Experimentation & Ventures

Corporate venturing consulting is the work of deciding how much a company spends on finding things out, which of those bets becomes a venture with its own team and its own economics, how each one is funded and governed, and at what point it is stopped. Vivaldi has advised companies on growth, innovation and new business building since 1999, from ten offices on four continents.

This is the portfolio view. It sits above the three capabilities in this group, and it answers a different question from any of them: not whether one idea holds, but whether the set of bets a company is carrying is worth the money it costs to carry them.

• Since 1999growth, innovation and venture strategy
• 200+published case studies
• 10 officeson four continents
• 5xWirtschaftsWoche Best of Consulting, Strategy and Innovation

When companies bring us in

• The innovation budget is fully spent and nobody can say which part of it bought information.
• The pilot list has grown for years and almost none of it has reached a decision to kill or to scale.
• One large bet absorbs most of the funding, and there is no written condition that would end it.
• A venture is live, the parent company has become the constraint, and the governance was never agreed.
• The board has asked what the innovation spend is worth and the answer so far is a list of activity.

Why the inherited portfolio split no longer holds

Most innovation portfolios run on a version of the ambition split: the great majority of effort on the core business, a slice for adjacent moves, a sliver for anything genuinely new. That split was a sensible answer to a real constraint. Exploration was slow, expensive, and staffed by people who were needed elsewhere, so companies rationed it.

The constraint has moved. For a growing share of questions, the cost of running a real experiment and the cost of standing up a minimum viable business have both fallen. When the price of finding something out drops, the correct number of things to find out rises. The allocation does not adjust on its own, because it is a convention rather than a calculation.

So the question for a board is not whether to innovate. It is whether the current allocation was chosen or inherited. In our experience it was inherited, and it is still defending a constraint that has since loosened.

A venture is an option, not a plan

Finance already has better language for this than the innovation vocabulary does. An experiment buys information at a known price. A venture buys the right, but not the obligation, to participate in a future demand space at a cost set today. That is an option, and it should be priced and governed like one.

Which reverses the usual instinct. Uncertainty is an argument for buying options, not for waiting until the picture clears. What matters is that entry is cheap, the cost of holding the position is small, and the decision to exercise or abandon is taken deliberately rather than by attrition. Companies fail this in two directions. One funds a single large bet with no optionality and calls it conviction. The other runs dozens of pilots that never reach a decision and calls it a portfolio.

Ventures fail inside corporates for governance reasons before market ones

The post-mortem usually blames the market. In our experience the parent is the more common cause. A venture inside a large company competes for attention with a core business that is bigger, more certain and better represented in the room. It gets measured on the core’s metrics. It is asked to be predictable before it has anything to be predictable about.

Two decisions fix more of this than any accelerator. The first is the field of play: the domain this company genuinely has permission to build in. A venture outside it gets starved whatever the plan says, because nobody in the organization believes it belongs to them. The second is a decision right: who can say yes, at what threshold, on what evidence, named before the first money moves. Ventures rarely die of a bad result. They die because nobody had the authority to act on a good one.

What our corporate venturing consulting services include

1. Innovation portfolio and allocation review

An inventory of every active bet, with what each one costs to run and what question it is paying to answer. Most reviews end with the same finding: a large share of the spend is buying delivery, not information, and a second share is buying neither because the bet has no owner left. The output is an allocation you chose.

2. Demand space option mapping

We start on the demand side. The Demand Landscape maps where future demand will pool, and the valuable spaces usually cut across the categories incumbents organize around. Owning a demand space rather than a category is the reason a venture inside a large firm has any structural advantage at all, and it is where an option is worth holding.

3. Funding model and stage gates

Each bet gets an entry cost, a cost of holding and a stage at which more capital is released. Funding a venture like a project pays for a plan. Funding it like an option pays for the next piece of evidence, which is a smaller number and a faster decision.

4. Governance and decision rights

Who decides, on what evidence, at what threshold, and what the venture is allowed to do without asking. We write this before the portfolio runs, because governance agreed after a result is governance written by whoever liked the result.

5. Kill criteria and portfolio review cadence

Every bet carries a stated condition that would make it wrong and the evidence that would show it, agreed at funding. A review cadence then retires bets on that condition and moves the money, so the portfolio keeps a shape instead of accumulating one.

How a venture portfolio engagement works

1. Map. Every active bet, its cost to run, its owner and the question it is paying to answer. The output is an honest picture of how much of the spend is buying information and what the rest is buying instead.
2. Price. Entry cost, cost of holding and the evidence that would justify the next tranche, bet by bet. The output is a portfolio with economics attached rather than a pipeline with enthusiasm attached.
3. Govern. Decision rights, funding thresholds and kill criteria, written and agreed with finance before more money moves. The output is a sponsor who can say yes and a condition that can say no.
4. Review. A cadence that retires bets on their stated condition and reallocates the capital. The output is a portfolio your organization can run without us.

A first portfolio review usually takes weeks rather than months, because the hard part is agreement, not analysis. How long the ventures themselves run is set by the decision the board is waiting on, not by a fixed program length.

Why companies choose Vivaldi for corporate venturing

We come at ventures from the demand side rather than the technology side. The Demand Landscape is how we find the spaces worth holding an option on, and the Compound Economic Profit Loop is how we argue the value of holding it: demand, a right to win, price and volume against capital intensity, returns above the cost of capital, and the multiple the market applies to that. It is the difference between a venture portfolio and a research budget. A research budget is a cost the CFO tolerates. A portfolio is a claim on future economic profit with a stated cost of carry.

We are also realistic about the parent company. Most of what kills a corporate venture is internal, so the governance work is not an appendix to the strategy, it is most of the job. Vivaldi has worked on this since 1999 and the firm behind it is the one that developed the Demand Landscape and the Interaction Field. You can read more about us.

How to evaluate a corporate venturing consultant

• Ask how they decide what not to fund. A firm with no answer will grow your pipeline rather than your portfolio.
• Ask what they write down before the first bet is funded, and who signs it. Entry cost, decision right and exit rule, or governance by memory.
• Ask how they price a venture. If the model is a revenue forecast rather than an option, the number will be confident and wrong.
• Ask whether they will work with your CFO. Venture governance that finance has not agreed to does not survive the first bad quarter.
• Ask what they hand over. A portfolio discipline your own people run, or a dependency with a quarterly invoice.

Corporate venturing consultancy vs corporate VC fund vs venture studio?

The three capabilities in this group

Three capabilities do the work below this page, and each answers a different question.

• Business experimentation owns the method: which assumption to attack first, how the test is designed, what evidence would settle it and what counts as a result.
• Venture design owns the business: who it serves, what it charges, why this company rather than another, and which assumption would sink the model.
• Corporate venture building owns the build: standing a venture up inside a parent that was not designed to host one, and keeping it alive long enough to return an answer.

The split matters when you are choosing where to start. If the question is whether the idea holds, that is experimentation. If it holds and needs a business around it, that is venture design. If the venture exists and the organization is the problem, that is corporate venture building. This page sits above all three: how much to spend on finding out at all, which bets are worth holding as a set, and when each one stops.

This group is part of our Marketing Strategy & Acceleration practice, alongside Brand Acceleration and Service Design.

Corporate venturing consulting in the US and worldwide

We work with companies in the US, Europe, Asia and Latin America, from ten offices on four continents, and most venture portfolios we review are cross-border before anyone calls them that. The portfolio question travels well. Where a bet can be funded, who is allowed to approve it, and how quickly a loss can be recognized are set locally, so the governance work is done with the markets in the room rather than written in one head office and translated afterwards.