6 Ways Startups Can Play Nice With Corporations
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It is safe to say that the majority of startups around the world have historically perceived large, established technology companies as poor dance partners. While startups, and the entrepreneurs behind them, are viewed as exciting, agile and risk-prone, large established companies are often times not viewed in the same light, even when this is not true.
Large technology companies have made significant efforts to better understand the needs of entrepreneurs. This has led them to adopt new approaches to working within the startup ecosystem, both in a particular company's "home country" as well as in geographic regions that are located far away from corporate headquarters.
In fact, large corporations have made such significant progress working with startups in foreign locales that they have become, in the most successful cases, an integral player in the local high-tech ecosystem and a valuable resource to the entrepreneurs building new technologies.
Our experience at the Microsoft Israel R&D center working with the local entrepreneurs has led us to compile the following list of tips for how startups can best leverage the knowledge, experience and connections that corporations can offer:
1. Corporations have a vested interest in listening to the needs of a particular tech ecosystem. Even though there may be an assumption that they are looking to push their own products and platforms, this is often not the case. Go into meetings with an open mind and you will be surprised by how flexible corporations can be when it comes to understanding local needs and helping startups build solutions that are best for them, even when it includes the use of competitors’ products and technologies.
2. Attend events sponsored by the corporation. Large tech companies often host events on their corporate campuses for the local hi-tech ecosystem -- take the time to try and attend these events. Our Israel R&D Center often hosts events such as these and they have proven to be great opportunities for local entrepreneurs to "get in the door" and meet with senior representatives of the corporation as well as understand the thinking, vision and direction of a particular corporation.
3. Take advantage of the corporation's facilities and programs. Corporations are generally more than happy to allow local startups to use their facilities for events. If a corporation has an accelerator program, volunteer to help mentor some of the companies going through the process. These interactions, even though they are not with specific executives, will often times open doors that you did not even know existed.
4. Get involved with corporation and university collaborations. Corporations often establish partnerships with universities. For entrepreneurs, university programs are great opportunities to learn and gain important insights, as well as to get early exposure to some of the technologies being worked on in these programs. The more local involvement, the more the entire ecosystem benefits.
5. Understand how corporations tend to invest. Generally, corporations don’t do venture capital-type investments that are aimed at achieving an exit or getting a return on their money, but rather look to do strategic investments in companies that have products that complement their own technologies. The more time entrepreneurs spend with a corporation, even if the technology is not complementary to that particular company, the more likely it is that the corporation can help that entrepreneur when it comes time to raising money by making beneficial introductions to VCs.
6. Use the extensive networks of the corporations to help build your customer base. Of course, you need to identify the right person at the corporation to initially approach, but through their sales channels, corporations have exposure to thousands of companies -- use their experience and contacts to your advantage as you build your own sales teams.
While there are no guarantees, entrepreneurs who properly leverage the resources of a corporation for their benefit will be at a significant advantage, both in terms of connections made as well as knowledge gained. For a startup, this can mean the difference between being the star of the big dance or being left without a partner.