European Research in Entrepreneurship series
Edited by Alain Fayolle, Paula Kyrö, Tonis Mets and Urve Venesaar
Chapter 12: Corporate venture capital choices setting and investment behaviors: analysis at corporate, venture and business environment levels
The modern business landscape is characterized by fast technological changes, dynamic and complex competitive environments and a race towards new knowledge (Kuratko and Audretsch, 2009). That suggests to well-established companies the need for entrepreneurial adaptability. Indeed, in the last decades, many path-breaking innovations have tended to be implemented outside large entities by entrepreneurial ventures. To succeed in such a dynamic business environment and stay ahead of the competition, it is necessary for large corporations to innovate and to be part of those disruptive and changing technologies and markets (Weber and Weber, 2007; Souza et al., 2004). They have to be very proactive by opening their innovation process strategically and initiating entrepreneurial activities through, for instance, a corporate venture capital (CVC) program (OECD, 2008). CVC refers to “equity or equity-linked investments in young, privately held companies, where the investor is a financial intermediary of a non-financial corporation” (Maula, 2007). In other words, established corporations make direct minority equity investments in privately-held entrepreneurial ventures (Gompers and Lerner, 1998).
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