The objectives of corporate investors are not always aligned with those of tech company founders. Corporates often invest to obtain early and ideally preferential access to new technologies, markets or channels, and it will often not be in the interests of a corporate investor to see those opportunities offered to its competitors. On the other hand, an early-stage company is likely to want to market its technologies to as many customers of possible, irrespective of the competitive sensitivities of its corporate investor.

This misalignment can be particularly apparent when founders want to exit the company. The founders and other shareholders are likely to want to sell to the highest bidder, whereas if the technology has become strategic to the corporate investor, it is not in the interests of that investor to allow the sale price to be pushed up in that manner.

Big corporates often struggle to work well with small companies. Corporates tend to have a lot of reporting and compliance requirements which can overwhelm small companies. Corporate decision-making also tends to be bureaucratic and political, which can feel like slow death for a tech company operating in a fast-paced market.