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SINET Showcase 2011 A view from 3000 Sand Hill Road

SINET Showcase 2011 A view from 3000 Sand Hill Road Gerald Brady Head of Entrepreneur Services Group. SVB - Focused on one thing. Banking the innovation economy. Some numbers from a banker – of course!. 47%. 1 in 6. $5.9m. £27bn.

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SINET Showcase 2011 A view from 3000 Sand Hill Road

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  1. SINET Showcase 2011 A view from 3000 Sand Hill Road Gerald BradyHead of Entrepreneur Services Group

  2. SVB - Focused on one thing Banking the innovation economy

  3. Some numbers from a banker – of course! 47% 1 in 6 $5.9m £27bn Sources: National Cyber Security Alliance; Help Net Security; Ponemon Institute; Detica

  4. Mega-trends drive disruption • Mega-trends: • Globalization • Shift to knowledge based economies • Globally mobile workforce • Globally connected (everyone to everything) • Countries need to drive: • Growth • Employment • Innovation • Wealth creation • Companies are impacted by: • Traditional innovation models • Exponential innovation • Pressure on growth • China moving up the value chain

  5. Innovation, Capital Markets and Growth

  6. Innovation is back on the CEO’s agenda…

  7. Companies are talking-up their innovation activities

  8. And not to be outdone….

  9. And in pharma:

  10. And at P&G

  11. The sell-side is also talking about innovation However, given the speed at which the innovation curve continues to progress, new entrants with new products and redefined business models also have a chance to succeed, re-shaping profit pools across the industry. This is all the more so given a well funded venture capital industry (staffed with industry veterans), creating dilemmas for the leaders of the past and a driving force for deal-making activity: ‘Invent or Dent’: If you cannot innovate, dent your balance sheet to procure innovation. This is either a defensive strategy (to fend off disruptive threats) or an offensive strategy (to pursue new areas of growth). ‘Reply or Die’: If something new is about to supersede your approach, swallow the threat early.Otherwise, your own historical growth profile will turn into another company’s future growth. ‘Corroborate or commiserate’: Consolidate to sustain your and your partners’ innovation paths, especially when well-funded competitors can cyclically outspend you.

  12. Corporate innovation is different this time Traditional corporate Innovation The new model for corporate innovation Internally focused Greater external focus Isolated / little correlation with CVC • Innovation partnering (VC, M&A, JVs & licensing) CEO / Chief Innovation Officer led Driven by R&D Outcome driven Open to cannibalization Cost not outcome focused Evolution NOT Revolution

  13. Companies’ are tracking the innovation landscape Mature M&APartneringDistribution Venture Portfolio:Segmentation bycompany stage Corporate VC Growth Disruptive trends, white spaces& roadmaps Start-ups

  14. Start-up formation remains robust in Silicon Valley Q32011: No summer slow down – 2nd highest new account openings

  15. SVB’s: At the center of the innovation economy SVB’s Role • Positioned like Switzerland • Neutral about: - Investors - Location - Stage - Sector • Able to connect: • Corporate CompaniesCorporate VCsCorporate Corporate

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