How does corporate venturing boost corporate innovation?
Following up on my last article “What is corporate venturing?”, today I’d like to tackle the question of how corporate venturing positively supports corporate innovation activities. My passion and interest for innovation made me dig deeper into the reasons why big corporations struggle to find efficient ways to optimize their businesses. Therefore, the purpose of this article is to give you an idea of how investing in corporate ventures can boost corporate innovation. I organized the top 5 ways I’ve seen happen into 5 takeaways.
TAKEAWAY #1: REACH A COMPETITIVE ADVANTAGE
You probably want to be the first to seize new growth possibilities, leaving competitors in the dust. This can be difficult for companies with rigid regulations and bureaucracies that prohibit new ideas from advancing beyond the drawing board.
By investing in independent ventures, you can avoid some of the obstacles related to draining rules and administration processes. This would allow your company to swiftly and efficiently experiment with new technologies and business models, just as startups do.
TAKEAWAY #2: TRY NEW TECHNOLOGIES
Because of their size and the inherent risks involved in making large changes at that scale, corporations might find it difficult to test out new technologies. Furthermore, many businesses lack the know-how, initiative, and exposure to innovations that have the potential to transform their sectors. It’s a great potential for smaller companies to gain market share and obtain a competitive advantage.
Startups are known for being able to access, use, and create next-generation technologies. Corporations that create their own startups have direct access to these new technological progresses, which they can use to gain an advantage over their startup competitors.
TAKEAWAY #3: OFFER NEW EXPERIENCES TO YOUR CUSTOMERS
As quickly as the markets change, so might your perception of what constitutes a good customer experience. Customers are placing a higher value on companies that provide memorable experiences rather than actual products. As younger generations develop purchasing power, this is becoming a more prominent tendency.
Startups are excellent to try out new consumer experiences without jeopardizing your brand’s reputation. Because of their modest size and flexibility, they can quickly test new growth marketing, branding, and selling techniques to see what works and what doesn’t.
TAKEAWAY #4: OVERCOME THE AGE GAP
Large corporations that have built their business on delivering traditional client demands may find it challenging to engage with and reach younger generations. It’s all about convenient digital services, individualized experiences, and a story that represents the customer’s values these days.
With innovative business models, communications, and digital services, corporate venturing can help overcome the age gap.
TAKEAWAY #5: TEST YOUR IDEAS
User interviews, smoke testing, and online surveys are just a few of the approaches utilized to evaluate new concepts. The problem is that many companies have not yet optimized their strategy and are still conducting R&D in the traditional manner. This can be both costly and ineffective.
Corporate ventures are an excellent opportunity to test fresh ideas and concepts. They act as sounding boards for new technologies, products, and services, testing them in limited, contained settings.
If you’re interested in the topic and want to know more about how corporate venturing can boost corporate innovation, stay tuned for my next article!
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