Technology companies can innovate in different ways: they can do it organically, partner, invest or acquire. Qualcomm does all of the above and is one of the last remaining companies on the planet investing in technology research. I’m looking more and more at how tech companies do it.
Qualcomm is no stranger to acquisitions with companies like Atheros Communications, NUVIA and Veoneer’s Arriver springing to mind over the past decade. A more popular way to invest in technology companies is to run a separate venture capital arm within a parent company to acquire an equity stake. Qualcomm has had a strategic venture arm of its business called Qualcomm Ventures for over 20 years. With Qualcomm Ventures, the company has deployed capital in synergistic markets, added value and achieved return on investment, sometimes in the form of an exit or IPO.
Led by 15-year Qualcomm veteran Quinn Li, senior vice president and global head of Qualcomm Ventures, the team has helped hundreds of companies succeed and scale over the past two decades. While ROI is a crucial metric for these companies, strategic investments also help Qualcomm in popular markets such as automotive, 5G, AI, enterprise and consumer.
Qualcomm has been very busy with Qualcomm Ventures, and the numbers speak volumes. The company has 150 companies in its portfolio, around 50% of which are in the United States. It has over $2 billion in assets under management in the extensive portfolio. Although we are months away from the new year, 2021 has been a banner year for Qualcomm Ventures. Let’s take a look back at some of the wins from last year and where the company is headed in 2022.
A look back at Qualcomm Ventures in 2021
Last year was the best year ever for Qualcomm Ventures. Qualcomm uses its network with other key players to open doors for companies operating under its umbrella. It has to be a win-win situation for both companies for these deals to work. The portfolio company secures capital investment from Qualcomm Ventures and has access to Qualcomm’s deep technology expertise and partner network, while Qualcomm uses its network and strategic synergies to increase market penetration.
In 2021, Qualcomm Ventures added 25 new companies to its portfolio across various markets. Although Qualcomm Ventures invests in many new companies throughout the year, the other side of the equation is when these portfolio companies are acquired by other large companies or go public, largely due to the value and capital invested by Qualcomm in the company. By 2021, more than 20 portfolio companies had also experienced successful exits. I will list some of the more notable releases below.
2021 portfolio company exits:
- Matterport: A Leading Spatial Data Company
- SentinelOne: Most Valuable Cybersecurity IP
- Altiostar: A v-RAN Leader Acquired for a Valuation of Over $1 Billion
- Innovium: A switching silicon supplier acquired by Marvell for more than a billion
- MapMyIndia: India’s leading provider of digital maps and geolocation services
Qualcomm Ventures in 2022
I expect Qualcomm Ventures to keep pace with capital investments and portfolio company exits throughout 2022. I think a big area of focus for the company could be the connected smart edge. Qualcomm is intimately involved in mobile devices, primarily because it’s a leading SOC vendor, so it makes perfect sense to seek out 5G infrastructure in a holding company. Billions of smart devices will use 5G connectivity, so it makes sense to focus on 5G in portfolio companies. AI is another area I’m looking for Qualcomm Ventures to invest capital in this year. There are many applications for AI in automotive and robotics. XR is another emerging area that Qualcomm is considering moving forward. The company founded the XR Ecosystem Investment Alliance in China this year, indicating that the company believes XR is important.
Above all, I believe that Qualcomm Ventures will continue to take a blended approach to distributing capital to companies in its core markets of IoT, 5G, enterprise, AI and many others.
After spending some time looking back at the performance of Qualcomm Ventures 2021, it’s clear the company succeeded in its mission last year. It has invested large amounts of capital and spurred innovation in its core markets. While I believe past successes can be an indicator of future performance, there is still a lot of work to do if Qualcomm Ventures is to surpass last year’s record performance. Adding 25 companies to your portfolio and having 20 successful exits is no mean feat. I think the company is focused on the right markets and the right use cases to continue to deploy capital and earn meaningful returns in these big growth markets like IoT, AI, and 5G.
Only time will tell if the company can continue its momentum. If 2021 indicates what we might see in 2022, then the future could be very bright. Great job in 2021, Qualcomm Ventures.
Note: Moor Insights & Strategy writers and editors may have contributed to this article.
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