Venture Client Unit

Definition

A Venture Client Unit is a strategic department within a company, tasked with managing and executing venture client activities.

The BMW Group pioneered the concept of a dedicated Venture Client Unit in 2015 with the launch of the BMW Startup Garage. This initiative was the first of its kind in the corporate world, establishing a model for how companies can derive strategic benefits from individual startups and ecosystems, thereby gaining a competitive advantage.

Venture Client Unit of BMW: The BMW Startup Garage (Munich, Germany), Image by BMW

Mission of a Venture Client Unit

The primary mission is to harness innovative technology solutions from startups, thereby enhancing the company’s competitive edge and operational capabilities. As a key corporate venturing vehicle, this unit aims to leverage strategic benefits from the startup ecosystem through non-equity partnerships and controlling investments, such as mergers and acquisitions (M&A).

Organization of a Venture Client Unit

A Venture Client Unit is typically structured as a functional department within a company. It can operate under a specific business unit or subsidiary, depending on the strategic relevance of the startup ecosystem clusters. If startup technology is primarily important for R&D, the Unit is aligned with the CTO’s organization. However, if startup solutions are valuable across the entire company, impacting R&D, manufacturing, sales, marketing, and HR, the Unit often reports directly to the CEO or the Chief Strategy Officer (CSO).

In multinational corporations with multiple brands and subsidiaries, there may be distinct Venture Client Units for each, ensuring that the unique strategic needs of different business segments are effectively met.

Operational Model of a Venture Client Unit

The Venture Client Unit operates as a service provider for any department where startup technology or knowledge of the startup ecosystem holds strategic importance, functioning much like an IT or HR department.

The unit can be structured either as a profit center or a cost center, depending on the organization’s specific strategic goals and operational needs.

Team

A Venture Client Unit features a core and an extended team.

Core Team

Size: In large corporations, the core team should have a minimum of three full-time members. For companies with less than $1 billion in revenue, one or two full-time members normally suffice.

Roles and Responsibilities:

  • Head of: Oversees the unit’s overall strategy and management.
  • Service Area Managers: Each manager is responsible for a specific service area within the VCU:
    • Startup Intelligence Manager: Identifies promising startup technologies.
    • Startup Piloting Manager: Facilitates pilot projects to test startup solutions.
    • Startup Adoption Manager: Coordinates adoption and integration of startup technologies.
    • Startup Adoption Culture Manager: Promotes a culture of collaboration with startups.
  • Global Strategy Manager: Responsible for strategy and structure when coordinating activities across multiple VCUs globally.

Experience and training: Core team members should have experience in the venture client company, possess a technical background, and share a passion for startups, innovation, and corporate collaboration. All core team members need training in the Venture Client Model and certification as Venture Client Managers.

    Extended Team

    Size: The extended team consists of employees positioned in critical roles in business areas where startup technology is relevant.

    Responsibilities:

    • Plan Venture Client activities for the pertaining business area
    • Identify relevant problems for which startup ecosystem offers competitive solutions
    • Support the management of pilot projects
    • Monitor adoption projects
    • Generate awareness about the strategic value of startups
    • Communicate activities and promote stories of successful Venture Client projects

    Experience and training: The extended team should also undergo training and certification in the Venture Client Model to ensure alignment and effective collaboration with the core team as well as the problem owners, i.e. the Venture Clients.

      This combined structure of core and extended teams empowers the Venture Client Unit to efficiently manage relationships and projects with startups while ensuring it can address challenges across the organization, even in decentralized corporations.