Open innovation, or collaborative innovation, is certainly a hot topic, and something that I’ve touched on numerous times over the past few years.
JLINX is an incubator based in Belgium that offers startups a way to develop from within the companies life science ecosystem.
“The mission of Johnson & Johnson Innovation is to identify and advance the best science – internal or external,” said Paul Stoffels, Chief Scientific Officer and Chairman, Pharmaceuticals, Johnson & Johnson. “We are confident that JLINX will create a vibrant ecosystem of start-ups and entrepreneurs with access to the world-class expertise and technology at the Janssen Campus in Belgium and within our global network.”
Getting It Right
Whilst the B2C space has made ample use of the Web to broker these open connections, it has been less common in the B2B field, where a smaller number of deep connections is more common.
Much of the challenge here is to sift through the huge amount of information required to make informed decisions. I’ve written a few times previously about automated platforms that aim to make finding the latest research in a particular field that little bit easier.
Whilst sites like Semantic Scholar and Meta are undoubtedly useful and you sense a valuable step in the right direction, they still struggle with providing busy executives with the context required to make decisions.
The Virtual Technology Cluster (VTC) Group attempt to take a much more curated approach to innovation. They aim to provide companies with a customized ecosystem of startups, academics and government agencies to help bring the latest innovations that are happening in their field.
The first application of the VTC model was launched last March at Lockheed Martin. The network focused on cyber security and now contains over 70 technology companies and 13 of the top universities in the U.K. for cybersecurity.
“The virtual nature of the VTC Group means that entrepreneurial IT startups don’t have to consider moving their operations in order to access large corporates, potential customers, partners and advisors. The virtual nature also means that startups benefit from access to large organizations and expert scale up advice through webinars and video master classes. As each Cluster also welcomes SMEs and listed companies, startups are also able to collaborate with smaller, more established companies,” Auriol Stevens, CEO of VTC Group told me recently.
The network provides a curated feed of information from these organizations that Lockheed executives can monitor for an easier way to stay on top of what’s happening in their field.
This curation process is crucial as there are considerable, and often unforeseen costs involved in open innovation. A recent Spanish study found that whilst open innovation did indeed increase the innovativeness of an organization, it also significantly increased the costs.
A Balanced Relationship
There is also a strong desire for a balanced relationship between big and small companies. A recent Accenture report highlighted the reluctance of many startups to engage with large company’s for fear that the dice are loaded against them. It’s a challenge that VTC are keen to overcome.
“We are trying to create a safe environment for startups to play with large corporates, where the curated interaction between them builds trust and ultimately leads to revenue opportunities. Our success is determined by commercial impact, and the quantifiable financial benefit accruing to the startups through their collaboration with sponsors and large companies. The VTC provides a complementary platform for all existing accelerators, incubators, Academic programs, etc. as we focus primarily on connecting the innovation within each VTC to revenue,” Stevens continues.
It’s an approach that the innovation platform The Bakery very much endorses. They work backwards from a real business problem that a corporate is having, and then use the budget assigned to tackle that problem to trial various solutions from a startup.
“We’ve developed a process to ensure that every engagement with a corporate leads to a real trial of new technology and revenue for a startup, normally within a matter of weeks, because we do the hard work beforehand, identifying the brief, tying down the budget and setting the timeframe expectation,” says The Bakery cofounder Andrew Humphries, who is due to speak at the upcoming Open Innovation Summit in London.
The results thus far have vindicated the approach, with clients such as Unilever, Panasonic and BMW conducting over 70 trials of new technologies and generating over £3 million in revenue for the startups in the program, all without any equity being lost along the way.
Programs like these aim to make the open innovation landscape a bit more evenly weighted and help startups gain a real foothold in industry and scale up more successfully.
This article was written by Adi Gaskell from Forbes and was legally licensed through the NewsCred publisher network.