The European VC (EUVC)
E658 | Martin Scherrer, Redstone VC: CVC Secondaries Without Burning Bridges
AI Summary
In this episode Martin Scherrer of Redstone VC explains how corporate venture arms can exit their investments through secondary sales or managed runoff without eroding value or relationships. He highlights the importance of treating CVCs as true portfolio managers—using proper KPIs, governance structures, and performance‑based fee models—to avoid the typical short‑life, “pet project” pitfalls. Scherrer also shares practical tactics such as spin‑outs, continued follow‑on funding during wind‑down, and ring‑fencing capital to keep corporate sponsors engaged while attracting third‑party LPs.
Episode Description
Corporate venture capital isn’t just having “a bit of VC on the side.”
Done well, it’s a strategic lens on the future. Done badly, it’s a short-lived pet project with a half-life of 3.7 years and a trail of confused founders and annoyed co-investors.
In this episode, we sit down with Martin Scherrer, Partner & Head of Managed Funds at Redstone, alongside our own CVC lead Jeppe Høier, to unpack what really happens when corporates leave venture — and how to do it without destroying value or reputation.
Redstone runs a dual model: classic VC funds + “VC-as-a-Service” for corporates and family offices. Martin himself has lived three lives:
Inside Swiss Re’s CVC (later shut down)
As a founder of an insurtech in Switzerland
Now as VC & fund manager at Redstone across multiple corporate mandates.
🎧 Here’s what’s covered:
01:37 Why Martin? Why now? — Jeppe on Redstone’s VC-as-a-service role, his history with them, and why Martin is the go-to voice on CVC secondaries.
02:50 Redstone in both worlds — Martin explains Redstone as a VC + CVC-as-a-service platform with deep corporate, VC, and founder roots.
06:12 Portfolio thinking 101 — Why corporates underestimate startup investing, ignore the J-curve, and must commit to true portfolio construction + financial KPIs.
09:37 Runoff vs. selling the bag — Score case: options to sell the whole portfolio at a 50–80% NAV discount vs. patient value-maximising runoff.
13:54 Spin-outs & resilience — How CVCs can evolve into mixed-LP or fully independent VC funds (Swisscom Ventures, Berliner Volksbank → Redstone Fintech III).
18:27 Follow-ons in “shutdown mode” — Why corporates sometimes should still fund follow-ons in runoff to unlock new investors and protect upside.
20:25 Designing the partnership — Governance, IC design, reporting (e.g. IFRS 9), and performance-based structures that align Redstone and corporates.
31:41 Managing vs. buying portfolios — How Redstone runs CVC runoff as an external manager with fees + carry, versus secondary buyers who acquire the assets outright.
44:02 How to avoid a wind-down — The “gold standard”: bring in third-party LPs, avoid annual-budget setups, ringfence capital in a dedicated entity, and keep exec sponsors close.
Show Notes
EUVC
By The European VC
E658 | Martin Scherrer, Redstone VC: CVC Secondaries Without Burning Bridges
Published: Nov 28 2025
Corporate venture capital isn’t just having “a bit of VC on the side.” Done well, it’s a strategic lens on the future. Done badly, it’s a short‑lived pet project with a half‑life of 3.7 years and a trail of confused founders and annoyed co‑investors.
In this episode we sit down with Martin Scherrer, Partner & Head of Managed Funds at Redstone, alongside our own CVC lead Jeppe Høier, to unpack what really happens when corporates leave venture — and how to do it without destroying value or reputation.
Redstone runs a dual model: classic VC funds + “VC‑as‑a‑Service” for corporates and family offices. Martin himself has lived three lives:
-
Inside Swiss Re’s CVC (later shut down)
-
As a founder of an insurtech in Switzerland
-
Now as VC & fund manager at Redstone across multiple corporate mandates
🎧 What’s covered
-
01:37 – Why Martin? Why now? – Jeppe on Redstone’s VC‑as‑a‑service role, his history with them, and why Martin is the go‑to voice on CVC secondaries.
-
02:50 – Redstone in both worlds – Martin explains Redstone as a VC + CVC‑as‑a‑service platform with deep corporate, VC, and founder roots.
-
06:12 – Portfolio thinking 101 – Why corporates underestimate startup investing, ignore the J‑curve, and must commit to true portfolio construction + financial KPIs.
-
09:37 – Runoff vs. selling the bag – Score case: options to sell the whole portfolio at a 50–80 % NAV discount vs. patient value‑maximising runoff.
-
13:54 – Spin‑outs & resilience – How CVCs can evolve into mixed‑LP or fully independent VC funds (Swisscom Ventures, Berliner Volksbank → Redstone Fintech III).
-
18:27 – Follow‑ons in “shutdown mode” – Why corporates sometimes should still fund follow‑ons in runoff to unlock new investors and protect upside.
-
20:25 – Designing the partnership – Governance, IC design, reporting (e.g. IFRS 9), and performance‑based structures that align Redstone and corporates.
-
31:41 – Managing vs. buying portfolios – How Redstone runs CVC runoff as an external manager with fees + carry, versus secondary buyers who acquire the assets outright.
-
44:02 – How to avoid a wind‑down – The “gold standard”: bring in third‑party LPs, avoid annual‑budget setups, ring‑fence capital in a dedicated entity, and keep exec sponsors close.
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