Corporate venture models are transforming how businesses address sustainability challenges. These models combine the resources of large corporations with the agility of startups to drive innovation and create scalable solutions for environmental and social issues. Here's a quick rundown of the nine key models:
- Corporate Venture Capital (CVC): Corporations invest directly in startups, prioritizing long-term goals over immediate profits.
- Accelerators & Incubators: Programs that mentor and support startups tackling sustainability issues.
- Co-Innovation Labs: Corporations and startups collaborate on research and development projects.
- Joint Ventures: Partnerships that combine resources to address waste and promote circular economy projects.
- Sustainability Venture Funds: Corporations invest in funds managed by experts, focusing on green and social impact.
- Open Innovation Challenges: Competitions to crowdsource solutions for specific sustainability problems.
- Venture Studios: Corporations create and launch new businesses focused on sustainability.
- Sustainability Consulting: Experts guide companies to meet sustainability goals while improving operations.
- Ecosystem Platforms: Collaborative networks that bring together multiple stakeholders to tackle large-scale challenges.
Each model has distinct benefits, challenges, and scalability potential. For example, CVC programs provide access to cutting-edge technologies but carry high risks, while ecosystem platforms enable industry-wide collaboration but require complex coordination.
Quick Comparison Table:
| Model | Focus | Collaboration | Scalability | Example |
|---|---|---|---|---|
| CVC Programs | Direct startup investments | Financial and strategic support | High | BP Ventures invested in 40+ clean energy startups |
| Accelerators & Incubators | Mentorship and resources | Hands-on partnerships | Medium | Unilever Foundry supported 400+ partnerships |
| Co-Innovation Labs | Joint R&D | Deep collaboration | Medium | Mercedes-Benz & BASF for recycled materials |
| Joint Ventures | Circular economy projects | Shared risks and resources | High | Sika & Sulzer tackling construction plastics |
| Venture Funds | Indirect investments | Managed by experts | High | Salesforce Ventures Impact Fund |
| Open Challenges | Crowdsourced solutions | Global innovators | High | 100+ Accelerator with Coca-Cola, Unilever |
| Venture Studios | Building new businesses | Co-founding startups | Medium | AB InBev's EverGrain for protein ingredients |
| Sustainability Consulting | Guidance for greener operations | Expert advisory | High | Unilever's Sustainable Living Plan |
| Ecosystem Platforms | Multi-stakeholder collaboration | Shared resources | Very High | Sustainable Apparel Coalition |
These models show how corporations and startups can work together to create meaningful change while also aligning with business goals.
Reframing the Green Opportunity: The Role of Venture Building in addressing the global ESG agenda
1. Corporate Venture Capital Programs
Corporate Venture Capital (CVC) programs offer a direct way for large companies to invest in startups focused on sustainability. These programs allow corporations to take equity in early-stage green ventures, providing startups with both funding and access to established markets. In return, corporations gain exposure to cutting-edge technologies that align with their sustainability goals.
Focus on Sustainability Outcomes
CVC programs targeting sustainability often prioritize strategic objectives over financial returns. According to a study of 19 participating CVCs, 42% emphasized strategic goals as their primary focus, compared to only 21% prioritizing financial outcomes. This focus makes CVCs particularly effective for addressing long-term environmental challenges, where the impact often outweighs immediate profitability.
The cleantech sector has been a major beneficiary of CVC investments. In 2022, venture capital funding in cleantech hit $70 billion, with the global market projected to grow to $600 billion by 2030. This surge in funding highlights how CVC programs are driving innovation to compete with traditional energy sources and promote sustainable practices across industries.
Collaboration with Startups
CVC programs go beyond just providing financial support - they create deep partnerships with startups. Corporations contribute critical resources such as manufacturing expertise, distribution networks, regulatory knowledge, and established customer bases, which are invaluable to early-stage companies.
"There are solutions in the market created by startups and in this circularity realm, I think it's more important than ever to partner with [them]." – Otilia Barbuta, Principal at HP Tech Ventures
This collaborative model is especially impactful in circular economy initiatives. Rob Lawson-Shanks, CEO and co-founder of Molg, emphasizes the importance of partnerships:
"Circularity relies on these upstream and downstream kind of partnerships... We could toil for years and [barely make a] dent, whereas if we can grow and scale alongside each of [our] needs and circularity goals, we have such a larger opportunity."
Interestingly, 78.8% of CVC programs co-invest with other venture capitalists. This syndication approach not only spreads risk but also brings diverse expertise and perspectives to sustainability-focused startups.
Scalability of the Model
CVC programs are particularly well-suited for testing disruptive technologies in uncertain markets because they offer flexibility and lower risk. This adaptability allows corporations to explore new sustainability solutions without overcommitting resources.
The scalability of CVC-backed innovations is evident in success stories like CATL. In July 2021, CATL introduced a sodium-ion battery capable of charging to 80% in just 15 minutes at room temperature. By late 2023, these batteries were being mass-produced and installed in vehicles like the BYD Seagull and Chery iCar's new energy lineup.
Broader Ecosystem Impact
CVC programs don’t just benefit individual startups - they create ripple effects that accelerate innovation across entire industries. By merging corporate resources with startup ingenuity, these programs drive progress that no single entity could achieve alone.
Several portfolio companies illustrate this broader impact. For example:
- Glavel produces Foam Glass Gravel, a sustainable, rot-resistant material made from recycled glass.
- Arbiom developed SylPro, a yeast-based protein alternative for animal feed, addressing protein shortages in environmentally stressed regions.
- INOVUES created smart windows that convert absorbed light into electricity, helping reduce peak energy demand.
Geographic trends in CVC investments also shape global sustainability efforts. While North America saw a 33% drop in cleantech funding, the Asia-Pacific region, led by China, experienced a 50% increase. This shift highlights how CVC programs are driving regional innovation and sustainability development.
2. Sustainability Accelerators and Incubators
Sustainability accelerators and incubators play a critical role in guiding green startups by offering structured support and fostering collaboration. These programs are designed to drive impactful progress in sustainability-focused innovation.
Focus on Sustainability Outcomes
Unlike traditional investment models that prioritize rapid financial returns, sustainability accelerators and incubators focus on creating measurable environmental and social benefits. By supporting startups addressing specific environmental challenges, these programs help corporations achieve their broader sustainability objectives.
Take the Stanford Sustainability Accelerator, for example. Their mission is clear:
"The Sustainability Accelerator speeds the translation of Stanford research into scalable technology and policy solutions to address urgent global sustainability challenges".
These initiatives prioritize projects with the potential to create large-scale impact, emphasizing ambitious and measurable goals over mere market potential. A 2022 literature review revealed an imbalance in focus areas: of 76 studies on startup accelerators, 75 centered on economic sustainability, 35 on social aspects, and only 5 on environmental outcomes. This underscores the need for programs that specifically address environmental challenges.
The approach goes far beyond superficial commitments to sustainability. Research on French business incubators found that when sustainability is treated as a mere checkbox, it risks fostering misleading practices, which can erode trust in genuine efforts toward sustainable entrepreneurship.
Level of Collaboration with Startups
While Corporate Venture Capital programs often provide financial backing, accelerators and incubators distinguish themselves by offering hands-on, long-term collaboration. These partnerships go deeper, providing startups with the tools, mentorship, and resources needed to succeed.
A great example is Unilever Foundry, a corporate incubator launched in 2014. It connects Unilever's business units with external innovators to tackle challenges like sustainability, artificial intelligence, and plastic waste reduction. Instead of taking equity or intellectual property, the Foundry offers non-dilutive capital through pilot programs and co-development opportunities. This model has facilitated over 400 partnerships between Unilever and startups.
Similarly, BASF's Chemovator, established in 2018, provides a space for innovation teams to test bold ideas and explore unconventional growth opportunities in industries like construction, transportation, and energy. By supporting early-stage concepts, Chemovator creates a pipeline of ventures that BASF can either integrate into its operations or spin off as independent businesses.
Corporate incubators often support startups from ideation to becoming fully functional businesses. Some focus exclusively on internal employee ideas, others partner with external startups, and hybrid models combine both approaches, creating a collaborative environment for innovation.
Scalability of the Model
Accelerators and incubators are designed to scale their impact by systematically measuring and optimizing growth. Accelerators typically run short, focused programs (3–4 months), while incubators provide support over extended periods.
The Miller Center for Social Entrepreneurship at Santa Clara University offers a great example of how these programs can scale their impact. In 2021, they partnered with Sopact to enhance impact management for 300 social enterprises. Before this collaboration, the Miller Center struggled with limited data collection and mentoring on data strategies. The partnership led to improved portfolio insights and robust data strategies for all participating enterprises.
The financial investment in these programs is significant. For instance, the Scaling Impact program provides in-kind support worth approximately $60,000-$70,000 per enterprise. This level of backing highlights the commitment corporations make to fostering sustainable solutions.
Key metrics like customer acquisition cost (CAC), lifetime value (LTV), and growth potential are assessed alongside sustainability outcomes to ensure startups are both financially viable and environmentally impactful.
Potential for Ecosystem Impact
These programs do more than just support individual startups - they help shape entire industries by promoting sustainability policies and entrepreneurial pathways. Events and initiatives stemming from these programs spread the message of sustainability across broader networks.
One participant in the Scaling Impact program shared their experience:
"Scaling Impact is perfect for high impact social enterprises who wish to scale and raise capital. Their commitment to getting to know and understand your business, and provide tailored advice was invaluable. It genuinely accelerated our preparedness for scaling and raising, and we learnt so much about business and growth that we otherwise would never have learnt." - Zoe Condliffe, Founder & CEO at She's A Crowd.
Impact accelerators excel at connecting startups with investors, offering mentorship, and opening doors to larger markets. This creates a ripple effect, as successful program graduates often return as mentors or investors, building a self-sustaining ecosystem of sustainable innovation.
However, achieving true ecosystem impact requires a delicate balance. As one program manager put it:
"We help them think about their impact, but we don't go far beyond that because their main focus quickly becomes how to make money. We cannot spend much of our time measuring our social and environmental impact. Our priority and goal are to enable tenants to earn a salary for themselves and their employees; otherwise, there is no impact." - Program Manager, Incubator Z.
This challenge highlights the need for programs that integrate social, environmental, and economic priorities, ensuring long-term sustainability across entire business ecosystems.
3. Corporate-Startup Co-Innovation Labs
Co-innovation labs represent a fascinating collaboration model where corporate resources meet startup agility to tackle sustainability challenges. These labs are designed to spark fresh ideas, create impactful solutions, and drive progress in ways that wouldn’t be possible within traditional corporate structures alone.
Focus on Sustainability Outcomes
The primary aim of co-innovation labs is to develop sustainable solutions that address the needs of both customers and communities, all while aligning with broader business strategies. By working together, corporations and startups can create innovative products and processes that genuinely make a difference in sustainability efforts.
Take Symetri’s 2020 partnership with Build Health International (BHI) and the Autodesk Foundation as an example. Together, they designed and constructed a maternal healthcare center in Koidu, Sierra Leone. With Autodesk Foundation’s technology and support, Symetri crafted a workflow that improved energy and resource efficiency, creating a better healing environment for patients while also benefiting other BHI facilities. This incredible effort earned Symetri Autodesk's Most Impactful Sustainability Win award in 2022.
"At Symetri, we believe that collaboration is key to driving meaningful change in the construction and manufacturing industries." - Symetri
Level of Collaboration with Startups
What makes co-innovation labs stand out is the deep level of collaboration they require. Rather than sticking to the usual vendor-client dynamic, these labs encourage a real exchange of skills and ideas between corporations and startups, creating a space where both sides learn and grow.
For instance, Mercedes-Benz partnered with BASF and startup Pyrum Innovations to boost the use of recycled materials in its vehicles, aiming for an average of 40% by 2030. BASF’s chemical recycling technology, combined with Pyrum’s process for converting used tires into pyrolysis oil, has helped create a robust circular economy solution.
Another example is Enel’s collaboration with Cisco, which began in 2017. Cisco became Enel’s Global Technology Partner, working alongside them to develop digital solutions for electricity grids, advance Industrial Internet of Things (IIoT) technologies, and strengthen cybersecurity. Together, they also explored new co-innovation opportunities.
"Innovation and sustainability go hand-in-hand." - Federica Ingrao, Account Manager, Cisco
These collaborations demonstrate how such partnerships can lead to scalable and meaningful advancements.
Scalability of the Model
Scaling co-innovation labs isn’t just about expanding operations - it requires a mix of strong leadership, clear governance, and the right team dynamics. Executive sponsorship is key to providing direction and clearing roadblocks, while multidisciplinary teams that combine internal and external expertise are essential for long-term success. To manage growing project volumes, labs often adopt structured workflows, stage-gate processes, and clear handoffs to business units.
Continental’s co-pace model is a great case study. By partnering with startups focused on smart mobility and sustainability, Continental has managed to speed up development cycles and improve market responsiveness.
AI has also become a game-changer in this space. Tools powered by AI help identify trends, evaluate startups, and even assist in drafting business models or simulating user journeys. Generative AI, in particular, is proving to be a valuable addition for co-creating solutions and managing innovation.
Potential for Ecosystem Impact
Co-innovation labs don’t just create isolated successes - they have the potential to drive broader ecosystem impacts by addressing multiple sustainability challenges at once. Open innovation, which involves leveraging ideas and partnerships from outside sources, is especially crucial in today’s interconnected world.
This approach is timely, given the current climate. Surveys show that 75% of consumers rank climate change as a top priority, while 61% of business leaders expect it to significantly influence their strategies over the next three years. On top of that, industries could collectively save $437 billion annually by 2030 through improved energy efficiency alone. These numbers highlight the dual environmental and economic value that co-innovation labs can unlock.
However, achieving this level of impact requires serious commitment. As Tomás O'Leary, CEO and Founder of Origina, puts it:
"The way things are going globally, a company's focus on climate, carbon, and the circular economy can't be simply for the sake of marketing. It must be willing to put skin in the game at the highest levels and make a real commitment to making a difference."
The most effective co-innovation labs understand that tackling sustainability challenges demands not just groundbreaking ideas but also the determination and resources to bring those ideas to life. This collaborative approach sets the stage for a more in-depth comparison of venture models in the next section.
4. Joint Ventures for Circular Economy Projects
Joint ventures in circular economy projects bring together the strengths and resources of corporations to tackle challenges that neither could address alone. By forming new entities, these partnerships focus on transforming waste into reusable resources and developing more sustainable business models. This approach opens doors to exploring sustainability goals, collaboration strategies, scalability, and the broader impact on industries and communities.
Focus on Sustainability Outcomes
The primary goal of these ventures is to address waste generated by linear business models. By combining diverse expertise, they turn complex waste issues into profitable opportunities while reducing environmental harm.
Take the partnership between Sika and Sulzer, announced in March 2025, as an example. Sika contributes its knowledge of polymer applications, while Sulzer brings its expertise in chemical recycling. Together, they aim to tackle the two million tons of plastic waste produced annually by the European construction industry. Their joint system employs both mechanical and chemical processes to collect, process, and repurpose construction plastics into high-quality raw materials.
"This joint venture represents a significant milestone on our path toward greater sustainability and circularity in the construction industry. By converting waste into high-quality raw materials, the project helps reduce Scope 3 CO₂ emissions. At the same time, it supports companies in meeting increasing ESG standards and unlocking new value creation streams."
- Ivo Schädler, Head of Construction, Sika
Another example is the partnership between RHI Magnesita and BPI, Inc., announced in June 2025. This collaboration combines RHI Magnesita's expertise in refractories with BPI's extensive U.S. infrastructure and technical capabilities. With 20 plant locations across states like Pennsylvania, Ohio, and California, as well as Canada, the venture is well-positioned to deliver locally sourced solutions and shorten supply chains.
Collaboration with Startups
These ventures often create new entities that merge corporate resources with the innovative drive of startups. This setup allows corporations to benefit from fresh ideas and agile solutions, while startups gain access to established manufacturing systems, supply chains, and financial backing.
A standout example is The Rubbish Project, a joint venture between Loop Innovations, a consultancy firm, and Grist Environmental, a waste management company. This partnership enables both sides to share resources - such as design expertise and waste management services - resulting in innovative approaches to waste while addressing operational challenges like payroll.
Such collaborations go beyond traditional business relationships. By sharing risks, investments, and profits, both parties align their incentives for long-term success, pooling their expertise to achieve more effective and innovative solutions than they could independently.
Scalability of the Model
Joint ventures are well-suited for scaling operations by leveraging the infrastructure and market reach of their partners. For instance, the Sika-Sulzer partnership plans to pilot its projects in Germany, Austria, and Switzerland in the second half of 2025, showcasing a phased approach to scaling.
Additionally, this venture intends to integrate local logistics and recycling companies into its processes, creating a network that can expand geographically while staying relevant to local needs.
The RHI Magnesita-BPI collaboration also highlights scalability. With 20 plant locations across North America, this venture shortens supply chains and ensures locally sourced solutions, making it easier to replicate and expand.
Broader Ecosystem Impact
These joint ventures have the potential to create ripple effects across entire industries. By addressing fragmented recycling systems in sectors like construction, they establish models that other companies can replicate. This not only helps industries meet ESG goals but also turns waste into new revenue streams.
"Sulzer technologies are at the heart of critical infrastructures and processes. Our solutions enable industries around the world to reduce emissions, reuse resources and recycle materials. The combination of Sulzer's and Sika's technologies is now paving the way for the construction industry to achieve a functioning circular economy and an even more sustainable future."
- Michael Schüpp, Head of Ventures, Sulzer
The partnership between RHI Magnesita and BPI also has far-reaching implications. Refractory products are essential for industries like cement, steel, and aluminum. Improvements in this sector can benefit multiple industries, creating a more sustainable supply chain.
"This joint venture is more than a partnership; it's a bold step toward redefining industry standards for sustainable sourcing and material recovery. We are excited about the future and look forward to supporting our customers with expanded capabilities that will forge new solutions for safety and efficiency while reducing environmental impact."
- Craig Powell, Regional President, North America, RHI Magnesita
These examples illustrate how well-structured partnerships can address systemic challenges while building scalable, profitable models that benefit industries, communities, and the environment alike.
5. Investment in Sustainability Venture Funds
Corporate ventures are taking their commitment to sustainability to the next level by channeling funds into dedicated sustainability venture funds. Instead of directly investing in individual startups, companies are partnering with skilled fund managers who specialize in identifying and nurturing businesses focused on green and social impact. This approach has gained momentum, with sustainable assets now making up 36% of total assets under management. By combining corporate resources with expert fund management, companies are amplifying their impact on sustainable innovation.
Between 2019 and 2021, U.S. corporate social responsibility (CSR) fund inflows surged from $20.6 billion to $65 billion. This rapid growth reflects a growing confidence in sustainability as a strategy that delivers both financial returns and meaningful impact.
Focus on Sustainability Outcomes
These funds prioritize investments in green technologies and responsible business practices, aiming for measurable social and environmental benefits alongside financial gains.
Take the Salesforce Ventures Impact Fund as an example. Launched in 2017 with $150 million, this fund focuses on enterprise software companies that drive measurable impact in areas like education, climate, diversity, digital health, and social sector technology. By July 2023, the fund’s portfolio companies had reached over 66 million people.
"Our idea was to marry the mission of impact-driven organizations and the strategic, financial return goals of corporate venture in a really compelling fashion", said Claudine Emeott, VP and Partner of the Salesforce Ventures Impact Fund.
Another standout example is Svante Inc., which secured $318 million in a Series E funding round led by Chevron New Energies. This investment is fueling the development of a commercial-scale filter manufacturing facility in Vancouver, capable of producing enough modules to capture millions of tonnes of CO₂ annually across multiple carbon capture facilities.
Collaboration with Startups
This funding model does more than provide capital - it fosters deep collaboration with startups to scale their innovations. Corporate investors often go beyond financial backing, offering startups patient capital, technical expertise, market access, and mission alignment.
The TELUS Pollinator Fund for Good illustrates this collaborative spirit. Launched in 2020 with $100 million, the fund supports companies addressing challenges in health, education, agriculture, and the environment. By July 2023, it had invested in 26 companies, including Gotcare, showcasing its ongoing engagement with portfolio businesses.
"We aim to be a helpful partner. We work very closely with our portfolio companies and very hard on their behalf. We can connect a portfolio company to internal experts on product, pricing, sales enablement, DEI, and ESG. The Salesforce ecosystem is an incredible resource, and we aim to provide that support throughout a company's journey", said Claudine Emeott of Salesforce Ventures Impact Fund.
This hands-on approach has proven invaluable to startups. Rachel Romer Carlson, CEO and co-founder of Guild Education, shared:
"The dedication and thoughtfulness of the Salesforce Ventures Team and the way they go about their work is a true difference-maker."
Scalability of the Model
The scalability of sustainability venture funds is evident in the growing number of companies embracing this model. In 2022, 2,604 corporates participated in at least one deal - a 5.5x increase over the past decade.
Climate technology businesses alone attracted $70 billion in investments in 2022, an 89% jump from the previous year. Corporate-backed deals accounted for 19% of global venture capital activity in 2022, up from 15% in 2021. This demonstrates the model’s ability to accommodate diverse corporate strategies and investment levels.
Broader Ecosystem Impact
Corporate investments in sustainability venture funds have a ripple effect, benefiting the entire sustainability ecosystem. By reducing debt financing costs and lowering risks for startups, these investments make it easier for companies to innovate. Corporate backing also serves as a powerful endorsement, attracting additional funding and partnerships.
As market and societal expectations evolve, nearly all global CEOs now recognize sustainability as a critical factor in future business success. This alignment fuels a virtuous cycle: corporate investments drive innovation, which opens up new market opportunities and encourages even greater corporate participation.
The TELUS Pollinator Fund encapsulates this broader vision:
"Ultimately, we believe that investing in and empowering women is essential to create a more sustainable and durable economy", said Blair Miller, Managing Partner of the TELUS Pollinator Fund for Good.
This perspective highlights how corporate venture funds can tackle systemic challenges while building resilient, sustainable business models.
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6. Open Innovation Challenges and Competitions
Open innovation challenges provide a platform for corporations to define specific problems and invite global innovators to propose solutions, particularly for sustainability issues. This approach flips the traditional model of scouting for partners, instead drawing qualified startups to tackle clearly outlined challenges. By doing so, companies can more efficiently identify ideas and technologies that align with their sustainability goals.
Focus on Sustainability Outcomes
These challenges are especially effective at addressing complex problems that benefit from diverse perspectives. For instance, the BetterTogether/Juntos Es Mejor Challenge sought solutions for Venezuela's migration crisis, emphasizing input from those directly impacted. Similarly, the Innovation for WASH in Urban Settings Challenge aimed to generate ideas for improving access to clean water and sanitation in urban areas.
Collaborative efforts among corporations are also on the rise. The 100+ Accelerator, featuring companies like Unilever, Colgate-Palmolive, The Coca-Cola Company, and AB InBev, brought startups to the forefront of solving issues in areas such as circular packaging, smart agriculture, and climate action. Another example is the Sustainability Open Innovation Challenge 6th Edition, which offered over $2.5 million in funding and pilot opportunities.
These initiatives naturally lead to partnerships where startups and corporations work closely, as explained in the next section.
Level of Collaboration with Startups
Open innovation challenges create an environment where startups and corporations can test solutions with minimal risk. Startups gain access to mentorship, corporate expertise, and resources, while companies explore fresh ideas without heavy upfront investments. This model has proven effective, with over half of startup-corporate collaborations beginning during or after the pandemic.
For example, Novo Nordisk's "Actors of Diabetes" competition in late 2023, hosted on the Agorize platform, attracted 38 startup submissions. The event culminated in a finale at Station F in January 2024, where DiappyMed won the grand prize, leading to a global partnership. Another standout, La Tribu des Supers, received the "Coup de Cœur" award. Similarly, NEC's 2022 Innovation Challenge drew 324 participants from 66 countries, resulting in four collaborative projects between NEC, its partners, and the winning startups.
The benefits of these collaborations are clear: companies working with external innovators meet their goals 67% of the time, compared to 51% for those going it alone. Nearly 90% of these partnerships consistently achieve their objectives.
Scalability of the Model
The success of open innovation challenges has encouraged their expansion across industries. A growing number of organizations recognize their importance, with 83% identifying open innovation as essential for achieving sustainability goals. Additionally, 86% of corporations plan to maintain or increase their open innovation budgets by 2025.
One example of scalability is PepsiCo and Pioneer Foods' SSA Development Fund, which focuses on co-creating solutions for South Africa's food system. This initiative prioritizes agricultural development, education, and support for Black-owned food innovation startups.
"No one company has all the answers. Even though we're a big player in this space, we need collaborations with many different innovators in the agriculture space to come up with new solutions", said Gusui Wu, Head of Seeds Research at Syngenta.
Open innovation initiatives are also delivering measurable results: 63% of organizations report environmental sustainability improvements, and 55% note progress in social sustainability indicators.
Potential for Ecosystem Impact
Beyond individual projects, open innovation challenges contribute to strengthening the larger sustainability ecosystem. Seventy-five percent of organizations view open innovation as essential for solving today’s complex business challenges. This approach also boosts innovation performance by integrating diverse perspectives across industries.
"As businesses make the dual transition towards a digital and sustainable economy, nurturing a culture of open innovation is a critical success factor for organizations", said Pascal Brier, Chief Innovation Officer at Capgemini and Member of the Group Executive Committee.
The ripple effects include operational improvements: over 60% of organizations report better efficiency, greater agility, and stronger revenue through open innovation. Additionally, 55% experience faster innovation cycles, and 62% see improved employee adaptability. These efforts also align with advancing UN SDGs and ESG objectives by optimizing resource use.
7. Corporate Venture Studios for Green Business Creation
Corporate venture studios take a hands-on approach to building sustainability-focused businesses from scratch. Unlike traditional investment models, these studios not only fund but also actively create, launch, and scale new ventures. By leveraging the resources of their parent companies while maintaining the flexibility of a startup, they offer a powerful way to tackle climate challenges. This proactive approach has gained traction, with more studios focusing on ventures aimed at addressing environmental issues. It’s a step beyond earlier collaborative models, fully integrating corporate strengths into the venture creation process.
Interestingly, companies that allocate 20% of their growth capital to new ventures tend to grow 2 percentage points faster. Over the past five years, ventures launched under this model have contributed 16% of enterprise value and 13% of revenue for their parent organizations.
Focus on Sustainability Outcomes
Climate-focused venture studios are designed to generate ideas and test solutions for pressing environmental problems. From the very beginning, these studios emphasize equity and fairness, ensuring that their innovations lead to scalable and just outcomes.
Take X, The Moonshot Factory, for example. This venture studio under Alphabet is known for tackling massive global challenges through ambitious projects. Their sustainability efforts include 280 Earth, which develops direct air capture systems to remove CO₂ from the atmosphere, and Wing, which creates environmentally friendly autonomous delivery drones.
Deep Collaboration with Startups
Corporate venture studios go beyond traditional investment relationships by forming close partnerships with entrepreneurs. They don’t just fund startups - they co-found them, bringing together multidisciplinary teams to turn ideas into reality.
The Future Climate Venture Studio is a great example of this approach. It provides startups with access to expert advisors, resources, and tailored content from partners like UConn and R/GA. The studio offers financial support, connections to top executives, and access to strategists, technologists, and designers.
"At Mach49, we are your partners and co‐founders–not consultants."
These partnerships often extend into broader collaborations with universities, industry leaders, and corporations, creating a network that accelerates the growth of innovative solutions.
Scalability of the Model
The venture studio model demonstrates clear advantages in scaling green businesses. Startups originating from venture studios secure seed funding twice as fast and exit 33% faster than traditional startups. On top of that, they boast a 44% higher success rate compared to conventional startups.
An impressive 84% of venture studio startups successfully secure seed funding - far exceeding industry averages. This success is largely due to the comprehensive support these studios provide, including mentorship, resources, and access to networks.
For instance, InMotion Ventures, Jaguar Land Rover's studio, merges venture studio and venture capital approaches to focus on mobility, sustainability, and connectivity. Their portfolio includes ventures like The Out (luxury on-demand car rental), Pivotal (premium car subscription service), and BeyondMath (AI simulation).
Similarly, Kamet Ventures, backed by AXA, has explored over 1,000 ideas in Insurtech and HealthTech. Their successes include Air Doctor (connecting travelers with doctors globally), Akur8 (advanced insurance pricing solutions), and Birdie (smart homecare technology).
Potential for Ecosystem Impact
Corporate venture studios have the potential to drive significant change across entire ecosystems, especially in sustainability. By channeling capital and talent into high-impact ideas, these studios reduce risks while accelerating progress.
"Climate venture studios can help move capital and talent towards higher impact ideas, and faster, with lower risk."
- Jamil Wyne, Founder, Climate Tech Bootcamp
The Future Climate Venture Studio at the University of Connecticut exemplifies this impact. It supports startups like Applied Bioplastics (producing lower-carbon durable plastics), Clean Crop Technologies (using electricity to enhance crop yields), and Cool Amps (recycling lithium-ion batteries).
This ecosystem approach often involves cross-sector collaboration. Corporate venture studios from different industries are increasingly working together to tackle complex challenges. For example, Western studios are expanding into Latin America, sharing knowledge and adapting their models to fit diverse markets.
8. Sustainability Consulting as a Service
Sustainability consulting offers companies expert guidance to meet their environmental and social goals. This service is becoming increasingly popular as 85% of Fortune 500 companies have set ambitious sustainability targets, yet only 28% are on track to achieve them. The gap between goals and results has fueled a growing demand for consulting services, with spending on ESG and sustainability consulting projected to hit $16 billion by 2027, growing at an annual rate of 17%.
Unlike traditional consulting, sustainability consulting is designed as an ongoing partnership. Consultants evaluate environmental impacts, craft sustainability strategies, ensure compliance with regulations, and develop corporate social responsibility (CSR) programs. They guide businesses toward greener operations while uncovering competitive advantages and improving long-term profitability. This approach not only enhances internal efficiencies but also fosters external collaborations for innovation.
Focus on Sustainability Outcomes
Sustainability consultants focus on creating measurable results by analyzing business practices and designing targeted solutions.
Take Unilever as an example. Working with consultants, the company launched its Sustainable Living Plan, achieving impressive milestones: 75% of its factories reached zero non-hazardous waste to landfill by 2020, and it implemented sustainable ingredient sourcing worldwide.
Data-driven decision-making is another cornerstone of this model. By analyzing metrics like energy use, water consumption, and waste production, consultants provide businesses with clear benchmarks and strong cases for sustainability investments.
Collaboration with Startups
Sustainability consulting opens doors for partnerships between established corporations and innovative startups. Consultants help startups integrate green technologies and align their strategies with sustainability goals.
This collaboration benefits both sides. For instance, 67% of startups in Europe have made sustainability a core mission, and 45% of venture capital firms now consider sustainability when making investment decisions. A standout example is Adidas, which teamed up with consultants and Parley for the Oceans to create sneakers made from ocean plastic. This partnership highlights how consulting can bridge the gap between corporations and startups to drive innovation.
Consultants also assist startups in meeting regulatory requirements and embedding sustainability into their branding. The results are striking: 64% of startups focusing on sustainability report increased brand trust, while 50% see improved customer acquisition rates.
Scalability of the Model
The sustainability consulting model works on a large scale when companies adopt a systems-based approach. Businesses using this method report a 100% annual average return on sustainability investments, while reducing 245,000 tonnes of greenhouse gas emissions and avoiding 102,000 tonnes of waste.
Maple Leaf Foods demonstrates the potential of this approach, becoming the first major carbon-neutral food company while also boosting net profits.
"What we argue is if you want to improve your sustainability, you should find the most lucrative way to get there. To do that, you will want to maximize operational efficiency in your company." - Bruce Taylor, CEO of Enviro‑Stewards
This scalable model applies across industries and company sizes. For example, IKEA assigns each country manager a dual role as a Corporate Sustainability Officer, ensuring leadership accountability for sustainability goals. By combining data-driven strategies with cross-industry collaboration, consulting amplifies sustainable impact.
Potential for Ecosystem Impact
Sustainability consulting doesn’t just benefit individual companies - it drives systemic change. By addressing climate and nature challenges collectively, consulting partnerships create broader resilience and promote large-scale transformation.
The potential impact is massive. Currently, 55% of global GDP - equivalent to $58 trillion - is at risk from nature-related issues. With expert guidance, decisive action could unlock $10 trillion in opportunities and generate 4 million jobs annually.
Starbucks offers a compelling example of this ecosystem approach. Through its Greener Stores Initiative, the company not only reduced its environmental footprint but also influenced the wider market to prioritize sustainability.
"Everybody starts with the last mile. 'Are we going to do solar panels or carbon credits?' No, that's the last mile. The first mile is reducing how much energy you need in the first place." - Bruce Taylor, CEO of Enviro‑Stewards
Consultants also play a key role in helping companies adhere to CDP and GRI reporting standards. This fosters transparency and accountability across industries, encouraging collaboration and knowledge-sharing that magnify the impact of sustainability efforts.
9. Ecosystem Partnership Platforms
Ecosystem platforms are reshaping how industries tackle sustainability challenges by bringing together a wide range of stakeholders. These platforms allow participants to share resources like data, applications, and expertise, creating a collaborative space where sustainable practices can thrive across different sectors. Unlike traditional one-on-one partnerships, these platforms coordinate multiple players simultaneously, enabling solutions that no single organization could achieve on its own.
This approach helps overcome common obstacles to sustainability, such as fragmented supply chains, lack of trust, and limited innovation. According to IDC, by 2025, 60% of G2000 companies will form cross-ecosystem ESG teams to pool resources and expertise for advancing sustainable practices. This collaborative framework sets the stage for real-world examples of how these platforms drive measurable results and foster industry-wide change.
Focus on Sustainability Outcomes
Ecosystem platforms amplify their impact by combining complementary solutions to achieve tangible sustainability goals. For instance, rePurpose Global, launched in 2016, enables individuals and businesses to offset their plastic footprints by purchasing verified plastic credits. This initiative has removed approximately 11 million pounds of plastic waste annually while creating jobs for over 9,500 waste workers. Similarly, Sembcorp's renewable energy certificate (REC) aggregator platform, introduced in 2020, simplifies energy portfolio management for companies looking to meet renewable energy targets. In the fashion world, Poshmark’s circular economy platform connects over 80 million users to buy and sell second-hand goods, extending the lifecycle of products.
Collaboration with Startups
These platforms are particularly effective at fostering collaboration between startups and established corporations. Startups gain access to resources, market channels, and scaling opportunities, while larger companies benefit from innovative solutions and specialized technologies. For example, BIMA uses mobile technology to offer health and insurance products to over 35 million people in Asia and Africa. By partnering with telcos, mobile money services, and insurers, BIMA has created an ecosystem that also employs 3,000 agents to educate customers and facilitate purchases. In healthcare, Cityblock Health, a 2017 spinout from Sidewalk Labs, integrates primary care providers, behavioral health specialists, and social workers into a unified ecosystem. Their approach has reduced emergency room visits by 15% and inpatient hospital stays by 20%.
Scalability of the Model
Ecosystem platforms achieve scalability through advanced software frameworks, including APIs and modular tools that allow others to build on the platform. Research indicates that nearly 25% of innovative business models now incorporate ecosystem strategies. This scalability is critical in addressing gaps in emerging markets. For example, by 2025, 45% of the demand for recycled PET (rPET) could remain unmet due to limited supply. Companies with well-defined ecosystem strategies are almost 50% more likely to outperform competitors, and top performers are twice as likely to generate at least 60% of their revenue from ecosystem-driven initiatives. With AI increasingly integrated into these partnerships, ecosystem-driven IT deals now account for over 73.2% of all agreements, growing at an annual rate of 6%.
Potential for Ecosystem Impact
Ecosystem platforms have the power to create lasting change across industries and value chains. By fostering collaboration, these platforms address large-scale issues like climate change and environmental protection through coordinated, cross-sector efforts. In fact, 85% of leading companies believe a significant portion of their future revenue will come from tackling societal challenges through ecosystem partnerships. For example, Google’s Environmental Insights Explorer has partnered with over 1,000 cities worldwide, offering standardized tools to measure and report greenhouse gas emissions, enabling more effective climate action.
The need for such coordinated efforts is pressing. To align with the Paris Climate Agreement, the ICT sector must cut greenhouse gas emissions by 45% by 2030. Joint ventures within ecosystems further highlight their impact. ACES Delta, a collaboration between Chevron and Mitsubishi Power Americas, focuses on green hydrogen production in the Western U.S., while Evogreen, a partnership between Beeah and Polygreen, operates in the Middle East with a focus on environmental protection and circular economy principles. These partnerships allow companies to tackle critical sustainability challenges while maintaining their competitive edge.
Model Comparison Table
After diving deep into the details of each model, here's a side-by-side comparison that highlights their key features and practical uses. This table sums up the nine corporate venture models for sustainability, focusing on how they collaborate, their benefits, challenges, scalability, and examples from real-world applications.
| Model | Collaboration Approach | Key Benefits | Main Challenges | Scalability | Industry Example |
|---|---|---|---|---|---|
| Corporate Venture Capital Programs | Direct equity investments in external startups | Access to new technologies, financial returns, and strategic insights | High failure rates (over 75% fail to meet objectives), requires significant resources | High – can invest in multiple startups simultaneously | BP Ventures invested over $800 million in 40+ clean energy startups by October 2024 |
| Sustainability Accelerators and Incubators | Structured mentorship and resource-sharing programs | Fast-tracked startup growth, reduced risks, access to talent | Limited portfolio size, intensive management needs | Medium – batch-based approach limits scale | Unilever Foundry supported over 400 sustainable partnerships |
| Corporate-Startup Co-Innovation Labs | Joint research and development partnerships | Shared expertise, reduced R&D costs, faster innovation | Cultural misalignment, disputes over intellectual property | Medium – requires dedicated facilities and teams | Swisscom's rready venture utilized external SaaS expertise for global scaling |
| Joint Ventures for Circular Economy Projects | Pooled resources for shared sustainability goals | Risk-sharing, combined capabilities, broader market access | Complex governance and potential conflicts | High – can tackle large-scale challenges | Action to Accelerate Recycling, formed by Alcoa and partners in 2012, increased recycling rates by 20% |
| Investment in Sustainability Venture Funds | Indirect funding through specialized investment vehicles | Portfolio diversification, professional fund management | Less control over individual investments, dependent on fund performance | High – leverages expertise across sectors | Salesforce Ventures Impact Fund reached over 66 million people through portfolio companies by July 2023 |
| Open Innovation Challenges and Competitions | Crowdsourced solutions addressing specific problems | Broad talent access, cost-effective innovation | Uncertain results, intellectual property concerns | High – engages participants worldwide | Dairy Management Inc. collaborated with CEOs representing 75% of U.S. milk sales to reduce carbon emissions |
| Corporate Venture Studios for Green Business Creation | Internal startup creation with dedicated resources | Full control over development, aligned with strategic goals | High resource demands, requires internal expertise | Medium – limited by internal capacity | AB InBev's Evergrain transforms barley waste into protein ingredients |
| Sustainability Consulting as a Service | Knowledge-sharing and advisory partnerships | Lower risk, flexible collaboration models | Limited equity benefits, reliance on external expertise | High – can serve multiple clients at once | PDS Ventures supports 28 startups, including Materra and Evrnu, as of May 2024 |
| Ecosystem Partnership Platforms | Collaborative networks with multiple stakeholders | Industry-wide impact, shared resources | Complex coordination, diverse stakeholder interests | Very High – connects unlimited participants | Sustainable Apparel Coalition includes 100+ organizations representing 30% of the global apparel market |
Each model brings its own way of driving sustainable innovation, tailored to specific corporate and startup needs.
The collaboration methods differ widely - some focus on direct financial investments, while others emphasize sharing knowledge or pooling resources. Scalability stands out as a key factor, with ecosystem partnership platforms offering the greatest potential to create widespread impact. For example, the Action to Accelerate Recycling initiative, launched by Alcoa in 2012, brought together diverse stakeholders to boost recycling rates by 20% across various materials.
However, challenges like governance complexity and cultural alignment are common across all models. Companies that adopt structured systems, such as stage-gate processes, have seen innovation success rates improve by up to 38%. A standout example of effective multi-stakeholder collaboration is the Latin American Water Funds Partnership, which includes 32 local funds, collectively managing $27 million across Brazil, Colombia, Mexico, and other nations.
Ultimately, choosing the right model depends on an organization's goals, risk appetite, and resources. While direct investment models offer more control, collaborative platforms can achieve a broader reach by leveraging shared resources and coordinated efforts across entire value chains.
Conclusion
Corporate venture models have evolved from being niche experiments to becoming essential tools for aligning business growth with sustainability goals. As Ed Winters from Nixon Peabody puts it:
"VC has emerged as a pivotal force in fostering environmental stewardship and is increasingly leveraged to support innovations that promote sustainability".
The numbers back this up. Companies focusing on sustainability are twice as likely to achieve at least a 10% boost in revenue while also meeting the increasing demands of eco-conscious markets. This synergy between large corporations and startups - where corporations bring resources and market reach, and startups contribute agility and fresh ideas - has proven effective in tackling complex sustainability challenges.
Corporate commitment to sustainability is evident in their budgets. Businesses now allocate 10% to 15% of their capital to sustainable ventures, a trend that contributed to a 19% rise in corporate venture capital investments back in 2018. Looking ahead, 93% of CEOs plan to either maintain or increase their investment in corporate venture funds by 2024.
These investments are already delivering results. Take Microsoft and Walmart as examples: Microsoft has channeled funds into carbon removal technologies to meet its ambitious goals of becoming carbon negative, water positive, and zero waste. Walmart, on the other hand, has introduced its Built for Better app to help customers make sustainable shopping choices.
Beyond financial returns, corporate venture capital (CVC) enhances companies' ability to respond to technological disruptions, identify emerging competitive threats, and test innovations with minimized risk. Experts agree that CVC investments in sustainability represent both a responsible and economically sound approach.
Ultimately, the success of these ventures depends on having clear goals, transparent communication, and strong alignment between all parties involved.
FAQs
How do corporate venture models help businesses meet sustainability goals?
Corporate venture models are making waves in sustainability by bridging the agility of startups with the resources and know-how of established corporations. These collaborations aim to support sustainable practices, fund green technologies, and build partnerships that promote environmental, social, and economic progress.
By bringing together players from various industries and backing responsible business models, corporate ventures help tackle sustainability challenges while opening doors to new growth possibilities. They also boost ESG (Environmental, Social, and Governance) performance and promote responsible innovation, empowering businesses to take meaningful steps toward their sustainability goals.
What challenges do companies face when forming joint ventures for circular economy initiatives?
Companies face a range of obstacles when establishing joint ventures for circular economy initiatives. One major issue is collaboration difficulties, often stemming from differences in organizational cultures, conflicting priorities, or varying levels of dedication to sustainability goals. These misalignments can create friction and slow down progress.
On top of that, regulatory challenges and the absence of advanced recycling technologies or proper infrastructure can act as significant roadblocks. Another layer of complexity comes from ensuring transparency and accountability in ESG (Environmental, Social, and Governance) reporting, navigating cultural differences, and effectively integrating operations between partners.
Overcoming these hurdles demands clear and open communication, a commitment to shared objectives, and creative problem-solving. These elements are essential for building partnerships that can drive meaningful, long-term results.
How do ecosystem partnership platforms bring together stakeholders to drive sustainable innovation?
Ecosystem partnership platforms serve as a hub where stakeholders can connect, communicate, and work toward common goals. They focus on creating an environment that encourages open dialogue, collaboration, and alignment among diverse interests, ensuring everyone involved plays an active role in sustainability efforts.
These platforms make it easier for participants to engage, share information seamlessly, and make decisions together. By pooling resources and tapping into shared expertise, they pave the way for creative solutions that tackle sustainability challenges while delivering mutual benefits.
