Corporate venture business strategies that work – TechCrunch

Corporate venture business strategies that work – TechCrunch

There are nearly 2,000 corporate venture capital (CVC) firms in existence, many hundreds of them created by first-time investors, according to Global Corporate Venturing.

As GCV also reports, last year alone, CVCs raised $41 billion in investment funds, mostly from their corporate parents.

Given Merck Global Health Innovation Fund’s (Merck GHIF) track record, I’m often asked as a long-time successful CVC investor to describe the business strategies used to ensure our scale and staying power. Merck GHIF is the digital health corporate venture capital arm of pharmaceutical giant Merck & Co. Merck GHIF was founded in 2010 with an initial allocation of $125 million. Today it’s a $500 million evergreen fund, and we’ve invested $800 million in more than 50 companies to date.

The four key strategies

No. 1: Developed an independent LLC with a defined investment charter

From the beginning, we set up an independent business structure with a well-defined investment charter. We created our investment model, strategy and expectations to ensure strategic and financial balance. As a seasoned corporate VC leader coming from Johnson & Johnson, I knew that there was not a corporate parent who says it’s okay to lose money. I knew that if we lost money as a fund, we’d be out of business.

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California governor announces a statewide shelter in place – TechCrunch

California governor announces a statewide shelter in place – TechCrunch

In a press conference this evening, California Governor Gavin Newsom ordered “all individuals living in the State of California to stay home or at their place of residence” to stop the spread of the novel coronavirus disease.

Earlier this week, Mayor London Breed issued a shelter in place for six Bay Area counties, including San Francisco, through April 7. Newsom’s order for the entire state will be mandated until further notice.

Essential businesses will remain opened within the state. This includes gas stations, pharmacies, grocery stores, food banks, farmers markets, and restaurants that offer takeout and delivery service. Businesses that must shutter indefinitely include dine-in restaurants, nightclubs, gyms, fitness studios, convention centers, and entertainment venues.

This decision to close restaurants and keep people inside their homes comes after Newsom claimed that roughly 56 percent of Californians are likely to get COVID-19.

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When the ‘dry powder’ disappears – TechCrunch

When the ‘dry powder’ disappears – TechCrunch

Venture capitalists have raised record-breaking funds in recent years, but that doesn’t always mean the money is there for them when they want it. In extreme downturns, the people and institutions that promise capital to venture capital firms, and then wire it when the VCs need it for their startups, have little choice but to answer the phone less. The alternative is to sell others of their positions — including in publicly traded stocks —  at a steep loss, and they’d really prefer not to do that.

“The public markets end up being the ATM for the illiquid stuff,” says Chris Douvos of Ahoy Capital, one such limited partner who has backed such firms as First Round, Data Collective and True Ventures. When the markets are in free fall as now, the collective reaction of asset managers, he says, is: “Holy smokes, this kind of sucks.”

What happens next depends on how sustained and deep this downturn proves. But LPs seem to agree that the the industry could be in for a reckoning this time, and if so, they’ll have to get practical, fast.

Already, newer managers are seeing LP interest dissipate before their eyes. Though Douvos says he doesn’t “think we’re there yet,” he also shares the story of a fund manager who has been struggling to close a $50 million fund and on whose behalf Douvos has been “pinging a bunch of my LP friends.” The response he is getting is, “‘We’re not investing in new relationships right

With the travel market in tatters, when can Airbnb go public in 2020? – TechCrunch

With the travel market in tatters, when can Airbnb go public in 2020? – TechCrunch

Hello and welcome back to our regular morning look at private companies, public markets and the gray space in between.

This morning we’re tracking Airbnb’s latest losses, its anticipated and real Q1 revenue growth, and what the company’s current situation likely means for its public debut, something the company has promised will occur in 2020.

Last September, Airbnb told its investors, employees, and the world that it would begin to trade publicly in 2020, with the company widely expected to pursue a direct listing instead of a traditional IPO. Since then, the company’s persistent deficits have continued. And, unexpectedly, the world’s travel industry has become troubled in light of the spread of COVID-19, the resulting border closures and reduction in personal and business travel. Mix in a broad stock market selloff, and Airbnb is in a tricky spot.

It is too early to say that Airbnb will not float in 2020, but it’s not too early to say that a public listing in the first half of the year is out. Let’s explore why.

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Nintendo’s online Switch services are experiencing an outage when we need them most – TechCrunch

Nintendo’s online Switch services are experiencing an outage when we need them most – TechCrunch

The era of social distancing is going to put a lot of existing systems to the test. Nintendo’s online services for the Switch have been experiencing outages in the U.S. and parts of Europe. The company noted the issues on social media, adding that it’s “looking to rectify the situation as soon as possible.”

The official Network Maintenance Information page noted that it is currently “Unable to connect to the network service.”

Surely not the most dire of situations, though many are no doubt relying on such services to help pass the time, as more and more cities enact bans on gatherings and closures of schools and restaurants to encourage social distance in order to curb COVID-19’s spread. Microsoft’s Xbox Live also experienced a multiple-hour outage over the weekend.

Nintendo is currently readying the system for the release of Animal Crossing: New Horizons. The latest entry in the series looks perfectly positioned to help eat away some hours when it’s released March 20. 

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