The group of smaller and medium-sized investors has been growing, and their value has never been clearer to founders and co-investors. They tend not to seek M&As, neutralising a concern that some startups have about having corporates on their cap table, while still bringing the advantage of corporate connections. They often place an even heavier emphasis on the health of the investment syndicate, as they may be in a worse position than larger funds if things fall through, and they often opt, for example, for observer seats over board seats. All in all, they are team players who can still open very important doors.

My guest today is Brian Armstrong, executive managing director of Ensemble Innovation Ventures. While Ensemble Innovation Ventures is the CVC arm of dental insurance company Delta Dental, the unit’s remit extends much farther across the entire healthcare spectrum, with a focus on B2B software solutions.

We talk about how, in a US healthcare system which is facing significant shortages in labour – such as a 250 thousand-strong shortfall in doctors and medical practioners as well as a similarly huge shortfall in nursing professionals – smaller funds can play a hugely important role in finding the technologies that can plug those gaps, going in at earlier stages to support innovative tech that focuses both on the patient-facing and back-office aspects of the system.

We also touch on other factors such as tightening margins, higher costs, and growing burnout are affecting the system, and how many problems exist that will require attention regardless of who wins in next month’s presidential election, regardless of whether the main candidates have very different views on what healthcare should look like.

The US healthcare system has a huge resource shortage. Here’s how small and medium-sized investors can help plug the gap.

With Lotte Group’s expansion into biotech, it wanted its CVC, Lotte Ventures, to set up a new office in the world’s largest biotech innovation ecosystem, the US, with a new – 3-person team in the Bay Area. But going into a new market is never a walk in the park.  

My guest today is Leo Ahn, head of Lotte Ventures’ US office, who talks to me about what Lotte Ventures is trying to get from establishing a presence in the US, and the challenges he’s faced trying to get a new office on its feet in the first year.

There have definitely been some hurdles – starting with the lack of local contacts and name recognition, which is getting in the way of building networks and a deal pipeline, especially in a local VC ecosystem that is quite close and insular. Just the costs of setting up in the Bay Area are higher than most would think, and startups tend to prefer more thematic funds to generalist ones, unlike in Korea where there are fewer VCs, and many tend to be generalist.

So this first year has ended up being more about setting up and getting ready, rather than deploying capital. However, the unit is hoping to close the first $50-100m fund next year, followed up by another fund every 2-3 years as it grows its team. The unit is eager to get going, backing startups not just in biotech, but also in healthcare, food-tech, robotics, as well as more broadly AI, software, web3 and entertainment.

Opening a new CVC office in the US is not easy – here’s how Lotte Ventures is doing it.

To fix things in the human body, you have to see them. This is what Olympus does. The legendary Japanese camera-maker, which in recent years divested its camera business and went full-tilt into medical devices, retains its core strength of optics and doubling down in its application to medicine.

My guest today is Abby Hunter-Syed, director of Olympus Innovation Ventures, the CVC arm initially set up with Touchdown Ventures, with whom it continues to work very closely.
We talk about advancements in the miniaturisation of optics, nano-sized sensors and non-invasive procedures, as well as how improvements in AI and compute are supercharging diagnostics.

For OIV, a big part of the strategic objective in their venture activity is to build an M&A pipeline for the corporate – something that in times past may have raised questions from startups, but Hunter-Syed says that things have changed, and that as long as the terms are fair and not restrictive to the startup’s upside, people welcome the potential exit opportunity that comes with an M&A goal.

She also talks about how in her view having an investment committee on the larger side is not necessarily a hindrance as others might see it, but rather an asset that helps assess risks in any investment, and the advantages that come with having a close relationship with a CVC as a Service provider.

How Olympus Innovation Ventures is looking into the human body

The past year has not been the most active for the Brazilian CVC market. High interest rates, lack of sufficient liquidity, and decreased dealflow, among other things, have all slowed it down relative to past years. But that is not true across the board. Some funds, like, L4 Venture Builder – the single-LP fund backed by Brazil’s main stock exchange, B3 – have been investing a lot since it officially launched early in 2023.  

L4 is one of the most flexible corporate-backed funds you’re likely to find out there. They can invest pretty much anywhere, at any stage, and because of their sponsor’s breadth of activity, it spans a range of sectors far beyond financial services.

My guests today are Pedro Meduna and Tiago Wigman, co-founders and general partners of L4.

They take a contrarian view – if you were to look back at when the market was really hot in 2021-2022, when the valuations were high, much of that excitement won’t end up translating into returns for those investors. The caution of other investors is an opportunity for those who recognise the Brazilian market is inherently very cyclical, and are willing to make bets.

Their flexible mandate allows them to invest in late-stage private equity-type sure things – including public companies – while still being able to take the early-stage risks that bring in bigger returns.

While others are cautious in a slower Brazilian market, L4 wants to be greedy

At the beginning of the year, I spoke to Bill Taranto, president of the MSD Global Health Innovation Fund about what he expected over the course of the year in the healthcare space.

He had predicted that M&As would make a moderate comeback and more liquidity would be coming into the market from private equity firms, and that we would see a wave of consolidations taking shape as smaller “point solutions” get integrated into larger platforms.

I wanted to invite him back on the show to take a look back at the year and see how things have played out, and how they’ve compared to his expectations. Looking back on it now, M&A and liquidity has started coming back, but not quite to the extent that he had thought it would, with the PE firms being a bit more conservative than anticipated. Consolidations have also started to creep back, but again, not quite as much as expected.

We also talk about how CVCs have really been stepping up to the plate during this rough phase, the topic of a recent op-ed he wrote for GCV. Their connections to the corporate knowhow and networks have given CVCs a huge advantage over financial VCs. Unlike in the past, when CVCs were somewhat overlooked, CVCs are now on equal footing with VCs both to startups and to co-investors, he argues, but they can bring more than just the money. They used to be a “nice to have”, now they’re a “need to have”.

We also touch on best practices to develop strong investment syndicates, how people need to be patient with the implementation of AI, and how despite healthcare being a political football that gets tossed around every US election, investment in the technology itself will always be needed.

M&A and liquidity making a slower comeback in healthcare, but CVCs are stepping up to the plate

We’ve got a bit of a different episode again this week – Fernando sits down with GCV’s editor-in-chief Maija Palmer, who asks him some questions about a recent report he wrote for GCV’s Global Energy Council on the topic of getting first-of-a-kind cleantech technologies and projects of the ground.

FOAKs, as they are called, face a big funding gap as earlier stage VCs drop off once the tech is established, but the more risk-averse infrastructure money doesn’t start coming in until they can prove that the process is repeatable. This creates big issues for anyone trying to do something new in a sector where everything costs a lot of money and takes a long time.

So what are some best practices on how to get those off the ground, and how have a couple of new companies with exciting new technologies – solar panel recycler SolarCycle and geothermal technology developer Fervo Energy – managed to do it?

You can read the full report on FOAK projects here.

How to get first-of-a-kind cleantech projects off the ground

Nightlife has changed in recent years. It’s not just the macro-effects of the pandemic – with higher costs of living and young people having less disposable income – but their preferences are also evolving.

Fewer are going to the traditional clubs and bars, but that doesn’t mean that they’re not going out altogether. Their hangouts and their social networks are evolving, not stopping.

My guest today is Andrea Rosen, portfolio manager at Best Nights VC, the corporate venturing unit of Mast-Jagermeister, who talks to me about how they are working to back startups at the forefront of cultural movements.

Best Nights VC wants people to meet in real life again

Latin America has always been fertile ground for fintech innovation and growth. Combining a young, tech-savvy population and a relative under-penetration of financial services you may see in other developed markets, there is plenty of opportunity for startups to feast on.

My guest today is Thiago Iglesias, head of Torq Ventures, who took over the unit this year after payments solutions developer Evertec – where he had been senior innovation manager – acquired financial technology company Sinqia, which had been Torq’s parent company.

Torq backs startups across financial technologies, including risk/fraud, payments, blockchain, AI, data aggregation and more.

Torq hopes to replicate Brazil’s fintech success across LatAm

For every dollar that is invested in semiconductors, around $3 of economic activity is thought to be generated downstream – and in this case, downstream means absolutely anything technology-related. Just about piece of tech equipment you can buy today will rely in some way on a semi-conductor.

My guest today is Sanjay Kumar, who was recently senior director in the US department of commerce, where he was very closely involved in deploying part of the $52bn that was legislated as part of the CHIPS Act, aimed at spurring domestic production of semiconductors.

He tells me that he used to be sceptical of people who said the industry would one day be a trillion-dollar one, but that has now changed. The sector has been buoyed by high performance computing, automotive and other applications, but with the advent of AI we are experiencing another “Cambrian explosion” of demand, as Kumar calls it, reminiscent of the advent of the smartphone, when all of a sudden everyone needed a chip in their pocket at all times.

According to Kumar, the CHIPS Act is set to contribute off $400bn of FDI by the end of the decade for the US, which is trying to claw its way back to the top of a geopolitically crucial chip manufacturing market that has been completely dominated by Asia.

Along this value chain, there is plenty of space for startups and investors to innovate, everything from networking, to storage, to memory, the chip architecture itself, and even the capability of AI itself to help design the chips that make it possible.

We are in another iPhone Cambrian explosion for the chips industry

The past year has been a big one for fintech startups. The high interest rate environment we’ve been under is slowly easing, along with the uncertainties stemming from having to wait for the outcome of the election in the US. The huge amounts of capital that have been parked on the sidelines are now looking to be deployed, and momentum is returning to the fintech space.

M&A activity looks to be on its way back, as well as priced rounds, which have in recent years given way to insider rounds.

My guest today is Brian Kaas, president and MD Of TruStage Ventures, the CVC arm of Trustage, the mutual insurance company which primarily provides services credit unions, cooperatives and other smaller financial institutions. We recorded this episode just before the new year, looking back at the fintech landscape in 2024, and ahead at 2025.

We also talk about the tech challenges credit unions are facing – including a rise in fraud and cyberthreats, and how they need to use technology to find new streams of revenue to keep up with changes in the way people pay for things today.

We also talk about new technologies that will help these financial institutions stay relevant in the long-term and compete with larger banks and even retailers who are increasingly cutting them out of the sales process through embedded finance and other instruments.

Looking ahead at fintech’s comeback

The CVC Unplugged podcast is a weekly show that brings you fascinating and wide-ranging conversations with leading corporate venture capital investors, subject matter experts, startup founders, journalists and other market participants to keep you informed of the most important trends affecting early-stage investing.

Hosted by Global Corporate Venturing's, Fernando Moncada Rivera, guests dive into strategy, market movements and drivers, best practices, macro trends and much more.

New episodes are available every Monday on your favourite audio platforms, including Spotify, Apple Podcasts, Soundcloud, Stitcher, or wherever else you get your podcasts.

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