Inside the Brain of Intel Capital at CES 2017

Summary

This interview features Wendell, a key figure at Intel Capital, discussing the company's investment strategies and recent developments. Wendell explains Intel Capital’s shift from financial returns to a focus on disruptive technologies and how the company is positioning itself in emerging markets like autonomous vehicles and sports technology. He emphasizes Intel Capital's role in helping startups scale with Intel’s resources while maintaining independence from acquisitions. Wendell also touches on corporate venture capital, the state of the IPO market, and the evolving landscape of tech investments. Overall, the discussion highlights Intel's commitment to innovation and market leadership.

Takeaways

• 📊 Intel Capital manages a large portfolio of about 400 companies, making it one of the biggest venture capital (VC) firms in the world.
• 💼 The new head of Intel Capital aims to refocus the company's investments, concentrating on adding value to companies that align with Intel's strategic goals.
• 📉 Intel Capital considered divesting parts of its portfolio but decided against it after a review, choosing instead to streamline and maintain its existing investments.
• 💡 The strategy shift is to prioritize investments in disruptive technologies and business models, rather than just focusing on financial returns.
• 🚗 Intel Capital made a significant investment in mapping technology for autonomous vehicles, partnering with BMW, Audi, and Daimler to establish a strong position in this emerging sector.
• 💰 Intel's approach is to acquire 10-20% stakes in companies, allowing it to have board representation and influence the direction of these businesses.
• 📈 Intel Capital does not use its investments as a funnel for mergers and acquisitions but rather aims to add strategic value to help companies grow and succeed.
• 🤝 The firm leverages its network and resources to assist portfolio companies with their go-to-market strategies and potential exit opportunities, such as IPOs or acquisitions by other firms.
• 🔬 The head of Intel Capital has an engineering background, which he believes helps him understand technology investments better and ask the right questions during due diligence.
• 🏅 Intel Capital is interested in sports technology, both in terms of content delivery and in areas like athlete health, safety, and training, and sees this as a promising investment sector.

Q & A

What is the speaker's main role at Intel Capital?

The speaker oversees Intel Capital and focuses on making strategic investments where Intel can add value, ensuring the company’s portfolio aligns with future technological advancements.

How many companies are currently in Intel Capital's portfolio?

Intel Capital's portfolio consists of about 400 companies.

What was the speaker's approach when reviewing the portfolio upon taking over?

The speaker aimed to focus on companies where Intel could add value, noting that Intel Capital had become too large and was making too many investments each year, which made it difficult to maintain focus.

Did Intel Capital ultimately divest any of its investments after the portfolio review?

No, Intel Capital decided to keep all its investments after the review, although there were some offers from external parties to take over parts of the portfolio.

What is Intel Capital's current investment philosophy?

Intel Capital now aims to invest in disruptive technologies and different business models that may not directly align with Intel’s core operations, acting as a pathfinding VC to identify future opportunities.

How does Intel Capital differentiate itself from other venture capital firms?

Intel Capital differentiates itself by not only providing financial support but also by accelerating companies' routes to market, leveraging Intel's resources to help portfolio companies succeed.

What is Intel’s strategy in the autonomous vehicle sector?

Intel Capital has invested in mapping technologies critical to the future of autonomous cars, partnering with companies like BMW, Audi, and Daimler to ensure Intel's place in the sector.

How has the speaker's background in engineering helped in their role at Intel Capital?

The speaker's engineering background helps them ask insightful questions and stay informed about emerging technologies, which is essential when evaluating potential investments in the tech sector.

Does Intel Capital aim to acquire the companies it invests in?

While Intel Capital has acquired 11 portfolio companies in the last year, its primary aim is not acquisition but rather helping companies grow. Acquisition happens only when it aligns with mutual interests.

What technological trends at CES excited the speaker?

The speaker was particularly impressed by advancements in autonomous vehicles, drones, and the growing presence of sports technology, noting how technology will change how sports are consumed and delivered.