Samsung is looking to its venture capital arm, ‘Next’, to find the next big thing within tech.
Next was launched in 2013 and has since made over 60 investments and 15 acquisitions of startups, Felix Petersen, managing director of Samsung Next Europe, told Techworld at Web Summit.
It has offices in Korea, New York, San Francisco, Silicon Valley, Tel Aviv and Berlin.
“We invest in anything that has the potential to be transformative to Samsung within a two to five year horizon,” he says.
Next focuses on software and services companies rather than hardware, which is an area Samsung “already does really well”, Petersen says.
Specific areas of focus include artificial intelligence, VR, AR, mobility, mapping and blockchain, according to Petersen. Next is looking closely at “last mile autonomous delivery”, he says. Next tends to invest in startups “fairly early” on in their funding cycle.
“We have a $150 million fund but it’s an evergreen fund, so it can be topped up,” he adds.
Next works closely with Samsung business units to discuss strategy, but the VCs don’t require explicit approval from the business for their investments. Rather, these go through an independent investing committee, Petersen explains.
Although the European team is headquartered in Berlin, Samsung is “really committed to covering the whole region”.
“I’m a real believer in unifying the European ecosystem, and it’s growing closer all the time. We will have someone in Paris and London on the ground soon. It’s an ambitious project,” Petersen says.
Next is on the verge of closing its first investment in Europe, although Petersen cannot yet reveal details of the deal.
What do startups get from working with Samsung? Although there are no guarantees your software will be ‘preloaded on the S9’, the Next team help startups with recruiting, business development, finance, fundraising and technical questions, as well as raising funds, of course. They also do not force startups into exclusivity deals, leaving them free to work with others, he says.
Although there is a culture clash between nimble startups and a tech giant like Samsung, this is partly the whole point. “The aim was always to bring some Silicon Valley into Samsung,” Petersen says.
There isn’t a rigid set of criteria for how Next assesses which startups to invest in.
“It’s not so much a plan they’re presenting, it’s more how they see themselves in the space they work in, their hypothesis, what they’ll try out. Someone who knows their space from A-Z and back and forth, someone with the agility and knowledge to succeed in that space,” he says.
“Good deals are always the ones that were polarising at the time. If there’s too much consensus usually it’s not a good sign,” Petersen adds.