Can startups truly innovate by partnering with corporate giants, or as Dr. Shameen Prashantham puts it, “dancing with gorillas”? In this episode, Dr. Prashantham, professor of International Business & Strategy at the China Europe International Business School, joins Alex Raymond to share his research on corporate-startup partnerships. They explore how these collaborations have evolved, emphasizing the shift towards equity-based models and the critical role of non-equity partnerships in fostering innovation.
Dr. Prashantham stresses the importance of startups balancing optimism and caution when engaging with large companies. He advises focusing on core expertise and being strategic about revealing information to maintain leverage. Success stories like Techstars-backed Sphero’s partnership with Disney to create the BB-8 droid and Microsoft’s rise in the startup ecosystem illustrate the power of these collaborations.
The episode also delves into the democratization of partnerships, highlighting sustainability and positive impact initiatives. Dr. Prashantham underscores the necessity of complex arrangements involving city governments, NGOs, and United Nations agencies to tackle societal challenges. He showcases how startups can drive meaningful outcomes through innovative solutions, leveraging their unique strengths to create a global positive impact.
Quotes
- “Essentially, the insight was that you could bring together managers from big companies and entrepreneurs from startups to achieve something beyond what either could do on their own. Having studied many companies in different parts of the world and different industries, I realized that, knowingly or unknowingly, they were addressing what I call the paradox of asymmetry. On one hand, you have a potential win-win situation between these two different sets of companies, each having something the other lacks. Startups, for example, have agility, while big companies have scale.” (09:51 | Dr. Shameen Prashantham)
- “The big advantage of working with a large company is leveraging economies of scope to build partnerships across different units and regions. By being proactive and seeking introductions, startups can gain champions within the corporation. Many have benefited, but it’s crucial to keep future options open.” (27:54 | Dr. Shameen Prashantham)
- “For me, the idea that very different, asymmetric actors and nontraditional partners can come together is key. In terms of startups, particularly those leveraging digital technology, this is making a huge difference in many areas, helping people who are not privileged enough to have access to real-time information.” (39:26 | Dr. Shameen Prashantham)
Links
Connect with Dr. Shameen Prashantham:
Book: https://www.gorillascandance.com/
Connect with Alex Raymond:
LinkedIn: https://www.linkedin.com/in/afraymond/
Website: https://consciousentrepreneur.us/
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