This is the fifth post in our blog series unpacking Silicon Foundry’s full suite of offerings and the thinking behind each one. In this installment, Managing Director Mark Menell explains how Silicon Foundry can serve as an extension of Corporate Venture Capital teams, with end-to-end support from fund setup to post-investment execution. With Silicon Foundry’s guidance, corporates gain the strategic insight and operational infrastructure needed to build or accelerate investment efforts and create lasting value.
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Let’s start with the “why.” What inspired Silicon Foundry to create Corporate Venture Capital (CVC) offering?
CVC is a very natural part of our business and what we do, right? We work with clients who are looking for innovative solutions to business problems, and we help them leverage technology from emerging companies to solve those challenges. When a corporate engages with a startup, there’s a wide range of potential outcomes. We think of it as a continuum. More often than not, it starts on the left side. That’s what we call venture clienting. In that scenario, the startup becomes a vendor. The corporate learns about a promising company and then adopts its product or service within their business. It’s a commercial relationship.
On the far right of the spectrum, you have M&A. That’s when the solution is so critical that the corporate decides they need to own it outright. At that point, it becomes a build-versus-buy decision. In between those two ends of the spectrum, you’ve got everything from simple partnerships or joint ventures, which may or may not involve any economics, to strategic investments. These aren’t full acquisitions, but they reflect a belief that supporting the startup is aligned with the corporate’s long-term interests. Maybe the corporate becomes a major customer, which in turn helps the startup raise its next round. That alignment is beneficial to both sides.
Then you get into questions like: Is investment part of the corporate’s standard operating procedure, or do they need to create a specific vehicle to do it? Over time, we’ve seen more corporates institutionalize their investment programs, not just investing opportunistically in helpful companies, but actively seeking them out and supporting them through formal processes.
That means doing the same upfront work, scouting, diligence, founder interactions, and economic evaluation, as they would in venture clienting. The only difference is the outcome. Whether they’re forming a commercial partnership or making an equity investment, the motions are the same. It’s muscle memory at this point.
Why do you believe CVC is particularly relevant right now?
One of the things we’ve consistently found, especially in corporate development, is that these areas are significantly understaffed. A common path for a corporate to establish a CVC is that, somewhere along the way, they’ve made a handful of investments, often tied to partnerships, but without a clear process or structure. Eventually, they come to the realization that a defined investment strategy could align closely with their broader strategic goals.
But you can’t just press a button and have a functioning CVC. Typically, someone from corporate development, M&A, or investments steps in to take on that responsibility. More often than not, though, they don’t have true venture capital experience. These are small teams to begin with, and that experience gap is real.
That’s where we come in. We essentially plug in and provide the infrastructure, access, and expertise they need. Because you can’t just hang out a shingle and say, “We’re a CVC now,” and expect startups to line up. You have to build visibility. You have to be a compelling storyteller. And again, that’s where we add value. We integrate directly into these under-resourced or under-prepared teams and accelerate their time to value doing everything except, in most cases, actually writing the check.
In your own words, how would you explain the impact this offering has for corporate leaders?
I think it’s huge. Imagine the scenario I just described. You’ve got one corporate development person at a legacy company in the Midwest who now suddenly holds the title “Head of XYZ Ventures.” There isn’t really a playbook for him. That’s why the timing and opportunity here are so important. From a CEO’s perspective, it all comes down to time to value. That new investment professional or team might take six months or more to get their sea legs. We can have them up and running almost instantly, starting a real program right away.
I’m working with a client right now in that exact situation. They see the value in being able to skip the long setup process. Instead of hiring a whole team or figuring out the structure and best practices from scratch, they’re essentially getting a full CVC capability out of the box.
And that creates real value, especially from the top down.
What’s a misconception people often have about this offering?
Sometimes the outside world, prospects more than clients, misunderstands what we do. One of the biggest misconceptions is that we’re an investor. I can’t tell you how many messages I get from startups saying, “Hey, we’re raising a round. Does Silicon Foundry want to participate?”
That’s a common misperception.
There are others, too, and we’ve got good answers for all of them. In some cases, not just in the CVC space but across many of our offerings, corporates wonder what our angle is. Because we have strong relationships with both VCs and startups, they sometimes ask: Do we have skin in the game? Are we financially tied to the startups we introduce?
We’ve had situations, without naming names, where members of a client team were concerned that the startups we were recommending might be companies we had invested in or were somehow getting paid by. The concern was, how could they trust that we were showing them the right companies, not just companies we had a vested interest in?
That kind of skepticism sometimes carries over into the CVC conversation as well. “Are you pushing these startups because you want deals to happen, or because they’re truly the best fit for us?” The answer is simple. Just like with everything else we do, our work is fixed fee. We don’t get paid per deal. That means we’re not incentivized to get any deal done. We’re incentivized to help get the right deals done. Our model is uniquely aligned with our clients. That’s the whole point.
Can you share a favorite anecdote or example where this offering really made a difference for a client?
I’m actually working on one right now that’s a great example, and it cuts both ways.
This is a corporate that decided to set up a CVC. They’ve got a strong strategy and corporate development lead driving it, but that’s essentially the entire team. Within just a few months, we’ve become his trusted advisor—his thought partner.
He’ll come back from meetings and immediately email us saying, “Hey, I just saw this really interesting company. Let’s get something set up. I want you to meet them.” It honestly reminds me of my VC days, when I’d meet a compelling startup and pick up the phone to call one of my partners right away. It’s been great to see how quickly we’ve become embedded in their process.
What’s even more interesting is that in one case, we were essentially being paid to tell him not to do a deal he was excited about. He was nearly ready to move to a term sheet. But our diligence surfaced a major red flag and something we felt had to be addressed before moving forward. At first, I don’t think he or the company saw it the way we did. But once we walked them through it from our perspective, they came around. They realized they couldn’t go forward with the deal.
Helping clients avoid costly mistakes can be just as valuable, sometimes even more so, than helping them find the next big thing.
What’s something you personally learned or found surprising while building or delivering the CVC offering?
This shouldn’t have been surprising, I guess, but I found it surprising how quickly I realized how much I enjoy being on the venture side. You’re a lot closer to the playing field and really get to flex those muscles. That’s been a nice surprise.
The other surprise, and maybe it shouldn’t be, since it’s what I’m selling, is how easy it’s been to gain traction with other investors and startups when using the Foundry calling card on behalf of [X CVC]. I thought we might get more pushback, or run into the usual complaints that VCs and startups have about corporates, things like slow timelines, complicated processes, or just being more trouble than they’re worth.
But I’ve found that we’re actually able to grease the skids a bit. We help open doors more quickly because we speak “founder,” and that makes it really natural for us to play that middle role. We can go back to the founder and explain what we heard from our client in a way that makes sense to a startup, and we can return to the client with the founder’s message, framed appropriately for a corporate audience. There’s a real translation role there, and I could go on and on about it.
If you could give one piece of advice to a corporate leader considering this offering, what would it be?
I’m a big believer in corporate venture capital. I think it’s an important tool in the toolkit for any strategy or corporate development professional. Being able to make investments that are aligned with your strategic interests is incredibly valuable, and that alignment, in my view, is essential. Sometimes corporates forget that. But when an investment is truly aligned with the company’s broader objectives, it can be incredibly powerful. Even if you’re not looking for a direct ROI from every deal—and of course, CVCs should be thinking about ROI alongside strategic value—that alignment makes the investment meaningful.
That’s why having a third-party expert who can act as an extension of your team is so important. In a nutshell, that’s what we offer. It’s like the saying, “Don’t try this at home” or maybe more accurately, “Don’t try this at home just yet.”
We don’t have to be a permanent fixture. Honestly, what would make me happiest is helping to instill some of that institutional knowledge in the client’s team, imparting the DNA, so to speak. Not fishing for them, but teaching them how to fish. It’s about helping them build their own best practices so they can eventually take the training wheels off. I’m oversimplifying, but that’s a big part of this role, empowering the team so they eventually don’t need Silicon Foundry.
And that’s exactly why it makes sense. Unless you already have an experienced investor stepping into the role, why wouldn’t you bring in this kind of support?
What excites you most about working in this space?
In many ways, it’s the same thing that excites me about all the work we do. It’s about helping clients solve really interesting problems and doing it in a space I care deeply about, which is the startup ecosystem and technology. Broadly speaking, just about everything we do at Silicon Foundry excites me for that reason. But what really energizes me in this category is the chance to take nearly 20 years of venture capital experience and put it to work for our corporate clients. It’s incredibly rewarding to channel that knowledge, network, and know-how like a firehose into a corporate setting and help them solve complex challenges and uncover new opportunities.
Venture capital has always been known as an apprenticeship business. You learn from those who came before you, then try to follow in their footsteps. Mentorship has always been a big part of that. And in this work, we get to play that same role, mentoring the next generation of corporate venture capital leaders and sharing whatever wisdom we’ve gathered along the way.
Anyone who knows us knows that mentorship, teaching, and best practices are a huge part of our culture. For us, this work is a major form of giving back.
And I should emphasize, this isn’t just about me. I’ve talked a bit about my background, but I’m not unique in this regard. Neal has tremendous venture experience. Eric has venture experience. Several of our other partners and junior team members do, too. It’s not just one or two of us.
Even if I’m not directly staffed on a project, our clients still benefit from our collective experience. We’re a small, highly collaborative team. If my name’s not on the report, I’m still there behind the scenes, supporting my partners and contributing to the work.
