The oil and gas industry has historically been slow to adopt new technologies, but one major player has sought to break from that tradition.
Yesterday, Houston-based Chevron Technology Ventures LLC announced a new $90 million fund – its seventh – to focus on innovation within the energy industry.
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This fund promises to invest in “high-tech, high growth startups and breakthrough technologies” that will help Chevron’s oil and gas business, and create growth opportunities in the future, according to its press release.
It’s important to note that venture investing is not a new endeavor for Chevron, which formed its fund in 1999. It’s made over 90 investments over the past 20 years, per its press release, In 2018, it launched a $100 million focused fund to target the future of energy.
Its most recent investment closed last week, when it participated in a $68 million funding round for Canada-based clean energy company Carbon Engineering. It’s also seen at least 17 exits over time, according to its Crunchbase profile.
Chevron appears unafraid of the pushback that some corporations get for being self-serving when it comes to investments. It plans to invest in early-to mid-stage companies, as well as partnership funds.
We’re seeing more corporations jump into startup investment, which is part of the reason that Touchdown Ventures, a firm which advises corporations like Kellogg on how to manage their venture funds, came to be.
Kana Lee, a marketing manager at Touchdown Ventures, said that with this uptick, corporations need to take a moment to decide whether they are designing a venture capital fund in the most “conducive” way.
The challenge is that some corporations pull people from random departments like merger and acquisitions or finance and task them with designing a fund, Lee said to Crunchbase News.
As for why we’re seeing more companies engaging with startups? Lee said as big industries realize they are starting to get disrupted by startups, it’s the new “win-win” situation.
The result: the startup gains the capital and leadership support they need, she said, while the corporation finds a way to help the younger venture become a viable, long-lasting business.
Illustration: Li-Anne Dias