Navigating the new frontiers of innovation

BigCo leaders must learn to navigate the new frontiers of innovation.

TechNexus began nearly fifteen years ago to bring Chicago’s nascent tech startup community together to create meaningful relationships and connect entrepreneurs in ways that helped us all build better businesses. Plenty of large companies also found value from this “frontier of innovation,” discovering new partners, new ideas, and learning “the ways” of communicating and working more effectively with entrepreneurs.

Chicago’s startup community grew up, and today there are dozens of great resources for nurturing our young companies. TechNexus then evolved and became more focused: we recognized the most valuable role we could (continue to) play was as “the guide” to the frontier, helping large companies learn to navigate, to “speak the language” of entrepreneurs (natives to the frontier of innovation), to build relationships and to explore and grow business together. Today, TechNexus is one of the most active venture investors in the country, targeting investments at the heart of collaborations with corporate partners.

BigCos across the globe are experiencing unprecedented economic disruption. Nearly 3 out of 4 companies on the Fortune 1000 list a decade ago are no longer listed today. Within the next 10 years, half of the Fortune 500 will have fallen off the list — even without the influence of the global coronavirus pandemic. Ironically, most big companies still won’t recognize the likelihood that they will quickly end up on the losing end of these equations. The “wild frontier” is now just outside every company’s front door, and adapting to the rapid, chaotic, ever-changing market is an essential survival skill. It’s not that large company CEOs are blind to the risk, but many (just like gilded settlers of old) are headed down the trail with bloated wagon loads, and too few of the right tools and skills they will need. To survive (and then thrive), they’ll need entrepreneurial pathfinders and collaborators with aligned interests. 

A few years ago, the TechNexus team spent some time with a large financial firm, learning about their innovation goals. They were nearly finished with a year-long internal effort, where each week they convened small focus groups of current customers and employees, challenging them to “think outside the box” and “help imagine what the company should become” to remain relevant. 52 weeks of “exploring,” and most of the ideas amounted to “keep doing what we do, just better, faster or cheaper”. 

This wasn’t surprising. For decades, the most popular management philosophy focused on sustainability and staving off disruption, not harnessing it to explore new frontiers. Successfully scaling a business was about reducing risk and variables and creating repeatable processes. Customers and employees were conditioned to value predictability (and struggled to see the firm as an entirely different business). I’m convinced that including entrepreneurs in those weekly discussions — people with different senses of survival (incentives and risk tolerances) — would have changed the outcome of that innovation effort, and helped that large firm find entirely new paths to market. Accessing a fresh, outside perspective is critical. You can’t build a fence around your business and expect to survive on the frontier. You might feel protected, but you’re not exploring, and you’re not really moving forward. 

Many businesses try to hire pathfinders–consultants to help them navigate the wild environment. The TechNexus team believes a better way is to curate a community of entrepreneurial insight that can be more provocative than anything consultants provide, with optionality that can be more actionable. The future of big business isn’t about sustainability anymore. And it’s no longer just about disruption. Innovation is now about survival. Whole industries are at risk of being replaced. Entrepreneurial activity will largely map out these new territories and accelerate this shift. And the other half of the Fortune 500 companies I mentioned earlier — the half that will survive a decade from now — those companies will adapt, collaborate to learn the trail forward, and thrive.

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