This article was first published in Global Corporate Venturing 2012 Powerlist 100 supplement, Nov 2012
In today’s fast-paced and rapidly changing world, it is clear that the great businesses of tomorrow will be those that truly embrace innovation.
Indeed, research carried out by McKinsey & Co in 2010 showed that 84% of executives think innovation is extremely or very important to their company’s growth strategy. So what will drive this innovation? People. The reality is that people sit at the heart of all ground-breaking developments and discoveries. It is people that take the risks needed for true advancements to be made, people that have the vision to not just do something better or faster, but to do something totally different, or in a completely different way.
In a very close second place to people – culture. Even the most visionary people need the right environment in order to deliver their best. Once you have the right people working in the right culture, the groundwork is in place for real magic to happen. The recent rise in the number of businesses appointing a chief innovation officer perhaps demonstrates that the corporate world is waking up to this fact and taking steps in the right direction. The increased focus on championing the “intrapreneur” is another clear sign. That said, there is still a way to go.
In her new book, Welcome to Entrepreneur Country, Julie Meyer talks about the need for “David and Goliath” to find new ways of working together. Nowhere is this more true than in the world of corporate venturing. Corporate executives and entrepreneurs are typically very different animals – with each bringing a very different set of skills to the table and benefits to an organisation.
Goliath has the brand, distribution and financial backing that most Davids can only dream of. David, on the other hand, free from traditional corporate restraints and less averse to taking risks, brings the agility and free thinking needed for true innovation and pioneering advancements.
This is what makes corporate venturing such an exciting and interesting domain. Done properly, the somewhat unique blending of Davids and Goliaths should create the optimum environment for commercial success.
There are numerous different routes a business undertaking corporate venturing can take. Each route has its own share of success stories and, of course, failures. The specific path taken is not the issue here – it is the people who are taking the business down that path. Determining who the right people are is both an art and a science. Regardless of the specific corporate venturing route you have chosen or are considering, external specialist talent should not be ignored.
Is your project time critical? If so, the agility of an interim executive might be particularly beneficial. Perhaps the venture you are working on needs a short, sharp, but heavy dose of research and development expertise or experience of launching into an international market. Again, a specialist interim could prove an invaluable resource.
Will the business need further rounds of investment? If so, the venture needs a backable leadership team and the right people for this path are more likely to be permanent appointments. Non-executive directors can add significant strength to the board. They help to align stakeholder objectives and provide an informed yet independent viewpoint beneficial to both the backer and the venture.
Personal investment from individuals in any of these roles, provides an added layer of commitment and demonstration of intent and is an area where we foresee significant growth over the next few years.
Once you have determined the skills, experience and mindset needed from the people you share the corporate venturing path with, the way they are incorporated into the business deserves careful consideration. The success of any high-growth venture – whether or not it benefits from big-company backing – very much depends on maintaining and developing the entrepreneurial spirit that created the business or idea in the first place. Just as an exceptional entrepreneur may not be well placed to handle the day-to-day management of a large enterprise, the most talented corporate executive may not be the right person to take forward a new initiative.
Collaboration is the key to a successful future. Early- stage businesses can learn much from their more established peers, but equally, the giants can, and should, learn from the ever-increasing entrepreneur community. Creating boards and leadership teams that combine the best of both worlds is where corporate venturing can play a crucial role in making this happen.
Click on the link for Global Corporate Venturing 2012 Powerlist 100