Measuring Success in Corporate Venture Capital

David Horowitz – financial return is easy once a fund is complete. One tabulates the capital deployed in an investment or portfolio of investments, and compares it to the money returned on realizing an exit. The raw comparison provides a cash-on-cash multiple on invested capital (referred to as “MOIC”), and when the dates of these cash flows are included, an internal rate of return (“IRR”) calculation is generated.

On the other hand, measuring strategic return is challenging — there are very few frameworks to help corporate venture capitalists articulate strategic goals and measure them. So at the recent Global Corporate Venturing & Innovation Summit in Monterey, California, I led a session exploring best practices for identifying and measuring the strategic goals of corporate venture capital. The session leveraged my two decades of personal experience in corporate venture, as well as the expertise of our firm Touchdown Ventures.

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