Ro Gupta, Woven Capital: How Toyota uses corporate venture to win in AI and robotics

0:00Andreas Munk Holm:Welcome to the EUVC podcast. Today, we're going deeper than the usual CBC conversation. We're talking to Ro Gupta, CEO and Managing Director at Woven Capital. Woven, of course, is one of the most serious corporate venture platforms globally. They're backed by Toyota, operating at real scale and with a clear ambition to shape the future of mobility.

0:22This show is not investment advice and the hosts of this episode may be invested in the funds and companies featured.

0:28Andreas Munk Holm:Ro, it's awesome to have you with us. Likewise, gang. Thanks for having me on. We will talk about the robots behind you, I'm sure, because everyone is going to be all focused on that. To those watching this or only listening to this, Ro has two very interesting-looking robots behind him. They're very cute, Ro. These are our podcast robots, yes. All they do is look cute on podcasts. It's their job. I love that. I love that. Jappak, could you say a bit about Woven Capital? Give some words about why we love having the team on the pod. Yeah, we got to know Woven a good year back. I think when you meet someone with the ambition that the Woven team has, then you are getting truly engaged.

1:17We had the pleasure of hosting an event at the drop in Malmö, Sweden, last year with Woven. And, you know, we have a growth investor here, you know, looking at Series B and later on and also being very active in the European market and having done a larger engagement with the UK as well. So I'm all eager to hear, you know, what the lines that Roe are setting up for for moment going into 2026 and further on.

1:47Andreas Munk Holm:Roe, looking to you now, you just stepped in literally today. The role was announced. CEO and Managing Director of Woven Capital. Can you tell us all a bit about your journey inside Woven? You've been part of the team since 2021. So both that and then also kind of what are we looking at now? Well, yeah, my journey to Toyota really started actually as an entrepreneur myself. I co-founded a spatial AI company in the last decade, and this was pre-generative and transformer. And as I tell people, we had to roll our own machine learning the old-fashioned way, uphill both ways. It wasn't so easy like it is today.

2:36But we were in the autonomy space, focusing on mapping and road intelligence for automated driving and developed a relationship with Toyota as a customer initially. And one thing led to another, and we were one of, if not the first venture-backed acquisition I think Toyota's ever made, certainly at least in our region. And then when I joined Woven by Toyota, which is the advanced software subsidiary of Toyota that developed internal technologies for things like self-defined vehicles, AV, etc. My first job was actually running an engineering division. And then I went on to do some other things in corporate strategy and partnerships.

3:21And then, yeah, recently, as you noted, they asked me to take the helm here at Wilbur Capital, whom I had been helping as an entrepreneur in residence, you know, on a sort of advisory basis for a couple of years. But I was honored and thrilled to take the helm as we move from fund one to fund two, which I'm happy to tell you more about.

3:42Andreas Munk Holm:I'd love to just dig a bit into the move from being an entrepreneur to being inside of what is a huge corporate to then now leading the venture arm of a huge corporate. Some would say, and this is a dueling perspective we've always had on the podcast, as should the lead of a CVC unit be someone from the outside who comes from inside the venture and entrepreneurial ecosystem? Or should it be someone who's coming from the inside of the big mothership? Can you talk a bit about, reflect a bit on that and also your own dispositions and inklings as an entrepreneur by heart, but then you've been part of a big machine for a long time and then reflect on this in the context of the role of leading a venture unit?

4:29I guess you could say, you know, I'm a bit of both. I mean, I've been mostly in startups for the past couple of decades of my career, but that's been bookended by two large, iconic global brands. But Disney early in my career, which actually was my entry point into startups in the 2000s, I was working in their digital technology group. And then a lot of my week was meeting with startups, you know, disrupting media back then. And then I did go on to join one of the very first Y Combinator startups in the 2000s. And then the next one after that was the one called Carmero that I sold to Toyota, as I mentioned.

5:09These last five years since the acquisition, I have been in the belly of the beast in a number of roles, both technical and business oriented. So, yeah, I do think, especially what Woven Capital is trying to do on behalf of Toyota, I do think it's helpful to be kind of equal parts and have a perspective on both and on kind of all the stakeholders. You know, CVC is the definition of them or the expectations of what a CV is supposed to be has changed also a lot from when I did my first startup, where, to be honest with you, reputation wasn't great necessarily for that category. But I think the corporate venture firms that are still around and not just around, but like Toyota that are really doubling down, they've learned on what the right kind of makeup is of bringing the best to corporates, but also really being empathetic to founders and startups.

6:03So that's what I'm striving to do here.

6:05Andreas Munk Holm:yeah but can you talk a bit about it from what you've seen and all the conversations you have with uh with different cvc leads yeah no i think it's an ever-ongoing topic of of how to design and who to put in charge of uh of the cvc entity i lean very much to a larger analysis on on culture and the perception from leadership from corporate here at Toyota, right? So I think also, you know, when engaging with American and European and Asian corporates, it's that discussion that pops up. And for every entity, it's different, right? So, and you can see that now, you know, Boven has been around for quite some time now.

6:49And, you know, they're settling in. And, you know, I think Roe will find his ways in the system, right? But it's a lot of work. And Ro, maybe could you share just a few sentences on the spend of your time, right? How much is engaging with Toyota leadership and how much is with your investment team? Yeah, that's a great question. I actually think about it in a few different stakeholder groups. Some of it is, yes, RLP, which is Toyota. Very important. And Toyota was certainly not the first to really go into venture. And so I think it's a very Toyota thing to do, though, to kind of think deeply about something before knee jerking or rushing in.

7:37But then when you do do it, really go in with intentionality and a long-term view. And I think a lot of that is credit to our fund one at Wilvin Capital and also our sister fund, Toyota Ventures, which has been around now for, I think, about eight years or so. and in the early stage, whereas we're in the growth stage. That is obviously a key stakeholder, and that learning journey continues into Fund 2. But I think it's also at a time that's really critical for Toyota. The day we're recording this is also the first day of Wilhelven Capital's executive sponsor now moving into the CEO chair of Toyota.

8:16And that's, by the way, quite unique, I think. It's quite also exciting for me that, you know, This is a CVC that's supported from the very top, from the team of most voices. So I think continuing to nurture that corporate stakeholder is even more important and rewarding because they understand how critical it is for Toyota's future, not just survival, but thriving. And fully agree, right? And we'll also get to it later, right? That's also how you engage with the startups later on, right? And it's super important that your engagement with top leadership is also what basically comes across into the portfolio.

8:54So fully agree. I think the other stakeholders, though, yes, of course, there's our team, excellent team. And it's very global where we're in every region, feet on the ground everywhere. That's our charter is to look for all the most important startups wherever Toyota's footprint is, which is nearly everywhere. I'm actually based in the U.S. I was living in Japan, but I'm now U.S.-based. And that's also, I think, something that we're leaning into to make sure that, for example, my own personal networks in the Valley or other parts outside of Japan, we can take full advantage of, really be present.

9:31So I think all those stakeholders, I think about, you know, and balancing kind of my, you know, action.

9:37Andreas Munk Holm:Just to those in the audience that are less aware of venture investing as a corporate, I'd love to ask you about the decision to having both an early stage fund and a growth stage fund, having them as two different teams and what the role of each is, so to say. because at the early stage, you, of course, get exposure as the mothership to what's moving really, really fast in the very early stages. You're meeting a lot of startups. And then at the later stage, it's at times at least a bit different motivations because obviously these companies are much, much more mature. I'd love to get your breakdown on that and what you see as your core role as a growth investor inside the mothership, so to say.

10:28Yeah. Well, I should mention that actually at Toyota, we now have three investment vehicles. So in addition to Toyota Ventures at the early stage, Woven Capital at the growth stage, it was recently announced the formation of another fund called Toyota Invention Partners, which actually our CIO, Michiko Kato, she's actually was also announced today, she's actually leading that fund.

10:53Andreas Munk Holm:And the strategy of that fund is... Oh, yeah. So that fund, I think, kind of rounds out, I think, what is very Toyota as well, which is having a ubiquity in offerings, whether that's powertrains or whether that's venture investing. Toyota Invention Partners is much more Japan-centric. They're based here in Tokyo. And they also don't have the same parameters that a typical venture fund has with regard to stage or check size. So they have more flexibility on either going much earlier than, for example, Toyota Ventures might go, or much later than Willowden Capital may go. or maybe even filling in some gaps where there might be certain investments that are very strategic but are not a fit for some of the financial markers that some of the other funds have.

11:44It's meant to round out the offering. But I think if you look at it as a whole, and this partly answers your question as well, Andreas, about why having separate funds, we want to have an option for any valuable company that Toyota would like to engage with. From a geography perspective, Toyota Ventures tends to be more US or Western-based. I mentioned Toyota Investing Partners is Japan-based and World Capital is global. And so that also, I think, is how we're each set up. But any one of us can meet an interesting company and know exactly where to route them, whether that's for minority investing, whether that's for a business collaboration, or maybe even an acquisition opportunity.

12:30And that's the idea. We wouldn't have an option for any interesting team.

12:34Andreas Munk Holm:Ro, you just described that your executive is now chairing Woven Capital as well. Your executive sponsor. I'd love to understand, or at least tease out, what's the strategic rationale behind that? Because obviously it means that the executive branch or Toyota is coming closer to Woven. How are you doing that? Why are you doing that? What does this mean? What does this imply? in terms of how Woven will be utilized by Toyota? Yeah, I should clarify. Actually, it's the same sponsor we've had since, you know, certainly since I got here, a gentleman named Kenta Kohn, who was the CFO of Toyota. So he has been our executive sponsor.

13:19And as CEO, he's still very much supportive. There is sort of a division called the Mobori 3.0 division of Toyota that still rolls up to him and is responsible for investing in the future of mobility and even beyond cars. So that remains to have that type of support. And I just mentioned that because, like I said, in my own experience, I think I've been through probably three cycles of seeing how CDCs have evolved. And that's not only not always true, I would say it may even be rare that you have that type of direct connection to the very top leadership who's thinking about not just the next 10 years, but the next 100 years of driving.

14:04Andreas Munk Holm:Yeah, it's one of the big things that we often talk about, exactly the importance of having executive sponsorship, because otherwise it can be very, very difficult to realize the strategic needs, but also stay alive as a CVC. Yeah, but maybe you can talk a bit to that. I think, Ro, I think it's interesting to follow, right? It's also more when you're getting to the investment activities and so forth, the integration and the support from senior leaders and how they actually bring you along through the larger organization. So that's how I often see it play out. It is that engagement is needed. Maybe you can talk a little bit into that and how you do that.

14:47Well, it starts, as we just acknowledged, it certainly starts with having that type of top level sponsorship, but that's not nearly enough. We have to really use our own reach and our powers of communication and explanation on why what we call the Toyota Gemba. Gemba is a Japanese term for where the work happens. And that Gemba is vast. Like I said, it's almost every industrial region on the planet. And Toyota is also a very decentralized, bottom-up type of company. So even if you do have support from the top, that's not enough. You really need to develop relationships in each division, in each region.

15:32And so in addition to a very strong investment team that is global and in every continent, Toyota also has, or sorry, excuse me, Woven Capital, we formed a very strong portfolio success team as well. And their job is very much to develop that bottom-up relationship and really be able to understand everywhere in the Toyota universe, two things actually. One is what we call inside-out investing. So if you think about, let me indulge me in a nautical metaphor, if you will. So if you think about Toyota as the super tanker, you know, traversing the seas, has massive force and power and can reach anywhere and, you know, it could go on, but you get it.

16:19But the way that CVCs like Wilbur Capital can serve that super tankers, or sometimes we use the metaphor of speedboats. So we are able to go on missions very, you know, agile in a very agile way. And there's two types of missions that our portfolio success and our investment teams perform on behalf of that supertanker. One, we call that inside out, which is Toyota already knows there are areas that are really important strategic. There may be gaps, there may be areas we want to accelerate. And so that supertanker, we talked to the divisions of Toyota and asked them, what are those areas? And we can go out very quickly and efficiently and find those those amazing companies working on those things.

17:04Of course, when we're out there in those foreign lands, we also see things that Toyota doesn't even know what to ask for yet. And so that's what we call outside-in investing as well. So I think it's that duality. That, by the way, I don't think all CDCs share, but I think part of what I love about this job is we have both missions. And it's something that our leadership wants us to do. Yeah. No, I think it's great with this, you know, ambassador network that you try to create, right? Because it's super important to have the backing from the employees, right? And this speedboating you also talk to, you know, and the inside out, right?

17:42Where you kind of go around the organization, figure out what are the challenges that are needed, right? It's almost, you know, it's a part of venture clienting as we also sometimes touch upon in the show, right? And then, you know, I think that's super interesting. And then where you bring even more value, right, is that you go around in the network, the venture capital network, you figure out what are the tech developments that are coming up that can be used with inside of Toyota, right? So you're basically covering really broad and it's really nice to hear, but it's also the way and the path to success.

18:17Andreas Munk Holm:Ro, I want to ask you a difficult question potentially. Venture is notoriously moving on cycles and moving very, very quickly, whereas a corporate and especially a famed one as Toyota moves with a longer horizon and they will tend to not get as caught up in a hype cycle as venture does. I'd love to ask you how you navigate that to make sure that you're on the one hand moving as fast as venture, but on the other hand, moving very much in sync with the machine of Toyota. or sorry, with the machine of Toyota. As an example, we've got AI that if you're in the venture group, you almost think that any organization is obsolete because in the future, it's all going to be robotics.

19:11Andreas Munk Holm:And if you're in a corporate world, it's much more, there's something going on here. We've got a bed big, but it's also very much just exploratory. How do you straddle if we take that as a use case right now, AI, you come from it yourself with your startup in the past. How do you navigate what's happening in AI as an investment space with a venture group that's moving incredibly fast, doubling down on what feels like absolute moonshots that you can't imagine being integrated into any organization because they're either going to disrupt them completely or they're just not a fit, so to say, and then make that work together with this massive corporate that probably to a large extent has not yet caught up with the changes?

20:01Yeah, it's a very good question. And I think I'll piggyback off my own comment about this sort of multi-path diversified approach, which is it's very much a Toyota general approach. So the analogy might be something like, I think I referred to before Powertrain. I think largely because Toyota is so global and does have to already cater to so many diverse circumstances around the world, it can never be either, you know, it can never be too indexed into an incumbent technology or future technology. You know, Toyota really has to have bets and the optionality to, you know, throttle up or throttle down as things evolve.

20:46And so we've seen that already, for example, with ICE versus hybrid versus EVs versus fuel cell. You know, Toyota notably has really stuck to its multi-pack approach so far that has paid off. Now, it's still no guarantee because that throttling up and down is every year, every cycle decision. But I think we've seen how hard it's predict in advance, just how quickly something will continue to accelerate versus where the troughs of disillusionment are. And then when they pick up again, right? So I think you can extend that to investing as well. And this is why, again, we have now three different venture funds.

21:28And in addition to that, it's not just about venture investing. There's many other kind of innovation ecosystems within Toyota that can catch just about every technology at whatever lifecycle it's in to make sure we're seeing everything. And so, for example, with AI, there's some aspects of AI that are quite mature and they are now making them into mass production. And we're not when I joined this company. And then there are others that are still that are very interesting and are moving faster than we ever thought, but still not quite real yet. But having, say, early stage vehicles, later stage vehicles, you know, even sort of discovery mechanisms, even if you don't invest those speedboats, it allows us, I think, to, you know, to monitor them all and do that throttling up and down as we go.

22:21Can you be super concrete on AI as a field that you're looking at now, as an investment field?

22:31Andreas Munk Holm:Were you excited? Were you less excited? And also maybe on the structural level, how have you gone about it? Do you build a big thesis inside Volven on this space and say, these are the types of solutions that we're looking for because they map into Toyota super well? Or is it more opportunistic? How do you form your conviction around a space like AI? Yeah, well, I think maybe I'll answer the question by giving you a little bit of an idea of the areas that we've been focusing on. Because again, we are growth stage, both strategic and financial CVC. And what that means is we tend to want to balance on one hand, looking at the frontier and not being too limited because again, especially for the outside-in speed missions, we want to make sure we're looking at those areas that Toyota may not be thinking about and stretch their thinking.

23:31That's our mandate. However, because we are a later stage, we really do want to be able to at least see a path to Toyota being able to work with that technology or the specific company in our foreseeable time horizon. So given that, if you think about generally the things that Toyota, just from a DNA perspective and historical perspective, is very good at, it's building things, it's moving things. And increasingly, because of digital technologies, because of new grid technologies, it's connecting those things. And so under build, move, connect, I would say there's about a half a dozen more concrete categories that have been the most active from fund one and now as we look to fund two.

24:17Under build, I think certainly advanced manufacturing, a lot of that is now very much AI enabled manufacturing is one of them, but that goes across the supply chain. That could be materials, that could be any number of things. Next is physical AI and particularly like next generation robotics. And we can talk about that in a second about even breaking that down a little bit further about what we're looking at. But that would be under build. Under move, of course, Toyota is known for cars and for terrestrial mobility. And we still continue to look at investments there on the next frontier of that.

24:55But we've also been quite active in aerospace, both, for example, on things like EV tolls and at World Capital. A number of our last investments have been in a new emerging space economy. And then under Connect, I think there's also more AI sub-segments there as well, particularly in what I would call IoT data and AI, or sometimes we say distributed intelligence. And that could be types of AI that allow us to continue the journey beyond the vehicle. So that might be through voice or that might be through home robotics or things like that. And then also under Connect is, as I mentioned before, is the grid.