Startup Funding Espresso -- Pros and Cons of Working With Corporate VCs

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

There are pros and cons to working with Corporate VCs.

Here are the pros:

They take a long-term point of view giving the startup time to grow and develop.

They bring access to partners, customers, and other resources.

They bring domain knowledge far beyond what most traditional VCs bring.

They can fund major projects much longer than traditional VCs.


Here are the cons:

You must gain commitment all the way to the top of the organization.

Corporations have silos and can be difficult to build consensus or sell ideas across department lines.

Corporations move slowly compared to the startup world which can frustrate the new ventures.

Corporations are competitive and do not always work well with other corporations.

Corporates can shift their attention to other things leaving the startup underfunded.

The startup’s innovation will ultimately be pulled into the corporate structure which dilutes the startup’s brand.

Consider these points in determining your participation with a corporate VC.

 

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today.
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