These partnerships have the potential to yield breakthrough innovation quickly and at a relatively low cost
Corporate venturing squads bring multiple players to the table, fostering a dynamic partnership that encompasses various activities such as scouting, product and service testing, and investment.
Image: Shutterstock
Corporate venturing has been described as a David-and-Goliath cooperation in the business world. Established companies seek innovation by partnering up with agile startups via a range of mechanisms, including scouting missions, hackathons, venture clients, corporate incubators and accelerators.
These partnerships have the potential to yield breakthrough innovation quickly and at a relatively low cost, and in recent years, such efforts have become one of the mainstays of the innovation landscape.
But sometimes it pays to expand the relationship and get more corporations on board — even those that might be competitors. Such counterintuitive collaborations, and the innovation benefits they can create, are detailed in Open Innovation: Corporate Venturing Squads, co-authored by IESE Business School professor M. Julia Prats with Josemaria Siota, Carla Bustamante and Beatriz Camacho from IESE’s Open Innovation and Corporate Venturing Institute, in collaboration with the firm Kapita.
The major benefit, according to the industry professionals interviewed in the report, is better access to startup deal flow, in terms of both quantity and quality. Teaming up with other corporations can provide a more attractive corporate value proposition to startups than those working alone. Other key benefits include enhanced access to innovation networks, the sharing of knowledge and best practices, increased credibility and visibility, and reduced costs with reduced risk.
[This article has been reproduced with permission from IESE Business School. www.iese.edu/ Views expressed are personal.]