What Is Boeing's Hybrid Venture Capital Strategy?

TL;DR

Boeing's hybrid venture capital strategy partners with AE Industrial Partners to scale investments while maintaining a strong link to Boeing's core business. This model allows for faster decision-making and access to broader capital sources, enhancing innovation within aerospace. The success hinges on effective stakeholder communication and the Applied Innovation team, which drives value creation through strategic collaboration.

Transcript

good morning good afternoon or good evening everyone thank you so much for joining us today in the 35th edition of our cbc insider series my name is omara i'm part of 500 global one of the world's most active seed stage investment firms having backed over 2500 exceptional startups in 75 different countries at 500 we work closely with corporate inve... Read More

Key Insights

• 🔠 The success of a hybrid corporate venture capital model relies on effective communication, alignment of interests, and showcasing value creation.
• 💄 Overcoming internal resistance requires involving stakeholders in the decision-making process and addressing their concerns.
• 😤 An Applied Innovation team can serve as a secret weapon by bridging the gap between startups and the core business, driving value creation.
• ❓ Clear communication, alignment, and buy-in are crucial when transitioning to a hybrid model, ensuring continued success and support from LPs.

Questions & Answers

Q: What was the initial purpose behind launching Horizon X and how did you overcome resistance from internal stakeholders?

The main objective of launching Horizon X was to tap into external innovation and disrupt the aerospace industry. We overcame resistance by showcasing the benefits and value creation that partnering with startups could bring, while actively involving internal stakeholders in the decision-making process.

Q: How did you ensure buy-in and support from the technical community within Boeing?

We employed a proactive approach, involving members of the technical community in deal screenings and seeking their input. By valuing their expertise and making them a part of the innovation process, we gained their support and buy-in for the venture unit.

Q: What role does the Applied Innovation team play in the hybrid model, and how does it contribute to value creation?

The Applied Innovation team, reporting to the Chief Technology Officer, acts as an interface between external startups and Boeing's technical experts. They identify areas of need and gaps in capability, facilitating collaboration and the integration of disruptive technologies into Boeing's operations.

Q: How do you select LPs for the hybrid model, and what considerations do you take into account?

LPs for the hybrid model are selected based on a diverse makeup, including financial investors, semi-strategic partners, and strategic partners. The aim is to create a balance that supports the fund's objectives while bringing additional value, such as geographic or industry-specific expertise.

Summary & Key Takeaways

• Brian Schedler, Prime Partner at AEI Horizon X, discusses his unorthodox path into corporate venturing and the lessons learned throughout his career.

• He shares the challenges faced when launching Horizon X, Boeing's venture capital fund, and how they overcame internal resistance to create value within the corporate parent.

• Brian explains the recent transition to a hybrid model, combining Boeing's strategic partnership with AE Industrial Partners, a private equity firm, to scale their investments and support startups in the aerospace industry.