March 19, 2025
In venture capital, the role of corporate investors has long been debated. Are they truly aligned with startups? Do they move too slowly? Can they deliver more than just capital? These questions have shaped how corporate venture capital (CVC) has evolved over the last decade.
We sat down with Dan Reed, Managing Director and President of American Family Ventures, to unpack how corporate venture capital has shifted, how his team transitioned from a single-LP corporate fund to a multi-LP venture model, and what it really takes to add value beyond just writing checks.
When we first met Dan in 2018, American Family Ventures was a traditional corporate VC fund, investing solely on behalf of American Family Insurance. Over the years, it evolved into a multi-LP venture fund, bringing in other insurance carriers as limited partners. This is a rare model—most CVCs remain tied to a single corporate parent, often limiting their ability to act purely as investors.
Dan’s transition into a multi-LP structure was driven by a realization: other insurance companies were trying to replicate what American Family had already built. Rather than competing with new funds, Dan and his team invited them in. Their third fund in 2019 included 13 new LPs, and by Fund 4, they had doubled the capital base and expanded their network even further.
The key lesson? Industry collaboration beats duplication. Instead of multiple firms trying to spin up their own venture arms, pooling resources and expertise has led to smarter investments, stronger deal flow, and better alignment across the insurance ecosystem.
One of the most insightful parts of our conversation with Dan was how he categorizes startups into two buckets: disruptors and enablers.
Dan’s fund invests in both, but over time, he has seen a shift. Early money in insurance tech went toward disruptors—startups trying to reimagine the industry. But as the market matured, the enabler side grew faster. Selling into an industry like insurance, where distribution is everything, often yields a shorter path to revenue than trying to take down billion-dollar incumbents.
This isn’t just true in insurance. In almost every industry, startups must decide whether to compete or collaborate. And while disruption makes for great headlines, the enabler model often wins in the long run.
A decade ago, corporate VCs had a reputation problem. They were seen as slow-moving, misaligned with founders, and prone to pulling out of deals when markets shifted. Some forced startups into exclusivity agreements or added strategic restrictions that made raising follow-on capital harder.
But Dan’s perspective is clear: that stigma has faded. The best corporate VCs today operate just like traditional VCs—with financial-first thinking, faster decision-making, and cleaner deal structures.
Of course, not every corporate investor is great. We’ve all seen bad actors, but we’ve also seen traditional VCs behave poorly. The truth is, it’s no longer about whether an investor is corporate or institutional—it’s about whether they actually help the companies they back.
Venture capital is full of overused buzzwords, but none are thrown around more than “value add.” We teed this up for Dan because, let’s be honest, most VCs who claim to add value don’t actually do anything beyond introducing founders to other investors or writing a Twitter thread about their portfolio.
Dan’s team at American Family Ventures, however, is structured differently. With six full-time team members dedicated to connecting portfolio companies with LPs, they are actively building bridges between startups and industry decision-makers.
Startups don’t just need capital. They need access to customers, partners, and talent. A warm intro means nothing if it doesn’t lead to actual commercial traction. Dan’s team understands this and operates with a long-term mindset—helping both startups and LPs navigate complex industries like insurance.
So, where does CVC go from here? Will we see more companies shifting to multi-LP models, or will most stay locked into traditional corporate-backed funds?
Dan is optimistic but realistic. The market is warming up after a rough 2022-2023, but it’s still uncertain how corporate innovation strategies will evolve. The challenge for many firms is staying committed through market cycles—something Dan and his team have been able to do by focusing on real returns, not just corporate innovation buzzwords.
The key takeaway from this conversation? The best investors—corporate or not—aren’t just writing checks. They’re actively creating pathways for startups to succeed. And in a world where distribution and industry access matter just as much as technology, that’s where the real edge lies.
Want to continue the conversation? Reach out to us at ben@highlinebeta.com or marcus@highlinebeta.com
We always enjoy conversations about innovation and startup building so please get in touch.
