Startup-Corporate Collaboration: What You Need to Know Before Diving In
Remember the moment you conceived the idea for you startup business? Remember the exact moment you realized that your idea can change lives or make you an ungodly amount of money, or both?
We bet you felt prouder than a new parent. And perhaps with pride came a smidgen of possessiveness. Which is probably why when an opportunity to collaborate comes, you become wary. Because why would you want someone else to put their grubby fingers anywhere near your idea?
But you see, collaboration is one crucial key to success in business. In fact, if you are seriously intent on changing lives or making an ungodly amount of money, collaboration might just be what your startup needs.
Why Do Businesses Collaborate?
One of the tried and tested ways for a business to move forward is by using collaboration. We are not merely talking about collaboration within one team; intra-team collaboration is pretty much a given in any organization. Today, we will dive deep into business to business collaboration. As a startup, collaboration may be with other startups, a lone professional whose help your budding company needs, or with a corporation.
As a startup, you will probably not blink at the idea of collaborating with another startup or with an individual. You likely have the same level of passion and enthusiasm for what you do. A collaboration between businesses of similar sizes or scope will not make you feel extra possessive about your ideas. After all, this type of collaboration puts everyone in the same footing.
But would you feel the same when presented with an opportunity to collaborate with a big corporation? Would this type of collaboration fulfill one of your dreams as a founder? Or would the following questions be running through your head:
- Would collaborating with a corporation be considered selling out?
- Would the collaboration be fair, especially for your smaller company?
- What will your startup get out of the collaboration?
These are valid concerns, of course. Before we get around to answering those, let us first take a look at why a big corporation would want to collaborate with you in the first place. What makes collaborating with startups attractive to corporations?
Why Do Corporations Collaborate with Startups?
The reason may include some, if not all, of the following:
- Passion – Every single member of a startup company is dedicated and passionate about what they do. They believe in their product or service. There is no doubt in their minds and hearts that what they do can change lives. Or make them a lot of money, as it were.
- Innovation – Apart from passion, startups are also known for their innovation. They are known for their new way of doing things, whether in production, marketing, or in the many other ways of conducting business.
- Complete Team – Startups are small but they are often complete teams. Their manpower may not fill a skyscraper but every single employee of a startup has a role to play and is integral to the success of the small company.
- Fast Learners – A startup team is comprised of members that learn new things quickly. Unlike an established corporation with “old timers,” a startup has young-ish members who can learn new tricks quite easily.
All great reasons why a big corporation would want to collaborate with your startup, right? You are very much aware that these are qualities that your own startup possesses. When a corporation works with you, they will in passion and innovation. But what does your startup get in return?
What do Startups Get Out of a Startup-Corporate Collaboration?
- Financial Support – Startup-corporate collaboration is one way to get financial capital for your business. Startups are typically limited in budget. A big corporation, however, would already be raking in profit from their time in the industry. With the right collaboration, your budding company will be able to access deeper pockets, and consequently, be well on your way to success.
- Manpower – Guess what big corporations have that startups don’t? Aside from money, corporations have people. They have buildings of workers ready to make your product dreams a reality.
- Facilities and Other Resources – Apart from the manpower, corporations have facilities and resources that a startup might find difficult to access on their own. These would include important equipment and latest production technology.
- Distribution – Not only do big corporations already have the people who will help bring your ideas to reality, they also already have customers who will buy whatever fruits your ideas may produce. Let’s face it: not a lot of people are probably aware that your startup exists. This is not the case with corporations; they have customers and distribution channels that your startup could only dream of touching.
- Network – This can easily be lumped with the manpower benefit but we have to highlight this, especially when talking about startup-corporate collaborations. Corporations know experts and powers-that-be in many fields. By collaborating with a corporation, you, a small startup, will get your chance to work with these experts and powers-that-be. Talk about doors opening!
Other benefits of a startup-corporate collaboration include enhanced publicity, increased revenues, and boost in market and technical knowledge.
Sounds like a walk in the park, doesn’t it? Yes, you can expect the things above when embarking on a startup-corporate collaboration. But keep in mind that there are barriers, too.
What Barriers Can you Expect from a Startup-Corporate Collaboration?
- Slow Decision-Making Process– Startups and corporations are not structurally equal. Startups have the founder or founders and then you have the team members under them. That pretty much sums up your typical startup hierarchy. This is not the case with corporations, however. With big companies, hierarchy and structure are so rigid that decision-making can be a slow and complex process.
- Clashing Cultures – It may already be 2017 but there are some corporations that are still not receptive to the innovation that startups can bring.
- Rigid Processes – Flexibility is one defining trait of startups. And guess what? Flexibility is not exactly something that corporations are known for. They have rigid processes. They have done things a certain way for so long that having a startup muck about their process may not lead to a fruitful collaboration.
- Lack of Trust – There is often an imbalance of power in startup-corporate collaborations. Can a startup trust a corporation not to steal their ideas? Can a corporation trust a startup to deliver what they promised?
How Do You Embark on a Smooth Startup-Corporate Collaboration?
The barriers above should not stop you from embarking on a startup-corporate collaboration. Any kind of business endeavor is fraught with all sorts of barrier. The ones above come with the territory.
In order to enjoy a successful collaboration, try to build trust with the corporation you want to work with. There is a “getting to know you stage” in startup-corporate collaborations. If possible, go through a pre-collaboration period; try to establish a relationship, especially with your point of contact.
Speaking of point of contact, consider finding champions in the big company. It is essential to take care of the new network that will open up to you as a result of the collaboration. Furthermore, keep in mind that you don’t have to collaborate with just about any corporation that approaches you. It’s perfectly okay to feel possessive about your ideas. If you feel that the partnership isn’t fair, don’t sign the deal. If you think that a current partnership isn’t going where you think it should, you can quit. Knowing when to quit might just save your startup from eventual demise. After all, corporations can easily, albeit accidentally, kill startups.
Additionally, you also have to be realistic about outcome, improve your salesmanship, and take a balanced approach to intellectual property. Arm your startup with tools that are sure to make the process much easier. For instance, a good application for business to business collaboration is Dead Drop. Allowing for secure communication and limitless collaboration, this cloud-based app will allow startups to work with multiple corporations without worrying about data leaks.