Intel Capital strives for new heights

Intel Capital reported some spectacular progress in diversity representation, surpassing more than $300m invested in female and under-represented minorities-led businesses. The conversion of words into action is to be celebrated.

The bigger perspective is even better as Intel Capital remains confident to hit its investing targets of $300m to $500m this year despite the impact from the coronavirus on many parts of the economy and its clients. Technology and innovation remain relatively immune as digitalisation is only speeding up through the crisis.

It is unsurprising, therefore, to see Intel Capital has been quite active through the pandemic. Intel Capital is the poster child for a resilient corporate venturing team. 

The group has weathered multiple recessions and downturns since its founding in 1991. Wendell Brooks, president of Intel Capital, made this point at the Global Corporate Venturing and Innovation Summit in both 2016 and 2018. 

Brooks and his leadership team have been consistent in talk and action with respect to maintaining their “relentless” focus on delivering value to existing portfolio companies and continuing their unwavering quest to invest in disruptive technology companies through all business cycles.

Intel Capital has relatedly pointed out the unique capabilities beyond money that corporate investors are able to bring and each year curates thousands of business development introductions each year between its portfolio companies and the Global 2000.

As chairman of the GCV Leadership Society advisory board until his two-year term finished in January, Brooks was instrumental in the development of the GCV Connect communications algorithm as part of the mission for CVCs to be better, together as well as more inclusive and diverse.

This Connect platform has expanded for the GCV Digital Forum on 3-4 June with the introduction of an open innovation challenges platform so corporations can share with entrepreneurs their immediate pain points and goals.

However, since stepping down as chairman, Brooks and Intel Capital has retreated into its shell after losing its excellent public relations officer, Peter Delevett, to National Grid Partners.

This is a shame for the messages he and the group bring to the ecosystem remain powerful and important – more so as groups turn to leadership from their more experienced counterparts.

It is also potentially dangerous as the so-called techlash (the backlash from the public over the role of technology in people’s lives) and broader geopolitical situation between the US and China risks embroiling corporate venturing units over their deals and the appearance of hiding satisfies few who have little of the broader context of Intel Capital’s achievements over nearly three decades.

Reuters’ report on the Intel announcement focused explicitly on how two of the deals are in China and the geopolitical issues between the world’s first- and second-largest economies. “The investments in companies that compete in fields typically dominated by US players come as Intel remains embroiled in tensions between the United States and China over chip manufacturing….

“This batch of announced investments comes days after Intel CEO Bob Swan wrote a letter to the US Department of Defense expressing readiness to build a chip fab in the United States, with the goal of ensuring US technological leadership.”

Perhaps they have just been busy - after all, Intel Capital recently acquired Moovit, one of its portfolio companies and the latest in a series of strong deals to build up the business units and forge new strategic ground by “building our connected future” – a phrase just by at least half the new portfolio companies.

Intel Capital’s investments and early scouting in artificial intelligence (AI), for example, led to the acquisition of Saffron AI in 2015 and then Nervana and Movidius in 2016. This formed the foundation of a new business group focusing on AI. Intel has been one of the most prolific investors in AI, including Habana Labs, which it invested in in 2018 then acquired for $2bn at the end of last year. 

Even before announcing the Habana purchase, the chip-making giant said it expected to generate more than $3.5bn in AI-related sales in 2019, up about 20% from the year before according to the Wall Street Journal at the time.

Intel Capital’s role in identify trends and landing use cases within the industry and also within Intel to add new capability and growth has stood the test of time. As Gayle Sheppard, CEO of Saffron, told TechRepublic: “Intel Capital had an aspiration about artificial intelligence and the future of autonomous learning, so [it] invested in our company and we implemented our technology inside Intel helping it solve some important operational issues….

“About 15 months later [in 2015], Intel acquired us and for us it was a marriage made in heaven, so to speak, because we are solving some specific problems but underneath that is a fundamentally robust platform – and Intel is a platform company.”

The deals are transacted through Intel Capital, where a decision can be made to invest or acquire or simply to have a business unit do a collaboration agreement. Over the past 29 years, Intel Capital has constantly evolved. The crisis of the early 2000s was a catalyst for many of the changes Intel Capital made that underpin its success today. 

To paraphrase former Intel CEO Andy Grove, bad corporate investors are destroyed by crisis, good corporate investors survive them, great corporate investors are improved by them.

What new heights will Intel Capital reach will help make the world a better place.