Join the disruptors — the corporate accelerator
“Yikes, the startups in our industry will not only make us look bad but eventually disrupt us.”
If you work in a large company and haven’t realized this yet, just look at the picture below. It illustrates startups attacking the different offerings of the bank Wells Fargo. It makes me think of the phrase “death by a thousand cuts”. And this example is not unique to the banking sector.
Large companies might have brilliant employees, high revenue and a great brand. This is all good, but it also creates impediments for innovation:
- A great brand means a fear of making a fool out of oneself — this creates difficulties in trying out new ideas and talking openly to customers about ideas under development
- Your employees might be brilliant, however they are often stuck in structures, processes or role descriptions. This hinders innovation
Progressive large companies that have realized this are looking into ways of endorsing startup methodology. There are several ways to do this. You could for instance collaborate with, invest in or buy a startup. Another way to infuse innovation into a large company is to start an accelerator. This approach is becoming more and more popular. However, most corporations are setting-up these accelerators in a poor way; robbing themselves of the possibility to speed up their innovation and creating a false sense of security.
I'm running the accelerator of a major company in Europe. Based on my experience I would say that the foundation in a good corporate accelerator is the mindset. Our mindset is to both work with disruptive innovation and to create a change of culture towards entrepreneurship in the existing organization. Only with these cornerstones in mind will you be able to create an integrated corporate accelerator.
I think there are three crucial steps needed to set up such an accelerator:
1. Do it yourself
Remember that one of the main purposes of starting a corporate accelerator is to learn and transfer the startup skills and mindset into your corporation. This is achieved by managing the accelerator yourself and to release your employees (see below).
Put together a core team of people who are not afraid to get out of the office and who can get things done on their own. They need top management support to feel comfortable to break some rules and processes (it will be necessary). Don’t forget to have one team member who is external and knows the local startup community by heart and can coach the startups in Lean Startup, The Mom Test and other methods.
2. Release your employees
Some think that employees of large companies are less creative than startup employees. I disagree. Rather, corporate employees have unique knowledge about an industry and know which problems that need to be solved (problems = $).
You can use the accelerator to release employees from the impediments mentioned above. This is how. Firstly, give them the same seed funding (budget) as you give the external startups that are accepted into the accelerator. Secondly, give them the possibility to put 100% of their time into the startup. Thirdly, give them the opportunity to return to their old position if their startup doesn’t fly (they will then bring back the unique competence and the mindset you are looking for).
With released employees you have created good conditions for innovation and also signaled to all employees that creativity is valued. This was exactly what Google´s famous “20 % time” rule was intended to do.
3. Integrate, integrate, integrate
To be taken seriously and to make sure that you get top tier deal flow the corporate accelerator must become an integrated part of the local startup scene. Sponsor it but more importantly, be active. Go to the events (leave the tie at home), get to know people, be humble and learn from them. Remember, some of their knowledge is that treasure chest you are looking for. And of course, put the accelerator offices in a co-working space filled with other entrepreneurs.
At the same time, your accelerator must also become an integrated part of your own company. This could be a whole post by itself but you need to anchor the accelerator in the cooperation. As mentioned before, top management support is crucial but it takes more. For example, remember that you as an corporation have a lot of industry experts, use them as startup mentors. Make the corporation feel that they are a part of the accelerator. If you do not succeed in this integration the accelerator will not last long, even if your deal flow is awesome.
The third integration is the batches of startups; make sure to accept teams both from within the company and outside the company. They will learn so much from each other. And you know what, this is something only a corporate accelerator can do — use it to differentiate from “normal” accelerators.
Get in touch if you want to learn more! Ping me at twitter @v_svanstrom or @EON_agileNordic
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Thank you for inspiration and feedback Kajsa-Stina Kalin (@kskalin), Dan Gärdenfors, Hampus Jakobsson and Joel Larsson!
