to internal R&D (With Henry Chesbrough and Vareska van de Vrande)”
Christopher L. Tucci
the Ecole Polytechnique Fédérale de Lausanne (EPFL))
The role of corporate venture capital (CVC) programs inside the firm has received relatively little scholarly attention. Do these programs substitute for traditional corporate investments, such as R&D? Or do they complement internal R&D? To further explore this phenomenon, we have developed a dataset of corporations initiating CVC programs from 1973-2001. We find that the existence of a CVC program is positively associated with the level of corporate R&D spending. We also find that a combination of having a CVC program and higher R&D spending is associated with higher firm performance, thus concluding that CVC investments can complement other corporate innovation initiatives.