#63: Exploring the Frontiers of Corporate Venture Capital as a Service with CEO and Founder David Horowitz of TouchDown Ventures
I am not a client of Touchdown Ventures nor have I been compensated for this article.
Today I’m speaking with whom I call the founding father of Corporate Venture Capital as a Service, David Horowitz of Touchdown Ventures. David has been referred to me by more than a dozen individuals that I trust very much in the industry. It was with great excitement when David replied promptly to my outreach about participating in the Newsletter. More to follow on who David is and his recommendations on CVC.
Touchdown Ventures’ Origin Story
David graduated from the University of Michigan in the late 1990s and it’s not without pride that he states that he has returned to join the University of Michigan faculty in 2024 where David is teaching venture capital to undergraduate students. It clearly shows the full circle of his knowledge and willing to contribute and pay it forward to the next generation.
David started his career in Investment banking but went into Corporate Venture Capital joining Comcast Ventures in the year 2000 and stayed for almost 15 years. David looks back at his time at Comcast with great pride.
“I was there for almost 15 years and there were a lot of success both in terms of financial performance, but also strategically for Comcast. Nearly every new business that Comcast got into during the time I was there had some tie to the Venture Capital division either we had found the startup that was a technology solution or vendor or Comcast acquired some of these start-up companies so CVC at Comcast became really impactful”
Leveraging his 15 years of experience David together with Scott Lenet and Rich Grant founded Touchdown Ventures 10 years ago in 2014. As David describes it the inception of Touchdown Ventures roots back to a need in the market for seasoned CVC expertise outside the traditional tech sphere and we recognized an opportunity to cater to this demand.
“We saw a big market need...especially non-technology companies that are getting into corporate venture, but they don’t really have anybody on their team with any corporate VC or VC experience. This gap led to the creation of Touchdown Ventures, aiming to blend strategic corporate objectives with the robust dynamism of venture capital”
How has Touchdown Ventures tailored its approach to suit the unique needs of its corporate partners
Touchdown Ventures has a foundational understanding of corporate venture capital (CVC) and a sophisticated ability to leverage synergies that benefit our corporate clients. Their approach is deeply ingrained in a meticulous onboarding process that sets the stage for a fruitful collaboration.
David explains,
“We have honed a robust method for initiating and integrating corporations into our venture framework, which is a cornerstone of our success. This includes a comprehensive strategy phase lasting about 90 days. During this period, we conduct extensive interviews with board members and executive leadership to gain a profound understanding of their current strategic objectives."
The onboarding process culminates in the crafting of a tailored venture capital strategy designed to align directly with the corporation's long-term goals. David adds,
“We collaborate closely with each corporation to develop a customized venture capital strategy that not only meets but anticipates their strategic needs, ensuring that we are not just reactive but proactive in our engagements.”
This approach has proven effective with more than 20 corporate clients, significantly impacting their strategic ventures.
From my own experience in the industry, it is evident that many corporations could benefit from this level of detailed research and strategic planning. Properly implemented, such a strategy can dramatically extend the typically short industry average lifespan of 3.7 years for a CVC.
Moreover, the method by which Touchdown Ventures collaborates with its clients underscores a profound understanding of the necessity for corporate engagement to fully realize the potential synergies. This tailored approach not only fosters alignment but also drives substantial value creation through strategic venture investments, making Touchdown Ventures a leader in the CVC space.
Additionally, David shared a blog that he wrote outlining Five Reasons Corporate Venture Capital Programs Fail. The number one reason David cited was “lack of objectives and overall strategy” related to the corporate venture program.
How would you explain the concept of VCaaS to someone unfamiliar with it, and what makes it a revolutionary approach in the venture capital landscape?
David elaborated on the concept of Venture Capital as a Service (VCaaS) by emphasizing its unique positioning in the venture capital landscape, especially tailored for corporate entities. He explained that traditionally, corporate entities had two primary approaches to engaging with venture capital: either passively as limited partners in venture funds, where they might gain insights and deal flow but without significant control or strategic integration, or by attempting to manage their own corporate venture capital operations, which poses its own risks including the challenge of assembling and retaining a skilled team.
VCaaS, as pioneered by Touchdown Ventures, bridges these approaches by combining the professional management and strategic rigor of traditional VC with the flexibility and control desired by corporations. David described this as the "ultimate model" because it integrates the advantages of professional venture management with the bespoke needs of each corporate partner.
One of the revolutionary aspects of VCaaS, as highlighted by David, is the ability to maintain control over investment decisions while leveraging the extensive networks and expertise of a seasoned VC firm. This arrangement allows corporations to foster innovation and drive strategic growth without the traditional overhead or the steep learning curve typically associated with setting up and running a standalone corporate venture operation.
Touchdown Ventures, through its VCaaS model, provides corporations with a "scaled platform" behind their venture efforts. This means not just expert advice or investment management, but a comprehensive ecosystem including access to an extensive network of VC firms, startups, and industry relationships, which a corporation on its own might find challenging to develop. This scalability and the depth of resources offer a significant advantage, ensuring that corporate ventures can more effectively meet strategic goals and optimize investment outcomes.
David’s description underscores the substantial stability and ongoing value creation that VCaaS offers, making it not just an alternative venture capital model, but a fundamentally better approach for companies that want to engage deeply in innovation without diluting their focus from core operations. This model, according to David, is not only sustainable but can be superior in integrating strategic goals with venture opportunities, thereby enhancing the overall impact and effectiveness of corporate venture initiatives.
A look at the person behind – David Horowitch
Beyond his notable professional achievements, David Horowitz’s approach to leadership and business is profoundly shaped by his personal values and life experiences. At the core of his philosophy is the value of empathy. David emphasizes,
Advice to young people in the industry
David strongly believes that the environment in which one starts their career can profoundly impact their professional growth and success. He emphasizes the critical importance of selecting a firm that prioritizes a culture of mentorship and personal development.
Conclusion
"It was extremely inspiring talking with David. Throughout our conversation, David referred multiple times to the Touchdown Ventures blog on corporate venture capital titled "Risky Business" on Medium. The link can be found in the comment field below. I've read several of the articles and highly recommend them, as they encapsulate key learnings from many years of experience as well as insights into the market."