Acquisitions and investments are always risky and it's next to impossible to know for sure what the return is going to be. Whether corporations are collaborating, buying, investing or partnering with a startup, they want to minimize all risks. This is why so many of them are experimenting with innovation labs that introduce employees to new tools and approaches that help bring in startups and customers for collaboration. In this blog post we introduce 3 tips on how the corporate side can make sure their maximizing their benefits from their investments in startups.
1. Align technical and operational systems
The lack of structures in corporate innovation efforts will end up in money losses and will not bring you concrete results. It's important that before investing, you make sure that your operational work flows and technical systems fit with the startup. Merging two companies together takes forever and by that time, the product you were investing in has become obsolete and dated. This is why structured innovation strategies and efforts are essential.
Without aligning your systems and having the drive to think, act and operate like a startup, your collaborative actions are more likely to fall flat. If this is something that can't be established within your corporation, then investing in a startup isn't probably the best idea and you'll most likely take better use of the asset by buying it.
The first step to minimizing the risks and resources and making a profitable investment, is to construct a formal program that doesn't drain your resources.
Innovation requires open communication between your industry peers and startups. Corporations bring years and years of industry knowledge, research and resources to the table. Startups bring fresh ideas, approaches, skills and agility.
There are three important steps in collaborating with startups that cut the risks for corporations:
1. Pilot, pilot, pilot.
2. Learning period after the pilot stage. Take into account what works and what doesn't.
3. Trial run. After fixing what's wrong in step 2, you have a final trial run for the finished product. Pick the low-hanging fruits first (startups that are the most obvious and easiest fit to your organization).
2. Map out your goals
Sit down with your innovation and strategic team and figure out what your common goals are for the next five years. Where do you want to be and what should your innovation team be doing in order to achieve these goals? These questions should help you figure out the best partnership type for the collaboration.
Obviously, the plan for collaborating with a startup doesn't have to be set from day 1 and all plans change, but it helps to have one. It also helps if you make the rest of the organization understand the drive and need to change and involve them in the planning and strategic resourcing. Have a concrete goal for each step you take with the startup.
3. Well planned is half done
Prepare an innovation strategy that's based on your long term strategic goals IF you don't have one already. Then, asses your organizations current capabilities and reflect them on your goals. This will help you clarify what your external needs are for achieving those goals. Determine the niche you want to be in and what your opportunities are.
Make a draft according to these assessments. The strategic precision you get from doing this will help you see and analyze what kind of products and startups fit your company the best. By examining your organization's current capacities you might find important gaps to fill and gives you incentives for collaborating with startups.
These three tips will help you crystallise your goals and current capabilities and the gaps between those two. You need to know what your strategic goals and needs are, to be able to find the best startups that match your development needs. These basic structures will help you take full advantage of your business ventures.
Read more on: http://www.rocketspace.com/corporate-innovation/make-more-out-of-your-corporate-vc-investments