How corporate-venturing can speed up your innovation efforts
If it feels to you as though more and more companies are turning to tech to revolutionise their business offerings or operations, you’d be right. Corporates are finally seeing the value that startups are bringing to the market, and it is forcing them to have to relook their business models, and business strategies, in order to keep up with forward-thinking disruptors and the ever-changing needs and wants of consumers.
In the past, startups were small and didn’t pose much of a threat, if any, to competitors, nor did they really do much dismantling of existing corporate practice, at least nothing notable until the arrival of Google and Microsoft in the 1990s. But with all the technological advances and changes that have occurred over the last two decades, bright-eyed, bushy-tailed and tech-savvy entrepreneurs with good ideas are able to get their vision to market in a hot minute. In fact, according to a study conducted by IESE in collaboration with BeRepublic, between 2010 and 2015, there was a 42% increase in corporate-venturing — a percentage which will no doubt have grown substantially over the last five years.
Data that was compiled by a team of Credit Suisse analysts in 2017 showed that the lifespan of the average company has fallen from around 60 in the 1950s to less than 20 years today. This can be ‘blamed’ on the advent of the internet and the technological advances that have happened alongside it, giving people infinitely more options when it comes to retail, applications and service providers, with corporations such as Apple and Amazon being two of the main disruptors as far as innovation acceleration is concerned. Corporates who remain complacent aren’t going to enjoy nearly the same level of success as Steve Jobs or Jeff Bezos but, by keeping a finger on the pulse of industry trends, and embracing and prioritising innovation, they will stand in better stead than their less-agile competitors to go the distance. Here are four reasons why corporate-venturing is the key to speed innovation and longevity.
1. It can speed up the process
The typical corporate company structure (and the bureaucracy and red tape that often comes along with it) often doesn’t allow for much time or room to explore innovative upgrades to automation, products and services. There is also the misconception that innovation is a slow process with no certain reward. In fact, having a small team with their primary focus being on innovation allows for flexibility and gives them the ability to explore and consider future opportunities to see if they are viable before the entire company shifts gears.
2. It allows you to gauge future growth opportunities
The sad reality when it comes to many corporates is that they often remain loyal to outdated models and practices even when it isn’t in their best interest when it comes to future growth. According to the Digital Transformation Report by CorporateLeaders and PTC, digital transformation has improved operational efficiency (40%) and allowed for a faster time to market (36%) as well as improving the ability to meet customer expectations (35%), which indicates just how beneficial corporate-venturing can be when it comes to staying ahead of the game.
3. It can lead to discovery
Most companies know who their market is. But do they really? Corporate-venturing is all about seeking out opportunities for growth and industry domination, and this process inevitably forces staff to research emerging trends and markets outside of their regular framework. This not only gives companies the opportunity to widen their scope and tap into a new (and potentially lucrative) market but can also help them gain new insights which can be applied to their current model, and help teams to see and understand the bigger picture.
4. Minimal risk for (potentially) major rewards!
As mentioned before, rather than trying to implement huge company-wide shifts and changes which could, ultimately, fall flat, corporate-venturing allows companies to get an understanding of the consumer wants and needs, the viability of their product or service, what competitors are up to and what the future of the industry will look like. This puts them in a position to make data-driven decisions on the direction they want to steer in when it comes to transformation, and then reap the rewards when their innovation efforts pay off.
The age we live in is fast-paced and complex. To survive, corporations need to have a willingness to constantly change and innovate to stay ahead, lest they be overtaken by the competition. Today’s success is not an indicator of future viability or longevity, and failure to innovate can bring even the most revered and long-standing business to its knees. Businesses that don’t want to join the ranks of other short-lived companies and become another statistic should be harnessing the expertise of startups to optimise digital technologies and tap into new business areas. The time is now!
