New technologies are emerging every day. And every day, startups are using these technologies to design new services and apps. Innovation is racing forward. Finance, insurance, agri-food, health – no sector is left behind. And they now all have a technological counterpart, supported by a vibrant startup ecosystem: FinTech, InsurTech, FoodTech, E-Health… The list goes on.
The wind is changing, and it would take a truly smart person to predict where the next technological tidal wave will strike. The solution? Stop being passive and start taking action! Still not convinced? Here’s 5 reasons for major groups to work with startups.
Reason 1: Actively monitor trends in your sector
Put simply, it’s vital. Every company should carry out active technological monitoring of the startups in its sector. It’s a way for you to identify trends before they transform your market forever. The aim is simple – make use of new technology to avoid falling victim to it. And so you don’t experience the sad fate reserved for companies that are less vigilant, like Kodak and Blockbuster.
Groups as big as these two companies obviously find it harder than others to take the step back that’s needed to detect new trends. It’s simply down to their size and their complex structure.
And that’s why it’s important to work closely with startups. On one hand, it lets you keep your finger on the market’s pulse so you can identify weak signals. And on the other, once you’ve identified a trend, you’ve got a good way to seal strategic partnerships with the startups behind an innovation. An innovation that could complement your own, or even supersede it.
Reason 2: Reveal synergies with emerging technologies in other sectors
But why limit yourself to monitoring startups in your own industry? After all, innovation can come from anywhere. Who would have thought in 1714 that a clockmaker would discover how to calculate longitude at sea? At the time, the scientific community was counting entirely on astronomy to resolve the issue. Innovation and creativity find their roots in curiosity and open-mindedness.
It’s a chance to test out new technologies and business processes that aren’t necessarily linked to your business or sector, but which could open doors to new products or services.
Let’s look at a concrete example. In Ghana, a man who is just 29 years old recently developed a land registry management system using blockchain. It’s revolutionary in a country that’s been seeking out a viable solution to this administrative puzzle for over a decade. But blockchain was originally associated with transfers involving bitcoins, the electronic currency that’s been in the headlines for a few years now. By taking inspiration from technology used in the financial sector, this young Ghanaian resolved a complex property problem.
These two examples show us the extent to which all sectors – without exception – can be infiltrated by technologies that emerge in a range of fields.
Reason 3: Open new development and growth avenues
Startups are excellent concept labs. They’re places where it’s possible to experiment with new products and services. Where the potential of a niche, of a new market, can be measured. They act as a sort of life-size test that’s much more reliable and concrete than market studies can be.
That’s why companies such as Google acquire stakes in startups in fields as varied as the automotive sector, artificial intelligence, pharmaceuticals, and virtual reality.
Reason 4: Define the next technological standards of your industry
Supporting startups also gives them the chance to use your technology. And the products and services that emerge will have one thing in common: your patents.
Essentially, it’s a question of setting the standards in your sector before your competitors do. It’s how you can become the leading player in your market for the next generation of products and services. After all, it’s what Microsoft did with its .NET framework. The American giant developed a framework that allows developers to create, release and maintain Windows apps more easily. By making this service available to startups, Microsoft pulled the rug out from under the feet of its competitors, such as IBM.
Reason 5: Boost demand for your products and services
So you’ve made your technology available to startups to allow them to develop their products and services. What better way to stimulate your long-term demand? If these fledgling firms grow big enough to build a market, your own market share will be safe for a number of years.
And so it’s a way of making your business sustainable using an existing technology rather than from a desire to generate new concepts.
Whether you want to keep an eye on the trends in your sector, seek out innovative technologies so you can stay ahead of the game in your market, or just secure your business’s future, startups are your greatest asset. Through the partnerships you forge with startups, you’ll become the driving force for innovation in your sector.
Do you want to work with startups and seek out new technologies? Let us help you with your drive for innovation.