our experience in the first year. Since we have only one limited partner (GM LLC), we don’t need to create a fund structure, which gives us some flexibility to set our annual funding based on actual experience.
X: The history of corporate venture capital is not exactly storied. Corporate venture arms are usually short-lived, changing with corporate management or hard times—and because they aren’t part of the core focus of the company that spawns them. How do you plan on avoiding the traditional pitfalls?
JL: First of all, we structured GM Ventures to address many of the “lessons learned” of other venture capital firms. Specifically, I personally talk to a number of independent and corporate venture capital firms to review our investment philosophy, governance, and linkage to other key organizations within GM. One cornerstone that was defined for GM Ventures was that the primary purpose of the fund is to support our core automotive business, not an activity focused on investing strictly for financial return. Now, that doesn’t diminish the expectation that GM Ventures will be self-sustaining in the longer term, but it provides a clear framework in terms of our focus on automotive-related technologies and the value-add benefit for GM.
X: If all goes well, what will you have done in one year, five years, or longer?
JL: A simple measure of our success will be that investments that GM Ventures makes today winds-up in the GM vehicles of tomorrow. While that won’t be something that happens after one year, it certainly is something that I expect we will be able to demonstrate within 5 years. And, if [we] do this consistently, it should give GM a competitive advantage in the longer-term, drive more GM vehicles sales, and give us a reputation as the automaker that offers cars, crossovers, and trucks with the best technology.
