Gerald Brady
Managing Director
Silicon Valley Bank
Banking the Innovation Economy
Our Mission:
To increase our clients’
probability of success
Build Deep Relationships
Give Advice
Make It Easy to Do
Business with Us
Solve Problems
Vision
To be the premier provider of
financial services and thought
leadership to innovation
companies, of all sizes, and
their investors, world-wide
5
Differentiated
Focus on “innovation”
markets
Mainly balance sheet
lender
Strong deposit franchise
Diversified revenue
streams
Global reach
Leader
THE bank for innovation
companies
More than 600 venture/ PE
firm clients
Global reputation
Established
30 years of supporting
innovation
26 U.S. and 7
international offices
$20.0 billion in total
assets
$35.5 billion in total client
funds
We work with start-ups to global corportions
~50% Market Share
<15% Market Share
<10% Market Share
Innovation: Macro-themes
• 2008-2010: Developed economies slow down / corporate growth
impacted
• Company EPS maintained through RIFs, operational excellence programs
and increased productivity – little or no focus on innovation
• The pace of innovation continues to accelerate – largely driven by startups
• Corporates have more cash on their balance sheet than at any other time
• Established leaders stumble - i.e. Nokia, Microsoft, Pfizer etc
10
The CEO’s agenda – looking beyond
2012
• Technology impact and business model shift across all industries
• Technology driven disruption of existing supply chains
• Non-traditional alliances & partnerships accelerate i.e. GE & Google,
P&G & Inverness
• Chinese corporates go from local to regional to global champions
• Innovation becomes driver for competiveness
11
Innovation is back on the CEO’s agenda
• Capital market stabilization results in investors shifting focus from cost
management to growth:
- “where is long-term revenue growth going to coming from?”
• Innovation returns to the CEO agenda – as a driver of growth
• Increasingly, corporate venturing goes beyond “open innovation” to
include:
- Internal & external innovation initiatives
- Corporate ventures
- Licensing
- Partnering
- JVs
- M&A
12
CVC is different this time
Traditional Corporate Innovation
The new model for corporate innovation
Greater
external
focus
Internally focused
Internally
focused
Internally focused
Little correlation with
Separated
Corporate Venture
from
CVC
/
Capital
Strategy
Cost not
Cost not outcome
outcome
focused
focused
Driven by
Innovation
Little
correlation with
Corporate Venture
partnering
Capital
Driven R&D
by R&D
Evolution
Evolution
NOT
NOT
Revolution
Revolution
Cost not outcome
Outcome
driven
focused
CEO / CTO / Chief
Driven by
Innovation
R&D
Officer
led
Evolution
Open
to
NOT
cannibalization
Revolution
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The corporate ecosystem: growth is driving the need for innovation
Disney, Hearst,
News Corp, WB
BMW, GM, Honda,
VW
Cisco, Juniper,
Huawei, Mot
Allianz, Citi, CS,
Hartford, Visa
Media
Automotive
Amazon, eBay,
Google
Internet
Life
Sciences
Comms
Fin Services
Adobe, IBM,
MSoft, SAP
F&B
Enterprise
Software
FMCG
Semis
App Mat, Arm,
Intel, Nat Semi
Glaxo, Pfizer,
Roche, Takeda
Pepsi, Coke, Gen
Mills, Nestle
Best Buy, Ikea,
P&G, Unilever
Cleantech
ABB, HON, GE,
Siemens, Vestas
14
Corporate innovation intersects all company stages
Mature
Venture Portfolio:
Segmentation by
company stage
M&A
Partnering
Distribution
Corporate
Innovation
Growth
Start-ups
Disruptive trends,
white spaces
& roadmaps
15
SVB’s role: At the center of the innovation economy
VCs
SVB’s Role
• Positioned like Switzerland
• Neutral about:
- Investors
- Location
- Stage
- Sector
Global
innovation
centers
SVB
• Able to connect:
Corporate
Corporate
Corporate
Companies
VCs
Corporate
Corporates
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Portfolio
companies