How Startups and Large Corporations Connect Successfully
by Avery Stone Fish
Chicago has evolved from a city of large corporations to an ecosystem that includes entrepreneurs and startups. With the growth of incubators and accelerators, with over 100 shared workspaces and incubators in Chicago today (source), large corporations are continuing to see the value of connecting with small startups.
Major companies from McDonalds and ConAgra to Motorola and GE Healthcare have moved their headquarters into the city to attract talent and connect with startups.
With large corporations’ growing desire for connecting with startups, one question that comes up in every entrepreneur’s mind is ‘How can I develop a partnership with a large corporation to cultivate credibility, connect with potential customers, or get an investment opportunity?’
As the number of successful corporate-startup connections continues to grow, people like Kristi Ross, who sold her last company to TD Ameritrade for $606 million, and Mark Lawrence founder and CEO of SpotHero, offer prime examples of these successes. On the corporate side, leaders of big companies like Brian Krause, Vice President of Marketing and Communications at Molex, know that startups provide insight and perspective that is often overlooked in large corporations. Through conversations with these corporate leaders who believe in connection-making, I came up four guidelines to increase the success rate of connections between large corporations and startups:
1. Leverage relationships to find the right person
“The key to connecting with large corporations when you are a startup is to find the right person in the organization that understands the need for your startup AND actually can move the dial. They need to be a decision maker and someone who is focused on more than only their department. If you can get to the CEO or executive team member, you have a better chance of successfully maneuvering the political landscape often found in large organizations” – Kristi Ross, dough Inc.
If you can find someone who understands the need for your organization, but they aren’t senior enough, they won’t be able to help you out on their own. They are still a great person to know, but you should leverage them for an introduction to a more senior person at the company. A warm introduction is always more welcome than a cold intro.
2. Walk in their shoes and cater your approach
“You need to describe how you are going to change or disrupt what’s out there with your technology and how the company fits in. Think about it from their perspective, think about it as an investment.” – Brian Krause, Molex
Knowing what the company stands for as well as what problem they are trying to solve allows you to clearly communicate the way that your strengths align with their needs. You want to make it as easy as possible for your timing-conscious contact to understand the way that you can fit into their organization.
3. Demonstrate your value and start small
“It is so much easier to start with a pilot and expand it. With a pilot, you don’t have to get approvals from legal and all the different departments, which could take a year, which is a lifetime for a startup. Start with value—not necessarily a contract. By the time the contract has gone through, the premise may have shifted.” – Mark Lawrence, SpotHero
Build a working relationship by running a pilot to demonstrate your value practically. Showing the company what you bring to the table instills confidence that a larger partnership will be mutually beneficial. Clearly articulate your value consistently to the right person, and they will become an ambassador for your success.
4. Stay persistent – it’s worth it
“Being unsuccessful often comes with lack of follow up and timing. Understanding the timing and schedule of the person you wish to work with is one of the more important logistical coordination nightmares that can lead to unsuccessful attempts and waste of time.” – Kristi Ross, dough Inc.
Startups need to maintain a high level of patience to connect with large corporations, who often take much longer to make decisions. You must set realistic expectations and goals internally, understanding that persistence in your approach and patience in your mentality will be paramount to sustaining a relationship throughout the partnership.
For a corporate-startup partnership to be effective, both parties need to see the value in the relationship. Communicating your value as a startup and understanding the value your potential partner can bring to the relationship will ensure that this partnership continues to be fruitful from start to finish.
Avery Stone Fish is the Program Manager for the Innovators Connection at Chicago Innovation where he runs the Corporate-Startup Matchmaking program. Avery also works as a Consultant at Kuczmarski Innovation, an innovation consulting firm in Chicago.