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Strategies & Market Trends : The New Economy and its Winners -- Ignore unavailable to you. Want to Upgrade?

To: Wizard who wrote (9965)	12/10/2001 7:32:15 PM
From: stockman_scott	Respond to of 57684

Corporate VC has backing in hard times December 10, 2001 (Reuters) — Despite posting billions of dollars in losses this year, most U.S. corporate leaders plan for their venture capital arms to continue investing to get the jump on new technologies and IPO prospects, according to survey findings released Monday. According to the survey by consulting company Accenture Ltd., 85 percent of U.S. executives have no plans to shut down their corporate venture efforts—something many analysts have predicted given the losses notched up by corporate venture units after taking stakes in risky private companies, especially technology start-ups. Corporate venture capital efforts took off in the 1990s as companies ranging from chip-making giant Intel Corp. to personal computer-maker Compaq Computer Corp. began investing profits in start-up companies that were developing new technology and promising big returns in a then-hot IPO market. The Accenture survey found 59 percent of executives fund venture capital efforts for strategic reasons—to find technology to use or to develop markets—and 29 percent pursue venture investments for financial reasons. Strategic investing requires corporations to hold on to stakes in private companies for long periods of time. Accenture found, however, that executives are not willing to shoulder too much risk in uncertain economic times by having their business units make venture investments on their own. The consulting company found 55 percent of executives plan to pursue corporate venturing through joint ventures, while only 17 percent said they would undertake corporate venturing through new stand-alone venture capital units.