For many industry-leading enterprises, a partnership with a high-growth tech startup has helped to unlock valuable product development opportunities. With support from a value-driven and agile startup partner, corporates can effortlessly test and optimize products in a controlled environment. Through these types of powerful innovation strategies, corporates can build products that better align with customer preferences, wants, and needs. However, investing in a startup-corporate partnership is a massive undertaking, especially during the product development stage. During this phase, everything needs to run smoothly and bringing on another stakeholder may feel a bit overwhelming. Is partnering with a startup during the product development phrase really worth the investment or potential risks?
Below, we outline the top ways tech startups fit into a product development strategy. Use these key insights to guide your decision making prior to committing to a startup-corporate partnership.
Understanding the Corporate Product Development Strategy
During the product development phase, joining a startup-corporate collaboration provides a number of benefits. Because startups tend to run lean, it is easier to exploit new technologies and enhance or shift business models. This allows corporations to speed up innovation cycles, outpace competitors, and more.
Here's how tech startups influence corporate product development strategy success:
1. Preparation and Assessment
During the early stages of product development, startups can work alongside corporate entities to define collaboration goals and objectives. In many instances, the startup can act as a sounding board. What are the desired outcomes? What does the business hope to accomplish? During this phase, startups and corporates work together to define the broad areas of interest that the concept or prototype would eventually emerge from. Additionally, startup and corporate teams work to design an actionable and growth-oriented roadmap towards product development success.
2. Proof of Concept
Secondly, startups can assist in developing a basic proof of concept. During this phase, teams commit to rapid design, iteration, and testing. With a proof of concept in place, corporate leaders can validate the technical viability of their product and showcase its market potential.
Furthermore, according to several industry reports, design mistakes are cheaper to fix earlier in the product lifecycle than when detected further down the road. For example, if a defect is found in the proof of concept phase, it may only cost $1 to fix. If that same defect is found in the coding phase, it may cost upwards of $1,000 to fix. A proof of concept gives stakeholders an opportunity to understand the capabilities and limitations of the system and select processes that deliver the greatest benefits.
Thirdly, businesses benefit from startups' rapid product development capabilities. As mentioned, startups typically leverage the latest discoveries and innovations. With access to all-new technologies, businesses can deploy high-powered and advanced products. Prior to market deployment, startup and corporate teams can work together to establish key performance indicators including:
- Monthly sales growth
- Monthly sales/new customers
- Monthly new leads/prospects
- Number of qualified leads
- Net profit margin
- Working capital
- Retention rate
Finally, after the product has been deployed, startup and corporate teams can benchmark product performance against those sales, marketing, and customer success indicators. The most advanced startup-corporate collaborations allow teams to create powerful product enhancements based on early consumer feedback. Maintaining a proactive approach to early product iteration allows businesses to create more valuable and customer-oriented products.
Kickstart Your Corporate Product Development Strategy at RocketSpace
Partnering with a startup during the product development phase might feel like a bit of an undertaking. Bringing on another stakeholder during this delicate time may feel a little overwhelming. However, the benefits of a startup-corporate partnership outweigh the risks. In fact, partnering with a startup to assist with the corporate product development strategy allows businesses to create deeper, more personalized, and higher value products that customers love.
RocketSpace offers a suite of corporate innovation services tailored to meet the exact needs of your enterprise. From product development to advanced pilot partnerships, our corporate innovation packages can be flexed to help solve your corporation's key challenges. RocketSpace's corporate innovation programs promise to deliver the following benefits:
- Provides value through the unique combination of external innovation expertise, emerging technology access, and an exclusive focus on actionable solutions
- Brings external knowledge, integration, and actionability of emerging technologies outside of an organization to within.
- Provides accessibility, proximity, and strong connections to new technologies.
- Delivers on tangible outcomes that clients can clearly act on and deliver to their business during and after the engagement. Potential outcomes include pilot partnerships, joint ventures, investment recommendations, and acquisitions.