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Innovating with Start-ups has its Challenges

Innovating with Start-ups has its Challenges
Thursday, 15 November 2018

Innovation is a buzzword in today’s business world—everyone believes they should be promoting this kind of culture (even if it doesn’t always prove to be as easy as it seems on paper). One of the ways that larger firms are able to increase their innovation capabilities is by investing in start-up technology. Because start-ups are not ruled by the same regulations and restrictions (both legal and mental) as larger companies, they are often able to find the flexibility and creativity that larger organisations lack for innovation.

However, this type of collaboration does not guarantee innovation success either. From the perspective of a large, establish entity, dealing with the inexperience that start-ups bring means more work dealing with intellectual property and brand protection management in addition to a lack of technological readiness, financial stability, and entrepreneurial culture. On the other hand, it is hard for start-ups to understand when to start collaboration, the hierarchy established in large companies, and the slow decision making. [2]

Luckily, there proven and tested ways to make the most out of a collaboration. As we can see in this study (published May 2018), there are 11 mechanisms to consider—and combine—when companies are working on creating innovation units:

  • Scouting mission
  • Hackathon
  • Sharing resources
  • Challenge prize
  • Corporate accelerator
  • Corporate venture capital
  • Excubator (venture builder)
  • Corporate incubator
  • Strategic partnership
  • Venture client
  • Acquisition

In addition, the study shows us that, by focusing on more holistic opportunities, companies have the opportunity to be more successful in the long-term [3]. See the entire study here.