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Startup Engagement – The Key to Change Acceleration

In recent years, the change-cycles across every industry vertical have accelerated beyond what can be managed internally. The rapid adoption of emerging technologies like AI, IoT, big data, and ambient computing are all enabling a new level of the consumer experience. This drives every company to learn how to transform itself rapidly, as digital experiences demand, physical products and services shape another. The days of a corporation single-handedly defining the specification of its product or value proposition are gone. Also, the "fast-follower" strategy is no longer a viable option. By the time you decide to follow, what you thought you would be following may no longer be relevant to the market.

Corporate Culture Must Adapt to Sudden Changes

Often what causes this type of challenge is corporate processes and culture that have been developed or nurtured for rather predictable or manageable times. We no longer are in such times. Aside from the current public healthcare crisis and the resulting economic crisis, several industries were already feeling pressure to change as consumers are increasingly vocal and direct about what they need. And their loyalty, increasingly, is not to a brand but to a cause, a purpose. On top, startups will continue to enter the corporate space more boldly, given that they are digital natives and flexible.

Companies find themselves forced to launch new businesses or business models in this current environment, even before they are truly prepared ("minimal viable product"). This creates a heightened urgency to develop a muscle to create new businesses internally with startup-like attributes and partner effectively with external startups. Well, it is easier said than done.

At, Sente, we believe there are no fixed answers or best practices copied and pasted for this challenge. To start with, corporations are economic and social communities, with each one having a unique business strategy and culture. You may disagree with this but think for a second about the following example. We can all use the same type of canvas and color set but paint slightly or significantly different pictures at the end of the day even though we may be looking at the same landscape.

The Other Important Element – The Ownership Structure

We have certainly observed key differences between family-owned, private-equity owned, and publicly traded companies related to the role of open innovation or startup collaboration for their organizations. Given all the uncertainty surrounding disruptive innovation at its earlier stages, corporations and startups should pool their resources to complement each other.

Startups have speed and agility. If combined with infrastructure, talent, and market reach of corporations, such a mix, if done right, could significantly accelerate the commercialization of innovation, increasing consumer loyalty and long- term sustainability. Change is a constant, and its velocity has been increasing, and with the increased affordability of emerging technologies, this velocity will only go up.

There is a need for a flexible and productive approach to solving this complex challenge if investing in B2B startups, particularly. These are some of the reasons why each of our investment programs, Indoor AgTech, Innovation in Food and Ingredients, and LogisticsTech is unique in its nature to meet the specific challenges of our corporate partners. Yet all of the programs leverage similar strengths and benefits of startup ecosystems that we have been involved in since 2009.


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