The Benefits of Obtaining Corporate Venture Capital

When entrepreneurs seek capital for their startup business, they have a number of options, among them venture capital funds. Corporate venture capital comes from large companies that have an interest in the innovation in the market. This is an option that entrepreneurs ought to give much weight.

Market validation

Corporate VC can enable startups to access customers that are already established. This quickens its ability to find the market that best fits a business. Most companies that offer these funds usually already have a large customer base. The company can easily identify adopters of the new set of technology. This enables the startup to obtain the first batch of customers that can buy the startup’s products or services.

Revenue Growth

Once the startup gains market validation, it becomes easier to access revenue. This should be as an independent agreement form the investment agreement. This reduces the startup’s need for outside capital and enables the startup to be depicted as a sustainable business model.

Access to capital

This relieves the startup from searching for additional ways of raising funds. It becomes easier accessing other investors after the startup has obtained funding from one investor. The investor company can invest in the startup in as many rounds as it may desire.

Domain expertise

Since the investor companies already have experience in a given field, it is easier to guide the startup on how best it can penetrate the market and grow into a big business. VC’s skills and experience makes the startup to stand out in the market.

References

https://www.entrepreneur.com/article/293272

https://hbr.org/2002/03/making-sense-of-corporate-venture-capital

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