It is a bit like the advice that might come out of a marriage counselling session: startups need to articulate their needs better and corporate partners need to be more willing to listen.
That was the gist of what came out of the Sifted online panel on corporate innovation last week. Elizabeth Nyeko, founder of Modularity Grid, a spacetech startup currently working with Airbus, and Cat Jones, managing director at Founders Factory, the London-based company builder, helped tease out some of the common pain points of the startup-corporate relationship.
Here are the five takeaways from the discussion (which you can also watch in full below).
1) Startups: be assertive
Startups: be more assertive about what you need. Nyeko describes being initially quite “starstruck” when starting to work with Airbus. “These are companies you look up to as a startup. You expect them to know everything. But often they don’t, and they don’t know what you need if you don’t tell them,” she says.
In particular startups should clearly define how much — and what types of — risk they are willing to take on for the joint project. “Technical risk we are all up for, we know how to deal with that, but anything else not,” she says. Big companies are often keen to offload risk onto their startup partner, but small companies may not be equipped to, for example, take on the risks associated with being a data controller on a project.
2) Avoid projects that need a lot of data sharing
Speaking of data, for an easy life avoid projects that involve sharing a lot of data. It is always complicated and will take a long time. There are no easy answers to this. If data sharing is fundamental to the project, make that the very first thing you line up.
3) Startups: sell your product hard
Just because you are in an accelerator or innovation programme doesn’t mean the right people are noticing you. “Make sure everyone is really excited about the shiny new thing you are providing,” says Jones. “Really showcase your product and what it can do for the company.” One company working with Founders Factory, Shepper, provides inspections of physical assets for companies and always does a sample inspection of a corporate’s site before going into a meeting with them so they can “show not tell” what they can do.
4) Corporations: streamline processes for startups
“Take a step back and think what is your ability to flex your processes a little bit. Is that procurement process too onerous, could it be lighter?” says Jones. L’Oreal, for example, has created a separate, lighter-touch procurement contract for startups.
5) Corporations: make time to listen properly
Corporations need to make a lot of regular time available for the startups they are working with. A weekly 15-minute phone call is more useful than a big debriefing session at the end of the project, says Nyeko. “They need to be willing to take on board feedback from startups, not just at the end of a project but on an ongoing basis.” This helps avoid nasty surprises on both sides, picking up on any problems early. Many corporate-startup partnerships do fail or end up not continuing into a further relationship. The important thing is for that not to come as a surprise for either side.
Watch the full video here: