How Startups Can Land a Second Meeting with a Corporate Partner
For start-ups, even securing an initial meeting with a corporation can be tough — let alone establishing a partnership. To understand what works, the authors attended 150 one-on-one meetings between start-ups and corporations such as IBM, Sony, SAAB, L’Oréal, Scania, Toyota, and AstraZeneca. Our observations helped identify five best practices to help start-ups generate corporate interest in collaborating after the meeting: 1) Have clear but flexible goals; 2) Address existing problems and needs; 3) Address ease of integration and collaboration; 4) Present use cases and new value propositions; and 5) Assemble the right team.
In a LinkedIn post shared last year, the general manager of PepsiCo Labs, Anna Farberov, shared her frustration with the strategic errors start-ups make when pitching to corporations. Having attended 3,500 such meetings, she felt she had the expertise to detail their mistakes. However, the backlash to her post was severe, with employees and founders of start-ups keen to highlight the issues they faced when approaching corporations. Both sides clearly wanted to collaborate. But they struggled to find ways to engage in successful and lasting engagements.
For start-ups, even securing an initial meeting with a corporation can be tough — let alone establishing a partnership. Cold calls are a lottery. Corporations are a “black box” to external entrepreneurs, and initiating contact with decision-makers can be difficult. As a serial (and quite successful) entrepreneur told us, “I wouldn’t even be able to enter their office, let alone start a collaboration.” If even experienced entrepreneurs struggle to secure the chance to collaborate, one can only imagine how difficult it must be for first-timers and early-stage start-ups.
Initiatives such as “speed-dating” events, where multiple start-ups pitch to corporate representatives, can facilitate the process. At such events, often organized by intermediaries, corporate “scouting teams” look to generate an inflow of ideas, technologies, and solutions for the company. Despite such efforts, start-ups are still unlikely to capitalize on this crucial first encounter.
At the first meeting, early-stage start-ups must garner sufficient interest to secure a follow-up meeting. A good performance during that first interaction is essential. There are usually no second chances. But how can start-ups gain that critical second meeting?
To answer this question, we attended 150 one-on-one meetings between start-ups and corporations including IBM, Sony, SAAB, L’Oréal, Scania, Toyota, and AstraZeneca. The meetings were organized by Ignite Sweden—a nonprofit initiative that aims to foster innovation by connecting tech start-ups to large companies. Our observations helped identify insights into the best ways for start-ups to generate corporate interest in collaborating after the meeting. The following best practices helped the start-ups we observed secure that all-important second meeting.
Have clear, yet flexible goals.
Depending on their stage of development, a start-up’s goals might include collaborating on a proof of concept, working on a pilot, making a sale, or co-creating products. A start-up with clearly stated goals helps the corporation see possibilities for engagement. This can lead the corporation to offer alternatives that a flexible start-up could use to tap into unforeseen opportunities.
For instance, one gaming start-up, Attractive Interactive, adapted its technology for SAAB to help pilots land in harsh weather conditions. The company’s COO said, “It was exciting to apply our knowledge of gaming development on brand-new issues.” This collaboration would have been unimaginable for Attractive Interactive before its meeting with SAAB. Not all start-ups need to pivot in this way but those that do may see potential they hadn’t previously envisioned. Thus, clarity with flexibility is a virtue.
Address existing problems and needs.
Start-up team members should understand the corporation’s needs in sufficient detail before the first meeting. Such preparation might simply involve perusing the corporate website and industry-related documents before the pitch. This aligns solutions with the corporation’s existing efforts to create customer value by improving current processes, products, and services.
In one example, Toyota Material Handling collaborated with IPercept Solutions, a deep-tech start-up that provides AI services for tracking industrial machines. In the initial meeting, IPercept were able to show how their solutions closely fit the needs and ambitions of Toyota Material Handling. The implementation of these tools radically improved the latter’s process, according to Mattias DahlgrenMaintenance Manager at Toyota Material Handling.
This example shows how start-ups that address existing problems and provide innovative solutions can make themselves indispensable to corporations.
Address ease of integration and collaboration.
Start-ups must know how to integrate their products into the corporation’s existing processes. The start-up should make it easier for the corporation to engage with them by first understanding the latter’s current workflows.
One start-up created a machine-learning algorithm to help Alfa Laval — a leading global heat transfer, separation, and fluid handling provider — assess precisely when its heat exchanger required cleaning. Thanks to this collaboration, the corporation, founded in 1883, could deploy intelligent heat exchangers despite its lack of expertise in this domain.
Present use cases and new value propositions.
During the meeting, the start-up should show how it would create new value for the corporation and its customers. One approach would be to talk through a corporate-specific mock use case. Alternatively, actual use cases based on the start-up’s engagement with other corporations could be presented.
These opportunities for creating value should be communicated via simple demo presentations that emphasize the ease of integrating the proposed solutions with existing channels. Pilot collaborative projects with corporations are particularly useful for early-stage start-ups because they boost the latter’s legitimacy and help expand their client base.
Assemble the right team.
Beyond the start-up’s founder(s), it is useful to involve business development and technical experts who can engage corporate representatives in fruitful dialogue. Teams composed of both technically competent members (e.g., CTOs) and those with business development backgrounds are better able to understand how the start-up’s technology benefits the corporation. With the right team, possibilities can emerge beyond the start-up’s technology and the corporation’s challenges. Founders whose technical background was strong but who could not explain their technology or its applications usually failed to attract audience interest. Teams must therefore include members who can explain potential uses of their services alongside those who can answer technical questions.
The list of do’s and don’ts below distills our observations of how start-ups can ensure successful first meetings that lead to follow-ups and collaboration.
What to do in the first meeting.
- Address the corporation’s existing problems and needs, and those of their industry.
- Tailor presentations to individual corporations and show how your new start-up could help them.
- Focus on ease of integration rather than your technology.
- Present mock/use cases to show new value propositions.
- Be flexible and prepare to pivot and co-create when the opportunity arises.
- Bring a team with expertise in technology and business development.
What not to do in the first meeting.
- Don’t just pitch: Listen to their current and future needs.
- Don’t use the same pitch to different corporations: Customize.
- Don’t just focus on your technology but show how it will help the corporation.
- Don’t only send technical staff on a highly technical presentation.
Start-ups can achieve a desirable level of engagement by first engaging with what they know about their corporate partners. Only then should they focus on co-creating products and services. Start-ups that have clients who can demonstrate how their technology would help the corporation are practically guaranteed to gain the latter’s interest in follow-up meetings. Their efforts should therefore be geared toward understanding the corporation’s value streams, its customers, and potential ways of creating more value.
In this way, start-ups can overcome the challenges of navigating the corporation’s often complex internal functioning. They can get to know the corporation and its ways of working. And they can build on this knowledge to receive an invitation to a second meeting where both teams can focus on innovation.