Startup 101 - large corporations are the enemy; big, hulking slow-moving behemoths who could only dream of the startup nirvana of bean-bag chairs, branded t-shirts and ping-pong tables. Their only purpose in the startup ecosystem is to provide a target for you to disrupt, using your agile, cool new product or service to eat away at the market they had arrogantly and naively thought of as entirely their own.
Well, so conventional startup wisdom seems to go, and so indeed as I had bought into myself until beginning my current project 18 months ago. Working with the challenges of a relatively new scientific field - biomimetics - we decided that if we could harness the various and notable assets that collaborations with these large companies offered, we would be set on a much clearer path towards achieving our goals than if we embarked on a voyage of disruption.
This strategy led to a year of numerous proposals, pitches and meetings, brought neatly to a head by a recent exhilarating week on the West Coast of the USA exploring the specifics of some opportunities with companies whose annual revenues number in the double digit billions. Convincing corporations of this kind that any very early stage company has something substantive to offer is never going to be a simple process; these are some of the lessons I've learned along the way and which I wish I'd known before we started:
1) Know why you're there
This might appear so obvious as to not be worth stating, but from your very first interaction have a crystal-clear vision in your head of why you're bothering:
a) What can they offer you? Big companies have deep pockets and immense resources, sure, but if you're just looking for a cheque to help you develop your product or service then you're pitching to the wrong audience. We found more success in thinking a bit more outside the box: how could we tap into their world-leading expertises and talent pools; how could we maximise the kudos of partnering with one of the world's greats; in short, how could we benefit most from things that were easiest for them to give away?
b) What exactly do you want from them? Rest assured it won't be the same as what they want to give you, so if you're going to meet somewhere in the middle you might as well start from your ideal position. We found that nothing halts momentum more than not having a compelling and thorough answer to the question "so what do you actually want from us?"
2) Know what they want
Crystallise the reasons why what you have to sell will really mean anything to them, given the remarkable resources they can already bring to bear. How will it noticeably improve their product offering, their brand, their customer base, and so on. What are the key assets you have that mean working with you will help them solve a problem they never could themselves; people, processes, proprietary technologies? In pitching technology, we found the key was to move beyond the "How" - it does something in a cool new way - into the "(So) What" - what does that mean for the end consumer - and most importantly the "Why" - whatever the difference is, why will anybody care. We found companies of this size cared very little about the former, but perked up as soon as they began to visualise the latter two.
3) Find a 'champion'
Do your utmost to entirely hook in even just one of their people as early as possible. No deal worth its salt with a company of this kind will ever be signed off by one person, often even if you're lucky enough to be meeting people right at the top of the chain. Having someone who really believed in us to the point where they were selling our proposals from the inside became a crucial asset in navigating the maze of corporate sign-offs. To our surprise, we actually also found that the relative seniority of our 'champion' didn't have the expected linear relationship with their impact; in fact, it was often when we had convinced somebody in middle rather than senior management of our merits - the 'doers' - that we really started to see results.
4) Make it easy for them to say 'yes'
Even our most fearlessly enthusiastic champions often got held up when it came to crossing swords with the titanic might of a corporate legal team. Such teams seemed - understandably - naturally cynical and suspicious of partnerships with early-stage companies, who are almost guaranteed to be risky and often unproven propositions. Initially, we made the mistake of pitching 'all-or-nothing' propositions; multi-year agreements with 7 figure sums attached which met typically hesitant results. Without compromising on our goal or overall model, breaking this proposition down into bite-size chunks - staggered project plans with frequent stage-gates and results-driven revenue triggers - dramatically reduced the perceived risk factor and allowed a company to dip a toe into the water of what we were selling rather than being forced to dive in head-first.
5) Play to your strengths
Big companies are often governed by entrenched processes and routines that they find hard to break out of. If they present a commercial structure or anything like that that's not quite what you were after, if it's not a deal-breaker for you then swallow your pride and agree to it. We ended up banning the phrase: "that's not how we do things"; you can be certain you'll hear it from them, so we made sure to be flexible where they couldn't.
6) Be patient
The most painful lesson was how long things can take; whereas decisions on our side could often be made over a 30 minute meeting, similar actions on the opposite end often took anywhere from two weeks to a month. All we could learn here was that whenever the ball is in your court for an action, smash it back over the net as quickly as you possibly can.
7) Admit when it's not working
It's no secret that time is often the most precious resource of any early stage company, and it's an unavoidable truth that these processes will drain a lot of it. Just like any other kind of relationship, be brave enough to cut and run and move on when things don't seem to be heading in the right direction.Suggest a correction