Product details

Xerox Corporation, founded as a copier company in 1958, decides in the late 1980s to take advantage of the products and technologies developed internally but not directly related to the company''s core product line. Creating a wholly owned venture capital (VC) organisation, Xerox begins investing in internally generated ideas with plans to eventually spin-out these companies as initial public offerings (IPO). The chief managers at the VC company do well for the first two years with a portfolio of ten companies that are mostly software developers. They create an entrepreneurial environment in the new companies by offering employees highly leveraged equity plans with the payoff coming at IPO. However, they begin to have doubts about their ability to keep the venture capital company profitable. They wonder whether there are better models available to improve the performance of these wholly owned entities.