Experts at Dallas Startup Week told entrepreneurs that large companies are looking for startups to can help them innovate. So why shouldn’t that be you, they told entrepreneurs.
“When we think about the next big thing or next great idea … that’s definitely not coming from inside the organization,” said Sherif Mityas, TGI Friday’s former chief information officer who was recently named chief experience officer. “It’s really coming from the startup community.”
For a panel discussion at Dallas Startup Week, Mityas joined Jason Illian, the locally based managing director of Koch Disruptive Technologies, the investment arm of Kansas-based Koch Industries. The two offered suggestions for startups trying to link up with larger organizations, providing best practices and encouragement.
They said corporations and organizations are evolving to provide easier access for startups, building doors for entrepreneurs. At Koch Industries, that doorway is called Koch Labs. Given that the company has numerous subsidiaries, it recognized the need for one access point for innovators. Once the ideas come through Koch Labs, they are then filtered to the right business unit.
“We’re tying to get people to ‘yes,’” Illian said, referring to entrepreneurs. “We’re saying, ‘We’re interested, and here’s how we partner with you.’”
To create greater access, TGI Friday’s launched a quarterly pitch program similar to that of ABC’s television program “Shark Tank.” Mityas said sometimes the most innovative ideas come from startups in stealth mode, so with this new access point, he’s hoping to find more. Recently, the company hired Hypergiant, which at the time was still in stealth mode, to help the company build an artificial-intelligence-driven bartending product.
So what’s the best way to pitch a large corporation?
Mityas and Illian offered several insights on this topic. For one, do the homework, they said. An artificial intelligence startup once showed how Koch could take a process that would normally take the company weeks with an eight-person staff down to three or four days for 80 percent less money, Illian said.
“Know what the use cases could be,” Mityas said. “You may have done something in a totally diff industry but bring it back to a use case that can be applicable to me.”
Part of that “homework” includes having specific metrics ready. TGI Friday’s doesn’t pilot anything without a start date, an end date, and a metric for success, Mityas said. And for Koch, data was the selling point for the startup that offered to cut the company’s costs.
The two also said it’s imperative for a startup to be succinct about what it can and can’t do. The corporation likely won’t partner with the startup if it is trying to do too much. So make sure the product or solution solves a very specific pain point, he said.
“There’s no way your team of three … is going to solve all of our problems,” Illian said. On the other hand, he added, don’t discount your own product by assuming it could be developed by the company itself. “In most instances we’ve thought of the idea internally, but we can’t do it. We don’t have the resources and talent.”
And finally, view the interaction as a relationship. This is about how both sides can benefit, they said. Sometimes that means just sitting down to listen and talk trends without selling a thing.
“I’ve had the honor of getting to know a lot of serial entrepreneurs, and it’s been built over years,” Mityas said. “The best and brightest of that group are the ones that said, ‘I have nothing to sell you. Let’s just talk about what you’re doing.’ Get out there and do those types of things. Use your network. It’s that crawl, walk, run that will pay off in the future.”
Illian compared the relationship to something like an ideal marriage, in which you listen and stay humble. “It’s about how do we jointly tackle this,” he said. “… I’m looking for entrepreneurs who are hungry and humble. You can be a rebel without being an idiot.”