Best Buy shakeup: Founder returns; VC arm possibly axed

Summary:Best Buy might be axing its venture capital arm, which will come as news to those who knew the big box retailer had a VC fund to begin with.

Best Buy is all in a tizzy today amid the comeback of its founder Richard Schulze.

The big box retailer announced on Monday morning that Schulze was returning to the company as Chairman Emeritus.

To recall, Schulze wanted to buy back nearly 80 percent of Best Buy as of last summer. By December, he was reportedly willing to spend up to $6 billion for the company. However, that deal appears to have fallen apart.

Nevertheless, Schulze likely has other plans up his sleeve now that he is back on the board.

For starters, he already nominated Brad Anderson and Al Lenzmeier to serve on the Best Buy Board of Directors, which according to Monday's announcement, is "pursuant to a previously disclosed agreement" between him and the company.

Described by Schulze as long-time colleagues, both Anderson and Lenzmeier are joining the board, effectively immediately but they'll still stand for election at Best Buy's annual shareholder meeting this June.

Hot on the heels of this news is word that that the Minneapolis-based chain is cutting off its venture capital arm.

The Minneapolis Star Tribune reported on Monday that the fund, which was said to have raised millions of dollars for at least eight early-stage startups, is being nixed as CEO Hubert Joly reprioritizes the business strategy around in-store and online operations.

Here's more from the Tribune's report:

Given Joly’s priorities, it makes perfect sense for the company to eliminate its venture capital unit, analysts say. Best Buy needs positive impact now, so investing in start-ups whose financial and technological benefits could be years away does not fit into that equation, said Carol Spieckerman, president of Newmarketbuilders, a consulting firm.

CORRECTION: A previous version of this article stated that Schulze had returned to the board. Best Buy clarified to us that he is only returning to the company as Chairman Emeritus.

Topics: E-Commerce, Tech Industry

About

Rachel King is a staff writer for CBS Interactive based in San Francisco, covering business and enterprise technology for ZDNet, CNET and SmartPlanet. She has previously worked for The Business Insider, FastCompany.com, CNN's San Francisco bureau and the U.S. Department of State. Rachel has also written for MainStreet.com, Irish Americ... Full Bio

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