Large businesses like Google, Facebook, Apple and others are increasingly building massive startup culture to their organizations to identify future growth and super-fuel their businesses. For years corporations have tried to show off how innovative they are by adopting superficial markings of startup culture—open office floor plans, ping-pong tables, and cold-brew coffee on tap. It became trendy to launch corporate-run startup accelerator programs, which I used to mock as “innovation by osmosis.” There’s a whole new class of corporate venture arms from non-tech corporations ranging from the insurance industry to Campbell Soup. Fortune 500 companies have hired “startup scouts” and opened innovation hubs in Silicon Valley. (Source: Fortune)
It has been seen that new startups like Uber, Tesla etc have grown up significantly beating the large businesses in a short time but still in spite of the aggregate revenue growth, not every startup tastes the success, in fact, the vast majority of the startups fail in 3-5 years.
A new study on the state of startup/corporate collaboration from MassChallenge and Imaginatik shows that not only are corporates more eager to work with startups, 23% see it as “mission critical, and 82% said it’s at least “somewhat important.”
Most importantly, 67% of those responded that they wanted to work with earlier stage startups (Source: Fortune).
Ironically, startups and established companies would both improve their success rates if they collaborated instead of competed. Startups and established companies bring two distinct and equally integral skills to the table. Startups excel at giving birth to successful proof of concepts; larger companies are much better at successfully scaling proof of concepts.
Startups are better at detecting and unlocking emerging and latent demand. But they often stumble at scaling their proof of concept, not only because they’re often doing it for the first time, but also because the skills necessary for creating are not the same as scaling. Startups must be agile and adapt their value proposition several times until they get it right. According to Forbes, 58% of startups successfully figure out a clear market need for what they have (Source: HBR).
There are unlimited strategic and business benefits while working with startups for corporate companies, for example:
In-depth Innovation: Many of the startups are building out of the box technologies with cutting-edge technologies in healthcare, finance, operation, manufacturing, IoT, Digital experience, mobility, security, block-chain and more such sectors. There are many such examples of disrupting technologies & researches these startups are working on. The large corporates are unable to build such niche technologies that make a big impact and hence it is good to work with startups to identify the new innovation for future growth.
Agility in Working: Startups focuses on agile methodologies while building their products, teams or doing researches. The agility helps the startups to innovate & execute faster which corporates find difficult to do so. Therefore, it is always good to build a relationship with a startup for faster execution. This not only saves a lot of time but also avoids lots of managerial processing and ultimately improves operational efficiency and productivity.
Optimized & Lesser costs: Startups do not need too much cost for working through fancy offices or unnecessary spending. This enables corporates to enhance their ROI by reducing their costs significantly and hence no better option to build innovative technologies, research, products with reduced costs in an efficient manner.
Strong & Excellent Talent: No doubt, startups follow the quality hiring process and most of the talent who works in startups are hard working, passionate, problem-solving skills, hunger to build products and many such qualities which are easily accessible through startup and corporate relationship.
These are just a few of the direct benefits these corporates have access to but there are unlimited advantages while working with startups. Executives who wish to tap into the growth of these smaller companies will find that having a big checkbook is not going to be enough, and that waiting for an investment banker to bring them deals is the wrong approach. A mercenary mindset will only go so far. When big companies try to engage with startups, a missionary mindset will create better odds of success (Source: HBR).
Are you the corporate who is looking to partner with such startups like Artivatic, do write at firstname.lastname@example.org
About Artivatic: Artivatic Data Labs is a young dynamic company into artificial intelligence, headquartered in Bengaluru, India. It builds, licenses and sells its proprietary Human-brain like AI systems such as ‘cross-connected-intelligence-genome’, ‘neuro-decision-intelligence’ and more to empower the businesses & developers in industries such as Insurance, Banking, Health-care & Finance & more. The system like brain works in real-time and gets intelligent over time.
[P.S: please do excuse for English or grammar mistake :)]