Every startup needs a gateway to growth that is difficult to achieve on its own steam. More than ever, the need of the hour is for startups to partner with large corporates to drive innovation and gain better insights on the changing nature of technology. At the same time, even established businesses are changing their approach to innovation by aligning with startups. Given this reality, one trend that is shifting the paradigm of the innovation landscape is the emergence of corporate innovation programs. Such programs result in new opportunities for startups that help them think big and respond better to transformations in the startup ecosystem.
What are the multiple benefits accruing to startups through their association with corporates? How do they apply these learnings in their businesses? Here, four entrepreneurs from T-Hub reveal their greatest learnings from corporates and how such collaborative experiences have shaped their company’s growth trajectory.
Sai Krishna VK |Co-founder, Scapic | Area of technology: AR/VR
Biggest learning: How to scale up fast
According to Sai Krishna VK, co-founder, Scapic, the best corporate innovation programs enable use cases that result in a superior product-market fit. “When you work with a corporate, there is an established need — either from customers or the business — that helps startups finetune consumer or business-specific use cases and bring in greater expertise,” he says. “What a startup usually grapples with is repeatable models of success or product-market fit.” Having participated in the maiden cohort of the India Innovation Hub Accelerator, under the aegis of Facebook and T-Hub, Sai Krishna believes startups that work with corporates are able to scale faster and more efficiently. Since customer or business needs are well-defined in such programs, startups are typically not subjected to repeated trial and errors before they come up with tangible use cases.
Further, being a DeepTech startup operating in the VR (Virtual Reality) and AR (Augmented Reality) space, Scapic participated in the corporate innovation program to get an opportunity to work with Facebook, more specifically for building products that are targeted towards end consumer use cases.
Sai Krishna counts insights gained into the use case needs of Facebook or customers who use the AR/VR space as one of the key takeaways from the program. He adds that Scapic also benefited from building products that try to cater or achieve some value for such types of use cases as identified. “This is very useful if you are working in a blue ocean field such as AR and VR and that’s our learning from the program,” says Sai Krishna.
By way of on-ground examples of how Scapic scaled, something as simple as collaborating with Facebook teams provided the startup with valuable insights and access to new market opportunities. Today, Scapic works with three teams in Facebook’s Menlo Park headquarters, where the tech giant either uses or endorses the former’s product. “The ability to maleate and integrate with these teams was what helped us achieve that path to scale; perhaps that’s where corporate innovation programs help,” says Sai Krishna.
He reasons well-implemented programs move away from the bottom-up approach and swiftly elevate the startup far higher up in the food chain.
Also, in terms of enhancing corporate innovation programs in the Indian ecosystem, Sai Krishna is of the view that such programs could be simplified where a longer amount of time is spent in selecting startups. This would result in a win-win situation for both startups and corporates if both parties could agree at the outset on the desired end outcome of the program.
“There is a lot of appetite for DeepTech startups inside corporate innovation programs,” says Sai Krishna. “Building a DeepTech startup in India is a tough task, but if we also leverage corporate innovation, we are fostering DeepTech as an industry in the country.”
Amit Sukhija | Founder, ZestIOT |Area of technology: IIoT/IoT) and Automation
Biggest learning: How to ace sales and product-market fit
Amit Sukhija recognises the importance of corporate innovation programs for startups. When his startup, ZestIOT, participated in the Boeing HorizonX Innovation Challenge accelerated by T-Hub in 2018, he gained unique insights into how his company should approach the sales and product-market aspects of the business. During the program, Boeing and other experts who were brought on board, imparted invaluable lessons in training, learning and development.
“As we are a B2B-focused startup, a different kind of mindset and process has to be followed to close a sale,” says Amit. “One of the key learnings for us lay in grasping how decision-makers’ value chains operate in a B2B set-up. All stakeholders have their own set of objections, which means a sale is not as much about selling a product, but more about how to handle objections.”
He added that if every stakeholder’s concerns and objections are handled efficiently, ultimately, the decision-maker is happy to sign off the product from a commercial standpoint, which will result in it being adopted in the market. This learning has been applied in ZestIOT’s day-to-day operations.
Illustrating the point further, Amit revealed that airports being the company’s primary customers, there are at least 10 decision-makers in each airport. Further, each decision-maker has a subordinate who vets products and solutions. These individuals review the product and raise concerns and objections in terms of feasibility, gaps, cost and security, among other thorny issues. Amit explains that it is vital for his company to understand how to handle the objections raised by these individual stakeholders as this alone will determine the successful closure of the sales process.
Elaborating on this, he discloses that corporate innovation programs impart invaluable lessons in quality and training. It enables startups to gain an understanding of potential customers’ criticism and proceed to resolve genuine concerns and objections. “As a result, we are able to address these concerns and the customers or stakeholders gained significant confidence in the product team and the leadership of the startup,” says Amit.
The learning material ZestIOT received at the Boeing program helped the company to improve its sales pitch. Additionally, the startup also benefited in terms of gaining a perspective on how to approach a potential customer and address their objections.
Another key takeaway for ZestIOT has been understanding the product-market fit in the sales context. “One of our biggest learnings in this entire exercise has been to focus on the use case,” says Amit. “If the startup can take one complete use case end-to-end, then they take ownership of a customer’s problem and bring disruption with technology to resolve a business problem. After achieving the significant milestone of a product-market fit, the Boeing program helped us understand these phases and milestones in the journey.”
In the context of Boeing, the corporate was able to show ZestIOT how to solve operations problems with stakeholders, fit the product from a strategic and planning perspective, demonstrate stronger product and leadership with the technology team, and deliver savings from ROI from the customer’s perspective. It was a significant takeaway for ZestIOT as it resolved customer problems of a repeatable nature, resulting in closing the sale.
Manoj Shinde | Co-founder, Orbo |Area of technology: AI
Biggest learning: How to refine the business processes
Participating in the OTIS Innovation Challenge accelerated by T-Hub turned out to be a beneficial exercise for Manoj Shinde, co-founder, Orbo, and his team. The three-month corporate innovation program offered them key insights into the nuances of the business processes that helped the startup build a better product that met the specific requirements of the program.
“Most of the corporate programs are open-ended and they just put out a one-line problem statement and let startups come up with their own thought process around it,” says Manoj. “However, Otis was very clear about its objective and what it wanted to achieve. Having such clarity helped us work through all nuances clearly, rather than going in for extra brainstorming.”
During the program, Orbo worked on finding an innovative solution to make moving accessible and seamless through AI (Artificial Intelligence).
Manoj adds that since the corporate partner provided a specific use case that required an innovative solution from the participating startups, Orbo was able to figure out the pain points along the way to innovation. Their efforts were further aided by the supporting documents shared by Otis that identified the corporate’s problem areas.
Additionally, what helped the startup get the final product ready for showcase or pilot was the level of mentorship they received from the corporate partner. “The technology team members from Otis and UTC worked very closely with us,” shares Manoj. “They offered subject matter expertise, dwelling on the technical aspects of moving people which gave us insights into the integral aspects of their ecosystem. They had been very proactive to share this knowledge with us.”
Manoj is of the view corporates should run such programs only when they have a serious intent to integrate startups into their ecosystem, and not solely because their competitors are doing it. “In terms of enhancing the scope of corporate innovation programs, corporates shouldn’t just stop at the innovation challenge, but should have a continuous dialogue going,” he says. “It’s a win-win for both corporates and startups only if there is mutual visibility and value addition at the end of the day.”
Ramesh Kasetty | Co-founder, Duranc, Inc. | Area of technology: Cloud video surveillance and analytics management system
Biggest learning: How to reach customers
Nashville-based Ramesh Kasetty, co-founder, Duranc, believes that a company’s corporate innovation programs must have meaningful deliverables. Corporates that establish well-defined goals at the start help startups to arrive at a decision on program participation. “All the shortlisted companies in any corporate innovation program should benefit and have a clearly defined output,” says Ramesh. “Since these are startups, both time and money are very important to these organisations.”
He adds that such a well-defined process will result in multiple benefits for startups, such as a pilot that could be rolled out, and potential investors who might come on board.
Coming from having participated in international corporate innovation programs, Ramesh shares key learnings that have benefited his startup. For example, Duranc’s participation in a six-eight week program run by Elisa, a telecom major in Finland, resulted in favourable outcomes for the startup.
Elisa’s objective was to identify startups that will help them build solutions to roll out a 5G mobile network across Finland. Although Duranc didn’t eventually make it to the top two companies that got picked, the association paved the way for interactions with potential customers. “Elisa lined up a few customers for us and one of them is the Finland smart city project,” says Ramesh. “If at the end of the day, a corporate innovation program doesn’t lead us to a customer, then it’s a waste of time.”
Currently, Duranc is in discussions with Finland’s city officials to roll out a pilot.
According to Ramesh, given that the majority of startups are trying to reach out to potential customers, a corporate innovation program can be termed effective only if it results in customer reach. “Once we have the reach, anything is achievable — multiple outcomes are possible, depending on how deep the corporate partner wants to get into the program,” he signs off.
Currently, we at T-Hub are are running programs with two corporates from different industries that can offer immense benefits for your startups.
One is MedTech Innovation Challenge in collaboration with Jubilant Biosys. Leverage your innovation in MedTech space and get an opportunity to work with them. Apply here.
The other is the Fintech Accelerator in collaboration with NPCI. Propel your fintech startup towards designing winning solutions in Digital Payments. Apply here.
The future of collaboration
In the age of the Fourth Industrial Revolution, collaboration between corporates and startups is reshaping the innovation ecosystem. And this phenomenon is only going to increase in the years ahead. Common to all successful partnerships is a mutual understanding of each other’s core competencies that will aid in building a foundation for future success. Since technology has created a level playing field for organizations of all stripes to co-exist, it is essential to make the interdependency between big business and startups work in the long-run. The key is in keeping things simple and giving innovation teams autonomy to make good ideas flourish.
Only when more startups and corporates seek each other out to resolve business problems will innovation sustain and thrive in the global ecosystem.
