Doing More with Less:
How Corporations Can Sustain Innovation in Lean Times
In the current economic climate of 2025, corporations are increasingly prioritizing cost efficiency while striving to maintain their innovation initiatives. For corporations that have invested in venture capital (VC) funds, the problem is that these are characterized by fixed ten-year cycles with 4-to-5-year investment periods, and therefore all important deal flow is available only for a limited time. Innovation remains essential for long-term competitiveness, however, and if corporate investors want to continue having access to new technologies, they need to “re-up” in the successor fund with a new commitment even without cash distributions from the current fund.
Emerald recognized this lack of flexibility in traditional VC fund models early on and, in 2016, introduced a flex-term fund structure designed to provide corporate investors with greater adaptability.
Emerald’s Flex-Term Fund Structure
Emerald’s flex-term approach allows limited partners (LPs) to enter the fund at any time and stay for as long as they see value from the partnership (subject to a five-year minimum). This structure contrasts with traditional, fix-term VC funds that have limited and predetermined investment periods for strategic open innovation engagement. By offering LPs to remain engaged as long as they want, Emerald enables corporations to align their investment horizons with their strategic objectives and innovation activities. Corporate investors commit to a flex-term fund only once, without any investment committee approval needed for a follow up fund, while deal flow access continues without interruption, theoretically indefinitely.
Advantages for Corporate Investors
Emerald’s flex-term structure therefore offers several benefits tailored to the needs of corporate investors:
- Being able to join the fund at any point in time
- Flexibility to remain committed to the fund as long as strategically meaningful to the corporation
- Possibility to flexibly and individually terminate the active investment period
- Ongoing participation in emerging technologies and startups, ensuring that corporate investors remain at the forefront of innovation, with a single fund commitment
- No risk of potentially joining a fund that won’t get to its minimum close
- No risk of a fund manager failing to raise a successor fund, where the team may leave before realizing exits from your assets in the current fund
Why this matters now:
- Lower cost, long-term value: Emerald’s model enables corporations to maintain their innovation strategy with a single commitment and indefinite recycling of capital. It’s a financially efficient approach to corporate venturing — exactly what CFOs are looking for.
- Stable access to deal flow and insights: Even in tight times, our corporate LPs and innovation leaders stay plugged into a robust pipeline of startups, technologies, and global innovation networks — without needing to build or manage an in-house team.
- Strategic alignment and short-term flexibility: LPs can onboard when ready, remain invested as long as needed, and align their strategy with market conditions — not arbitrary fund lifecycles.
- Team and platform continuity: With its flex-term setup, Emerald isn’t forced to constantly raise new funds or reshuffle teams. That stability translates into stronger support for startups and greater value for LPs.
In conclusion, as corporations navigate the complexities of a cost-conscious environment, partnering with venture capital firms that offer flexible investment structures like Emerald’s flex-term fund can be a strategic approach to sustaining innovation efforts. This model combines financial flexibility with a cost-efficient access to emerging opportunities in a dynamic market environment.
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