A corporate/startup partnership can be an ideal way to drive intentional innovation.
By Rich Langdale
Startups and corporate companies are often placed at opposite ends of the business spectrum. One is small, innovative, high-risk and quick. The other is a well-oiled, slow moving machine adverse to risk and rooted firmly in the proven status quo.It's "big risk, big reward" versus "slow and steady growth."
Because of this, corporate companies typically avoid involvement in the startup world. They look for financially stable partners with a proven track record. There's not a lot of reward in corporate environments for risk taking-nobody gets fired for hiring IBM.Yet, corporate companies sometimes face challenges that require innovative solutions-the type of innovations that are only possible by welcoming risk.
In a corporate environment, the idea of being intentional becomes very important, and that mentality carries over when thinking about innovation. For some companies, this means an internal restructuring of staff, resources and mentality. For example, Cardinal Health created Fuse, an innovation lab within the corporation that encourages a startup atmosphere of risk-taking and creativity. By devoting resources and talent to Fuse, Cardinal Health ensures a stream of fresh, innovative products and solutions the corporate arm may have never discovered.
Though effective, this type of restructuring is unrealistic for many companies. Instead, a corporate/startup partnership becomes ideal to drive intentional innovation.
Corporations have a clear understanding of the opportunities for improvement within their companies.With these in mind, they can engage the startup community to help solve these issues, directing them on the right path toward solutions that drive the most impact.The type of innovation created is deliberate, and it benefits both parties.
For corporations, the result is access to fresh, creative solutions without the need to completely restructure. These new ideas not only help corporations stay ahead of established competition, but it helps protect against potential up-and-coming industry disrupters. The startup partner also sees advantages in the form of direction, revenue, a large first customer and proof of concept.
Setting out on the path to intentional innovation through a startup partnership starts with three key steps.
Appoint a corporate innovation liaison
Whether it's a group or an individual, the liaison's job is twofold: determine where innovation would have the most value within the company and find the right startup partner to tackle it. This person should immerse themselves in the startup community to identify opportunities, make connections and begin the partnership process.
Integrate your startup partner
After identifying your startup partner, create a smooth path to integrate them. They should have easy access to the CFO, CTO and any other facets of the company necessary to develop a solution to internal challenges. Give your liaison authority to provide the startup with this access and serve as the "go-to" for any additional needs or questions.
The partnership should never be one-sided. Provide valuable resources to your startup partner that will help propel both innovation in your company and fuel the startup's growth. These resources can take the form of access to customer base, important industry connections or even access to capital through a corporate venture capital initiative. No matter what resources you're able to offer, always strive to be the partner you'd wish to have.
Rich Langdale is the president and Capital Committee chair of VentureOhio, an organization helping fuel Ohio's startup ecosystem, as well as the co-founder and managing partner at NCT Ventures.