Fri, 18 June 2021
Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.
Corporate VCs can leverage their position in the industry to sign up good startups with an investment.
The corporate VC brings a network of partners, distribution channels, a brand, an existing product line, and more.
An investment can leverage their research dollars and achieve more than if they build it themselves.
The pharmaceutical industry recognized this advantage years ago and now primarily invest in funding successful biotech startups rather than doing all the research and development themselves.
This model works well where R&D is expensive and there are many potential avenues to take.
There is a cost of setting up a corporate VC arm, but this investment can be spread across many startups.
If used extensively, it can become a core competence for the company.
To be successful at this, start with a clearly defined set of goals.
Gain commitment from the corporation.
Align the compensation of the corporate team to that of the performance of the investment.
Those companies whose growth has stalled for some time may be more open to committing to it.
Those facing a new wave of technologies may find this a better way to engage.
Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.
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Fri, 18 June 2021
In this episode, Hall welcomes John Dalton, Managing Partner at Industrial Device Investments (IDI).
Headquartered in Knoxville, Tennessee, IDI invests in manufacturers of industrial devices, sensors, machinery, and instruments. More specifically, they prefer specialty product companies that have $5 - $50 million in revenue, $1 - $6 million in earnings, strong technical features such that "use expertise" is value-added, the opportunity to improve by stronger strategic focus and strong operational execution, but not turnarounds, and segments where technology and innovation can drive sustainable advantage.
John is a three-decade industrial products veteran with experience in all company functions and as a private equity investor with SouthPointe Ventures in Atlanta. John’s past experience began with General Electric and Black & Decker and includes senior leadership and ownership positions with smaller organizations focused on unique technologies within basic industries. He holds a B.S. in Mechanical Engineering from Cornell University and an M.B.A. degree from the University of North Carolina. Dalton and his wife Sandy live in Knoxville, with their five children: Mark, Chris, Ari, Connor, and Krystin, and are active attendees at Two Rivers Church.
John mentions some good opportunities for investors to pursue. He also shares his investment thesis and some of the challenges entrepreneurs face.
You can visit Industrial Device Investments at www.idinvest.net, and via LinkedIn at www.linkedin.com/company/industrial-device-investments/about/.
Music courtesy of Bensound.