Corporations Launched 100+ Venture Capital Funds in 2022
Prominent companies continue to launch new CVC efforts and commit to successor funds
Corporate venture capital (“CVC”) has grown significantly over the past decade. Following up on our study of new CVC fund launches in 2021, we were curious whether changing market conditions in 2022 might impact the formation of new CVC programs.
This article focuses on CVC funds launched in 2022 where the majority of the capital came from a single corporate investor to fund its own venture program. The study leverages data from new corporate venture capital fund announcements that our team reviewed throughout the year.
105 CVC funds launched in 2022
Of the 105 corporate venture capital funds launched in 2022, 66% were new, first-time corporate venture programs, while the remaining 34% were successor funds for corporations with an existing CVC effort.
Compared to the number of new corporate VC funds launched in 2021, we saw a 25% decline in the total number of new CVCs formed, including a 23% decline in the number of corporations launching a fund for the first time (rather than a successor fund) in 2022 compared to the prior year.
Examples of New CVC Funds
Many prominent companies launched venture funds in 2022, including Chipotle, Christie’s, Carrier, Nestle, The NBA, The Home Depot, Dick’s Sporting Goods and PGA of America.
Operating model: internal staffing vs. use of external partners
78% of corporations launched their first-time CVC funds with internal teams, down from 84% in 2021. 22% of the first time venture funds launched with an external partner such as an alternative investment management firm or a “CVC as a Service” provider. For example, our firm Touchdown Ventures works with multiple corporations that announced or launched funds in 2022, including AmerisourceBergen, Cooperative Ventures, Erie Insurance, and INX International.
69 new corporate venture funds: public vs. private
In 2022, there was almost an even split between publicly traded and privately held companies starting new venture capital programs.
Geography
The majority of corporations that started new CVC funds were based in North America (67%), followed by Asia (17%) and Europe (12%).
Industry sector
About half of the new corporate VC funds started in 2022 were started by companies in the following industry sectors: software, energy & industrial, and financial services.
Within financial services and media, multiple companies classifying themselves as Web3 companies launched CVCs. Unsurprisingly, these launches were all by private companies, mainly in the crypto currency and NFT spaces, such as OpenSea and Ledger. 89% of those funds were started in the first half of 2022. Public companies launching funds were largely from industries such as transportation, cable & telecom, hospitality, and consumer packaged goods.
Size of New Corporate VC Funds
The average size of new CVC funds in 2022 was $160 million, with a median fund size of $100 million.
The average fund size was higher for privately held companies, with public companies committing an average of $106 million in capital compared to $211 million for private sector companies. This data is skewed by the largest private company CVC launch, a $2 billion venture capital fund started by the now defunct FTX. The smallest disclosed fund size was $25 million. Median fund sizes were $70 million for public companies and $100 million for private companies.
Successor Funds
Several corporations launched successor funds in 2022 to expand existing CVC efforts. Companies such as American Express, JP Morgan and Slack increased fund sizes or expanded the mandate for their venture programs by including new sectors or geographies.
The average size for successor funds was $322 million, twice the average fund size for first time corporate VC funds in 2022. Median successor fund sizes was $147 million, versus $100 million for first-time funds.
Notable larger successor funds included several billion dollar funds including Amazon’s Industrial Innovation Fund, and Leaps by Bayer, which committed capital to double its investment pace through 2024. Saudi Aramco launched multiple funds in 2022, including its $1 billion tech-focused Prosperity7 Ventures fund and a $1.5B sustainability fund.
In addition to launching new corporate venture funds this year, companies such as Amazon and MassMutual set aside additional more than $100 million each to invest in underrepresented entrepreneurs and diverse emerging managers respectively. This is a trend that we hope to see continue into 2023.
Overall, the corporate venture capital industry continues to grow. We believe that corporations need to innovate in both good times and bad and anticipate that these trends will continue.
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Rachel Gutnick is a Senior Associate at Touchdown Ventures, a firm that provides “Venture Capital as a Service” to help corporations launch and manage their investment programs.
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