It's easy to come to the conclusion that corporations need to work with startups. Access to cutting edge technology, avoiding disruption, and getting a leg up on the competition are just some of the benefits of startup collaboration that more and more firms are seeking out. But how should that collaboration take shape? Should corporations be investing, acquiring, partnering or setting up joint ventures?
Here's how four big name corporations have made collaboration work for them:
Investment - BMW and Moovit
Global car corporation BMW has an investment arm, BMW iVentures, as one of the ways it works with startups. It also has initiatives like BMW Startup Garage for early-stage pilots and an accelerator program called Urban-X.
But iVentures' collaboration with Israeli startup Moovit is one of its big success stories and shows how investment can lead into product partnership. Moovit is an award-winning smartphone app that supplies continuously updated information about public transport services, which at first glance doesn't seem to fit exactly in BMW's wheelhouse. But iVentures invested in the startup and then proceeded to integrate its own ridesharing offering DriveNow into the app. Moovit already offered users access to transport options like taxis, bike-sharing, and car-sharing alongside public transport and let them find the fastest route to any destination.
With its investment, BMW has seen a chance to leverage a successful startup – the app has more than 40 million users in over a thousand cities worldwide – to promote one of its own services.
Partnership - Accenture and Anaplan
Global professional services firm Accenture has partnerships with a number of startups, including cloud-based platform Anaplan. In this collaboration, Accenture is giving its own clients access to Anaplan's technology. According to the companies, prior to its partnership with Anaplan, Accenture customers were using a variety of different spreadsheets as part of their planning, budgeting, and financial forecasting. Anaplan's cloud-based data analytics in the form of its Smart Business Platform has changed all that.
“The reason why Anaplan is key to us—and the reason why we partner with Anaplan—is because they offer adaptive agility and effectiveness for our clients," said Tim Kelly, MD at Accenture Strategy.
Instead of developing a similar product or licensing it from a potential competitor, Accenture spotted a startup with an emerging technology that could help its customers and partnered up.
Joint Venture - GE and Local Motors
Partnership can go one step further with a joint venture, as is the case for GE and Local Motors, which makes low-cost tools and small-scale manufacturing capabilities available to both hobbyists and OEMs for online design and hardware co-creation.
The multinational and the open-source hardware innovator together have launched an online creation platform, FirstBuild, and a microfactory, a specialized facility focused on prototyping new products and fabricating small batches rapidly.
Their venture is looking to take ideas for GE products sourced from Local Motors' online hive mind of engineers, scientists, designers and enthusiasts, and speed up the process by which they get made and tested.
Acquisition - Twitter and Periscope
Corporations don't need to swoop in and buy up startups to get their hands on their technology, but there are times when it's the right way to go. And ultimately, it's still the goal of many entrepreneurs to find an exit from their startup.
With improved access to WiFi and faster mobile networks, live streaming is the next big thing in social media. For Twitter, it was an obvious area to get into and buying up Periscope has ensured that anyone who wants to use the app to live stream needs a Twitter account. The acquisition offered Twitter a ready-made technology, as well as the users Periscope had already acquired, and strengthened its position as a news-gathering and sharing platform.