Innovating with Impact: A Conversation with Thomas Van Halewyck CEO and founder of Bundl

Hi, I'm Jeppe and welcome to my weekly newsletter on Corporate Venturing, released every week. My aim is to provide a comprehensive perspective on the latest developments in the field and its related topics, drawing from the insights of top management, venture capitalists, founders, LPs, and family offices. I aim to offer valuable information and thought-provoking content that will aid in understanding the importance of Corporate Venturing in business strategy.

Today we dive into the world of corporate venturing with Thomas Van Halewyck , CEO of Bundl | Corporate Venture Development . Bundl, a pioneering venture development firm, partners with corporations like HSBC, IKEA and Beiersdorf, transforming innovative ideas into thriving new ventures.

?

Introduction to Bundl:

At Bundl, we pride ourselves on offering a comprehensive 360 corporate venturing stack encompassed in four distinct pillars.

First Pillar: Venture Framework

Our first pillar is dedicated to creating a robust venture framework. This foundational aspect involves assisting corporates in identifying and developing the types of venturing vehicles best suited to achieve their innovation goals. Critical elements of this process include analyzing desired value spaces, determining the types of venturing units required, establishing governance structures, and setting up legal frameworks. Additionally, we focus on recruiting the right leadership and team.

Second Pillar: Rapid Innovation

The second pillar of our approach is centered on catalyzing rapid innovation within the core business framework. At Bundl, we specialize in assisting corporations to extend their existing business units by introducing new service or product offerings, exploring new channels, and targeting new customer groups. Employing lean venture-building techniques, our strategy is to seamlessly integrate these innovations into the corporation's primary operations. We swiftly move from ideation to validation, engaging directly with end-users in both B2C and B2B markets to test these new concepts. Our primary objective is to ensure that these new ventures resonate well with the target audience, examining their business cases through the lenses of desirability, feasibility, and viability. This process is critical in determining how these new service or product extensions can be effectively integrated into the existing business units, thereby enhancing their reach and impact

Third Pillar: New Ventures

Our third pillar ventures into the domain of new ventures, particularly focusing on initiatives that extend beyond the traditional scope of core business activities. This pillar targets Horizon 2 and the edge of Horizon 3 innovations, emphasizing the creation of new legal entities that operate independently yet are born from the existing corporate structure. This approach includes tasks like formulating comprehensive go-to-market strategies, operating as a dynamic startup team to manage and refine the Minimum Viable Product (MVP), and providing crucial scaling support to these emerging ventures. Additionally, this pillar embraces the concept of spin-offs, where we nurture ventures that originate within the corporation but are developed into separate entities.

Fourth Pillar: Venture Partnerships

The forthcoming fourth pillar, venture partnerships, is poised to broaden our impact significantly. This pillar emphasizes building connections with external entities, primarily startups and other corporations.

The forthcoming fourth pillar, venture partnerships, is poised to broaden our impact significantly.

Activities under this pillar range from setting up accelerator programs and engaging in mergers and acquisitions, to investing in external startups and forming joint ventures with larger corporations. Our aim with this pillar is to foster innovation from an outside-in perspective, tapping into new ideas and collaborative opportunities.

?

Aligning Venturing Strategies with Core Business Objectives

At Bundl, our approach to supporting corporate venturing strategies extends beyond the conventional focus on viability, feasibility, and desirability.

We introduce a crucial fourth criterion across all our pillars: suitability with the corporate strategy.

We introduce a crucial fourth criterion across all our pillars: suitability with the corporate strategy. This additional dimension is pivotal in ensuring that our ventures are not only market-ready but also intrinsically aligned with the strategic ambitions and capabilities of our corporate clients.

Strategic Linkage: Ensuring Relevance and Support for Corporate Goals

To assess strategic linkage, we meticulously evaluate how each venture connects back to the corporation's overarching strategy and key performance indicators (KPIs). This process ensures that the direction of the venture aligns with the corporation's long-term goals, answering the fundamental question: Why engage in this particular area? This 'right to play' evaluation guarantees that each venture we nurture is not only viable but also strategically pertinent and supportive of our clients' broader objectives.

Leveraging Corporate Assets: Creating a Competitive Edge

In parallel, we delve into the corporation's arsenal of assets. This involves analyzing how the venture can harness the existing resources of the corporation, thereby answering the question: Do we have the potential to outperform our competitors? This 'right to win' assessment is crucial in identifying how our ventures can leverage these assets to gain a competitive advantage in the market.

Adding Suitability: Ensuring Strategic and Resource Alignment

By embedding this additional criterion of suitability into our evaluation process, we bridge the gap between a venture's market prospects and its strategic fit within the corporate framework. This approach ensures that each venture we develop is not only promising in terms of market success but also in perfect harmony with the corporation's strategic direction and resource capabilities.

??

Corporate Strategic Alignment with Venturing Activities

What are the Drivers of Corporate Venturing in Today’s Market

The landscape of corporate venturing is primarily driven by three pivotal factors:

Technological Innovation: As technology progresses at an unprecedented pace, corporate venturing emerges as a key strategy for established companies. It allows them to access the innovative edge that startups bring, ensuring they remain technologically relevant and competitive.

Market Agility: The ability to swiftly adapt to changing market demands and consumer preferences is more crucial than ever. Corporate venturing imparts large corporations with the agility to pivot and evolve in tandem with market shifts.

Sustainable Competitive Edge: By venturing into new domains, corporations can unlock fresh growth opportunities, innovative business models, and additional revenue streams, thus maintaining their leadership and competitive advantage in their respective industries.

?The Shift Towards Venturing for Innovation and Growth

Corporations are increasingly recognizing the value of venturing activities as an effective means to drive innovation and growth. This approach contrasts with traditional, time-consuming R&D processes, offering a leaner and quicker path to market. By enabling immediate validation with consumers, corporate venturing shortens time-to-market and mitigates risks by ensuring genuine customer interest.

Beyond venture building, corporations are actively engaging in venture partnerships. This allows them to connect with cutting-edge startups and stay abreast of emerging trends and technologies, further fueling their innovation engines.

Challenges in Strategic Alignment.

However, aligning these venturing activities with overarching strategic goals presents its own set of challenges. New startups, often in early stages and lacking substantial revenue, defy traditional success metrics. Corporations must focus on the long-term strategic value, a shift from the usual emphasis on immediate financial returns.

The operational scale of startups often clashes with the large-volume infrastructure of established corporations. This mismatch creates hurdles in supporting the growth of these nascent ventures, especially in terms of sales, marketing, and go-to-market strategies.

Additionally, complexities arise in structuring these ventures as separate legal entities. Challenges include navigating unfamiliar processes and establishing appropriate governance structures, founder equity setups, funding strategies, and intellectual property arrangements.

As ventures mature, determining the right time for corporate involvement becomes crucial. Missteps in timing can either constrain the startup's agility or impede its scalability.

?

Setting Meaningful KPIs: Tailoring Metrics to Corporate Venturing Goals

?KPIs in corporate venturing units are diverse and multi-layered, reflecting a wide range of corporate objectives. These objectives can span from revenue growth and brand enhancement to financial returns, market access, and talent development. The nature of these KPIs varies significantly depending on the type of venturing unit. For instance, a Corporate Venture Capital (CVC) unit may prioritize financial returns, whereas an incubator might focus on a balance between financial objectives and other goals like talent development or strategic ecosystem building. This diversity ensures that each unit's unique objectives are in line with its role within the broader company strategy.

?

Stage-Specific KPIs for Ventures

The journey of a venture, encompassing stages like discovery, validation, launching, and scaling, demands different KPIs at each phase. In the early discovery stage, the focus is often on desirability, ensuring there is a viable market for the idea. As the venture progresses, financial metrics like lifetime value, customer acquisition costs, and cost structures become increasingly pivotal.

Bundl’s Four-Layered KPI Approach

Bundl employs a four-layered approach to KPI setting, with layers based on desirability, feasibility, viability, and suitability. The last, suitability, is specifically tailored to ensure alignment with the corporate strategy. This method ensures that ventures are evaluated against relevant and stage-appropriate criteria, facilitating strategic alignment and effective performance tracking.

Bundl’s Role in KPI Setting

In our venture framework pillar, Bundl plays a crucial role in aiding corporations to assess their total methodology for venturing. We analyze aspects like the stages a venture has passed through and the types of venturing units used to achieve corporate KPIs. Understanding these KPIs at the corporate level is the first step.

Our approach uses a three-layer model:

Corporate-Level KPIs: These form the foundation and are applied across all venturing activities.

Venturing Unit-Level Objectives: Crafted from the corporate-level KPIs, these objectives take into account the specific goals and roles of each venturing unit within the portfolio.

Venture-Level KPIs: These are specific to each stage of the venture and are aligned with the objectives of the venturing unit.

?Throughout this KPI-setting process, Bundl engages in strategic exercises with corporations, assisting them in identifying and translating these KPIs across different levels of venturing activities. This ensures a cohesive and aligned approach to performance tracking across all ventures.

??

Aligning with Corporate Goals: Bundl's Strategic Approach

Involving Key Stakeholders

A critical element in this alignment process is the involvement of stakeholders who are either in tune with or responsible for shaping the corporation's strategic objectives. By ensuring stakeholder buy-in, either in the venture’s board setup or governance structure, Bundl maintains a clear and consistent objective alignment. This approach serves dual purposes: it not only guarantees that the venturing activities are congruent with the overarching corporate goals but also facilitates a two-way information flow. Such engagement allows ventures to provide feedback that can be seamlessly integrated into the corporate strategy, making this alignment a cornerstone of Bundl's methodology.

?

Metrics and Methodology Attuned to Corporate Goals

Another key aspect is the implementation of metrics and methodology that resonate with the corporation's strategic ambitions. During the ideation phase, Bundl helps establish 'value spaces' that are directly aligned with these strategic goals. This ensures that as ventures progress through the Stage-Gate process, their foundations are firmly anchored in areas that are either related to the corporation's business units or have their explicit endorsement.

Leveraging Corporate Assets

Furthermore, by strategically leveraging the corporation’s existing assets in these venturing activities, Bundl reinforces the alignment with corporate objectives. This approach not only maximizes the use of existing resources but also ensures that the ventures are intrinsically linked to and supportive of the corporation's overarching goals.

?

Reporting and Transparency: Ensuring Alignment and Accountability

The Criticality of Transparent Reporting

The importance of transparent reporting, particularly on KPIs and performance, cannot be overstated. Thomas stresses that numerous venturing activities face premature termination due to their inability to meet the set KPIs or align with the corporation's strategic search areas. A common pitfall is the delayed recognition of such misalignments, often surfacing only after years of operation. Ventures typically enjoy a degree of autonomy in their initial stages, but as time progresses, they come under increased scrutiny, especially concerning financial returns or strategic alignment. This late-stage realization can lead to ventures being discontinued if they fail to align with the overarching objectives.

?

Establishing and Aligning with the Right KPIs

To mitigate these risks, Thomas emphasizes the necessity of establishing the right KPIs that resonate with corporate objectives from the outset. It is crucial to maintain a continuous and transparent alignment with stakeholders throughout the venture’s lifecycle. This practice ensures that ventures remain on track and do not deviate significantly from their intended strategic path.

?

Bundl’s Role in Enhancing Reporting and Transparency

Through its services, Bundl plays a pivotal role in assisting corporations to provide clear and concise updates to stakeholders.

By aligning ventures with suitable KPIs and ensuring consistent reporting, Bundl helps corporations navigate the complex waters of corporate venturing

By aligning ventures with suitable KPIs and ensuring consistent reporting, Bundl helps corporations navigate the complex waters of corporate venturing. This transparency is key to maintaining stakeholder trust and ensuring that ventures continue to align with corporate goals.

Conclusion

In conclusion, our dialogue with Thomas Van Halewyck unveils the intricate tapestry of Bundl's approach to corporate venturing. Through its innovative four-pillar framework, Bundl not only fosters rapid innovation but also ensures strategic alignment with corporate goals. By setting meaningful KPIs and emphasizing transparency in reporting, Bundl navigates the challenges of aligning ventures with broader corporate objectives. The company's commitment to leveraging corporate assets and stakeholder involvement further solidifies its role as a catalyst in transforming visionary ideas into successful ventures. This conversation underscores Bundl's pivotal role in shaping the future of corporate innovation and growth.

I hope you enjoyed this week's newsletter. If you have any suggestions or contributions that you would like to share with me, please do not hesitate to reach out. I would be delighted to hear from you.

/Jeppe

?