In today’s innovate or die world where consumer behaviour is changing constantly, blueprint accelerator’s Hilary Szymujk opines on how corporates can leverage this new wave
Last week, the VP of a corporate posed a question I’m often asked by corporates of all shapes and sizes: My advice on how to engage with startups.
Of course the reality is that there are much larger factors at work which inspire corporates on a macro level: the innovate or die warning bell rung by Polaroid, Nokia, Yahoo and so on; the shift in consumer behaviour in the high street/main street with e-commerce; the proliferation of corporate accelerators globally and more recently, the abundance here in Hong Kong (six and counting!).
Whatever the reason, corporates will, and must, continue to look to develop strategies for innovation and accelerators will be a possible path. As they should. Designed to drive innovation internally through the incubation of external early stage startups, corporate accelerators can enjoy the positive uplift of great brand-building, increased experimentation and greater opportunities for partnerships, investments, and market research for the corporate.
At blueprint, we’ve experienced this firsthand, with folks from across the Swire Group citing it as a channel for innovation and a progressive example of experimentation within the group.
Startups can benefit greatly from corporate programmes as well. Access to top-tier executives, co-branding with a reputable corporate name, press exposure and shared resources can be transformative for early stage startups participating in a successful programme.
That said, there are certainly other, perhaps more appropriate ways to bring innovation in-house. Even a basic accelerator takes a lot of work and significant resources: time, space, funding, a team, a strategy and stakeholder support.
To run a good programme, for it to achieve tangible results for both the corporate and the startup, these factors need to be finely tuned and tailored to achieve the goals of both the corporate and the startup. Accelerators need to be an internally baked process by the corporate with the startup-as-customer in mind.
It cannot be an off-the-shelf offering or carbon copy of another successful programme if sustainable success is the goal. Without proper internal alignment and incentives, driving innovation within a big organisation is proven to be at risk for derailment regardless of the good intentions at play.
Add to this a potential accelerator bubble and the ‘Winter is Coming‘ warnings that are heard each year for accelerators and incubators, illustrating that undertaking an accelerator programme is not for the faint-hearted. It’s imperative for corporates to make concerted efforts to integrate the values and goals of the accelerator within the fabric of their business in order to sustain any lasting mission for innovation.
So what’s a corporate to do?
With all this support from corporates and others in the private sector, as well as the public sector, it’s a great time to start a startup. There are more resources, funding and support readily available for this purpose than ever before. We’ve seen the results in Hong Kong: in the past year alone there has been a 46 per cent increase in startups in the fragrant harbour.
Building a successful company from the ground up is still very difficult and it really does take a village. Support, resources and mentorship are necessary in a healthy ecosystem not only at the pre-seed and seed stage, but through the post-seed and growth phases as well. While there are numerous channels here for startups in the pre-seed and seed stage, the resources when they arguably need it the most to grow beyond Hong Kong just aren’t there yet.
After two rounds of startup acceleration at blueprint, we’ve found that success between a startup and a corporate in terms of business development tends to happen after the phase where accelerators traditionally focus their efforts.
It’s the point when the startup has some seed funding, but more importantly, has a functioning product and is building traction. Unfortunately, this is also where we see the least support in the market for startups.
Opportunity for corporates
Smart corporates can make a great impact while harnessing lighter models than a traditional accelerator. By partnering with existing networks or programmes, corporates can support and learn from startups by offering highly valuable resources in a formalised model.
A lighter model does not mean less meaningful. In fact, for this lean approach to work, I argue it takes more meaningful engagement by the corporate, but with potentially bigger and more lasting results.
Once a corporate has set out on the path of developing an innovation strategy and has asked the right questions internally to set goals and expectations, it has the fundamentals in place to canvas the opportunities for startup connection.
Here are some ideas on how to support innovation externally and internally in tandem with startups:
1. Share your product/resources/knowledge
Time and cash are often the most valuable, and finite, resources for startups. Corporates can help startups on both of these fronts by opening up their assets to early stage teams. Web hosting providers are great examples of how this can be done well, but the sharing can also extend to other products and services like market research firms, accounting and law firms, agencies etc.
By allowing early stage companies to use your products for free, bound by reasonable time or credit limits, corporates can help startups get a leg up in critical areas. Benefits to the corporate include adding to its customer pipeline, and the potential to perhaps appeal to previously untapped customer segments.
By creating a dialogue through the service or product, the corporate can better understand what companies at the forefront of innovation are thinking about, how they are using the corporate’s expertise and how they might develop a deeper relationship.
2. Write no-strings-attached cheques
Cash is king. Rather than spending innovation budgets on more intensive programmes or events, corporates can allocate funding to startups in the form of scholarships or cash prizes.
Find a reputable programme or event that has a great audience reach and provide a no strings attached cash prize. It could also include time or connection with key individuals or teams within the corporate to further the value and information exchange.
3. Open your network
The number one reason startups want to join the blueprint accelerator is access to the Swire Group network, and I imagine this is the draw of most corporate programmes.
But making a network accessible is no simple task, let alone achieving tangible outcomes like partnerships or sales relationships. We take this seriously – and have a dedicated member of staff focussed on facilitating this very goal.
Before doing any work with startups, formulating a plan on how to facilitate relationships between the corporate and startup is key. This means identifying enthusiasts within the corporate who will take the time to champion the accelerator and the startups, attribute value to the effort demonstrated by these individuals and celebrate meaningful outcomes.
4. Build a startup-made procurement process
The average enterprise sales cycle is over eight months long. For a startup, this is a very, very long time. Sometimes fatally long.
Corporates can increase opportunities for working with new technology by taking a hard, honest look at their procurement process from end to end, including all the touch points for the sale and any tech or specification hurdles along the way, and streamline this to onboard startups.
These processes typically were not built with uproven business concepts in mind as the potential vendor and a re-work of the process for startups can really cut down on the decision-making cycle. The key is to make the process as efficient as possible, and remaining open to the idea that the technology will not be purpose built for your corporate.
Once up and running, this should be broadcast, with a pipeline for potential startup vendors created. This could be in the form of an open call competition, or through the relationships built in the previous points, or by partnering up with a university or existing programme to source great tech for your corporate.
There are still a few days left to apply to blueprint’s accelerator programme, which provides a leg up to B2B startups and provides free flights to overseas startups who wish to participate in the 6-month programme located in Hong Kong. You can apply before 2nd November via www.blueprinthk.com.
The views expressed here are of the author’s, and e27 may not necessarily subscribe to them. e27 invites members from Asia’s tech industry and startup community to share their honest opinions and expert knowledge with our readers. If you are interested in sharing your point of view, please send us an email at writers[at]e27[dot]co
from e27 http://ift.tt/1XDy1TJ