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How EY can help
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Discover how our Corporate Venture Building team designs and delivers transformative new businesses by leveraging corporate endowments.
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Industrial products companies face a number of challenges, including disrupted supply chains, shortages of skilled labor, increased tariffs and an uncertain M&A market. Facing such disruptive forces, they need an alternative strategy for growth on top of the typical new product innovations or mergers and acquisitions. This alternative is corporate venture building. It leverages the unique assets and advantages that companies already possess to unlock new entirely new revenue streams. Unlike digital transformation or corporate venture capital, corporate venture building focuses on designing and launching ventures that can either turbocharge the core profit and loss (P&L) statement or create a new one altogether.
Seizing the moment
Over the past decade, venture-backed startups have successfully infiltrated industrial value chains, introducing innovative business models and technologies that address unmet demand. Their achievements highlight that customer needs often remain unarticulated until someone innovates to fulfill them.
Rather than seeing their value chains disrupted, though, industrial companies are uniquely positioned to capitalize on this opportunity. They already possess what startups spend years trying to develop: intellectual property (IP), supply chain networks and distribution channels. By harnessing these endowments or strategic assets through a corporate venture-building model, industrial companies can enter growth markets more swiftly, at a lower cost and with a robust foundation for scaling.