Ask any CEO to define an ecosystem, and you’ll get as many different responses. Some see it as simply a sales channel, while others a marketing tool, a show of industry power & connections, and finally, some might hark back to their high school biology days. Still, those who define a venture ecosystem by pitch days, hackathons, or field trips to Silicon Valley will universally attest that they provide little in the way of tangible results for the corporation. Too narrow, too short-lived, too ethereal, too discrete are common reasons given, but when a venture ecosystem is understood, harnessed, and capitalized, so much more can be realized.
A true Venture Ecosystem is a network of interconnected corporations and startups, engaging as a collaborative community to sustain and grow.
If built properly with specific, actionable goals defined, a highly-effective bespoke ecosystem becomes a resounding platform of leadership for the corporation. It becomes the lynchpin in an interwoven set of relationships that fosters common interests, innovation, and revenue growth.
A strategic ecosystem approach produces 5 key results
New Market Insights
Your teams are aware and sophisticated. Of course, they know the ventures and innovations on the horizon that have defined themselves in your industry. They are already visible or even knocking on your door.
In order to build a strong, robust ecosystem, smart organizations must widen their venture view and look both beyond standard channels and geographies. By engaging a broad spectrum of ventures and taking an inquisitive look at how they are tackling the market, a corporation will be able to look beyond its own preconceived notions and amalgamate trends.
What underlying technologies are needed to drive your company forward and what ventures are out there leading the pack even if they aren’t focused on your specific industry?
What about upstarts outside your typical geographic viewpoint? Are the problems being solved in other parts of the world applicable and right for your future organization?
What about non-related industries?
Are you unintentionally wearing blinders?
Reflecting against this information is critical to driving the innovation agenda for your corporation.
New Products and Services
Frankly, the venture landscape is replete with companies that are tackling ideas you already have. But they are probably tackling those ideas with more capital than you’ve allocated to your internal activity.
Instead of looking at these ventures as ominous threats, they can be seen as unique opportunities–today’s ventures are your products, services, or solutions of tomorrow. Why not get involved with them early and have a hand in shaping their progress and future outcomes?
Don’t wait until the final product is fully refined and gaining market traction to understand how it will affect your business. Diving in early with the venture provides energy and inspiration you can’t get by yourself. In building relationships with these ventures, the corporation has the opportunity to grab on to that energy and use its brand and market presence to accelerate products.
They may fill a gap in the product set and it may become an acquisition in the future, but there is no doubt that these ventures have resources and focus that the corporation lacks. Why not form partnerships to both your benefit?
New Business Models
The world is changing fast. Even before the pandemic a new set of consumers and their desire to get what they want, when they want it without a full purchase commitment was becoming the norm.
Now the same consumption trend has been undeniably transformed by the pandemic and the ways in which we live and work. If you weren’t thinking about your business model before, you better be doing so now.
Are there ways to sell my product as a service?
Does my service need to be broken down into smaller bite-size opportunities?
Do I need to offer a subscription?
The list can go on and on and in the venture ecosystem, startups are doing exactly that–offering the same thing you sell in new and innovative ways that appeal to new audiences. Smart corporations recognize that given their history it may not be in their DNA to think that way. However, by engaging with ventures, learning from them, and understanding what their models require, corporations can put themselves at the forefront of where things are going.
New Markets
Do you have one homogenous customer base or is it much more nuanced?
In today’s world, it should be the latter.
New generations and more delineated subsectors of customer groups want something different. Instead of buying products outright, they want an option to subscribe to them. Sure, they will buy, but only if there is something a little extra. They’re willing to purchase a product or service even if it’s inferior to your product if it meets more of their needs.
A venture ecosystem provides corporations with access to these new markets, and partnering with them will open the door to areas that you previously thought were untouchable. With a venture, your markets become heterogeneous and more extensive, providing unique growth opportunities.
Cultural Change
For many organizations when bespoke venture ecosystems are built with a growth mindset and buy-in from the top, they have profound effects on the organization, culturally and financially.
Without saying a word, the presence of a venture ecosystem shouts your innovation narrative loud and clear to your employees. “We support innovation, the future is bright, we are here to stay!”
Instead of sitting on your hands, denying projections, or fearing the future, your company becomes deeply-rooted in the conversations that shape the industry’s reality– leading at times, but humbly following in others. Over time collaboration with ventures will result in your team building better products more akin to future growth.
There are many other reasons beyond the ones I’ve highlighted, but simply put building a venture ecosystem will drive the future of your business. Through a scaled approach of capital and collaboration with dozens of ventures, the corporation will see profound results.
It’s important the success reverberates around a bespoke ecosystem. The mantra must be “collaboration for collective success.” The ventures become successful through the relationship, as does the corporation at the center of the industry, with insights shared both ways.
With an ecosystem mindset and execution, the corporation will also find such diversification will provide more chances to win. The days of a few capital investments are gone. But done right, the result is another 20…40…100 years of growth.