Business Trend: Dancing With Gorillas

MNCs are now increasingly engaging with start-ups to get back some of their earlier nimble-footedness; this can create huge value.

- Shameen Prashantham

 

The current fascination with entrepreneurship in mainstream society can be clearly seen in the wide coverage they get in the media. Such start-ups are viewed as proactive, nimble and agile, which allows them to be highly innovative and willing to take risks. This is the antithesis of how large multinational corporations (MNCs) are perceived by many: as slower, bureaucratic organisations that are no longer fleet-footed and, therefore, not as innovative or risk-taking as they once were.

Perhaps recognising this themselves, many MNCs are now actively wooing start-ups to engage and co-innovate with them. I recently talked to a number of MNC managers in Bangalore with job titles that, until not so long ago, didn’t exist: ‘Country Head, Startup Ecosystem’, ‘Startup Ecosystem Evangelist’, ‘Director of Startup Business Development’ – which suggests that some MNCs are making a concerted effort to engage start-ups. It wasn’t always like this.

When I first began a research programme in 2006 to study what I call “dancing with gorillas” – that is, how start-ups partner effectively with large MNCs – genuine engagement tended to be ad hoc and rare. The start-ups I studied in India back then had to work very hard to attract the attention of key decision-makers in (mostly US) MNCs. The story in the UK, where also I conducted research at that time, was not very different. Much has changed over the past decade. Nowadays, clearly identifiable network entry points exist for start-ups if they fulfil requisite criteria – typically, one should be developing offerings on top of the MNC’s platform technology. These network-entry points are often designated start-up engagement programmes: Microsoft’s BizSpark, IBM’s Global Entrepreneurship Program, SAP’s Global Startup Focus, to name but a few.