Why would it be a failure if a corporate venture fund had its invested company purchased by a competitor?
In the Old Days, this was a big deal. Corporate VC was partially view, either explicitly or implicitly, as an lightweight option to purchase.
No one cares today. They know this happens, and that all they are really buying is a look, and some loose alignment. And a positive return.
Often times, what Corporate VCs will ask for is a notice clause — let us know before you sell to our competitor so we aren’t embarassed.
It’s fine. It’s not a big deal.