are important, they should not form the main agenda when investing in startups for innovation purposes.<\/p>\n\n\n\n For the UL fund, he looks for three things in a startup before considering an investment.<\/p>\n\n\n\n Besides focusing on this set of criteria, Mathieu also advises corporations to have a dedicated innovation team that stewards the entire corporate venture capital process. With such a team in place, it is easier to handle issues like culture clashes, startup onboarding, commercial agreements, IP protection, among other issues that are bound to arise.<\/p>\n\n\n\n \u201cThe first step of innovation is ideation, and for ideation to happen, there must be curiosity,\u201d says Mathieu. Most corporations falter at this step because established cultures and norms do not allow for the presentation of ideas, most of which will inevitably fail. As failure is often frowned upon in traditional corporate settings, employees tend to keep their ideas to themselves lest they are labeled a failure, which can affect their performance rating or promotion prospects. \u201cA culture of innovation must start at the top. Management needs to say it is okay to fail, as long as we fail fast and we are failing in the quest for innovation,\u201d says Mathieu.<\/p>\n\n\n\n \u201cThis is, however, just half of the solution,\u201d he adds. For organizations to fully embrace an innovation culture, there must be mechanisms and processes in place to manage this inflow of ideas. Some companies use idea boxes while others utilize hackathons, or the 80\/20 rule made famous by Google. All these represent mechanisms by which ideas are solicited from employees, presented to management, filtered and supported or killed off quickly to keep the innovation momentum going. By adopting a fail-fast failure-tolerant innovation culture, organization leaders can inspire employees to think beyond their scope of work to help the company break into new levels of innovation.<\/p>\n\n\n\n \u201cCorporate innovation takes time,\u201d Mathieu reflects. While in a startup the entire company is a sandbox where experiments can be run hot and fast, the situation is different for traditional corporate organizations. \u201cInstead of focusing on why innovation cannot work in your organization, focus instead on how you can create a sandbox environment to test your boldest ideas within a controlled environment. Creating such a sandbox environment allows the organization to test out innovations without going straight to the deep end, allowing for bolder and more frequent innovation experiments,\u201d concludes Mathieu.<\/p>\n\n\n\n What may be standing in the way of sweeping disruption is perhaps the lack of legislative frameworks to regulate cryptos. While this may be taking time, there is no doubt that once these legislations are in place, the world of finance will look very different. VC funds that fail to embrace this trend in good time may find themselves locked out of a trillion-dollar opportunity that will allow billions of people across the world and from all walks of life to invest in whatever promising businesses they choose to invest in. Such an opportunity can only be grasped if VC funds begin to experiment and invest early in startups working on related solutions.<\/p>\n\n\n\n Venture capital is pattern based. It is perhaps the reason why VCs are called lemmings. This pattern-based behavior is not without cause. Most VCs are tasked by investors to find the best investment opportunities and act fast on them. No VC wants to be known as the one that passed on the next Facebook or Google. However, this pattern-investing has created a systemic issue with traditional venture capital that is ripe for disruption. While most VCs look for prototypical unicorns, the vast majority of startups will not achieve a billion-dollar valuation<\/a>, or a short exit horizon<\/a>, a prerequisite of most VC firms.<\/p>\n\n\n\n Pattern-investing has created an opportunity for alternative funding in the form of equity crowdfunding. As retail investors become better educated and better connected to startups through digital crowdfunding platforms like Wefunder and Indiegogo Equity, more of these non-unicorn startups are turning to crowdfunding. With the introduction of Regulation Crowdfunding<\/a> by the SEC, startups and investors can build more sustainable and mutually-beneficial funding relationships that are not heavily influenced by the pressure that comes with traditional VC money. In this way, digital transformation, as with other industries, has put the power of investing squarely in the hands of the masses, creating a powerfully disruptive disintermediation trend that has the potential to disrupt traditional VC.<\/p>\n\n\n\n While VC in the United States is enjoying one of its best run rates in recent history<\/a>, the reality is that disruption begins from edge case scenarios. While most traditional VC firms chase after unicorns and billion dollar exits using a 150-year-old funding framework, there will emerge new digital-first VC firms that will tap into the massive potential of startups that do not fit this investment pattern. As with the story of taxicab companies resting on their laurels and ignoring the frustrated masses only to be disrupted by digital-first Uber, here is presented a situation where the venture capital industry has become ripe for disruption, and the companies that disrupt it will be the next billion-dollar or even trillion-dollar VC companies of tomorrow.<\/p>\n\n\n\n The Silicon Valley Venture Capital Academy offers a unique opportunity to learn the investment strategies that top Silicon Valley venture capitalists use when investing in disruptive startups. The five-day immersion program includes learning sessions led by seasoned Silicon Valley venture capitalists, networking opportunities, and hands-on VC-led workshops.<\/p>\n","post_title":"Three Digital Transformation Innovations Disrupting Venture Capital","post_excerpt":"","post_status":"publish","comment_status":"open","ping_status":"closed","post_password":"","post_name":"three-digital-transformation-innovations-disrupting-venture-capital","to_ping":"","pinged":"","post_modified":"2020-02-08 14:52:57","post_modified_gmt":"2020-02-08 22:52:57","post_content_filtered":"","post_parent":0,"guid":"https:\/\/siliconvalley.center\/blog\/three-digital-transformation-innovations-disrupting-venture-capital\/","menu_order":0,"post_type":"post","post_mime_type":"","comment_count":"0","filter":"raw"},{"ID":660,"post_author":"1","post_date":"2018-08-15 19:11:00","post_date_gmt":"2018-08-16 02:11:00","post_content":"\n The traditional corporate environment is hardly fertile ground for innovation. With entrenched thinking, rigid management structures, and an established way of doing things, it is often difficult to convince employees to embrace innovation. In some cases, where the competition is usurping a company\u2019s market share, innovation is usually more of an act of survival than a preemptive strike. However, companies that have a strong market position may end up resting on their laurels, exposing them to rapid disruption from forward-thinking competitors or startups. To avoid being disrupted, traditional corporations must embrace corporate innovation.<\/p>\n\n\n\n Mathieu Guerville heads up the venture capital arm of UL, a company that has been around for over a century and that is deeply entrenched in the safety testing niche. \u201cThe safety industry has evolved from people being worried about getting electrocuted by their kettle to people worrying about cyber threats,\u201d he says, \u201cand so having been stuck in its ways for all those years, UL has had to redefine what safety means and what it means to assess safety.\u201d This reassessment and realignment led the firm to start UL Ventures, which invests in startups involved in the safety assessment and testing field. From his experience heading up this unit, Mathieu shares what he believes are key elements corporations must adopt to foster corporate innovation within their ranks.<\/p>\n\n\n\n \u201cWhenever we go looking for startups or other businesses to invest in, we first ensure the companies we approach align with our core mission statement,\u201d Mathieu says. This is a key insight for corporations that may get distracted by all the incredible technologies developing across different industries. While it is essential to explore developments in lateral industries, it is important to remain a mission-driven organization to sustain current momentum and keep current customers satisfied. In the case of UL, focusing on investing in startups that augment or complement its current mission statement ensures the firm\u2019s competitive advantage remains intact and continues to strengthen.<\/p>\n\n\n\n \u201cIf you are building the next Instagram or dog walking app, we are not interested,\u201d says Mathieu. By having this laser-like focus, the firm has been able to go through seventy acquisitions without losing sight of its core mission. For executives considering innovation, it is essential first to define a clear mission statement and then use this as a guiding principle when acquiring or partnering with startups. Doing this will save the firm both money and time while ensuring maximization of opportunity cost through avoidance of timewasting ventures.<\/p>\n\n\n\n \u201cWhy did UL start a venture capital arm?\u201d we asked Mathieu. \u201cOver time, UL simply could not keep up with all the advances in the technologies it inspects and certifies. Starting a VC arm was the natural progression to the direction we were taking to become a more innovative company,\u201d he explains. But, according to Mathieu, VC is not as simple as just putting together some money and throwing it at startups. The process of investing in and onboarding startups is often fraught with challenges such as culture clashes, poor returns and outright lack of fit as the startup evolves. He notes that while financial returns are important, they should not form the main agenda when investing in startups for innovation purposes.<\/p>\n\n\n\n For the UL fund, he looks for three things in a startup before considering an investment.<\/p>\n\n\n\n Besides focusing on this set of criteria, Mathieu also advises corporations to have a dedicated innovation team that stewards the entire corporate venture capital process. With such a team in place, it is easier to handle issues like culture clashes, startup onboarding, commercial agreements, IP protection, among other issues that are bound to arise.<\/p>\n\n\n\n \u201cThe first step of innovation is ideation, and for ideation to happen, there must be curiosity,\u201d says Mathieu. Most corporations falter at this step because established cultures and norms do not allow for the presentation of ideas, most of which will inevitably fail. As failure is often frowned upon in traditional corporate settings, employees tend to keep their ideas to themselves lest they are labeled a failure, which can affect their performance rating or promotion prospects. \u201cA culture of innovation must start at the top. Management needs to say it is okay to fail, as long as we fail fast and we are failing in the quest for innovation,\u201d says Mathieu.<\/p>\n\n\n\n \u201cThis is, however, just half of the solution,\u201d he adds. For organizations to fully embrace an innovation culture, there must be mechanisms and processes in place to manage this inflow of ideas. Some companies use idea boxes while others utilize hackathons, or the 80\/20 rule made famous by Google. All these represent mechanisms by which ideas are solicited from employees, presented to management, filtered and supported or killed off quickly to keep the innovation momentum going. By adopting a fail-fast failure-tolerant innovation culture, organization leaders can inspire employees to think beyond their scope of work to help the company break into new levels of innovation.<\/p>\n\n\n\n \u201cCorporate innovation takes time,\u201d Mathieu reflects. While in a startup the entire company is a sandbox where experiments can be run hot and fast, the situation is different for traditional corporate organizations. \u201cInstead of focusing on why innovation cannot work in your organization, focus instead on how you can create a sandbox environment to test your boldest ideas within a controlled environment. Creating such a sandbox environment allows the organization to test out innovations without going straight to the deep end, allowing for bolder and more frequent innovation experiments,\u201d concludes Mathieu.<\/p>\n\n\n\n Cryptocurrencies or cryptos are another digital innovation that has the potential to upend traditional venture capital. This disruptive potential is evident from the massive popularity of Initial Coin Offerings or ICOs. ICOs create massive decentralized VC funds that anyone can invest in, bypassing traditional VCs who act as gatekeepers. While a majority of these ICOs are considered scams, the trend cannot be brushed aside. Cryptos, a democratized currency, not only represent a means of democratized investing, they represent an entirely new way of how global financing can work.<\/p>\n\n\n\n What may be standing in the way of sweeping disruption is perhaps the lack of legislative frameworks to regulate cryptos. While this may be taking time, there is no doubt that once these legislations are in place, the world of finance will look very different. VC funds that fail to embrace this trend in good time may find themselves locked out of a trillion-dollar opportunity that will allow billions of people across the world and from all walks of life to invest in whatever promising businesses they choose to invest in. Such an opportunity can only be grasped if VC funds begin to experiment and invest early in startups working on related solutions.<\/p>\n\n\n\n Venture capital is pattern based. It is perhaps the reason why VCs are called lemmings. This pattern-based behavior is not without cause. Most VCs are tasked by investors to find the best investment opportunities and act fast on them. No VC wants to be known as the one that passed on the next Facebook or Google. However, this pattern-investing has created a systemic issue with traditional venture capital that is ripe for disruption. While most VCs look for prototypical unicorns, the vast majority of startups will not achieve a billion-dollar valuation<\/a>, or a short exit horizon<\/a>, a prerequisite of most VC firms.<\/p>\n\n\n\n Pattern-investing has created an opportunity for alternative funding in the form of equity crowdfunding. As retail investors become better educated and better connected to startups through digital crowdfunding platforms like Wefunder and Indiegogo Equity, more of these non-unicorn startups are turning to crowdfunding. With the introduction of Regulation Crowdfunding<\/a> by the SEC, startups and investors can build more sustainable and mutually-beneficial funding relationships that are not heavily influenced by the pressure that comes with traditional VC money. In this way, digital transformation, as with other industries, has put the power of investing squarely in the hands of the masses, creating a powerfully disruptive disintermediation trend that has the potential to disrupt traditional VC.<\/p>\n\n\n\n While VC in the United States is enjoying one of its best run rates in recent history<\/a>, the reality is that disruption begins from edge case scenarios. While most traditional VC firms chase after unicorns and billion dollar exits using a 150-year-old funding framework, there will emerge new digital-first VC firms that will tap into the massive potential of startups that do not fit this investment pattern. As with the story of taxicab companies resting on their laurels and ignoring the frustrated masses only to be disrupted by digital-first Uber, here is presented a situation where the venture capital industry has become ripe for disruption, and the companies that disrupt it will be the next billion-dollar or even trillion-dollar VC companies of tomorrow.<\/p>\n\n\n\n The Silicon Valley Venture Capital Academy offers a unique opportunity to learn the investment strategies that top Silicon Valley venture capitalists use when investing in disruptive startups. The five-day immersion program includes learning sessions led by seasoned Silicon Valley venture capitalists, networking opportunities, and hands-on VC-led workshops.<\/p>\n","post_title":"Three Digital Transformation Innovations Disrupting Venture Capital","post_excerpt":"","post_status":"publish","comment_status":"open","ping_status":"closed","post_password":"","post_name":"three-digital-transformation-innovations-disrupting-venture-capital","to_ping":"","pinged":"","post_modified":"2020-02-08 14:52:57","post_modified_gmt":"2020-02-08 22:52:57","post_content_filtered":"","post_parent":0,"guid":"https:\/\/siliconvalley.center\/blog\/three-digital-transformation-innovations-disrupting-venture-capital\/","menu_order":0,"post_type":"post","post_mime_type":"","comment_count":"0","filter":"raw"},{"ID":660,"post_author":"1","post_date":"2018-08-15 19:11:00","post_date_gmt":"2018-08-16 02:11:00","post_content":"\n The traditional corporate environment is hardly fertile ground for innovation. With entrenched thinking, rigid management structures, and an established way of doing things, it is often difficult to convince employees to embrace innovation. In some cases, where the competition is usurping a company\u2019s market share, innovation is usually more of an act of survival than a preemptive strike. However, companies that have a strong market position may end up resting on their laurels, exposing them to rapid disruption from forward-thinking competitors or startups. To avoid being disrupted, traditional corporations must embrace corporate innovation.<\/p>\n\n\n\n Mathieu Guerville heads up the venture capital arm of UL, a company that has been around for over a century and that is deeply entrenched in the safety testing niche. \u201cThe safety industry has evolved from people being worried about getting electrocuted by their kettle to people worrying about cyber threats,\u201d he says, \u201cand so having been stuck in its ways for all those years, UL has had to redefine what safety means and what it means to assess safety.\u201d This reassessment and realignment led the firm to start UL Ventures, which invests in startups involved in the safety assessment and testing field. From his experience heading up this unit, Mathieu shares what he believes are key elements corporations must adopt to foster corporate innovation within their ranks.<\/p>\n\n\n\n \u201cWhenever we go looking for startups or other businesses to invest in, we first ensure the companies we approach align with our core mission statement,\u201d Mathieu says. This is a key insight for corporations that may get distracted by all the incredible technologies developing across different industries. While it is essential to explore developments in lateral industries, it is important to remain a mission-driven organization to sustain current momentum and keep current customers satisfied. In the case of UL, focusing on investing in startups that augment or complement its current mission statement ensures the firm\u2019s competitive advantage remains intact and continues to strengthen.<\/p>\n\n\n\n \u201cIf you are building the next Instagram or dog walking app, we are not interested,\u201d says Mathieu. By having this laser-like focus, the firm has been able to go through seventy acquisitions without losing sight of its core mission. For executives considering innovation, it is essential first to define a clear mission statement and then use this as a guiding principle when acquiring or partnering with startups. Doing this will save the firm both money and time while ensuring maximization of opportunity cost through avoidance of timewasting ventures.<\/p>\n\n\n\n \u201cWhy did UL start a venture capital arm?\u201d we asked Mathieu. \u201cOver time, UL simply could not keep up with all the advances in the technologies it inspects and certifies. Starting a VC arm was the natural progression to the direction we were taking to become a more innovative company,\u201d he explains. But, according to Mathieu, VC is not as simple as just putting together some money and throwing it at startups. The process of investing in and onboarding startups is often fraught with challenges such as culture clashes, poor returns and outright lack of fit as the startup evolves. He notes that while financial returns are important, they should not form the main agenda when investing in startups for innovation purposes.<\/p>\n\n\n\n For the UL fund, he looks for three things in a startup before considering an investment.<\/p>\n\n\n\n Besides focusing on this set of criteria, Mathieu also advises corporations to have a dedicated innovation team that stewards the entire corporate venture capital process. With such a team in place, it is easier to handle issues like culture clashes, startup onboarding, commercial agreements, IP protection, among other issues that are bound to arise.<\/p>\n\n\n\n \u201cThe first step of innovation is ideation, and for ideation to happen, there must be curiosity,\u201d says Mathieu. Most corporations falter at this step because established cultures and norms do not allow for the presentation of ideas, most of which will inevitably fail. As failure is often frowned upon in traditional corporate settings, employees tend to keep their ideas to themselves lest they are labeled a failure, which can affect their performance rating or promotion prospects. \u201cA culture of innovation must start at the top. Management needs to say it is okay to fail, as long as we fail fast and we are failing in the quest for innovation,\u201d says Mathieu.<\/p>\n\n\n\n \u201cThis is, however, just half of the solution,\u201d he adds. For organizations to fully embrace an innovation culture, there must be mechanisms and processes in place to manage this inflow of ideas. Some companies use idea boxes while others utilize hackathons, or the 80\/20 rule made famous by Google. All these represent mechanisms by which ideas are solicited from employees, presented to management, filtered and supported or killed off quickly to keep the innovation momentum going. By adopting a fail-fast failure-tolerant innovation culture, organization leaders can inspire employees to think beyond their scope of work to help the company break into new levels of innovation.<\/p>\n\n\n\n \u201cCorporate innovation takes time,\u201d Mathieu reflects. While in a startup the entire company is a sandbox where experiments can be run hot and fast, the situation is different for traditional corporate organizations. \u201cInstead of focusing on why innovation cannot work in your organization, focus instead on how you can create a sandbox environment to test your boldest ideas within a controlled environment. Creating such a sandbox environment allows the organization to test out innovations without going straight to the deep end, allowing for bolder and more frequent innovation experiments,\u201d concludes Mathieu.<\/p>\n\n\n\n Cryptocurrencies or cryptos are another digital innovation that has the potential to upend traditional venture capital. This disruptive potential is evident from the massive popularity of Initial Coin Offerings or ICOs. ICOs create massive decentralized VC funds that anyone can invest in, bypassing traditional VCs who act as gatekeepers. While a majority of these ICOs are considered scams, the trend cannot be brushed aside. Cryptos, a democratized currency, not only represent a means of democratized investing, they represent an entirely new way of how global financing can work.<\/p>\n\n\n\n What may be standing in the way of sweeping disruption is perhaps the lack of legislative frameworks to regulate cryptos. While this may be taking time, there is no doubt that once these legislations are in place, the world of finance will look very different. VC funds that fail to embrace this trend in good time may find themselves locked out of a trillion-dollar opportunity that will allow billions of people across the world and from all walks of life to invest in whatever promising businesses they choose to invest in. Such an opportunity can only be grasped if VC funds begin to experiment and invest early in startups working on related solutions.<\/p>\n\n\n\n Venture capital is pattern based. It is perhaps the reason why VCs are called lemmings. This pattern-based behavior is not without cause. Most VCs are tasked by investors to find the best investment opportunities and act fast on them. No VC wants to be known as the one that passed on the next Facebook or Google. However, this pattern-investing has created a systemic issue with traditional venture capital that is ripe for disruption. While most VCs look for prototypical unicorns, the vast majority of startups will not achieve a billion-dollar valuation<\/a>, or a short exit horizon<\/a>, a prerequisite of most VC firms.<\/p>\n\n\n\n Pattern-investing has created an opportunity for alternative funding in the form of equity crowdfunding. As retail investors become better educated and better connected to startups through digital crowdfunding platforms like Wefunder and Indiegogo Equity, more of these non-unicorn startups are turning to crowdfunding. With the introduction of Regulation Crowdfunding<\/a> by the SEC, startups and investors can build more sustainable and mutually-beneficial funding relationships that are not heavily influenced by the pressure that comes with traditional VC money. In this way, digital transformation, as with other industries, has put the power of investing squarely in the hands of the masses, creating a powerfully disruptive disintermediation trend that has the potential to disrupt traditional VC.<\/p>\n\n\n\n While VC in the United States is enjoying one of its best run rates in recent history<\/a>, the reality is that disruption begins from edge case scenarios. While most traditional VC firms chase after unicorns and billion dollar exits using a 150-year-old funding framework, there will emerge new digital-first VC firms that will tap into the massive potential of startups that do not fit this investment pattern. As with the story of taxicab companies resting on their laurels and ignoring the frustrated masses only to be disrupted by digital-first Uber, here is presented a situation where the venture capital industry has become ripe for disruption, and the companies that disrupt it will be the next billion-dollar or even trillion-dollar VC companies of tomorrow.<\/p>\n\n\n\n The Silicon Valley Venture Capital Academy offers a unique opportunity to learn the investment strategies that top Silicon Valley venture capitalists use when investing in disruptive startups. The five-day immersion program includes learning sessions led by seasoned Silicon Valley venture capitalists, networking opportunities, and hands-on VC-led workshops.<\/p>\n","post_title":"Three Digital Transformation Innovations Disrupting Venture Capital","post_excerpt":"","post_status":"publish","comment_status":"open","ping_status":"closed","post_password":"","post_name":"three-digital-transformation-innovations-disrupting-venture-capital","to_ping":"","pinged":"","post_modified":"2020-02-08 14:52:57","post_modified_gmt":"2020-02-08 22:52:57","post_content_filtered":"","post_parent":0,"guid":"https:\/\/siliconvalley.center\/blog\/three-digital-transformation-innovations-disrupting-venture-capital\/","menu_order":0,"post_type":"post","post_mime_type":"","comment_count":"0","filter":"raw"},{"ID":660,"post_author":"1","post_date":"2018-08-15 19:11:00","post_date_gmt":"2018-08-16 02:11:00","post_content":"\n The traditional corporate environment is hardly fertile ground for innovation. With entrenched thinking, rigid management structures, and an established way of doing things, it is often difficult to convince employees to embrace innovation. In some cases, where the competition is usurping a company\u2019s market share, innovation is usually more of an act of survival than a preemptive strike. However, companies that have a strong market position may end up resting on their laurels, exposing them to rapid disruption from forward-thinking competitors or startups. To avoid being disrupted, traditional corporations must embrace corporate innovation.<\/p>\n\n\n\n Mathieu Guerville heads up the venture capital arm of UL, a company that has been around for over a century and that is deeply entrenched in the safety testing niche. \u201cThe safety industry has evolved from people being worried about getting electrocuted by their kettle to people worrying about cyber threats,\u201d he says, \u201cand so having been stuck in its ways for all those years, UL has had to redefine what safety means and what it means to assess safety.\u201d This reassessment and realignment led the firm to start UL Ventures, which invests in startups involved in the safety assessment and testing field. From his experience heading up this unit, Mathieu shares what he believes are key elements corporations must adopt to foster corporate innovation within their ranks.<\/p>\n\n\n\n \u201cWhenever we go looking for startups or other businesses to invest in, we first ensure the companies we approach align with our core mission statement,\u201d Mathieu says. This is a key insight for corporations that may get distracted by all the incredible technologies developing across different industries. While it is essential to explore developments in lateral industries, it is important to remain a mission-driven organization to sustain current momentum and keep current customers satisfied. In the case of UL, focusing on investing in startups that augment or complement its current mission statement ensures the firm\u2019s competitive advantage remains intact and continues to strengthen.<\/p>\n\n\n\n \u201cIf you are building the next Instagram or dog walking app, we are not interested,\u201d says Mathieu. By having this laser-like focus, the firm has been able to go through seventy acquisitions without losing sight of its core mission. For executives considering innovation, it is essential first to define a clear mission statement and then use this as a guiding principle when acquiring or partnering with startups. Doing this will save the firm both money and time while ensuring maximization of opportunity cost through avoidance of timewasting ventures.<\/p>\n\n\n\n \u201cWhy did UL start a venture capital arm?\u201d we asked Mathieu. \u201cOver time, UL simply could not keep up with all the advances in the technologies it inspects and certifies. Starting a VC arm was the natural progression to the direction we were taking to become a more innovative company,\u201d he explains. But, according to Mathieu, VC is not as simple as just putting together some money and throwing it at startups. The process of investing in and onboarding startups is often fraught with challenges such as culture clashes, poor returns and outright lack of fit as the startup evolves. He notes that while financial returns are important, they should not form the main agenda when investing in startups for innovation purposes.<\/p>\n\n\n\n For the UL fund, he looks for three things in a startup before considering an investment.<\/p>\n\n\n\n Besides focusing on this set of criteria, Mathieu also advises corporations to have a dedicated innovation team that stewards the entire corporate venture capital process. With such a team in place, it is easier to handle issues like culture clashes, startup onboarding, commercial agreements, IP protection, among other issues that are bound to arise.<\/p>\n\n\n\n \u201cThe first step of innovation is ideation, and for ideation to happen, there must be curiosity,\u201d says Mathieu. Most corporations falter at this step because established cultures and norms do not allow for the presentation of ideas, most of which will inevitably fail. As failure is often frowned upon in traditional corporate settings, employees tend to keep their ideas to themselves lest they are labeled a failure, which can affect their performance rating or promotion prospects. \u201cA culture of innovation must start at the top. Management needs to say it is okay to fail, as long as we fail fast and we are failing in the quest for innovation,\u201d says Mathieu.<\/p>\n\n\n\n \u201cThis is, however, just half of the solution,\u201d he adds. For organizations to fully embrace an innovation culture, there must be mechanisms and processes in place to manage this inflow of ideas. Some companies use idea boxes while others utilize hackathons, or the 80\/20 rule made famous by Google. All these represent mechanisms by which ideas are solicited from employees, presented to management, filtered and supported or killed off quickly to keep the innovation momentum going. By adopting a fail-fast failure-tolerant innovation culture, organization leaders can inspire employees to think beyond their scope of work to help the company break into new levels of innovation.<\/p>\n\n\n\n \u201cCorporate innovation takes time,\u201d Mathieu reflects. While in a startup the entire company is a sandbox where experiments can be run hot and fast, the situation is different for traditional corporate organizations. \u201cInstead of focusing on why innovation cannot work in your organization, focus instead on how you can create a sandbox environment to test your boldest ideas within a controlled environment. Creating such a sandbox environment allows the organization to test out innovations without going straight to the deep end, allowing for bolder and more frequent innovation experiments,\u201d concludes Mathieu.<\/p>\n\n\n\n AI is poised to disrupt traditional venture capital as it can analyze hundreds of thousands of deals and millions of other data points to find patterns that point to successful bets. These data points include past VC investment patterns, startups that received investments within a certain period, industries and technologies those startups focused on, global market and technological trends, among others. By combining these data points in millions of ways, it is possible that an AI VC can successfully pick winning startups to invest in, handily beating traditional VC picks.<\/p>\n\n\n\n Cryptocurrencies or cryptos are another digital innovation that has the potential to upend traditional venture capital. This disruptive potential is evident from the massive popularity of Initial Coin Offerings or ICOs. ICOs create massive decentralized VC funds that anyone can invest in, bypassing traditional VCs who act as gatekeepers. While a majority of these ICOs are considered scams, the trend cannot be brushed aside. Cryptos, a democratized currency, not only represent a means of democratized investing, they represent an entirely new way of how global financing can work.<\/p>\n\n\n\n What may be standing in the way of sweeping disruption is perhaps the lack of legislative frameworks to regulate cryptos. While this may be taking time, there is no doubt that once these legislations are in place, the world of finance will look very different. VC funds that fail to embrace this trend in good time may find themselves locked out of a trillion-dollar opportunity that will allow billions of people across the world and from all walks of life to invest in whatever promising businesses they choose to invest in. Such an opportunity can only be grasped if VC funds begin to experiment and invest early in startups working on related solutions.<\/p>\n\n\n\n Venture capital is pattern based. It is perhaps the reason why VCs are called lemmings. This pattern-based behavior is not without cause. Most VCs are tasked by investors to find the best investment opportunities and act fast on them. No VC wants to be known as the one that passed on the next Facebook or Google. However, this pattern-investing has created a systemic issue with traditional venture capital that is ripe for disruption. While most VCs look for prototypical unicorns, the vast majority of startups will not achieve a billion-dollar valuation<\/a>, or a short exit horizon<\/a>, a prerequisite of most VC firms.<\/p>\n\n\n\n Pattern-investing has created an opportunity for alternative funding in the form of equity crowdfunding. As retail investors become better educated and better connected to startups through digital crowdfunding platforms like Wefunder and Indiegogo Equity, more of these non-unicorn startups are turning to crowdfunding. With the introduction of Regulation Crowdfunding<\/a> by the SEC, startups and investors can build more sustainable and mutually-beneficial funding relationships that are not heavily influenced by the pressure that comes with traditional VC money. In this way, digital transformation, as with other industries, has put the power of investing squarely in the hands of the masses, creating a powerfully disruptive disintermediation trend that has the potential to disrupt traditional VC.<\/p>\n\n\n\n While VC in the United States is enjoying one of its best run rates in recent history<\/a>, the reality is that disruption begins from edge case scenarios. While most traditional VC firms chase after unicorns and billion dollar exits using a 150-year-old funding framework, there will emerge new digital-first VC firms that will tap into the massive potential of startups that do not fit this investment pattern. As with the story of taxicab companies resting on their laurels and ignoring the frustrated masses only to be disrupted by digital-first Uber, here is presented a situation where the venture capital industry has become ripe for disruption, and the companies that disrupt it will be the next billion-dollar or even trillion-dollar VC companies of tomorrow.<\/p>\n\n\n\n The Silicon Valley Venture Capital Academy offers a unique opportunity to learn the investment strategies that top Silicon Valley venture capitalists use when investing in disruptive startups. The five-day immersion program includes learning sessions led by seasoned Silicon Valley venture capitalists, networking opportunities, and hands-on VC-led workshops.<\/p>\n","post_title":"Three Digital Transformation Innovations Disrupting Venture Capital","post_excerpt":"","post_status":"publish","comment_status":"open","ping_status":"closed","post_password":"","post_name":"three-digital-transformation-innovations-disrupting-venture-capital","to_ping":"","pinged":"","post_modified":"2020-02-08 14:52:57","post_modified_gmt":"2020-02-08 22:52:57","post_content_filtered":"","post_parent":0,"guid":"https:\/\/siliconvalley.center\/blog\/three-digital-transformation-innovations-disrupting-venture-capital\/","menu_order":0,"post_type":"post","post_mime_type":"","comment_count":"0","filter":"raw"},{"ID":660,"post_author":"1","post_date":"2018-08-15 19:11:00","post_date_gmt":"2018-08-16 02:11:00","post_content":"\n The traditional corporate environment is hardly fertile ground for innovation. With entrenched thinking, rigid management structures, and an established way of doing things, it is often difficult to convince employees to embrace innovation. In some cases, where the competition is usurping a company\u2019s market share, innovation is usually more of an act of survival than a preemptive strike. However, companies that have a strong market position may end up resting on their laurels, exposing them to rapid disruption from forward-thinking competitors or startups. To avoid being disrupted, traditional corporations must embrace corporate innovation.<\/p>\n\n\n\n Mathieu Guerville heads up the venture capital arm of UL, a company that has been around for over a century and that is deeply entrenched in the safety testing niche. \u201cThe safety industry has evolved from people being worried about getting electrocuted by their kettle to people worrying about cyber threats,\u201d he says, \u201cand so having been stuck in its ways for all those years, UL has had to redefine what safety means and what it means to assess safety.\u201d This reassessment and realignment led the firm to start UL Ventures, which invests in startups involved in the safety assessment and testing field. From his experience heading up this unit, Mathieu shares what he believes are key elements corporations must adopt to foster corporate innovation within their ranks.<\/p>\n\n\n\n \u201cWhenever we go looking for startups or other businesses to invest in, we first ensure the companies we approach align with our core mission statement,\u201d Mathieu says. This is a key insight for corporations that may get distracted by all the incredible technologies developing across different industries. While it is essential to explore developments in lateral industries, it is important to remain a mission-driven organization to sustain current momentum and keep current customers satisfied. In the case of UL, focusing on investing in startups that augment or complement its current mission statement ensures the firm\u2019s competitive advantage remains intact and continues to strengthen.<\/p>\n\n\n\n \u201cIf you are building the next Instagram or dog walking app, we are not interested,\u201d says Mathieu. By having this laser-like focus, the firm has been able to go through seventy acquisitions without losing sight of its core mission. For executives considering innovation, it is essential first to define a clear mission statement and then use this as a guiding principle when acquiring or partnering with startups. Doing this will save the firm both money and time while ensuring maximization of opportunity cost through avoidance of timewasting ventures.<\/p>\n\n\n\n \u201cWhy did UL start a venture capital arm?\u201d we asked Mathieu. \u201cOver time, UL simply could not keep up with all the advances in the technologies it inspects and certifies. Starting a VC arm was the natural progression to the direction we were taking to become a more innovative company,\u201d he explains. But, according to Mathieu, VC is not as simple as just putting together some money and throwing it at startups. The process of investing in and onboarding startups is often fraught with challenges such as culture clashes, poor returns and outright lack of fit as the startup evolves. He notes that while financial returns are important, they should not form the main agenda when investing in startups for innovation purposes.<\/p>\n\n\n\n For the UL fund, he looks for three things in a startup before considering an investment.<\/p>\n\n\n\n Besides focusing on this set of criteria, Mathieu also advises corporations to have a dedicated innovation team that stewards the entire corporate venture capital process. With such a team in place, it is easier to handle issues like culture clashes, startup onboarding, commercial agreements, IP protection, among other issues that are bound to arise.<\/p>\n\n\n\n \u201cThe first step of innovation is ideation, and for ideation to happen, there must be curiosity,\u201d says Mathieu. Most corporations falter at this step because established cultures and norms do not allow for the presentation of ideas, most of which will inevitably fail. As failure is often frowned upon in traditional corporate settings, employees tend to keep their ideas to themselves lest they are labeled a failure, which can affect their performance rating or promotion prospects. \u201cA culture of innovation must start at the top. Management needs to say it is okay to fail, as long as we fail fast and we are failing in the quest for innovation,\u201d says Mathieu.<\/p>\n\n\n\n \u201cThis is, however, just half of the solution,\u201d he adds. For organizations to fully embrace an innovation culture, there must be mechanisms and processes in place to manage this inflow of ideas. Some companies use idea boxes while others utilize hackathons, or the 80\/20 rule made famous by Google. All these represent mechanisms by which ideas are solicited from employees, presented to management, filtered and supported or killed off quickly to keep the innovation momentum going. By adopting a fail-fast failure-tolerant innovation culture, organization leaders can inspire employees to think beyond their scope of work to help the company break into new levels of innovation.<\/p>\n\n\n\n \u201cCorporate innovation takes time,\u201d Mathieu reflects. While in a startup the entire company is a sandbox where experiments can be run hot and fast, the situation is different for traditional corporate organizations. \u201cInstead of focusing on why innovation cannot work in your organization, focus instead on how you can create a sandbox environment to test your boldest ideas within a controlled environment. Creating such a sandbox environment allows the organization to test out innovations without going straight to the deep end, allowing for bolder and more frequent innovation experiments,\u201d concludes Mathieu.<\/p>\n\n\n\n In 2009, Quid AI was challenged to use machine learning<\/a> to pick a list of 50 hitherto unheard-of startups that were set to dominate the business world. That list contained companies like Evernote, Etsy, Spotify, Zynga, Cloudera, and Palantir, all of which today, some nine years later, have billion-dollar valuations. This experiment demonstrated an interesting irony about the current state of venture capital. While most venture capital firms are increasing their investments in AI startups<\/a>, very few VC firms are utilizing AI to pick winning startups. This disconnect represents a massive opportunity for VCs that choose to adopt a disruptive startup mentality. In fact, according to a leading fund of funds approached by Bloomberg Businessweek to analyze the basket of 50 companies picked, the firm noted that if the companies represented one VC company\u2019s portfolio, it would be the second-best performing portfolio of all time. (The best performing portfolio rode the dot-com bubble.)<\/p>\n\n\n\n AI is poised to disrupt traditional venture capital as it can analyze hundreds of thousands of deals and millions of other data points to find patterns that point to successful bets. These data points include past VC investment patterns, startups that received investments within a certain period, industries and technologies those startups focused on, global market and technological trends, among others. By combining these data points in millions of ways, it is possible that an AI VC can successfully pick winning startups to invest in, handily beating traditional VC picks.<\/p>\n\n\n\n Cryptocurrencies or cryptos are another digital innovation that has the potential to upend traditional venture capital. This disruptive potential is evident from the massive popularity of Initial Coin Offerings or ICOs. ICOs create massive decentralized VC funds that anyone can invest in, bypassing traditional VCs who act as gatekeepers. While a majority of these ICOs are considered scams, the trend cannot be brushed aside. Cryptos, a democratized currency, not only represent a means of democratized investing, they represent an entirely new way of how global financing can work.<\/p>\n\n\n\n What may be standing in the way of sweeping disruption is perhaps the lack of legislative frameworks to regulate cryptos. While this may be taking time, there is no doubt that once these legislations are in place, the world of finance will look very different. VC funds that fail to embrace this trend in good time may find themselves locked out of a trillion-dollar opportunity that will allow billions of people across the world and from all walks of life to invest in whatever promising businesses they choose to invest in. Such an opportunity can only be grasped if VC funds begin to experiment and invest early in startups working on related solutions.<\/p>\n\n\n\n Venture capital is pattern based. It is perhaps the reason why VCs are called lemmings. This pattern-based behavior is not without cause. Most VCs are tasked by investors to find the best investment opportunities and act fast on them. No VC wants to be known as the one that passed on the next Facebook or Google. However, this pattern-investing has created a systemic issue with traditional venture capital that is ripe for disruption. While most VCs look for prototypical unicorns, the vast majority of startups will not achieve a billion-dollar valuation<\/a>, or a short exit horizon<\/a>, a prerequisite of most VC firms.<\/p>\n\n\n\n Pattern-investing has created an opportunity for alternative funding in the form of equity crowdfunding. As retail investors become better educated and better connected to startups through digital crowdfunding platforms like Wefunder and Indiegogo Equity, more of these non-unicorn startups are turning to crowdfunding. With the introduction of Regulation Crowdfunding<\/a> by the SEC, startups and investors can build more sustainable and mutually-beneficial funding relationships that are not heavily influenced by the pressure that comes with traditional VC money. In this way, digital transformation, as with other industries, has put the power of investing squarely in the hands of the masses, creating a powerfully disruptive disintermediation trend that has the potential to disrupt traditional VC.<\/p>\n\n\n\n While VC in the United States is enjoying one of its best run rates in recent history<\/a>, the reality is that disruption begins from edge case scenarios. While most traditional VC firms chase after unicorns and billion dollar exits using a 150-year-old funding framework, there will emerge new digital-first VC firms that will tap into the massive potential of startups that do not fit this investment pattern. As with the story of taxicab companies resting on their laurels and ignoring the frustrated masses only to be disrupted by digital-first Uber, here is presented a situation where the venture capital industry has become ripe for disruption, and the companies that disrupt it will be the next billion-dollar or even trillion-dollar VC companies of tomorrow.<\/p>\n\n\n\n The Silicon Valley Venture Capital Academy offers a unique opportunity to learn the investment strategies that top Silicon Valley venture capitalists use when investing in disruptive startups. The five-day immersion program includes learning sessions led by seasoned Silicon Valley venture capitalists, networking opportunities, and hands-on VC-led workshops.<\/p>\n","post_title":"Three Digital Transformation Innovations Disrupting Venture Capital","post_excerpt":"","post_status":"publish","comment_status":"open","ping_status":"closed","post_password":"","post_name":"three-digital-transformation-innovations-disrupting-venture-capital","to_ping":"","pinged":"","post_modified":"2020-02-08 14:52:57","post_modified_gmt":"2020-02-08 22:52:57","post_content_filtered":"","post_parent":0,"guid":"https:\/\/siliconvalley.center\/blog\/three-digital-transformation-innovations-disrupting-venture-capital\/","menu_order":0,"post_type":"post","post_mime_type":"","comment_count":"0","filter":"raw"},{"ID":660,"post_author":"1","post_date":"2018-08-15 19:11:00","post_date_gmt":"2018-08-16 02:11:00","post_content":"\n The traditional corporate environment is hardly fertile ground for innovation. With entrenched thinking, rigid management structures, and an established way of doing things, it is often difficult to convince employees to embrace innovation. In some cases, where the competition is usurping a company\u2019s market share, innovation is usually more of an act of survival than a preemptive strike. However, companies that have a strong market position may end up resting on their laurels, exposing them to rapid disruption from forward-thinking competitors or startups. To avoid being disrupted, traditional corporations must embrace corporate innovation.<\/p>\n\n\n\n Mathieu Guerville heads up the venture capital arm of UL, a company that has been around for over a century and that is deeply entrenched in the safety testing niche. \u201cThe safety industry has evolved from people being worried about getting electrocuted by their kettle to people worrying about cyber threats,\u201d he says, \u201cand so having been stuck in its ways for all those years, UL has had to redefine what safety means and what it means to assess safety.\u201d This reassessment and realignment led the firm to start UL Ventures, which invests in startups involved in the safety assessment and testing field. From his experience heading up this unit, Mathieu shares what he believes are key elements corporations must adopt to foster corporate innovation within their ranks.<\/p>\n\n\n\n \u201cWhenever we go looking for startups or other businesses to invest in, we first ensure the companies we approach align with our core mission statement,\u201d Mathieu says. This is a key insight for corporations that may get distracted by all the incredible technologies developing across different industries. While it is essential to explore developments in lateral industries, it is important to remain a mission-driven organization to sustain current momentum and keep current customers satisfied. In the case of UL, focusing on investing in startups that augment or complement its current mission statement ensures the firm\u2019s competitive advantage remains intact and continues to strengthen.<\/p>\n\n\n\n \u201cIf you are building the next Instagram or dog walking app, we are not interested,\u201d says Mathieu. By having this laser-like focus, the firm has been able to go through seventy acquisitions without losing sight of its core mission. For executives considering innovation, it is essential first to define a clear mission statement and then use this as a guiding principle when acquiring or partnering with startups. Doing this will save the firm both money and time while ensuring maximization of opportunity cost through avoidance of timewasting ventures.<\/p>\n\n\n\n \u201cWhy did UL start a venture capital arm?\u201d we asked Mathieu. \u201cOver time, UL simply could not keep up with all the advances in the technologies it inspects and certifies. Starting a VC arm was the natural progression to the direction we were taking to become a more innovative company,\u201d he explains. But, according to Mathieu, VC is not as simple as just putting together some money and throwing it at startups. The process of investing in and onboarding startups is often fraught with challenges such as culture clashes, poor returns and outright lack of fit as the startup evolves. He notes that while financial returns are important, they should not form the main agenda when investing in startups for innovation purposes.<\/p>\n\n\n\n For the UL fund, he looks for three things in a startup before considering an investment.<\/p>\n\n\n\n Besides focusing on this set of criteria, Mathieu also advises corporations to have a dedicated innovation team that stewards the entire corporate venture capital process. With such a team in place, it is easier to handle issues like culture clashes, startup onboarding, commercial agreements, IP protection, among other issues that are bound to arise.<\/p>\n\n\n\n \u201cThe first step of innovation is ideation, and for ideation to happen, there must be curiosity,\u201d says Mathieu. Most corporations falter at this step because established cultures and norms do not allow for the presentation of ideas, most of which will inevitably fail. As failure is often frowned upon in traditional corporate settings, employees tend to keep their ideas to themselves lest they are labeled a failure, which can affect their performance rating or promotion prospects. \u201cA culture of innovation must start at the top. Management needs to say it is okay to fail, as long as we fail fast and we are failing in the quest for innovation,\u201d says Mathieu.<\/p>\n\n\n\n \u201cThis is, however, just half of the solution,\u201d he adds. For organizations to fully embrace an innovation culture, there must be mechanisms and processes in place to manage this inflow of ideas. Some companies use idea boxes while others utilize hackathons, or the 80\/20 rule made famous by Google. All these represent mechanisms by which ideas are solicited from employees, presented to management, filtered and supported or killed off quickly to keep the innovation momentum going. By adopting a fail-fast failure-tolerant innovation culture, organization leaders can inspire employees to think beyond their scope of work to help the company break into new levels of innovation.<\/p>\n\n\n\n \u201cCorporate innovation takes time,\u201d Mathieu reflects. While in a startup the entire company is a sandbox where experiments can be run hot and fast, the situation is different for traditional corporate organizations. \u201cInstead of focusing on why innovation cannot work in your organization, focus instead on how you can create a sandbox environment to test your boldest ideas within a controlled environment. Creating such a sandbox environment allows the organization to test out innovations without going straight to the deep end, allowing for bolder and more frequent innovation experiments,\u201d concludes Mathieu.<\/p>\n\n\n\n In 2009, Quid AI was challenged to use machine learning<\/a> to pick a list of 50 hitherto unheard-of startups that were set to dominate the business world. That list contained companies like Evernote, Etsy, Spotify, Zynga, Cloudera, and Palantir, all of which today, some nine years later, have billion-dollar valuations. This experiment demonstrated an interesting irony about the current state of venture capital. While most venture capital firms are increasing their investments in AI startups<\/a>, very few VC firms are utilizing AI to pick winning startups. This disconnect represents a massive opportunity for VCs that choose to adopt a disruptive startup mentality. In fact, according to a leading fund of funds approached by Bloomberg Businessweek to analyze the basket of 50 companies picked, the firm noted that if the companies represented one VC company\u2019s portfolio, it would be the second-best performing portfolio of all time. (The best performing portfolio rode the dot-com bubble.)<\/p>\n\n\n\n AI is poised to disrupt traditional venture capital as it can analyze hundreds of thousands of deals and millions of other data points to find patterns that point to successful bets. These data points include past VC investment patterns, startups that received investments within a certain period, industries and technologies those startups focused on, global market and technological trends, among others. By combining these data points in millions of ways, it is possible that an AI VC can successfully pick winning startups to invest in, handily beating traditional VC picks.<\/p>\n\n\n\n Cryptocurrencies or cryptos are another digital innovation that has the potential to upend traditional venture capital. This disruptive potential is evident from the massive popularity of Initial Coin Offerings or ICOs. ICOs create massive decentralized VC funds that anyone can invest in, bypassing traditional VCs who act as gatekeepers. While a majority of these ICOs are considered scams, the trend cannot be brushed aside. Cryptos, a democratized currency, not only represent a means of democratized investing, they represent an entirely new way of how global financing can work.<\/p>\n\n\n\n What may be standing in the way of sweeping disruption is perhaps the lack of legislative frameworks to regulate cryptos. While this may be taking time, there is no doubt that once these legislations are in place, the world of finance will look very different. VC funds that fail to embrace this trend in good time may find themselves locked out of a trillion-dollar opportunity that will allow billions of people across the world and from all walks of life to invest in whatever promising businesses they choose to invest in. Such an opportunity can only be grasped if VC funds begin to experiment and invest early in startups working on related solutions.<\/p>\n\n\n\n Venture capital is pattern based. It is perhaps the reason why VCs are called lemmings. This pattern-based behavior is not without cause. Most VCs are tasked by investors to find the best investment opportunities and act fast on them. No VC wants to be known as the one that passed on the next Facebook or Google. However, this pattern-investing has created a systemic issue with traditional venture capital that is ripe for disruption. While most VCs look for prototypical unicorns, the vast majority of startups will not achieve a billion-dollar valuation<\/a>, or a short exit horizon<\/a>, a prerequisite of most VC firms.<\/p>\n\n\n\n Pattern-investing has created an opportunity for alternative funding in the form of equity crowdfunding. As retail investors become better educated and better connected to startups through digital crowdfunding platforms like Wefunder and Indiegogo Equity, more of these non-unicorn startups are turning to crowdfunding. With the introduction of Regulation Crowdfunding<\/a> by the SEC, startups and investors can build more sustainable and mutually-beneficial funding relationships that are not heavily influenced by the pressure that comes with traditional VC money. In this way, digital transformation, as with other industries, has put the power of investing squarely in the hands of the masses, creating a powerfully disruptive disintermediation trend that has the potential to disrupt traditional VC.<\/p>\n\n\n\n While VC in the United States is enjoying one of its best run rates in recent history<\/a>, the reality is that disruption begins from edge case scenarios. While most traditional VC firms chase after unicorns and billion dollar exits using a 150-year-old funding framework, there will emerge new digital-first VC firms that will tap into the massive potential of startups that do not fit this investment pattern. As with the story of taxicab companies resting on their laurels and ignoring the frustrated masses only to be disrupted by digital-first Uber, here is presented a situation where the venture capital industry has become ripe for disruption, and the companies that disrupt it will be the next billion-dollar or even trillion-dollar VC companies of tomorrow.<\/p>\n\n\n\n The Silicon Valley Venture Capital Academy offers a unique opportunity to learn the investment strategies that top Silicon Valley venture capitalists use when investing in disruptive startups. The five-day immersion program includes learning sessions led by seasoned Silicon Valley venture capitalists, networking opportunities, and hands-on VC-led workshops.<\/p>\n","post_title":"Three Digital Transformation Innovations Disrupting Venture Capital","post_excerpt":"","post_status":"publish","comment_status":"open","ping_status":"closed","post_password":"","post_name":"three-digital-transformation-innovations-disrupting-venture-capital","to_ping":"","pinged":"","post_modified":"2020-02-08 14:52:57","post_modified_gmt":"2020-02-08 22:52:57","post_content_filtered":"","post_parent":0,"guid":"https:\/\/siliconvalley.center\/blog\/three-digital-transformation-innovations-disrupting-venture-capital\/","menu_order":0,"post_type":"post","post_mime_type":"","comment_count":"0","filter":"raw"},{"ID":660,"post_author":"1","post_date":"2018-08-15 19:11:00","post_date_gmt":"2018-08-16 02:11:00","post_content":"\n The traditional corporate environment is hardly fertile ground for innovation. With entrenched thinking, rigid management structures, and an established way of doing things, it is often difficult to convince employees to embrace innovation. In some cases, where the competition is usurping a company\u2019s market share, innovation is usually more of an act of survival than a preemptive strike. However, companies that have a strong market position may end up resting on their laurels, exposing them to rapid disruption from forward-thinking competitors or startups. To avoid being disrupted, traditional corporations must embrace corporate innovation.<\/p>\n\n\n\n Mathieu Guerville heads up the venture capital arm of UL, a company that has been around for over a century and that is deeply entrenched in the safety testing niche. \u201cThe safety industry has evolved from people being worried about getting electrocuted by their kettle to people worrying about cyber threats,\u201d he says, \u201cand so having been stuck in its ways for all those years, UL has had to redefine what safety means and what it means to assess safety.\u201d This reassessment and realignment led the firm to start UL Ventures, which invests in startups involved in the safety assessment and testing field. From his experience heading up this unit, Mathieu shares what he believes are key elements corporations must adopt to foster corporate innovation within their ranks.<\/p>\n\n\n\n \u201cWhenever we go looking for startups or other businesses to invest in, we first ensure the companies we approach align with our core mission statement,\u201d Mathieu says. This is a key insight for corporations that may get distracted by all the incredible technologies developing across different industries. While it is essential to explore developments in lateral industries, it is important to remain a mission-driven organization to sustain current momentum and keep current customers satisfied. In the case of UL, focusing on investing in startups that augment or complement its current mission statement ensures the firm\u2019s competitive advantage remains intact and continues to strengthen.<\/p>\n\n\n\n \u201cIf you are building the next Instagram or dog walking app, we are not interested,\u201d says Mathieu. By having this laser-like focus, the firm has been able to go through seventy acquisitions without losing sight of its core mission. For executives considering innovation, it is essential first to define a clear mission statement and then use this as a guiding principle when acquiring or partnering with startups. Doing this will save the firm both money and time while ensuring maximization of opportunity cost through avoidance of timewasting ventures.<\/p>\n\n\n\n \u201cWhy did UL start a venture capital arm?\u201d we asked Mathieu. \u201cOver time, UL simply could not keep up with all the advances in the technologies it inspects and certifies. Starting a VC arm was the natural progression to the direction we were taking to become a more innovative company,\u201d he explains. But, according to Mathieu, VC is not as simple as just putting together some money and throwing it at startups. The process of investing in and onboarding startups is often fraught with challenges such as culture clashes, poor returns and outright lack of fit as the startup evolves. He notes that while financial returns are important, they should not form the main agenda when investing in startups for innovation purposes.<\/p>\n\n\n\n For the UL fund, he looks for three things in a startup before considering an investment.<\/p>\n\n\n\n Besides focusing on this set of criteria, Mathieu also advises corporations to have a dedicated innovation team that stewards the entire corporate venture capital process. With such a team in place, it is easier to handle issues like culture clashes, startup onboarding, commercial agreements, IP protection, among other issues that are bound to arise.<\/p>\n\n\n\n \u201cThe first step of innovation is ideation, and for ideation to happen, there must be curiosity,\u201d says Mathieu. Most corporations falter at this step because established cultures and norms do not allow for the presentation of ideas, most of which will inevitably fail. As failure is often frowned upon in traditional corporate settings, employees tend to keep their ideas to themselves lest they are labeled a failure, which can affect their performance rating or promotion prospects. \u201cA culture of innovation must start at the top. Management needs to say it is okay to fail, as long as we fail fast and we are failing in the quest for innovation,\u201d says Mathieu.<\/p>\n\n\n\n \u201cThis is, however, just half of the solution,\u201d he adds. For organizations to fully embrace an innovation culture, there must be mechanisms and processes in place to manage this inflow of ideas. Some companies use idea boxes while others utilize hackathons, or the 80\/20 rule made famous by Google. All these represent mechanisms by which ideas are solicited from employees, presented to management, filtered and supported or killed off quickly to keep the innovation momentum going. By adopting a fail-fast failure-tolerant innovation culture, organization leaders can inspire employees to think beyond their scope of work to help the company break into new levels of innovation.<\/p>\n\n\n\n \u201cCorporate innovation takes time,\u201d Mathieu reflects. While in a startup the entire company is a sandbox where experiments can be run hot and fast, the situation is different for traditional corporate organizations. \u201cInstead of focusing on why innovation cannot work in your organization, focus instead on how you can create a sandbox environment to test your boldest ideas within a controlled environment. Creating such a sandbox environment allows the organization to test out innovations without going straight to the deep end, allowing for bolder and more frequent innovation experiments,\u201d concludes Mathieu.<\/p>\n\n\n\n This booming industry, the genesis of modern-day venture capital, was whaling<\/a>. Much as that boom led to the birth of unicorns and million-dollar ventures, today, venture capital, especially in the United States, follows the same ground rules of the time, seeking and creating unicorns to invest in with the hope of returning extravagant returns. However, that was 150 years ago, and yet the industry has been slow to adapt to the rapid disruption being brought about by digital transformation. As Luke Kanies asks in a piece published on Medium<\/a>, \u201cAs much as the system of venture capital is built on success, we must ask: Where is it failing?\u201d As with all other industries that are ripe for disruption, we see disruptive digital technologies exploiting these gaps. In this article, we look at three digital innovations that are disrupting venture capital.<\/p>\n\n\n\n In 2009, Quid AI was challenged to use machine learning<\/a> to pick a list of 50 hitherto unheard-of startups that were set to dominate the business world. That list contained companies like Evernote, Etsy, Spotify, Zynga, Cloudera, and Palantir, all of which today, some nine years later, have billion-dollar valuations. This experiment demonstrated an interesting irony about the current state of venture capital. While most venture capital firms are increasing their investments in AI startups<\/a>, very few VC firms are utilizing AI to pick winning startups. This disconnect represents a massive opportunity for VCs that choose to adopt a disruptive startup mentality. In fact, according to a leading fund of funds approached by Bloomberg Businessweek to analyze the basket of 50 companies picked, the firm noted that if the companies represented one VC company\u2019s portfolio, it would be the second-best performing portfolio of all time. (The best performing portfolio rode the dot-com bubble.)<\/p>\n\n\n\n AI is poised to disrupt traditional venture capital as it can analyze hundreds of thousands of deals and millions of other data points to find patterns that point to successful bets. These data points include past VC investment patterns, startups that received investments within a certain period, industries and technologies those startups focused on, global market and technological trends, among others. By combining these data points in millions of ways, it is possible that an AI VC can successfully pick winning startups to invest in, handily beating traditional VC picks.<\/p>\n\n\n\n Cryptocurrencies or cryptos are another digital innovation that has the potential to upend traditional venture capital. This disruptive potential is evident from the massive popularity of Initial Coin Offerings or ICOs. ICOs create massive decentralized VC funds that anyone can invest in, bypassing traditional VCs who act as gatekeepers. While a majority of these ICOs are considered scams, the trend cannot be brushed aside. Cryptos, a democratized currency, not only represent a means of democratized investing, they represent an entirely new way of how global financing can work.<\/p>\n\n\n\n What may be standing in the way of sweeping disruption is perhaps the lack of legislative frameworks to regulate cryptos. While this may be taking time, there is no doubt that once these legislations are in place, the world of finance will look very different. VC funds that fail to embrace this trend in good time may find themselves locked out of a trillion-dollar opportunity that will allow billions of people across the world and from all walks of life to invest in whatever promising businesses they choose to invest in. Such an opportunity can only be grasped if VC funds begin to experiment and invest early in startups working on related solutions.<\/p>\n\n\n\n Venture capital is pattern based. It is perhaps the reason why VCs are called lemmings. This pattern-based behavior is not without cause. Most VCs are tasked by investors to find the best investment opportunities and act fast on them. No VC wants to be known as the one that passed on the next Facebook or Google. However, this pattern-investing has created a systemic issue with traditional venture capital that is ripe for disruption. While most VCs look for prototypical unicorns, the vast majority of startups will not achieve a billion-dollar valuation<\/a>, or a short exit horizon<\/a>, a prerequisite of most VC firms.<\/p>\n\n\n\n Pattern-investing has created an opportunity for alternative funding in the form of equity crowdfunding. As retail investors become better educated and better connected to startups through digital crowdfunding platforms like Wefunder and Indiegogo Equity, more of these non-unicorn startups are turning to crowdfunding. With the introduction of Regulation Crowdfunding<\/a> by the SEC, startups and investors can build more sustainable and mutually-beneficial funding relationships that are not heavily influenced by the pressure that comes with traditional VC money. In this way, digital transformation, as with other industries, has put the power of investing squarely in the hands of the masses, creating a powerfully disruptive disintermediation trend that has the potential to disrupt traditional VC.<\/p>\n\n\n\n While VC in the United States is enjoying one of its best run rates in recent history<\/a>, the reality is that disruption begins from edge case scenarios. While most traditional VC firms chase after unicorns and billion dollar exits using a 150-year-old funding framework, there will emerge new digital-first VC firms that will tap into the massive potential of startups that do not fit this investment pattern. As with the story of taxicab companies resting on their laurels and ignoring the frustrated masses only to be disrupted by digital-first Uber, here is presented a situation where the venture capital industry has become ripe for disruption, and the companies that disrupt it will be the next billion-dollar or even trillion-dollar VC companies of tomorrow.<\/p>\n\n\n\n The Silicon Valley Venture Capital Academy offers a unique opportunity to learn the investment strategies that top Silicon Valley venture capitalists use when investing in disruptive startups. The five-day immersion program includes learning sessions led by seasoned Silicon Valley venture capitalists, networking opportunities, and hands-on VC-led workshops.<\/p>\n","post_title":"Three Digital Transformation Innovations Disrupting Venture Capital","post_excerpt":"","post_status":"publish","comment_status":"open","ping_status":"closed","post_password":"","post_name":"three-digital-transformation-innovations-disrupting-venture-capital","to_ping":"","pinged":"","post_modified":"2020-02-08 14:52:57","post_modified_gmt":"2020-02-08 22:52:57","post_content_filtered":"","post_parent":0,"guid":"https:\/\/siliconvalley.center\/blog\/three-digital-transformation-innovations-disrupting-venture-capital\/","menu_order":0,"post_type":"post","post_mime_type":"","comment_count":"0","filter":"raw"},{"ID":660,"post_author":"1","post_date":"2018-08-15 19:11:00","post_date_gmt":"2018-08-16 02:11:00","post_content":"\n The traditional corporate environment is hardly fertile ground for innovation. With entrenched thinking, rigid management structures, and an established way of doing things, it is often difficult to convince employees to embrace innovation. In some cases, where the competition is usurping a company\u2019s market share, innovation is usually more of an act of survival than a preemptive strike. However, companies that have a strong market position may end up resting on their laurels, exposing them to rapid disruption from forward-thinking competitors or startups. To avoid being disrupted, traditional corporations must embrace corporate innovation.<\/p>\n\n\n\n Mathieu Guerville heads up the venture capital arm of UL, a company that has been around for over a century and that is deeply entrenched in the safety testing niche. \u201cThe safety industry has evolved from people being worried about getting electrocuted by their kettle to people worrying about cyber threats,\u201d he says, \u201cand so having been stuck in its ways for all those years, UL has had to redefine what safety means and what it means to assess safety.\u201d This reassessment and realignment led the firm to start UL Ventures, which invests in startups involved in the safety assessment and testing field. From his experience heading up this unit, Mathieu shares what he believes are key elements corporations must adopt to foster corporate innovation within their ranks.<\/p>\n\n\n\n \u201cWhenever we go looking for startups or other businesses to invest in, we first ensure the companies we approach align with our core mission statement,\u201d Mathieu says. This is a key insight for corporations that may get distracted by all the incredible technologies developing across different industries. While it is essential to explore developments in lateral industries, it is important to remain a mission-driven organization to sustain current momentum and keep current customers satisfied. In the case of UL, focusing on investing in startups that augment or complement its current mission statement ensures the firm\u2019s competitive advantage remains intact and continues to strengthen.<\/p>\n\n\n\n \u201cIf you are building the next Instagram or dog walking app, we are not interested,\u201d says Mathieu. By having this laser-like focus, the firm has been able to go through seventy acquisitions without losing sight of its core mission. For executives considering innovation, it is essential first to define a clear mission statement and then use this as a guiding principle when acquiring or partnering with startups. Doing this will save the firm both money and time while ensuring maximization of opportunity cost through avoidance of timewasting ventures.<\/p>\n\n\n\n \u201cWhy did UL start a venture capital arm?\u201d we asked Mathieu. \u201cOver time, UL simply could not keep up with all the advances in the technologies it inspects and certifies. Starting a VC arm was the natural progression to the direction we were taking to become a more innovative company,\u201d he explains. But, according to Mathieu, VC is not as simple as just putting together some money and throwing it at startups. The process of investing in and onboarding startups is often fraught with challenges such as culture clashes, poor returns and outright lack of fit as the startup evolves. He notes that while financial returns are important, they should not form the main agenda when investing in startups for innovation purposes.<\/p>\n\n\n\n For the UL fund, he looks for three things in a startup before considering an investment.<\/p>\n\n\n\n Besides focusing on this set of criteria, Mathieu also advises corporations to have a dedicated innovation team that stewards the entire corporate venture capital process. With such a team in place, it is easier to handle issues like culture clashes, startup onboarding, commercial agreements, IP protection, among other issues that are bound to arise.<\/p>\n\n\n\n \u201cThe first step of innovation is ideation, and for ideation to happen, there must be curiosity,\u201d says Mathieu. Most corporations falter at this step because established cultures and norms do not allow for the presentation of ideas, most of which will inevitably fail. As failure is often frowned upon in traditional corporate settings, employees tend to keep their ideas to themselves lest they are labeled a failure, which can affect their performance rating or promotion prospects. \u201cA culture of innovation must start at the top. Management needs to say it is okay to fail, as long as we fail fast and we are failing in the quest for innovation,\u201d says Mathieu.<\/p>\n\n\n\n \u201cThis is, however, just half of the solution,\u201d he adds. For organizations to fully embrace an innovation culture, there must be mechanisms and processes in place to manage this inflow of ideas. Some companies use idea boxes while others utilize hackathons, or the 80\/20 rule made famous by Google. All these represent mechanisms by which ideas are solicited from employees, presented to management, filtered and supported or killed off quickly to keep the innovation momentum going. By adopting a fail-fast failure-tolerant innovation culture, organization leaders can inspire employees to think beyond their scope of work to help the company break into new levels of innovation.<\/p>\n\n\n\n \u201cCorporate innovation takes time,\u201d Mathieu reflects. While in a startup the entire company is a sandbox where experiments can be run hot and fast, the situation is different for traditional corporate organizations. \u201cInstead of focusing on why innovation cannot work in your organization, focus instead on how you can create a sandbox environment to test your boldest ideas within a controlled environment. Creating such a sandbox environment allows the organization to test out innovations without going straight to the deep end, allowing for bolder and more frequent innovation experiments,\u201d concludes Mathieu.<\/p>\n\n\n\n In the mid to late 1800s, capital flowed to the Silicon Valley of the time, New Bedford, Massachusetts, to take advantage of an investment opportunity that could return massive annual profits to investors. These startups of the time were comparable to the unicorns of Silicon Valley in that they had small highly-skilled teams that took massive risks to return profits on investments. The VCs of the time, companies like Gideon Allen & Sons, by investing in these startups, were able to achieve stellar returns of up to 60% per year, returns that any VC today would find difficult to match. What\u2019s more, that booming startup industry of the time, like Silicon Valley, was also concentrated in the United States.<\/p>\n\n\n\n This booming industry, the genesis of modern-day venture capital, was whaling<\/a>. Much as that boom led to the birth of unicorns and million-dollar ventures, today, venture capital, especially in the United States, follows the same ground rules of the time, seeking and creating unicorns to invest in with the hope of returning extravagant returns. However, that was 150 years ago, and yet the industry has been slow to adapt to the rapid disruption being brought about by digital transformation. As Luke Kanies asks in a piece published on Medium<\/a>, \u201cAs much as the system of venture capital is built on success, we must ask: Where is it failing?\u201d As with all other industries that are ripe for disruption, we see disruptive digital technologies exploiting these gaps. In this article, we look at three digital innovations that are disrupting venture capital.<\/p>\n\n\n\n In 2009, Quid AI was challenged to use machine learning<\/a> to pick a list of 50 hitherto unheard-of startups that were set to dominate the business world. That list contained companies like Evernote, Etsy, Spotify, Zynga, Cloudera, and Palantir, all of which today, some nine years later, have billion-dollar valuations. This experiment demonstrated an interesting irony about the current state of venture capital. While most venture capital firms are increasing their investments in AI startups<\/a>, very few VC firms are utilizing AI to pick winning startups. This disconnect represents a massive opportunity for VCs that choose to adopt a disruptive startup mentality. In fact, according to a leading fund of funds approached by Bloomberg Businessweek to analyze the basket of 50 companies picked, the firm noted that if the companies represented one VC company\u2019s portfolio, it would be the second-best performing portfolio of all time. (The best performing portfolio rode the dot-com bubble.)<\/p>\n\n\n\n AI is poised to disrupt traditional venture capital as it can analyze hundreds of thousands of deals and millions of other data points to find patterns that point to successful bets. These data points include past VC investment patterns, startups that received investments within a certain period, industries and technologies those startups focused on, global market and technological trends, among others. By combining these data points in millions of ways, it is possible that an AI VC can successfully pick winning startups to invest in, handily beating traditional VC picks.<\/p>\n\n\n\n Cryptocurrencies or cryptos are another digital innovation that has the potential to upend traditional venture capital. This disruptive potential is evident from the massive popularity of Initial Coin Offerings or ICOs. ICOs create massive decentralized VC funds that anyone can invest in, bypassing traditional VCs who act as gatekeepers. While a majority of these ICOs are considered scams, the trend cannot be brushed aside. Cryptos, a democratized currency, not only represent a means of democratized investing, they represent an entirely new way of how global financing can work.<\/p>\n\n\n\n What may be standing in the way of sweeping disruption is perhaps the lack of legislative frameworks to regulate cryptos. While this may be taking time, there is no doubt that once these legislations are in place, the world of finance will look very different. VC funds that fail to embrace this trend in good time may find themselves locked out of a trillion-dollar opportunity that will allow billions of people across the world and from all walks of life to invest in whatever promising businesses they choose to invest in. Such an opportunity can only be grasped if VC funds begin to experiment and invest early in startups working on related solutions.<\/p>\n\n\n\n Venture capital is pattern based. It is perhaps the reason why VCs are called lemmings. This pattern-based behavior is not without cause. Most VCs are tasked by investors to find the best investment opportunities and act fast on them. No VC wants to be known as the one that passed on the next Facebook or Google. However, this pattern-investing has created a systemic issue with traditional venture capital that is ripe for disruption. While most VCs look for prototypical unicorns, the vast majority of startups will not achieve a billion-dollar valuation<\/a>, or a short exit horizon<\/a>, a prerequisite of most VC firms.<\/p>\n\n\n\n Pattern-investing has created an opportunity for alternative funding in the form of equity crowdfunding. As retail investors become better educated and better connected to startups through digital crowdfunding platforms like Wefunder and Indiegogo Equity, more of these non-unicorn startups are turning to crowdfunding. With the introduction of Regulation Crowdfunding<\/a> by the SEC, startups and investors can build more sustainable and mutually-beneficial funding relationships that are not heavily influenced by the pressure that comes with traditional VC money. In this way, digital transformation, as with other industries, has put the power of investing squarely in the hands of the masses, creating a powerfully disruptive disintermediation trend that has the potential to disrupt traditional VC.<\/p>\n\n\n\n While VC in the United States is enjoying one of its best run rates in recent history<\/a>, the reality is that disruption begins from edge case scenarios. While most traditional VC firms chase after unicorns and billion dollar exits using a 150-year-old funding framework, there will emerge new digital-first VC firms that will tap into the massive potential of startups that do not fit this investment pattern. As with the story of taxicab companies resting on their laurels and ignoring the frustrated masses only to be disrupted by digital-first Uber, here is presented a situation where the venture capital industry has become ripe for disruption, and the companies that disrupt it will be the next billion-dollar or even trillion-dollar VC companies of tomorrow.<\/p>\n\n\n\n The Silicon Valley Venture Capital Academy offers a unique opportunity to learn the investment strategies that top Silicon Valley venture capitalists use when investing in disruptive startups. The five-day immersion program includes learning sessions led by seasoned Silicon Valley venture capitalists, networking opportunities, and hands-on VC-led workshops.<\/p>\n","post_title":"Three Digital Transformation Innovations Disrupting Venture Capital","post_excerpt":"","post_status":"publish","comment_status":"open","ping_status":"closed","post_password":"","post_name":"three-digital-transformation-innovations-disrupting-venture-capital","to_ping":"","pinged":"","post_modified":"2020-02-08 14:52:57","post_modified_gmt":"2020-02-08 22:52:57","post_content_filtered":"","post_parent":0,"guid":"https:\/\/siliconvalley.center\/blog\/three-digital-transformation-innovations-disrupting-venture-capital\/","menu_order":0,"post_type":"post","post_mime_type":"","comment_count":"0","filter":"raw"},{"ID":660,"post_author":"1","post_date":"2018-08-15 19:11:00","post_date_gmt":"2018-08-16 02:11:00","post_content":"\n The traditional corporate environment is hardly fertile ground for innovation. With entrenched thinking, rigid management structures, and an established way of doing things, it is often difficult to convince employees to embrace innovation. In some cases, where the competition is usurping a company\u2019s market share, innovation is usually more of an act of survival than a preemptive strike. However, companies that have a strong market position may end up resting on their laurels, exposing them to rapid disruption from forward-thinking competitors or startups. To avoid being disrupted, traditional corporations must embrace corporate innovation.<\/p>\n\n\n\n Mathieu Guerville heads up the venture capital arm of UL, a company that has been around for over a century and that is deeply entrenched in the safety testing niche. \u201cThe safety industry has evolved from people being worried about getting electrocuted by their kettle to people worrying about cyber threats,\u201d he says, \u201cand so having been stuck in its ways for all those years, UL has had to redefine what safety means and what it means to assess safety.\u201d This reassessment and realignment led the firm to start UL Ventures, which invests in startups involved in the safety assessment and testing field. From his experience heading up this unit, Mathieu shares what he believes are key elements corporations must adopt to foster corporate innovation within their ranks.<\/p>\n\n\n\n \u201cWhenever we go looking for startups or other businesses to invest in, we first ensure the companies we approach align with our core mission statement,\u201d Mathieu says. This is a key insight for corporations that may get distracted by all the incredible technologies developing across different industries. While it is essential to explore developments in lateral industries, it is important to remain a mission-driven organization to sustain current momentum and keep current customers satisfied. In the case of UL, focusing on investing in startups that augment or complement its current mission statement ensures the firm\u2019s competitive advantage remains intact and continues to strengthen.<\/p>\n\n\n\n \u201cIf you are building the next Instagram or dog walking app, we are not interested,\u201d says Mathieu. By having this laser-like focus, the firm has been able to go through seventy acquisitions without losing sight of its core mission. For executives considering innovation, it is essential first to define a clear mission statement and then use this as a guiding principle when acquiring or partnering with startups. Doing this will save the firm both money and time while ensuring maximization of opportunity cost through avoidance of timewasting ventures.<\/p>\n\n\n\n \u201cWhy did UL start a venture capital arm?\u201d we asked Mathieu. \u201cOver time, UL simply could not keep up with all the advances in the technologies it inspects and certifies. Starting a VC arm was the natural progression to the direction we were taking to become a more innovative company,\u201d he explains. But, according to Mathieu, VC is not as simple as just putting together some money and throwing it at startups. The process of investing in and onboarding startups is often fraught with challenges such as culture clashes, poor returns and outright lack of fit as the startup evolves. He notes that while financial returns are important, they should not form the main agenda when investing in startups for innovation purposes.<\/p>\n\n\n\n For the UL fund, he looks for three things in a startup before considering an investment.<\/p>\n\n\n\n Besides focusing on this set of criteria, Mathieu also advises corporations to have a dedicated innovation team that stewards the entire corporate venture capital process. With such a team in place, it is easier to handle issues like culture clashes, startup onboarding, commercial agreements, IP protection, among other issues that are bound to arise.<\/p>\n\n\n\n \u201cThe first step of innovation is ideation, and for ideation to happen, there must be curiosity,\u201d says Mathieu. Most corporations falter at this step because established cultures and norms do not allow for the presentation of ideas, most of which will inevitably fail. As failure is often frowned upon in traditional corporate settings, employees tend to keep their ideas to themselves lest they are labeled a failure, which can affect their performance rating or promotion prospects. \u201cA culture of innovation must start at the top. Management needs to say it is okay to fail, as long as we fail fast and we are failing in the quest for innovation,\u201d says Mathieu.<\/p>\n\n\n\n \u201cThis is, however, just half of the solution,\u201d he adds. For organizations to fully embrace an innovation culture, there must be mechanisms and processes in place to manage this inflow of ideas. Some companies use idea boxes while others utilize hackathons, or the 80\/20 rule made famous by Google. All these represent mechanisms by which ideas are solicited from employees, presented to management, filtered and supported or killed off quickly to keep the innovation momentum going. By adopting a fail-fast failure-tolerant innovation culture, organization leaders can inspire employees to think beyond their scope of work to help the company break into new levels of innovation.<\/p>\n\n\n\n \u201cCorporate innovation takes time,\u201d Mathieu reflects. While in a startup the entire company is a sandbox where experiments can be run hot and fast, the situation is different for traditional corporate organizations. \u201cInstead of focusing on why innovation cannot work in your organization, focus instead on how you can create a sandbox environment to test your boldest ideas within a controlled environment. Creating such a sandbox environment allows the organization to test out innovations without going straight to the deep end, allowing for bolder and more frequent innovation experiments,\u201d concludes Mathieu.<\/p>\n\n\n\n In the mid to late 1800s, capital flowed to the Silicon Valley of the time, New Bedford, Massachusetts, to take... The traditional corporate environment is hardly fertile ground for innovation. With entrenched thinking, rigid management structures, and an established way...
\n\n\n\nSilicon Valley Venture Capital Academy<\/h2>\n\n\n\n
Stay Committed to Your Mission Statement<\/h2>\n\n\n\n
Start a Corporate Venture Capital Fund<\/h2>\n\n\n\n
Create a Culture of Curiosity<\/h2>\n\n\n\n
Conclusion<\/h2>\n\n\n\n
\n\n\n\nVideo: Corporate Innovation Interview with Mathieu Guerville<\/h2>\n\n\n\n
\n
Latest
Conclusion<\/h2>\n\n\n\n
\n\n\n\nSilicon Valley Venture Capital Academy<\/h2>\n\n\n\n
Stay Committed to Your Mission Statement<\/h2>\n\n\n\n
Start a Corporate Venture Capital Fund<\/h2>\n\n\n\n
Create a Culture of Curiosity<\/h2>\n\n\n\n
Conclusion<\/h2>\n\n\n\n
\n\n\n\nVideo: Corporate Innovation Interview with Mathieu Guerville<\/h2>\n\n\n\n
\n
Latest
Conclusion<\/h2>\n\n\n\n
\n\n\n\nSilicon Valley Venture Capital Academy<\/h2>\n\n\n\n
Stay Committed to Your Mission Statement<\/h2>\n\n\n\n
Start a Corporate Venture Capital Fund<\/h2>\n\n\n\n
Create a Culture of Curiosity<\/h2>\n\n\n\n
Conclusion<\/h2>\n\n\n\n
\n\n\n\nVideo: Corporate Innovation Interview with Mathieu Guerville<\/h2>\n\n\n\n
\n
Latest
Conclusion<\/h2>\n\n\n\n
\n\n\n\nSilicon Valley Venture Capital Academy<\/h2>\n\n\n\n
Stay Committed to Your Mission Statement<\/h2>\n\n\n\n
Start a Corporate Venture Capital Fund<\/h2>\n\n\n\n
Create a Culture of Curiosity<\/h2>\n\n\n\n
Conclusion<\/h2>\n\n\n\n
\n\n\n\nVideo: Corporate Innovation Interview with Mathieu Guerville<\/h2>\n\n\n\n
\n
Latest
Digital Crowdfunding<\/h2>\n\n\n\n
Conclusion<\/h2>\n\n\n\n
\n\n\n\nSilicon Valley Venture Capital Academy<\/h2>\n\n\n\n
Stay Committed to Your Mission Statement<\/h2>\n\n\n\n
Start a Corporate Venture Capital Fund<\/h2>\n\n\n\n
Create a Culture of Curiosity<\/h2>\n\n\n\n
Conclusion<\/h2>\n\n\n\n
\n\n\n\nVideo: Corporate Innovation Interview with Mathieu Guerville<\/h2>\n\n\n\n
\n
Latest
Digital Crowdfunding<\/h2>\n\n\n\n
Conclusion<\/h2>\n\n\n\n
\n\n\n\nSilicon Valley Venture Capital Academy<\/h2>\n\n\n\n
Stay Committed to Your Mission Statement<\/h2>\n\n\n\n
Start a Corporate Venture Capital Fund<\/h2>\n\n\n\n
Create a Culture of Curiosity<\/h2>\n\n\n\n
Conclusion<\/h2>\n\n\n\n
\n\n\n\nVideo: Corporate Innovation Interview with Mathieu Guerville<\/h2>\n\n\n\n
\n
Latest
Digital Crowdfunding<\/h2>\n\n\n\n
Conclusion<\/h2>\n\n\n\n
\n\n\n\nSilicon Valley Venture Capital Academy<\/h2>\n\n\n\n
Stay Committed to Your Mission Statement<\/h2>\n\n\n\n
Start a Corporate Venture Capital Fund<\/h2>\n\n\n\n
Create a Culture of Curiosity<\/h2>\n\n\n\n
Conclusion<\/h2>\n\n\n\n
\n\n\n\nVideo: Corporate Innovation Interview with Mathieu Guerville<\/h2>\n\n\n\n
\n
Latest
Cryptocurrencies<\/h2>\n\n\n\n
Digital Crowdfunding<\/h2>\n\n\n\n
Conclusion<\/h2>\n\n\n\n
\n\n\n\nSilicon Valley Venture Capital Academy<\/h2>\n\n\n\n
Stay Committed to Your Mission Statement<\/h2>\n\n\n\n
Start a Corporate Venture Capital Fund<\/h2>\n\n\n\n
Create a Culture of Curiosity<\/h2>\n\n\n\n
Conclusion<\/h2>\n\n\n\n
\n\n\n\nVideo: Corporate Innovation Interview with Mathieu Guerville<\/h2>\n\n\n\n
\n
Latest
Cryptocurrencies<\/h2>\n\n\n\n
Digital Crowdfunding<\/h2>\n\n\n\n
Conclusion<\/h2>\n\n\n\n
\n\n\n\nSilicon Valley Venture Capital Academy<\/h2>\n\n\n\n
Stay Committed to Your Mission Statement<\/h2>\n\n\n\n
Start a Corporate Venture Capital Fund<\/h2>\n\n\n\n
Create a Culture of Curiosity<\/h2>\n\n\n\n
Conclusion<\/h2>\n\n\n\n
\n\n\n\nVideo: Corporate Innovation Interview with Mathieu Guerville<\/h2>\n\n\n\n
\n
Latest
Cryptocurrencies<\/h2>\n\n\n\n
Digital Crowdfunding<\/h2>\n\n\n\n
Conclusion<\/h2>\n\n\n\n
\n\n\n\nSilicon Valley Venture Capital Academy<\/h2>\n\n\n\n
Stay Committed to Your Mission Statement<\/h2>\n\n\n\n
Start a Corporate Venture Capital Fund<\/h2>\n\n\n\n
Create a Culture of Curiosity<\/h2>\n\n\n\n
Conclusion<\/h2>\n\n\n\n
\n\n\n\nVideo: Corporate Innovation Interview with Mathieu Guerville<\/h2>\n\n\n\n
\n
Latest
Artificial Intelligence<\/h2>\n\n\n\n
Cryptocurrencies<\/h2>\n\n\n\n
Digital Crowdfunding<\/h2>\n\n\n\n
Conclusion<\/h2>\n\n\n\n
\n\n\n\nSilicon Valley Venture Capital Academy<\/h2>\n\n\n\n
Stay Committed to Your Mission Statement<\/h2>\n\n\n\n
Start a Corporate Venture Capital Fund<\/h2>\n\n\n\n
Create a Culture of Curiosity<\/h2>\n\n\n\n
Conclusion<\/h2>\n\n\n\n
\n\n\n\nVideo: Corporate Innovation Interview with Mathieu Guerville<\/h2>\n\n\n\n
\n
Latest
Artificial Intelligence<\/h2>\n\n\n\n
Cryptocurrencies<\/h2>\n\n\n\n
Digital Crowdfunding<\/h2>\n\n\n\n
Conclusion<\/h2>\n\n\n\n
\n\n\n\nSilicon Valley Venture Capital Academy<\/h2>\n\n\n\n
Stay Committed to Your Mission Statement<\/h2>\n\n\n\n
Start a Corporate Venture Capital Fund<\/h2>\n\n\n\n
Create a Culture of Curiosity<\/h2>\n\n\n\n
Conclusion<\/h2>\n\n\n\n
\n\n\n\nVideo: Corporate Innovation Interview with Mathieu Guerville<\/h2>\n\n\n\n
\n
Latest
Artificial Intelligence<\/h2>\n\n\n\n
Cryptocurrencies<\/h2>\n\n\n\n
Digital Crowdfunding<\/h2>\n\n\n\n
Conclusion<\/h2>\n\n\n\n
\n\n\n\nSilicon Valley Venture Capital Academy<\/h2>\n\n\n\n
Stay Committed to Your Mission Statement<\/h2>\n\n\n\n
Start a Corporate Venture Capital Fund<\/h2>\n\n\n\n
Create a Culture of Curiosity<\/h2>\n\n\n\n
Conclusion<\/h2>\n\n\n\n
\n\n\n\nVideo: Corporate Innovation Interview with Mathieu Guerville<\/h2>\n\n\n\n
Latest
Blog: Venture Capital
Three Digital Transformation Innovations Disrupting Venture Capital
How to Foster Innovation in a Traditional Corporate Environment
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