By 2021, the number of start-ups in France is expected to reach 1 million. This is much more than a trend! It's the perfect situation for large companies to collaborate with start-ups to integrate innovation into their habits, and for start-ups to collaborate with large groups to launch themselves. But what is the relationship between large corporations and start-ups? How do large corporations adapt to start-ups, and vice versa? How do they work together?
# Why collaborate?
Large companies and start-ups are opposites. Different goals, different culture, different way of working... in short, it's not the same system at all. So why collaborate? Because there are advantages for both!
Why do start-ups work with large corporations?
Firstly, it enables them to expand their network by coming into contact with many valuable people. Indeed, with this collaboration, start-ups benefit from direct contact with top executives. Secondly, working with large companies gives them rapid access to global markets, since they are already established abroad and have greater experience in the field. This collaboration also gives start-ups access to previously inaccessible resources. By working with developed companies, they gain access to laboratories, patents, partnerships, etc. Finally, major groups help to give start-ups visibility and credibility. This is an essential point, especially as reputation is crucial in the business world.
Why do large companies work with start-ups?
Start-ups mean innovation! Working with them gives companies access to the latest technologies on the market, which means producing faster and gaining speed - a real competitive advantage. This saves time and resources. Secondly, by collaborating with start-ups, large companies also gain access to specialized skills, as they call on experts in their fields. Last but not least, collaboration improves brand image. Companies associated with start-ups have a visionary image that attracts the younger generation. It shows that the company is at the cutting edge of technology and knows how to develop creative solutions.
# Successful collaboration
Developing a partnership between these two players is not as straightforward as you might think. So we took a look at the keys to successful collaboration.
Among the keys to success is an analysis tool that includes 3 important points:
- The first point to remember is strategic fit. In fact, it's vital that one company's solution or product meets the needs of the other. We're not going to collaborate with a start-up that's going to do nothing to help us in our business.
- The second point to consider is the ability to act. This includes the level of risk both the company and the start-up are prepared to take. Indeed, start-ups are agile but fragile, which is a real risk for large groups. Conversely, large companies can be expensive and slow-moving, which is a risk for a fast-growing start-up.
- The final point concerns the balance of power. A good partnership requires a balanced balance of power. Indeed, with the power they wield, large companies can modify the start-up's basic strategy. To avoid this, power must be balanced between the two parties.
This analysis tool is certainly not yet very precise, but by using it we can already get an idea of the success or failure of a collaboration. Partnerships are not to be taken lightly. A company can lose a lot of money and a start-up can collapse.
According to a professor of entrepreneurship at KEDGE, the 3 main obstacles to these collaborations are, first and foremost, a lack of mutual knowledge. In fact, the two structures know very little about each other. Secondly, the needs of large companies are poorly identified. The final obstacle is the way in which the start-up is introduced to the group, which is constantly redirected to different managers. To overcome these obstacles, this professor suggests the following solutions. We need to clearly define our working methods. Then, it's necessary to identify the needs of companies so as to meet them in the best possible way. You also need to communicate clearly and designate a sponsor within the group, so that the start-up has someone to turn to.
# How do these collaborations develop?
In 2009, 92% of major French companies were involved in collaborative ventures with start-ups. In fact, France is ahead of Germany and the United States when it comes to such collaborations.
Start-ups take over shopping centers
Successful collaborations include that between the Unibail-Rodamco-Westfield group and start-up Too Good To Go. The aim of this partnership? Reduce waste from food outlets in shopping malls and collect as many meals as possible. This collaboration has enabled To Good To Go to get off the ground and the group to develop its CSR policy.
Canal + Group chooses start-ups
A second example is the partnership between Canal + and start-up Wildmoka. Here, the aim was to enable web users to share and comment in real time on the highlights of their favorite shows.
Leroy Merlin bets on strat-ups
For many years now, the French retailer has been collaborating with some twenty start-ups. From delivery with Colisweb, You2You and Joko, to in-store data analysis with Retency, to sales forecasting with Metigate, the subjects are diverse and varied. The group has even set up a Start unit to accelerate innovation and foster partnerships.
These examples show that, despite the differences between large companies and start-ups, they are able to create great projects together. In these partnerships, both parties win. Big business, with its power, gives visibility and credibility to start-ups that are just getting off the ground. They speed things up and enable us to constantly adapt to our ever-changing environment.
