First Things First. What Is Open Innovation?
Open innovation is a paradigm that assumes that firms can and should use external as well as internal strategies in order to advance their use of technology. This also means sharing risk and reward with the new partners. Extending this concept further, global companies focused on open innovation can accelerate corporate innovation strategies by partnering with a select set of disruptive technology providers, i.e. startups and scale-ups.
As Clayton Christensen puts it, “disruptive innovation is a process by which a product or service takes root initially in simple applications at the bottom of a market and then relentlessly moves up market, eventually displacing established competitors.”
Therefore, the opportunities that scale-ups and large organizations bring to each other through collaboration are many: scaleups can be a source of talent, new technologies and service solutions that help corporates remain competitive in a world driven by innovation. Likewise, large firms represent numerous advantages: access to markets, established networks, market knowledge and experience, brand power and additional resources such as capital and funding.
Startups and scale-ups can help large corporations cultivate a more innovative mindset to help organizations solving problems and adding value to customers.
Scaleup-Corporate Collaboration In Numbers.
According to New Horizon 2015, a study carried out by KPMG, 88% of corporate respondents thought that collaboration with startups was essential for their own innovation strategy and 94% of startups (137 in total) are likely to repeat the collaboration process with a large organization.
Acquisitions of startups, in particular by large businesses with a focus on digital technologies, are also growing. More and more established businesses are starting structured programmes, such as accelerators and incubators, to attract disruptive talents and foster entrepreneurship.
In the recent “Winning Together” and “Scaling Together” reports published by Startup Europe Partnership, Nesta clearly explains the different modes of interaction and indicative resources required by corporates and startups to collaborate through different programmes – as shown in the following figure.
More corporate–startup collaboration would strengthen the European innovation ecosystem and will also support a stronger European tech ecosystem where startups can transform into so–called scaleups – large, sustainable businesses.
Bits and tips for corporates and scale-ups.
Tips for corporates:
- Key success factors for startup-corporate collaboration are concise and clear communication, assignment of responsibilities and overview of the process.
- Scout internationally to attract best startups and solutions (see our matching events here).
- Feedback cycle should be more compatible with the startup world (ie days rather than months)
Tips for startups:
- Provide the corporate with the appropriate material (one-pager and company deck) so to speed up next steps.
- Have a clear understanding of the problem you will be solving.
- Get a prior grip on how to navigate the intricate structure of the corporation you are working with.
Tips for both corporates and scale-ups:
- Agree on a clear set of KPIs (key performance indicators) and stick to them.
Bridging the gap between corporates and scale-ups.
Mind the Bridge and Nesta will present many more findings, data and trends on scaleup – corporate collaboration during the Corp-Up! event organized together with Enel and in collaboration with London&Partners.
Outstanding corporates such as Cisco, Virgin, Aviva, RBS will join the panel to discuss what they are doing to effectively collaborate with scale-ups. Moreover, outperforming EU scaleups -scouted by Mind the Bridge and selected by Enel – will present their personal open innovation model in the sectors of CleanTech and Renewable Energy solutions.