In February and March 2019, we conducted a small pilot survey (n=31) of founders of businesses that have received corporate funding, which were referred to the survey by their corporate backers. We called it the “GCV Founders Survey” and it gave us some interesting insights.
According to our Founders survey data, startup founders set their expectations on the value that corporate can delivery, for the most part, in line with their actual capabilities. Commercial partnerships (63%), access to the corporate supply chain and ecosystem (57%), access to corporate technical expertise (53%) and active assistance with marketing and commercialisation (37%) are the top raked expectations.
However, in terms of benefits actually obtained from corporate investors, it turns out corporates fall very short on delivering access to their supply chain and ecosystem – 57% of respondents expected to obtain this benefit, while only 31% said to have actually obtained it. What corporates also fall short on is assistance with potential exits. Few corporates are actively helping startups find potential acquirers – 23% of respondents expected them to but only 14% of startups received or are receiving such assistance. It may be argued, however, that the latter is hardly surprising, as corporate venturers have primarily strategic objectives in mind when committing capital rather than financial ones, which tend to place a higher weight on an eventual exit. The fact that nearly a quarter of all respondents expected corporates in their syndicate to help them look for an acquirer may reflect particular circumstances around specific businesses.
One of the often-talked-about shortcomings of corporate investors – corporates being perceived as unreliable follow-on investors – has been dispelled by our survey results. The majority of respondents (71%) say they feel confident that corporate venturers will continue to back their businesses in subsequent funding rounds. Read the May issue of our GCV magazine to see more insights from this survey!