The top 3 objections to startup partnering and how to overcome them

August 13, 2021
Setting up a new startup partnership within your corporation can be delicate balancing act. You might encounter some hesitations along the way, but with an adept innovation manager and defined processes set-up, you can ensure a fruitful relationship. Here is a guide to address the top 3 business unit objections to startup partnering and how to overcome them.

Introducing a startup partnership within your business unit (BU) may seem like a daunting endeavor, and it can be met with resistance. Our Corporate Innovation Managers (PoC managers) have seen the impact of startup partnerships at the ground level of leading corporations like Siemens, BSH, and Telefonica, and have learned how to respond accordingly to BU objections. We recognize that innovation pushes us to progress, create, and remain competitive in a fast-changing world, and the best way to stay on top is through startup partnering.

Startup partnering fears

Our PoC managers are driving change on the innovation front, working side-by-side with large corporations to build efficient and effective startup partnering processes. Taking on the role as mediator between both parties, our PoC managers have thus managed a wide range of hesitations and fears when it comes to startup partnering. The top three objections that arise are culture fit, unawareness of partnering options, and a lack of knowledge on how to set them up. 

Objection #1: I am concerned about culture fit

BUs that are unfamiliar with venture clienting often have the image that startups are scrappy, small ventures in their parents’ garage somewhere in Silicon Valley. They believe startups are not sophisticated enough due to a lack of processes and organization. In addition, there are doubts regarding market readiness - the tools might not be fully developed or the service is not at a standard that a corporation would need.

Objection #2: I am unaware of the option to partner with startups

Some BUs just do not know there is an option to form startup partnerships - they often think that this means having to buy or invest in the startup. There is a lack of information within the corporation that one can actually buy startup products and partner with them.

Objection #3: I do not know how to set up a startup partnership

Most corporations have no systemized startup partnering processes in place. Venture clienting has recently picked up momentum in the last few years, but few companies have been able to streamline procedures in regards to sourcing, managing, and scaling PoCs.

“With change management, you should approach business units on their level and make sure that they feel safe with you. They are leaning on you for expertise, and it is your role to take on their fears and provide them with a sense of security."
Madlen Weinhardt, Corporate Innovation Manager @ GlassDollar


What is really needed is serious change management since business units are not aware on how far startups have come. Startups have real solutions that can be applied quite easily, and they can also still pivot to the customer if needed while larger corporations usually cannot.

How to overcome business unit objections

The underlying solution to mitigate the top three objections is to make sure you have a good PoC manager who will always act as a bridge between your BU and the startup.  

Solution #1: Innovation managers drive change management within the corporation to align culture fit

The PoC manager is the buffer between your BU and a startup to ensure smooth communication and remove any emotional aspects that may block a fruitful partnership. Since both sides come from very different work cultures, it is imperative that a good PoC manager presides over change management and acts as a point of security.

When our PoC managers enter a corporation, they approach the BU on a personal level and make sure that everyone feels safe and heard during the process. They build trust by listening to pain points and addressing any concerns through open communication and aligned goals. Our PoC managers make it clear from the beginning that even though startups are still developing products, they have real solutions that can be easily applied and pivoted to the customer. This presents a chance for success as well as invaluable learnings even if a project were to fail. It is important to deploy expectation management upfront and be transparent about risks as well as potential successes.

To convince your BU unit about startup reliability, emphasize the track record of successful partnerships with positive results. This can be shared through success stories and case studies of other companies; for example, a project that resulted in a 50% adoption rate or a startup solution that saved 30.000€ a year for one factory assembly line. 

Also, make sure you have good sourcing to choose the right startup for the best possible partnership. Have your PoC manager prep the startup for meetings with your BU in order to make sure they have all the relevant information to present and ensure good implementation. When startups are well-prepared for meetings, it is easier to identify problems and have questions ready to fully explore the depth of clients’ pain points. This helps the product perform better since it is more targeted to the problem.

Solution #2: Position your innovation unit as the problem solver within your company by creating awareness on startup partnering

It is up to the innovation unit to create awareness and encourage startup partnering by emphasizing success stories and showing startups as reliable partners. BUs will be more open to set up a partnership if they see  that partnering is a very effective way of getting great solutions for their problems.

Promote startup collaborations through marketing outreach and material such as newsletters, events, use cases, and case studies to assuage any fears around partnering. This is also a chance to give BUs more exposure and transparency to ongoing projects. If they see others are using the approach with successful results, they are more likely to try it out. A good example of this is when corporations send out a quarterly newsletter with updates on an ongoing BU-startup partnership, there is always a consistent increase of internal problem briefings sent in.

Solution #3: Establish clear processes that remove overhead from the set-up of partnerships 

A PoC management software can help your BU set up clear and effective processes. Over the past years, GlassDollar has helped corporations pinpoint problems in their existing startup operations and developed procedures on how to solve them. By streamlining processes and automating tasks while still delivering high-quality projects, GlassDollar has developed an end-to-end PoC management solution that can easily set up your corporation’s startup activities.

This software solution will help you run more and higher quality startup projects by identifying innovation opportunities within organizations, providing first-class startup sourcing, managing and scaling projects, and quantifying value with impact tracking metrics. Touted as one of the best sourcing tools across the board, GlassDollar will quickly source the best startup option for your BU’s problems, and start you on your partnership journey. 

Pair this software solution with our best-in-class PoC managers who are well experienced in setting up first-time partnerships, overseeing pilots, and guiding change management. With these tools in hand, you can ensure that your startup partnerships will shape the innovative landscape within your corporation.

GlassDollar offers an end-to-end PoC management software solution that helps global companies like BSH, Daimler, Telefonica, and Miele scale the adoption of impact-driven technologies.

Are you looking to make your startup collaborations more impactful and scalable? Then book a free consultation with our innovation success managers to identify the next steps towards optimizing your startup partnering activities.

Further Reads

Expert advice

Best practices for innovation managers and business units to effectively communicate innovation requests

How to describe your problem and pain points objectively in order to find the best-matched sourcing results

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Fundamentals 

How startup partnering gives your corporation a competitive edge

What is startup partnering and how can it elevate your company's innovation activities? Read on to discover how external sources of innovation are shaping corporate strategies.

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Success stories

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Manufacturing companies' race towards automated workflows takes a new turn when AI-enabled voice machine control systems enter the production lines. See the results from BSH Home Appliances's partnership with startup Fluent.ai.

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