Always at the cutting edge, with fast development cycles and lean processes – larger companies also want to benefit from this ideal image of a start-up. The usual approach is corporate venture capital (CVC). This involves corporate groups taking a stake – usually a minority stake – in interesting young companies. For some time now, another approach has become increasingly common: With venture clienting, companies do not have to take a direct stake in the start-up but test its technology as an early customer in day-to-day business.

Companies that would have a difficult time as investors can become venture clients reports Gregor Gimmy, Partner at Deloitte and CEO of 27Pilots. Medium-sized companies with a turnover of 100 million euros and no network in the venture scene would hardly make it into the circle of investors of a sought-after start-up. The hurdle is smaller in venture clienting: "A medium-sized company that is one of the global market leaders in its field can give a start-up valuable feedback on the product as a venture client and carries weight in the customer list."

Companies that set up specialised venture client units have to do pioneering work. "Although many corporations cooperate with start-ups in one form or another, this is often in an opportunistic and uncoordinated manner," says the consultant. However, attention to a structured approach is increasing. A look at the consulting landscape shows this: several consulting firms now offer special consulting services for venture clienting. Gimmy's consultancy 27Pilots, founded in 2018, was acquired by Deloitte in January 2023.

A few weeks ago, Sopra Steria founded the "Sopra Steria Ventures Germany" unit. In addition to the Group-wide venture activities that have been in place since 2019, the technology company intends to expand its network in Germany in particular. The unit is intended to promote cooperation with and investments in young companies. "Here in Germany, we are focussing on venture clienting," says Christian Wrage, CEO of Sopra Steria. Co-operations have already existed in the past, but the venture unit will now give them a visible structure. "This helps to position the offering externally, but also creates more commitment within the Group."

The strategic goals are at the forefront of the activities: "It is primarily about recognising technology trends and bringing them together with the requirements of our customers," says Wrage. "This means that we invest time, resources and expertise in the joint development of solutions with start-ups and customers, but not necessarily large sums of money." However, having the option of a direct investment in the background is helpful. "Discussions can also turn in this direction, and then cooperation may result in an investment after all."

The Stuttgart-based Bosch Group is one of the best-known addresses for corporate venture capital. The company has had a dedicated unit for this since 2007, which has now made more than 100 investments, most of them in Series A or Series B start-ups. Bosch Ventures lists several companies specialising in artificial intelligence as active investments, including well-known names such as Aleph Alpha, as well as quantum computing start-ups and semiconductor companies. In the case of direct investments, the unit generally invests between 5 and 25 million euros, with the equity position usually totalling a maximum of 25%.

The specialised unit for venture clienting was founded in 2018 as part of Bosch Ventures and is called "Open Bosch". The two approaches complement each other, says Ingo Ramesohl, Managing Director at Bosch Ventures (see picture above). "We look at the profiles of 2,000 to 3,000 start-ups every year, and we make direct investments in five to ten of them." The Group wanted to utilise the market knowledge and innovation potential of the other start-ups for its own benefit, even without investing directly.

Ramesohl says that information from the Group departments is essential for this to succeed: "Our business units often use very specialised technologies and have specific challenges. If we know these, we can look for the best solutions in the start-ups we see." Knowing exactly what to expect from a venture client collaboration is also one of the most critical success factors for consultant Gimmy. Otherwise, the start-up's product may provide the answer to a question that nobody in the Group has asked.

The financial hurdles for venture clienting tend to be low: "For software solutions, the amounts for the pilot phase are often around 25,000 euros; for hardware that is more complex to integrate, it can sometimes be 50,000 euros," says Gimmy. He advises focussing on highly valued start-ups for venture clienting. This signals that the investor consensus believes the company has a high chance of success. A look at the list of investors also provides clues: "If prominent investors back the start-up, you can be sure that it has prevailed against strong competition and has been scrutinised intensively."

At Bosch, Ramesohl usually favours start-ups in a more mature phase for collaborations: "The product must be so stable that the absorbing business unit in the Group can use it immediately." Information from the venture ecosystem is also helpful when assessing potential partners. Ramesohl estimates the success rate of projects that Bosch subjects to a proof of concept in a pilot phase at 20 to 50%, depending on the area of application and region.

If the pilot phase is successful, a long-term collaboration can follow. But even otherwise, Ramesohl emphasises that it is often possible to learn from the projects in terms of processes or products. For him, close contact with start-ups is critical to success: "Ultimately, the goal is to secure Bosch's innovation leadership. We have to ensure that we don't miss out on any important developments or opportunities for disruption – and that we are not disrupted ourselves."