If your corporation is well-established and you have been running the operation for a significant amount of time, your idea well may be running dry. On the other hand, innovation comes easily to people just starting to explore the market and build their empire.
Leveraging their ideas to build a symbiotic relationship may be the key to unlocking the potential for both parties and emboldening your executive resume.
You could use their talents to detect latent demand, create a proof of concept, and a minimum viable product (MVP). While they could use your expertise to scale their business operation.
Start by providing seed funds and early-stage funds to startups that have the potential to streamline the business objectives of your corporation. You also have the option of investing in later-stage M&A deals which may cost you more money.
Don’t just sit back and watch the situation unfold afterward. A successful corporate collaboration can only emerge through mutual work towards achieving common goals.
This article will show you 5 ways to streamline your startup partnership:
Learn about startup disruption
The corporate world needs to go through a corporate digital transformation right now and is ready to go through some much needed corporate disruption.
There is a huge gap that needs to be filled between digital civil life and digital corporate life and startups are taking advantage of this gap. They are coming up with ideas and products to bridge this gap which is leading to corporate disruption.
Older, established companies that are set in their ways of operating are losing to the more technologically advanced startups which can get the same work done with lesser time and resources.
Startup and corporate partnerships are the answer to avoid this corporate disruption.
These startup collaborations are mutually beneficial as being closer to the corporate structure lets entrepreneurs get a peek at the major liabilities of this world and gives them ideas, data, and resources to come up with products that the market needs.
Startup partnerships also help big companies solve their problems while putting in minimum efforts.
So, rather than worrying about corporate disruption, you should look towards forming startup and corporate partnerships so both sides can benefit from each other’s existence.
2.Start small before considering further investment options
The bureaucracy of a big corporation can hinder startup partnerships. The more you want to invest, the more stakeholders are likely to get involved. And no matter how great you believe the startup is, everyone will have their own opinions over what is necessary and how the money should be invested.
To make the best of your time and resources, you should consider starting small. The most common approach taken by startups and corporations alike is the “pilot/roll-out structure”.
This has two stages: the pilot phase and the roll-out phase. In the pilot phase, both the startup and the company come together to lay the groundwork for their collaboration.
The most common factors contemplated during the pilot phase are ensuring that a minimum number of stakeholders are involved, verify that the cost is the lowest possible and primarily a realistic size is targeted that minimizes having to use procurement or compliance.
Moving on to the roll-out phase, it uses the data collected in the pilot phase and applies it to promote the pilot projects on a bigger scale. Once the model is successful on a smaller scale, more stakeholders can be involved.
Remember to not fall into honeytrap startups as some startups might create superficial images through beautiful presentations and perfect websites. But not all that shimmers is gold.
Dig deep and find out what exactly will your resources be used for. If at any stage you figure out that they might not be able to deliver on their promises, don’t be afraid to discontinue the partnership.
Research is your best friend! Find out the technologies being used by the startup and what development stage they have reached. Find out if the features they boast of online are even functional, and are any of their products ready for beta testing before you involve your board of directors in the investment process.
You must involve senior management in your startup and corporate partnership. Without their support, the project is bound to fail. If the situation allows, having the startup run from common grounds is a nice way of ensuring proper management and cooperation.
3.Work faster and establish mutual goals
Unlike big corporations, startups don’t have to go through a complicated and bureaucratic chain of commands before making a decision. You have to find a comfortable pace that works for both you and the startup to have a functioning startup collaboration.
While you as a corporation can take better steps towards being more agile, you should also clearly state the process and framework that leads to better accountability and help them figure out their own decision-making model that runs smoothly and efficiently.
Another factor to consider in a successful startup partnership is that the long-term goals of both parties should align. It is your job to clarify what you want from this relationship and what they would be getting out of this corporate collaboration.
If the startup is only looking for funds, it could make for a less than desired relationship. You should steer such startups towards venture capital funds as they will often not be beneficial to your operation.
If you want to build mutually beneficial startup collaborations, look for startups that are eager to learn from your expertise. They should be excited to make use of resources that a big corporation could provide like legal advice, distribution channels, etc.
Set up these specifications as soon as possible so your work together can go on without a bump in the road.
4.Treat them as equal partners while sharing your expertise
Big corporations are often money-oriented. If something is not as profitable as they would want it to be, they often cut their losses and move forward. But a budding partner cannot be treated the same way.
If you want the startup partnership to flourish, you have to make sure to not let the startup team feel like they are just like a supplier to the corporation, and only there to push their agenda forward.
You need to respect their ideas and execute processes that are mutually beneficial and not just in your interest.
If you think you are doing a startup any favors by being a buyer of their product and that entitles you to squeeze their revenue capability, then you might not be the right partner for startup collaboration.
A good startup and corporate partnership will sometimes require you to pay a little more than the minimum cost you wanted. Be a good support structure in the beginning and see the relationship flourish after the startup finds its roots in the market.
Another vastly necessary factor is that you need to trust the startup team and share your expertise with them.
Unlike big corporations, startups have more open source projects to save money and resources while working on their products. Corporations, on the other hand, protect their intellectual property, and rightly so.
But you have to learn to trust your partners to make their job easier by giving them access to information that could be imperative to their operation.
Most startups collaborate with big corporations for their expertise so help them reach a wider client base through your distribution channels so they can access more markets.
5.Identify if the startup can solve any of your objectives
If you thought that having a shared mission or the quality of the startup are the prime factors for a successful startup collaboration, this MassChallenge and Imaginatik study will have you believe otherwise.
Research shows that “strategic fit” is much more necessary for both startups and corporations alike to choose a partner for collaboration. This is why you must figure out what strategic objective you aim to solve with a startup partnership and how you can help the startup before you venture to find your partner.
The best example of a symbiotic startup and corporate partnership is the partnership between Sphero and Disney. Sphero manufacturers state-of-the-art robotic toys and it identified that they could make a great addition to Disney’s line of products.
Disney’s CEO, Bob Iger took interest and mentored them. This made Sphero come up with the new Star Wars droid, BB-8 which has been extremely famous among people.
So, identify startups that can solve a strategic objective for your corporation so you do not end up wasting your time and resources on a startup that cannot help your objectives. Determine what the startup is bringing to the table and why you should consider collaboration with them.
The corporate world is changing and corporate disruption is being caused by increasing corporate digital transformation. Corporates are collaborating with startups to maximize their potential and stay relevant in today’s market while helping startups streamline their operations.
This article divulges the secrets to streamlining collaborations with startups so go ahead and start researching the perfect startup to partner with.