Corporate venture capital (CVC) has become a crucial part of the global investment world, particularly when it comes to climate tech. In 2023-24, seven out of the ten biggest rounds for energy-related startups involved corporate investors, accounting for more than a third of all overall cash raised.
Shell Ventures has been one of the most prolific energy CVCs in recent years. Here, Shell Ventures’s managing partner, Quennie Co, and venture principal, Hector MacQuarrie, give their top insights on how to pitch to a CVC — alongside two of their portfolio companies: Mantel Capture and Detect Technologies.
How can climate tech startups identify which CVCs might be a good match?
When looking for investors, it can be hard to know where to start, so Co advises compiling a long list of CVCs.
“Identify a specific set of strategic investors that could be helpful on your journey,” she says. “Make sure you confirm the CVC invests in your specific stage, geography and sector, use their previous investments as a guide to relevance and have a compelling reason why the specific CVC is best suited to invest in you rather than others.”
It’s a bit like speed dating.
US-based Mantel Capture, which has developed a carbon capture system using molten borates, a high-temperature liquid, raised $30m in Series A funding in 2024. The round was co-led by Shell Ventures and another CVC, Eni Next. Founder and CEO Cameron Halliday says he had around 300 venture funds, including traditional VCs and CVCs, on a target list which he then whittled down.
“It’s a bit like speed dating. I wanted people who understand carbon capture and could add value beyond the money,” he says.
CVCs are increasingly providing this kind of value. According to research from Global Corporate Venturing (GCV), a growing number of corporate venture units now have dedicated business development teams that give startups access to corporate partners, suppliers and networks (86%), provide access to research and development (79%) and offer resources and funding for proof of concept development (52%).
How should you make the initial approach?
CVCs will typically be proactive about finding startups they’re interested in but are also happy to be approached via email or LinkedIn. Shell invests in startups across five domains — power, mobility, emission management, digital and resources — and usually screens 1,000-1,500 potential opportunities per year.
Some of the strongest introductions we see are generally from people we know and trust in the ecosystem.
“Our sweet spot is Series A and B, with first cheques typically in the range of $3m-15m,” MacQuarrie says. “In addition to this typical range, we can also invest both earlier and later. We have a smaller, earlier stage fund focused on seed stage opportunities that are typically deeptech or more capital intensive, and we also consider bigger, growth-stage cheques for later stage investments.
“Some of the strongest introductions we see are generally from people we know and trust in the ecosystem,” he adds. Otherwise, it might be a chance meeting at an event. Halliday met MacQuarrie, for example, at a conference after he’d pitched Mantel Capture to the audience.
India-based Detect Technologies is another portfolio company. It raised $28m in Series B funding in 2022, with participation from Shell Ventures. The company had taken part in Shell’s E4 accelerator in India and had already deployed its technology across a number of sites in the US and South-East Asia before signing the deal.
“We weren’t even looking for funding at the time, we just wanted to take the solution to the international market,” CEO Daniel Raj David says about participating in the accelerator. “But once we had an enterprise-wide deal with Shell, we became an attractive opportunity to the Shell Ventures team and were invited to pitch.”
What’s it like to pitch to a CVC?
Typically, the first pitch meeting will be a short video call off the back of a strong pitch deck being sent in advance, Co says.
“The company then enters the investment process, which might take two to three months in terms of assessing the financials and business plan,” she says.
That includes a second pitch to Shell Ventures's investment committee. Halliday remembers presenting to a room of around 30 people but says it’s less nerve wracking than it sounds.
“You’ve put a lot of work into getting there and if you’ve done it well, you’ve got most of those people on board already,” he says. “There are fewer questions about financial projections and the competitive landscape than a traditional VC. Often the investors we talk with have a good enough understanding of the vision to know there’s a massive market for this. They’re trying to probe if we can deliver on what we're saying.”
What should the perfect pitch deck include?
If there are any surprise questions, Halliday has an ace up his sleeve. His pitch deck has become an appendix of all of the company’s technical information and market positioning.
Vagaries, exaggerations and simply reading the deck are never helpful.
“The master deck is now around 500 slides,” he says. “I usually pull 10 of them to the front and that’s what we walk through for the first part of the pitch. When the pitch turns into a Q&A, I flip back and forth between the appropriate backup slides.”
For MacQuarrie, the most memorable pitches are those where the founder can easily navigate both high-level, strategic discussions as well as detailed topics like unit economics, the customer or business plan. And finally, while CVCs are looking to check many of the same boxes as traditional VCs, they’re also looking for an alignment with the parent company.
“We look for venture returns, and so our investments need to stand on their own two legs from a financial perspective,” MacQuarrie adds. “But beyond that, we're trying to draw that strategic link between the opportunity and ourselves. If a founder can give some forethought into what that looks like, that’s really helpful.”
In terms of what a founder should leave out, it’s a similar story to pitching elsewhere: “Vagaries, exaggerations and simply reading the deck are never helpful,” says MacQuarrie.
What questions should you ask to make sure the CVC is a good fit?
The pitching process is also a good time for both sides to set expectations. Halliday recommends asking questions early.
“It’s the best way to level that power dynamic and make it clear this is a two-way thing,” he says, adding he likes to ask about how the CVC sees the market. “If you spend the first 10 minutes with an investor understanding what they’re concerned and excited about, then you can tailor the pitch to meet those concerns.”
For example, David at Detect Technologies says they wanted to keep working with other partners: “We had questions around how this deal would impact our relationship with the rest of the market. And we also asked what kind of introductions Shell could make post-investment.”
Co agrees this is a good moment to ask the CVC how they might be able to work together in the future: “I would certainly ask what kind of deployment opportunities are available. Being transparent and realistic about what can and cannot be done is important.”
What happens next?
Every fund or CVC’s process and timeline looks a little different but after a successful pitch to Shell Ventures’s investment committee, it’s time for term sheets and confirmatory due diligence.
“From pitch to wiring money takes around three to four months when everything goes well,” MacQuarrie says of Shell Ventures’s timeline.
It can be a lengthier process than raising money from a traditional VC, but David says it’s worth it.
“There’s much more validation and due diligence done but if you have a strategic investor with the credibility of Shell, then that’s a stamp of approval for the rest of the industry,” he says. “Within three to four months of Shell investing, our company valuation had tripled.”
