Going Back to Our Roots

The Importance of CVC in Ventures

Over the past decade we have seen CVC take a turn for the better. CVCs are now part of 1 in every 4 VC-backed deals and a CVC investment is correlated with a higher chance of a successful exit. The value a CVC fund could bring to the table was always evident, the delivery was perhaps missing and needed some guidance. Surprisingly and despite what experts predicted, CVCs turned up the heat and doubled down during the COVID-19 pandemic. At the onset of the pandemic when almost all VCs hit the pause button we hosted a call attended by ~ 70 CVCs titled Reality Check. Some bold predictions were cast by guest presenters, including one that suggested a CVC contraction was inevitable:

Page from our 2021 State of CVC Report on the growth of CVC participation. Link here.

The 2021 State of CVC Report

We recently conducted the largest CVC benchmarking survey to date with Silicon Valley Bank. Our aim was to capture the most up to date self-reported data on how some of the biggest CVCs from around the world operate. 106 CVCs from ten different countries, accounting for ~ $7B in capital deployed annually and nearly 40% of total US CVC deals took part. The survey was completely anonymous with all data aggregated into a report we released on September 16th.

Why did we do this?

At our prior CVC shops, we struggled to find any accurate CVC benchmarking data. Frankly it did not exist. We relied on anecdotes and one-off data points. It was art with no science. With that in mind, we wanted any CVC benchmarking report to achieve the following:

  1. Create most comprehensive data set of self-reported data (106 CVC funds). This is not secondary data.
  2. Synthesize the data into a compelling narrative with juicy takeaways. CVC leaders could relay these best practices and trends to the HQ mothership and achieve their own goals.
  3. Present more transparent and educational data to the broader ecosystem: founders, traditional VCs, industry so we neutralize classic misconceptions about CVC investors.
Page from our 2021 State of CVC Report on five common CVC myths

How Do We Fit In & Why Us?

Again Counterpart Ventures is the rare traditional financial VC started exclusively by CVC alum. We are aware of all the internal challenges, blind spots and lazy misconceptions of CVC. We also are aware of the potential opportunity and upside of CVC. We breathe authenticity. We are not living on borrowed knowledge, we actually lived it. No one better understands the challenges and pain of CVC leaders than us.

  • Many face the same frustrations and opportunities, no matter what sector they invested, the size of their fund or check sizes they write.
  • For nascent CVCs there is a desire to learn from others that have perfected the art before them, but many don’t know where to start

Sources

  1. Pitchbook, Analyst Note: CVC’s Sea Change, Tracking the Strategy’s Shit, December 9, 2020, https://pitchbook.com/news/reports/q4-2020-pitchbook-analyst-note-cvcs-sea-change-tracking-the-strategys-shift
  2. Q1 2021 Venture Monitor Report, Pitchbook & NVCA, https://files.pitchbook.com/website/files/pdf/Q1_2021_PitchBook-NVCA_Venture_Monitor.pdf

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Counterpart Ventures

Counterpart Ventures

Stage agnostic Venture Capital firm based in San Francisco investing with unrivaled conviction to create unique and memorable stories.