Why Enterprises and Startups Collaborate

 
 
By Dennis McCafferty  |  Posted 10-15-2015 Email
 
 
 
 
 
 
 
 
 
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    Why Enterprises and Startups Collaborate
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    Why Enterprises and Startups Collaborate

    The relationship between enterprises and startups is often necessary for both to succeed—despite their seemingly opposed business views. Still, it’s complicated.
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    Learning Opportunity
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    Learning Opportunity

    82% of surveyed execs at large companies said they can learn how to become a digital business from startups/entrepreneurs, and 50% believe they need to work with startups/entrepreneurs to become sufficiently innovative.
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    Prosperous Partnership
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    Prosperous Partnership

    Survey respondents from enterprises expect the proportion of their revenues generated by collaborations with startups/entrepreneurs to rise from an average of 9% today to 20% in five years.
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    Approval Rating
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    Approval Rating

    71% of execs at major companies said they are collaborating successfully with entrepreneurs, compared to 57% of entrepreneurs who agree.
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    Priority Adjustment
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    Priority Adjustment

    78% of survey participants at large businesses said that working with entrepreneurs is "important" or "critical" to their own growth and innovation, but only 67% of entrepreneurs feel this way.
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    Non-Committal Response
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    Non-Committal Response

    29% of entrepreneurs said large organizations lack the commitment needed to work together, compared to just 7% of execs at large enterprises who say this is true.
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    Confined Environment
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    Confined Environment

    75% of survey respondents at big businesses describe themselves as sufficiently entrepreneurial, but 75% of startup leaders who worked at large companies said they left because they didn't feel that they could be entrepreneurial there.
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    Inequitable Arrangement
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    Inequitable Arrangement

    41% of execs at large organizations believe small, startup-styled businesses are committed to supporting their growth as they work together, but only 24% of entrepreneurs feel large enterprises are similarly committed to supporting the growth of smaller businesses.
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    Public Assistance
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    Public Assistance

    46% of survey respondents at major corporations say their government makes it easier for large companies to collaborate with startups/entrepreneurs, but just 30% of entrepreneurs agree.
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    Big Benefits, Part I
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    Big Benefits, Part I

    53% of execs at large organizations said accessing specific skills and talents is a top benefit of collaborating with startups/entrepreneurs, and 50% said the opportunity to enter new markets is a top benefit.
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    Big Benefits, Part II
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    Big Benefits, Part II

    49% of entrepreneurs said getting access to a large enterprise's distribution network and customer base is a top benefit of collaborating with these companies, while 45% cite the opportunity to serve as a supplier for these big organizations.
 

CIOs and other executives from large companies are learning how to foster a more innovative and effective digital business environment through their ongoing collaborations with entrepreneurs and startups, according to a recent survey from Accenture. However, the accompanying report, titled "Harnessing the Power of Entrepreneurs to Open Innovation," reveals that this developing relationship has seen its ups and downs: Enterprise leaders expect to generate increasing revenues thanks to input from entrepreneurs. Yet a notably higher share of these leaders feel that the collaborations are a success, compared to their entrepreneurial counterparts. And many entrepreneurs harbor reservations about large companies in general, given that they left these employers because they felt their ability to innovate was stifled by the prevailing corporate culture. "Despite the mythology that has built up around the disruptive power of startups, the overwhelming majority will need to leverage the market power and scale of larger, established enterprises if they are to be truly successful," according to the report. "For their part, large companies are feeling pressure to innovate and become more entrepreneurial, yet find their culture and structures getting in the way. These two kinds of organizations—entrepreneurs/startups and large enterprises—need to combine their respective, distinctive capabilities and collaborate in new ways in the digital era." An estimated 1,000 execs from large enterprises and 1,000 entrepreneurs took part in the research.

 
 
 
 
 
Dennis McCafferty is a freelance writer for Baseline Magazine.

 
 
 
 
 
 

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