Corporate Venture Capital: An Empirical Investigation of Antecedents to the Choice between Internal and External Corporate Venture Capital Units

Laura Fischer & Jesper Brodersen

Student thesis: Master thesis


This thesis provides a first step towards an understanding of the antecedents to the choice of setting up corporate venture capital (CVC) units as internal or external units. Drawing on existing literature on CVC and dominant theories of strategic management, we propose theoretical links between the following organizational dimensions of parent companies and the organizational structure of CVC units: (i) value of innovations, (ii) firm specificity of innovations and (iii) technological diversification. Our findings confirm the theorized links. Specifically, value of innovations is significantly negatively related, whereas firm specificity and technological diversification are significantly positively related to the likelihood of setting up an external rather than an internal CVC unit. We find no evidence of differences between industries, and technological diversification does not significantly moderate the relationship between the choice of an internal or external CVC unit and the value of innovations and firm specificity, respectively. The empirical analysis performed in this thesis is based on a sample of data on internal and external CVC units’ activities in the years 1985 to 2015 and the patenting activities of their parent organizations in the years 1976 to 2017. The data, which was retrieved from Compustat, Thomson One Banker and PatentsView, has been manually enriched through several rounds of clerical review. The final sample on which the analysis is based comprises 161 US-based CVC units in the pharmaceutical, semiconductor and IT software industries.

EducationsMSc in Finance and Strategic Management, (Graduate Programme) Final Thesis
Publication date2018
Number of pages157
SupervisorsFrancesco Di Lorenzo