Dick’s Sporting Goods debuts a $50M fund as the VC-fication of corporate America continues
From soccer cleats to term sheets… Dick’s Sporting Goods just joined the big leagues of a new sport: venture capital. Yesterday the retailer launched a $50M VC fund called DSG Ventures. Dick’s plans to use the in-house fund to invest in new sports products and tech.
- The first investment round includes women’s-sneaker brand Moolah Kicks, sports-gear marketplace SidelineSwap, and youth sports biz EL1 Sports.
- #SportsSynergy: DSG Ventures plans to also offer non-financial support, like distribution through Dick’s stores — a win for both Dick’s and the startups it invests in.
Everyone’s a (venture) capitalist… An old-school sporting-goods chain might seem like an unlikely source of VC funding, but corporate venture capital (aka: CVC) has a long history. Chemical giant DuPont became the first big CVC when it invested in fledgling automaker General Motors in 1917.
- Very big: Since then, titans like Google, Intel, GE, and J&J have become major CVC players. In 2020, CVCs invested more than $70B — a quarter of all VC funding that year.
- Very varied: Corporate VC arms exist across lots of industries, including construction (Caterpillar), convenience (7-Eleven), travel (United Airlines), and meat (Tyson). This year even crypto exchange FTX launched a $2B VC fund.
VC can act as discounted R&D… Instead of spending big to develop new products and tech, corporations can invest in smaller companies that’ve already created them. That could yield financial benefits like IPO returns and strategic wins like product partnerships. General Mills’ VC arm helped launch Beyond Meat, and Google Ventures backed GitLab, Slack, DocuSign, and Toast. Dick’s hopes to do the same with sporting goods, but it’ll be up against Nike, Adidas, and Under Armour — all of which have VC divisions.