Joining forces – 10 benefits that speak in favor of collaboration between established companies and startups
Digital transformation is gathering momentum in the economy. In fact it’s going full steam ahead, so it would be impossible to stop it now. It feels like no day goes by without a new trend rising out of the woodwork. But of course digitalization in the world of business is not just about opportunities – it also presents a number of challenges to established companies, just as much as more recent arrivals to business.
To deal more effectively with the challenges, it often makes sense to join forces. Working in unison, partners on different sides of the equation can benefit from each other’s strengths. Despite these advantages, according to a study recently published by the IT industry association Bitkom, many firms (77 percent) lack the right contacts to startups. The new.New Festival in Stuttgart, which will take place from October 8-10, 2018, offers the ideal platform for players on any side of a business equation to forge networks. Startups have until May 13 to submit an entry to the CODE_n CONTEST, which takes place during the international festival.
The benefits of collaboration:
New and original ideas are a defining feature of startups. But similarly, to remain competitive in the future it’s also important to regularly review, overhaul, and optimize business models, processes, and different approaches to task-sharing.
Established companies know the lie of the land because they look back on a long track record and already possess specialist knowledge. Startups have plenty to gain from this know-how. They can draw on experience and avoid the typical time-consuming and costly mistakes made by rookies.
- An appetite for taking risks
It’s not easy to summon up the courage to try something nobody’s ever done before, but this is another defining feature of startups that can be crucial when it comes to keeping up with the pace of digitalization. Those who dare, win.
- A culture of failure
This is about being able to talk openly about mistakes and learn from them – rather than pretend they didn’t happen and sweep them under the carpet. Startups have a culture of failure that revolves around finding solutions, and this ensures that they don’t make the same mistakes again. Ultimately, setbacks can save time and money.
Money makes the world go round. Established companies have the resources it takes to translate ideas into reality – from the finances, to people, and access to new technology. The difficulty faced by many startups is that they don’t have sufficient capital to turn their business concepts into reality or push them properly through media support.
- Market access
It’s never easy getting out of the starting blocks, especially when you’re faced with the challenge of introducing a new product to the market. Companies with sufficient experience under their belt typically have an array of selling options at their disposal. They can help startups to get things flowing – including revenues.
Long-established companies have a robust customer base that they have built up over many years. Startups can tap into the trust of these clients, especially when they’re launching products and trying to establish a name for themselves in the market.
3, 2, 1 – liftoff! Startups don’t normally have sufficient resources to tinker around in product development for years. Instead, they resort to rapidity when it comes to getting products onto the market – and into customers’ hands. Also, they have flat hierarchies and this makes it easier to make quick decisions and accelerate things.
Companies that have been built up over many years will tend to have fixed structures, clearly defined responsibilities, and standard processes. These are an asset when it comes to sending innovative business concepts on a safe journey. They are also an opportunity for startups to establish a sense of routine and security.
- Alternative working practices
Startups are flexible and often apply agile methods. As a result, they don’t sit down at the beginning and plan every stage of product development. Instead, they adapt things as they go along. This makes it possible to take emerging trends on board and immediately integrate new knowledge.
Both established companies and startups have plenty to gain from the benefits of collaboration. But it’s important to remember that they will come at things based on different requirements. Also, they may not have overlapping expectations. But if they can identify enough common ground to keep both parties happy, collaboration will be a highly successful undertaking.