Venture Building, in-house or want a hand? 🙋♀️
May 18, 2022
Let’s start off with the basics. What are the best-fitting innovation formulas for your corporation?
Innovation is quite a broad term to which almost every company makes reference to 6 out of 10 times in a few sentences (not statistically proven but experience-based fact), something similar to what happens to the term sustainability. In other words, the term innovation somehow embraces all kinds of out of the business “as usual” initiatives.
However, innovation is much more powerful (and please do not limit it to non-core related initiatives). In my experience, innovation has an essential element which is impact: financial, social, or environmental among others.
There are several initiatives corporations can carry out in order to boost innovation. In fact, I am sure that if your company has not implemented any of them yet, you may feel you are somehow lagging behind.
I would say there are two different approaches when deciding which is the best-fitting innovation formula. On the one hand, there are initiatives that are focused on business creation (in other words, developing ideas into real and operating business models) such as Venture Building, Intrapreneurship, Venture Client, Acceleration Programs and so on. On the other hand, there are other approaches that are more oriented to financial investment, such as Venture Capital or M&A. The common ground is that all formulas expect to have a positive impact in the organization.
Here are some examples of the initiatives mentioned above and the potential impact in the organization:
1️⃣ “We have developed a tech that helps us digitize a cumbersome strategic process”, aka Operational efficiency.
2️⃣ “We have implemented a brand-new digital customer experience that helps us reach the younger generation”, aka New target markets.
3️⃣ “By launching this new product, we are solving a real unsatisfied need of our customers”, aka New product development.
4️⃣ “We are investing in a startup that is disruptive in our sector, and we expect it to scale up and perform an exit” aka Profitability.
5️⃣ “We have created a spin off that has little to do with our core business, but we really believe it is going to be successful and will translate into a source of additional revenue” aka Diversification.
At Byld we develop new business models with corporations, which is included within the framework of Venture Building, and it is called Corporate Venture Building. We are always looking to have a real impact either on the top or the bottom line, that’s why for us innovation is far from a cost line in the budget but an investment, real ROI.
Going deeper in Venture Building. Why is it interesting to you?
What I like about Venture Building is that it entails creating a real valuable new business model that is intended to be launched and to be fully operational in the market with the aim of being scalable. So many beautiful words there, but trust me, it’s real.
Far from trying to underestimate other innovation formulas, my concern is that Venture Building is one of the most powerful tools since it goes from opportunity identification to really creating a new company with an ad-hoc team and funding to begin the adventure of achieving product market fit. In other words, you are in full control of the whole process and therefore fully responsible for the result.
Of course, not every corporation is ready to develop a Venture Building initiative, that’s why it is key to assess the level and culture of innovation inside the corporation before analyzing if Venture Building is the best formula for you. If you’re looking for a list of disruptive ideas or enhancing your branding, Venture Building is not for you.
Is Venture Building something you should carry out on your own?
Corporations are awesome doing what they do. It sounds obvious, right? Well, I’ll like to share a fun fact; granted my previous experience in management consulting and currently as a business builder (it may sound similar, but it has little to do), my mum would always ask me “What do you really do? I will never understand why companies don’t do it on their own, don’t they already have workers?”.
Industry and market know how, when talking about a core-related challenge, are key to guaranteeing the success of the project. Other key elements are for example: already built customer pool, already developed tech, specialized talent workforce, etc. Those are elements which are essential when deploying the new business and achieving the so-called product market fit. It is at this very moment when the synergy with the corporation is more powerful!
The truth is, most of the time, corporations don’t always have the resources “in house” to go from an idea to a real solution that is validated in the market and ready to be launched.
In this sense, corporations usually lack 3 important elements that prevent them of being successful, let’s check them out:
✔ Focus. Corporations are really focused on day-to-day operations and delivering a best-in-class service or product. Innovation is not usually part of their daily activities.
✔ Talent. Workers are usually highly-specialized and have a deep understanding of the industry, but are not capable of facing more strategic “big picture” issues.
✔ Knowledge in business creation. Corporations need to learn methodologies that help them go from an inspirational business concept to a grounded business model that works at both the operational and financial levels.
Finally, I want to give you the two main drivers to consider when making the decision of going for Corporate Venture Building with a partner like Byld.
💣 Reduced and shared risk.
We are your partners, meaning we also share risk by investing and believing in the opportunity, and therefore we want to minimize risks. How? Again, validating! That is our secret sauce. Experimentation together with business creation are our tools to launch a new business with the highest possible guarantee of success.
⏳ Time to market.
The time is now. Partnering with a third party that is expert in business creation allows you to go from idea to real business model in a few months. Check out our way of doing things in this section!
If you are wondering which path should go for, don’t hesitate to reach out!