Corporate Venture Capital: Structuring Concerns for Investors and Startups

Objectives of CVC vs. Pure Venture Capital, Term Sheets, Key Provisions of Investment and Shareholder Agreements

A live 90-minute premium CLE video webinar with interactive Q&A


Tuesday, October 26, 2021

1:00pm-2:30pm EDT, 10:00am-11:30am PDT

Early Registration Discount Deadline, Friday, October 1, 2021

or call 1-800-926-7926

This CLE course will provide commercial finance and private equity counsel with a review of corporate venture capital (CVC) investments in startups. The panel will discuss the differing objectives of corporate vs. pure venture capital investors and how those objectives are reflected in deal points like management control, sharing of information and technology, and exit strategies.

Description

CVC has seen unprecedented growth in recent years, with strategic venture investors looking at early-stage companies more than ever before. Direct investment (as opposed to a joint venture or cooperation agreement) gives the corporate investor greater involvement and offers the most significant financial upside. CVC provides a valuable source of financing for technology-focused startups while providing the investor with a new avenue for innovation in its own business.

The fundamental rights and duties of the investor are usually summarized in a term sheet or letter of intent. When dealing with strategically motivated investors, the founders should insist on strict confidentiality undertakings by the company regarding information received in the due diligence process and a non-solicitation obligation of the corporation regarding the startup's employees.

CVC financings generally utilize versions of the commonly used NVCA model documents. However, the specific needs and concerns of a CVC typically will be addressed in one of the investment documents or by side letters. This panel will highlight CVC-unique provisions.

Listen as our authoritative panel examines the aspects of CVC that distinguish it from traditional venture capital investment and issues which investors and startups should consider before entering into a CVC transaction.

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Outline

  1. CVC vs. pure venture capital
  2. Motivations of CVC: innovation, new technology for existing enterprise
  3. Motivation for a startup: CVC may offer longer-term financing, expertise
  4. Issues for CVC investor and startup
    1. Management control
    2. Sharing and ownership of information, intellectual property
    3. Employees: non-poaching concerns
    4. Exit strategy
  5. Process and documentation
    1. Term sheet/letter of intent
    2. Investment agreement
    3. Shareholder agreement

Benefits

The panel will review these and other crucial issues:

  • How do the objectives of the CVC investor differ from those of the pure venture capital investor?
  • What are some management concerns of the startup founders in looking at potential CVC investment?
  • How should the parties address the treatment of information and intellectual property after exiting the CVC investment?
  • What are the key documents in a CVC transaction?

Faculty

Futter, Dror
Dror Futter

Partner
Rimon

Mr. Futter focuses his practice on startup companies and their investors and has worked with a wide range of technology...  |  Read More

Kahan, Daniel
Daniel R. Kahan

Partner
King & Spalding

Mr. Kahan's corporate transactional practice focuses on venture capital and private equity investments,...  |  Read More

Lenet, Scott
Scott Lenet

Co-Founder and President
Touchdown Ventures

Mr. Lenet began his venture capital career in 1992 as the first associate at Geocapital Partners, a late-stage venture...  |  Read More

Attend on October 26

Early Discount (through 10/01/21)

Cannot Attend October 26?

Early Discount (through 10/01/21)

You may pre-order a recording to listen at your convenience. Recordings are available 48 hours after the webinar. Strafford will process CLE credit for one person on each recording. All formats include course handouts.

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