Investing in startups to promote open innovation
Having open innovation in its DNA, Solvay creates partnerships and collaborations in a variety of ways. One of these ways is smartly investing in startups, which is Solvay Ventures’ mission.
In 2005, Solvay decided to create its own capital venture fund. Managing an evergreen fund of $100m, Solvay Ventures focuses on startups working on technologies generally covering one of four domains: better resources use, health & wellbeing, energy transition and digital tools. As an added rule, all the fund’s investments feature a strong sustainability component.
Better, faster innovation
The idea behind all this goes beyond making smart investments in promising startups. It’s about creating partnerships and collaborations with one goal in mind: better and faster innovation. “Open innovation is all about accelerating innovation, explains Stéphane Roussel, Solvay Ventures Managing Director. There is a potential for innovation everywhere, and a creativity that surpasses that of Solvay’s researchers alone. It’s important to leverage that creativity and create partnerships with startups, in addition to our partnerships with universities.”
So how does Solvay Ventures pick its investments? The first criterion is the alignment of the companies’ activities with Solvay’s strategy: “We want to be able to work together on common issues, continues Stéphane Roussel. The objective is to not miss disruption.” Over the past 10 years, nearly 6,000 startups from around the world have been reviewed, for typically three or four investments a year. All this is achieved by a team of eight people spread out across the globe in Brussels, Paris, Shanghai, and on both coasts of the USA. With their ear constantly to the ground, these are the people who spot all the interesting and relevant startups and decide which ones to invest in – “we have great autonomy”.
Synergies and new markets
Of course, it’s not just about cutting a check. Solvay Ventures wants to create business synergies with the startups it invests in, bringing its industrialization capabilities and market access to the table. “The combination between Solvay and startups is the guarantee there is a credible value chain to bring innovation to the market, for example in the field of composite materials, batteries, lightweighting, etc.”, summarizes Stéphane Roussel.
The latest investments were two American companies: Multimechanics, a software company based in Omaha, Nebraska that developed a simulation solution for advanced materials, and Nohms Technologies, from Rochester, NY, that works on next generation Lithium-Ion batteries. “We are helping Nohms through R&I collaboration, product synergies and commercial partnerships. We basically help them get a foot in the door with our customers. As for Multimechanics, their simulation software allows for more freedom in designing parts, which can enable the adoption of new and complex materials such as our composites”, explains Stéphane Roussel.
Patience and competition
Legitimized by this activity in the field of cutting edge technology development, Solvay chose to participate in Hello Tomorrow’s Global Summit, to be held in Paris late October. Hello Tomorrow is an international non-profit organisation whose mission is to “accelerate the transfer of breakthrough technologies into real world solutions” by connecting deep-tech entrepreneurs (i.e. people who work on creating genuinely new technologies) with investors and enablers. “Deep-tech is a capital-intensive field of activity, and venture capitalists generally don’t like that. But at Solvay, we are more patient than most”, adds Stéphane Roussel.
This will be the first time Solvay is associated with Hello Tomorrow’s yearly Global Summit. “It’s an original event with an informal tone and atmosphere, which we enjoyed very much.” Its highlight is a startup competition: a selection of promising companies (most of which Solvay Ventures is familiar with) divided into 10 “tracks”, or fields, will be reviewed by a jury. Solvay is the proud sponsor of the New Materials track. Yet another way of distinguishing those who are at the forefront of technological innovation.
Solvay Ventures is the Venture Capital fund of Solvay, a global company committed to innovative and sustainable chemistry. Our mission is to build remarkable stories with entrepreneurs, balancing strategic and financial objectives.
Collaborating for higher value.