CVC in Ag, and White Space Opportunity?

This is an interesting interview where Rhishi Pethe interviews Mark Brooks, ex-Managing Director of FMC’s Corporate Venture Capital.

There were a few quotes that stood out to me.

Mark Brooks states the following:

I agree with the statement overall. The key being the “most effective.”

The independent data actually does reinforce that CVC backed company’s do better, according to Silicon Valley Bank’s 2024 Corporate Venture Capital Report:

In looking at some of the $100+ million agtech acquisitions, some had CVC, others didn’t:

CVC and likelihood of successful exit likely has a better signal in some segments (eg: potentially biologicals) than others, along with considering how a start-up gains access to experience and industry insight (eg: advisors, hires etc).

I think there is a lot of nuance to CVC being effective for the corporate and for the start-up.

What has stood out to me in my conversations is the importance of structure, particularly in an industry like agriculture that has effectively one sales cycle per year.

CVCs are generally set up as an external arm of the business, not directly integrated into the operating segment of the business. This is important because of the internal incentive structure of individuals in the operating segments, like marketing, R&D, regulatory etc within the businesses (eg: Bayer, BASF etc).