What is the deal? Instead of a direct investment, a corporate becomes a cornerstone client to aspiring startups to obtain concessional pricing or strategic advantage - it's a conditional arrangement. Scaleups benefit from cash flow and credibility by association and potential support for growth.

Best for: Big businesses looking to support potential new suppliers in a lean and low risk way, and early stage businesses who have a viable product and are looking to scale up.

Works best when: The big business can have its needs met by a bespoke supplier and the innovation partner really understands the needs of the corporate.

Reality check: Aligning objectives, culture and timelines can be difficult.

Key implementation steps include:

• Establish clear and arm’s length contractual relationships.
• Establish clarity over pricing, as well as asset and IP issues, early.

Corporate Venture Capital - VC Platform 

What is the deal? A venture capital platform invests in aspiring external scaleups, most likely to obtain a financial return. Scaleups benefit from funding and also from credibility by association and potential future financial support.

Best for: VCs taking multiple bets and early stage businesses who have a viable market proposition and are looking to scale up.

Works best when: The VC leverages its relationships on behalf of its innovation partner and allows its investment the time to develop into a viable business.

Reality check: Aligning objectives, culture and timelines can be difficult.

Key implementation steps include:

• Make sure to define ownership of any joint venture.
• Ensure that there is a clear business plan to attract investors.
• Be willing to accept input from the VC, but do not let them disrupt the creative and development process.
• Be prepared to respond to due diligence, timeline, and accounting requirements.

What is the deal? Businesses invest their money in aspiring external scaleups either to obtain a financial return or for strategic advantage. Scaleups benefit from funding and also from credibility by association, access to new customers and potential support for growth.

Best for: Big businesses who are looking to invest in the future of their business in a lean way, by taking multiple small bets, and early stage businesses who have a viable market proposition and are looking to scale up.

Works best when: The big business allows its innovative partner to operate and develop with minimal constraints associated with the investment.

Reality check: Aligning objectives, culture and timelines too rigorously can dilute the impact of collaboration.

Key implementation steps include:

• Ensure that the Corporation has a “bridge” between the technical and non-technical people involved if it is not a technology company.
• Ensure that clear expectations are set up at the beginning of the venture.
• Ensure that you are able to influence company direction and decisions in order to achieve the desired outcome.

Acquisition

What is the deal? A business acquires a controlling stake in another company.

Best for: Big businesses wanting to diversify their offering and smaller businesses wishing to scale their market presence.

Works best when: Smaller businesses are open to the culture and identity of the larger firm, but are allowed to keep their own identity and operating style.

Reality check: Small businesses can get lost in a big company unless they receive top level sponsorship.

Key implementation steps include:

• Establish clear objectives for the scaleup and for the acquiring company and define responsibilities of the acquired team.
• Define clear testing phases of the acquired company to overcome fragmentations.
• Create a new and different channel of communication for the start up to help them to avoid part of the corporate complexity that internal employees have to face.

What is the deal? 

These are short (three- to six-month), cohort-based programmes that provide seed funding and intensive mentoring and training for startups.

Best for: 

Ambitious early stage startups who want support (funding or otherwise) to grow quickly.

Works best when: 

The interests between the startups and their ‘host’ are aligned. Hosts should be able to offer insight from their knowledge and experience in a related field to help startups improve their proposition and business model appropriately.

Reality check: Relatively few accelerator programmes produce successful, sustainable businesses.

Key implementation steps include:

• Create a decided area of focus.

• Market effectively to recruit strong talent.

• Build strong founding teams.

• Ensure resources are available for testing, development, mentorship, etc.

What is the deal? 

Multi-disciplined teams compete against each other to solve a challenge in return for prizes.

Best for: 

Developing a usable prototype and introducing practical innovation.

Works best when:

The business has a clear challenge to solve which requires capability not available in-house. The prize needs to be sufficient to attract strong talent.

Reality check:

A hackathon generates ideas but often there is not sufficient impetus to convert the ideas in to a sustainable solution.

Reality check:

A hackathon generates ideas but often there is not sufficient impetus to convert the ideas in to a sustainable solution.

Key implementation steps include:

• Offer a sufficient prize to attract high quality teams. This can include a mixture of prizes, cash, job interviews, exposure to senior management, etc.

• Define specific goals and parameters.

• Have a plan for who should participate (i.e., anyone, internal/external to the company, employees only, strategic partners, etc.) and whether individuals need to join already in teams or will be allowed to form teams at the beginning.

What is the deal? 

These are short or long-lived programmes where a third party is engaged as part of the collaborative effort to provide funding, networking, or mentoring/training support and/or to act as a catalyst for bringing the parties together and helping them navigate their way to success.

Best for: 

Corporates without innovation expertise and/or ambitious early stage startups who want support (funding or otherwise) to engage with the right corporate partner(s).

Works best when: 

The 3rd party is highly adept at being an intermediary and the interests of the startups and the corporate are aligned.

Reality check: 

Costs associated with third parties can be higher than anticipated and all the parties need to be in alignment for the tri-party eco-system to thrive.

Key implementation steps include:

• Establish clear goals, objectives and guidelines for dividing responsibilities.
• Secure sufficient funding to keep the organization afloat for an extended period.
• Allow time and support for each step.
• Develop a sound technology platform upon which the ecosystem can operate and grow.
• Be flexible on IP ownership.

What is the deal? 

Businesses, governments or NGOs set up mechanisms to bring entrepreneurs and corporates together for mentorship and networking.

Best for: 

Big businesses who are looking to find idea generators, survey what's going on in areas of interest, and identify more speculative business opportunities and early stage businesses looking for mentorship and networking opportunities.

Works best when: 

Neither the big business nor the startup has well-developed, concrete business plans, the mentors know their business, and the startups appreciate the advice.

Reality check: 

Value proposition is highly speculative.

Key implementation steps include:

• This is an opportunity to enhance your reputation, while getting access to exciting new ideas and cultures.
• Recognise that build strong relationships takes time and sensitivity to the motivations of all participants.
• Understand the value of both parties - avoid typical big fish/small fish or client/supplier relationships.

What is the deal? 

Corporates and early stage businesses work together to co-develop a product that is jointly-owned.

Best for: 

Businesses wanting to tap into cutting-edge tech skills, and aspiring scaleups wanting to unlock the expertise and the ability required to grow.

Works best when: 

Both parties gain a considerable edge from the partnership.

Reality check: 

Clarifying roles and ownership in the enterprise is crucial.

Key implementation steps include:

• Set forth clear, achievable, and well-articulated business model and goals.
• Provide mentoring and support for the scaleup.
• Adapt corporate requirements to the scaleup’s strengths – allow for innovation and leeway.
• Allow enough time and support for each step.
• Clarify IP ownership issues at the beginning.

What is the deal? 

Corporates and early stage businesses work together to co-develop a product that is jointly-owned.

Best for: 

Businesses wanting to tap into cutting-edge tech skills, and aspiring scaleups wanting to unlock the expertise and the ability required to grow.

Works best when: 

Both parties gain a considerable edge from the partnership.

Reality check: 

Clarifying roles and ownership in the enterprise is crucial.

Key implementation steps include:

• Set forth clear, achievable, and well-articulated business model and goals.
• Provide mentoring and support for the scaleup.
• Adapt corporate requirements to the scaleup’s strengths – allow for innovation and leeway.
• Allow enough time and support for each step.
• Clarify IP ownership issues at the beginning.