I have had both highly positive and mildly negative experiences. It all depends on the corporation in question, its particular risk tolerance and investment objectives, and its history of doing this sort of thing.

It's important to pause, for a beat, on the "objectives" part. A VC firm and a strategic investor often have very different goals, and those goals will drive their behaviors and expectations. The VC wants explosive growth, followed by a big exit. The corporation wants to build option value for its working capital. That's a subtle distinction, but it makes a world of difference in many situations.

Here are some pros and cons I've dealt with:

Pro:

- Corporate investors are more likely to keep giving you chances, ironically enough. This is partially for cynical reasons, but also for political-functional reasons. No corporate exec wants egg on his/her face, so there's a big incentive to keep funding your project until it can no longer be justified. (The period of ostensible justification can be quite long.) An angel or VC, by contrast, has plenty of other horses in the race if yours breaks a leg. This leads to a paradox in risk tolerance. The VC expects, and even encourages you to pivot and to "find your business model" -- but it won't have years' worth of patience. A corporation is less likely to understand the Lean approach, and will be less forgiving of true startup methodology. But it will be very hesitant to pull the plug on you. Corporations are very susceptible to the appeal of sunk costs, whether real or fallacious. (Important note: I would strongly discourage you from actively seeking to game this fact, i.e., by attempting to make a career peddling bullshit up the corporate ladder. That's doable, but it's a very dishonest and often counterproductive strategy that will eventually catch up to you.)

- In theory, you can call upon internal and external corporate partners as immediate revenue sources, partners, or clients.

- Risk of abject failure is heavily cushioned. If you strike out completely, you're probably going to be forgiven, to a degree.

- Corporations have no incentive to fund your competitors.

- Corporations who invest for the long haul will do everything in their power to go to bat for you. Never discount the value that phone calls or intros from a Fortune 500 C-level exec can do for your business, for instance.

Con:

- Much more limited upside in many circumstances, because the corporate investor has no real incentive to sell or bring in outside investment, particularly if things are going well. Remember: they're buying a call option when they invest in you; they're not actually trying to build you toward an exit.

- Depending on the corporation, and the size of its stake, its presence in your cap table can discourage outside investment from institutional funds and angels. (Though not always, and as with every rule, there are plenty of exceptions and outright reversals.)

- Emphasis on, and pressure toward reporting, vanity metrics. Depends on the corporation, but generally speaking, corporations like their vanity metrics. More accurately: your corporate's internal, political sponsor likes selling his peers and superiors on vanity metrics.

- Depending on its level of control, the corporation might exert pressure to move in specific directions that benefit its internal business portfolio. Those directions may not align with your objectives. (A variant of the "agency problem".)

- Corporate executive ranks tend to shuffle like musical chairs, and when they do, project priorities shift for largely political reasons. Your startup might be one of those "projects."