Startups And Corporations: Disruption Through Collaboration

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Disruption has had (er, is having) a long moment. Though disruption is an easy concept to misunderstand, it's easy to understand why it remains such an attractive topic among entrepreneurs. We've seen simple startup ideas rapidly create new industries and take over established ones. It ties into our culture's love of an underdog story.

But what about the startup stories that are less "David versus Goliath" and more "David teaches Goliath how to be a better giant?"

We see that happening now as more large companies invest in corporate innovation—and turn to startups for help.

Why Corporations Need Startups

Earlier this year, I dropped by HubSpot's Inbound Marketing Jam Session, hosted by our friends at Raidious. A few things stood out to me from HubSpot's excellent presentation:

  • The expected lifespan of a Fortune 500 company has slid from 75 to 15 years (and is sliding toward 5 years).
  • U.S. corporations are collectively sitting on about $1.6 trillion.
  • More companies want to see product adoption following an S curve rather than a bell curve.


That last point is especially noteworthy. S curve growth of product adoption seems like a violation of logic, until you realize that many corporations are trying to disrupt themselves before a competitor does. That means innovating, innovating, and innovating to continually find new growth opportunities.

That's what startups are built to do. Hence, not only are we seeing more collaboration between corporations and startups, it also feels like corporate ventures are on the rise. (Though it's over a year old now, this Forbes article by Teddy Himler of Comcast Ventures mentions that "75 of the Fortune 100 are active in corporate venturing, and 41 have a dedicated CVC team.")

How Do Startups Create Relationships with Corporations?

We find ourselves talking about this a lot here at Powderkeg. We know the need is there, so we want to create as frictionless a path as possible to help startups and corporations to find each other.

It's something we're working to figure out, but we've noticed a few things so far. For example, like pitching to the press, knocking on the front door rarely works. That's a big reason why we push to get a corporation innovation presence at all of our events, so startup founders and corporate leaders can organically meet and start a conversation.

OK, But What About Doing That at a Larger Scale?

Of course, it isn't practical to rely solely on the above approach. Also, given the enormity of corporate America, there’s plenty organizations such as accelerators, entrepreneur centers, and even local governments can do to facilitate collaboration between startups and corporations.

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