Business innovation in itself is a herculean task, but is further complicated when a loner goes up against the established channels, industry knowledge and assets of the older companies. Thus instead of going all alone, start-ups would be advised to collaborate and leverage the mutual benefits provided by the established firms. This is true across industries- automobile, pharma or healthcare. The kind of all-out disruption and quickfire scaling common at Silicon Valley does not bode well in other industries. A good example would be that of pharma player 23andMe. They had a great IPO in 2009, but struggled later on thanks to untimely communications with the FDA resulting in temporary bans and later on a massive product recall. Tesla took a longer, more patient approach, yet is falling behind in design, so have approached Volvo to address this issue. Even established firms are struggling to cope up with the disruptions in notably the taxi and hospitality industries by Uber and Airbnb respectively. The older industries need to be transformed through knowledge of the regulatory environment, testing protocols and conventional physical assets. Business intelligence provided by CB Insights confirms that there has been a twenty-five percent rise in start-up investment since 2012 with a total of US$ 25 billion spent last year. The new model proposes that startups, established entities and VC funds work collaboratively.

Source:https://hbr.org/2017/07/innovation-is-as-much-about-finding-partners-as-building-products?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+harvardbusiness+%28HBR.org%29

Uploaded Date:28 July 2017