Large corporations are taking note of startups making disruptive moves in their industries. If you've seen HBO's Silicon Valley, you saw how Hooli and Pied Piper battled around various competing products the two offered. This is rarely the reality of how corporations and startups interact with each other.
Corporates and startups more frequently form mutually beneficial relationships that help drive both of their business goals. For startup founders, the question is when and how to get involved with large corporations.
You might be suspicious about working with corporates. In the long run, you might be looking to beat them. But, there are many benefits to both startups and established companies in working together. It's something I'd know a lot about -- Techstars often helps connect the two.
Building and maintaining the livelihood of any upstart is hard work. Building a large and fruitful network is a staple to success. Working with well-established companies allows startups to build a larger, industry-specific rolodex that can lead to many opportunities, including these three:
1. Direct sales, or white-labeled selling through corporates
They may not have the technology you offer, but instead of offering to buy your company altogether, or taking the time to build something of their own, they want to buy what you've spent your lifeblood working to create. Having large corporates as your customers will allow you to sell to larger and larger companies by using corporate relationships as case studies.
This summer, Amazon acquired PillPack, a Techstars alum and former Inc. 30 Under 30 company, to deliver medication straight to your door. The purchase showed how Amazon needed a startup solution that would gain traction quickly, confirming that PillPack was really on to something and could leverage their tech with corporates. Now, businesses that rely on in-store pharmacy sales, like Walgreens and CVS, are looking to Amazon and PillPack as an example for how startups can help larger, more established brands remain relevant and help them innovate.
This same dilemma is happening with local grocers. Food delivery by Amazon, Blue Apron and Plated have traditional grocers nervous that their business will take a hit as more consumers order their groceries online. Albertsons reacted early, gobbling up Plated to help jump ahead of the curve -- another example of a startup with a solution that big corporates wanted.
If an exit isn't your goal, and your product or service isn't necessarily what they're looking for there's something else you can sell: your startup mindset.
3. Discovery through experience
The times are a-changing when it comes to how large corporations innovate and iterate their business models.
I've seen some of the largest companies in the U.S. -- including household brands in tech and retail -- look to learn from the startups in the Techstars network. Now, my team and I work to connect startups directly with those companies. They might be struggling in certain areas that are prime for startup-style disruption, or could benefit from learning more about how startups think about solving problems differently than more established, old-school firms.
Doing so can expose you to real-life issues impacting corporations, giving you valuable experience in solving real corporate problems -- which you can then apply to your own business as you grow. It helps you ensure your products and services align with your target markets. You learn to work in tandem with a larger team to solve challenges.
Whatever your goal, it's time to embrace the corporate life that may have led you down the path to entrepreneurship in the first place.