When I’m asked by people outside Corporate VentureCapital (CVC) to explain what it is, I often start by saying that, put simply, when everything aligns and it works well, it’s where magic happens.
When a CVC comes together with a start-up, both parties are taking chances, building a personal relationship and showing faith by working together to create something bigger. Something better.
Each brings something special to the relationship. And it’s this space - where brands, ideas, people and innovation meet – that can generate transformational business moments.
As the CVC arm of BAT, we can provide our parent with access to new product categories such as Wellbeing & Stimulation as well as accessing new technology via minority investments and unlocking innovation through R&D collaborations.
In this way, Btomorrow Ventures (BTV) becomes the intermediary between the start-up world and BAT. Post investment, we also become the portfolio company’s ambassadors inside BAT. By doing so we are playing our part in BAT’s corporate purpose to accelerate change and build A Better Tomorrow™.
A marriage of experience and disruption
Corporates have a reputation for moving slowly, but they can offer experience, resources, finance and international networks. When investing in a start-up, corporates gain early access to innovative ideas; emerging technologies; exciting new products; new talent, and disruptive business models.
Start-ups tend to be faster, bringing agility, speed and energy to the table. And, in turn, they can benefit from the credibility, stability, industry support and global reach that comes from working with an established corporate.
But like pieces in a jigsaw, they have to fit, and it is not always easy.
For BTV, that means values, as well as business goals, need to be aligned. That’s why the portfolio companies we have invested in reflect our own commitments to ESG, sustainability, wellbeing, and new technology.
Working together for A Better Tomorrow™
Start-ups aren’t just known for being ahead of the game - often they change the rules of the game altogether, disrupting categories and accelerating pace. That’s why we believe in backing ideas that can disrupt the status quo.
In the most exciting cases, they invent their own game entirely. Take, for example, our portfolio company Moment and it's tagline ‘drink your meditation.’ In the words of its female founder, Aisha Chottani, Moment isn’t just an enhancement of something that currently exists. Rather, by creating a natural beverage that replicates the effects of meditation on your body - by helping to balance stress levels and boost cognitive functioning - Moment is a movement, an entirely new functional beverage category.
What’s so exciting for me being part of BTV is meeting so many founders who have an entirely different mind-set and approach to identifying and solving business problems.
But start-ups and their founders sometimes need help in realising the potential of their ideas.
Whether that is through marketing expertise; consumer insight; distribution; or even ways to enhance their back office operations. We can help them with these challenges, and introduce them to ideas such as growth-hacking, via our Labs programmes. Our start-up program, BTV Labs, offers a supportive partnership for the most important stage of growth for brands. With access to everything from stakeholder investment to growth-hacking and global distribution, this collaborative and committed partnership empowers brands to scale-up their businesses speedily and strategically.
As a strategic investor, BTV doesn’t only bring funding to our portfolio companies, but also strategic value, by leveraging some of the capabilities of our parent organisation. We have been successful in partnering with functions such as Wellbeing &Stimulation; R&D; New Sciences, and IT in bringing strategic benefit to some of the invested companies, as well as working closely with the markets.
For example, our Canadian colleagues in BAT helped our portfolio company AWAKE, which produces caffeinated chocolate, with account introductions for new distribution channels. On the other side of the world, BAT’s Malaysian team was involved in account introductions for Youvit, an Indonesian vitamin gummy company, while R&D collaborated with US companies, Open Book Extracts and Kanvas.
As MD, I place a lot of importance on teamwork – within our own teams here at BTV and BAT, and between different teams within our parent and portfolio companies.
Teams must be able to trust and respect each other and have each other’s backs. I know this is not very deep wisdom, but sometimes all you need is to get the basics right. To be honest, this is also the foundation for every personal relationship.
When it works, it works extremely well. And, like I said at the start of this article, when it works, this is when the magic happens.
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