A Chief Digital Officer and a startup founder speak up about how to win at the innovation game.

If you’re an established company, how can you partner with startups to drive innovation? And if you’re an innovative startup, how do you identify established companies to partner with? Those are some of the burning questions in the innovation community.

If you’re an established company, you’ve simply got to pay attention to startups. In the market, there’s a big disruption to how enterprises do business, how they operate, and how they execute their marketing strategies.

“It’s a consumer revolution, so we have to think what’s next,” says Martin Aubut, the Chief Digital Officer of L’Oréal Canada. “What’s next is services, it’s how we bring the best experience across channels, it’s data…”

Startups, Aubut explains, can help established firms move faster towards a world the enterprise can imagine, but is not always equipped to bring to life on its own. Alone, an enterprise might be able to get somewhere, but it will take much longer due to the bureaucratic nature of most large organizations. An enterprise + startup partnership can go faster because of the energy, passion, and entrepreneurship that the startup brings to the equation. Aubut cites the L’Oréal buzzword of métier (loosely translated to professional competency), and says that startups have certain things within their métier that enterprises just do not. In many ways, these partnerships can help enterprises become faster, leaner, and more agile.

I met Martin Aubut alongside Marie Chevrier, founder and CEO of Sampler, as they co-presented at the Path to Purchase Summit in Chicago. Sampler, a company devoted to changing how brands distribute samples, has partnered with a number of big companies over time as it has gained traction in the marketplace. On that front, Chevrier is the person to talk to about which established companies are best for startups to partner with.

“What we’re seeing is that…there needs to be a mindset of innovation,” says Chevrier. “There needs to be a mindset of wanting change and realizing that change is coming whether or not they participate or not.” To that end, Sampler is always looking out for executives who are open minded about new ways of doing business.

More than just lip service

Of course, some companies may simply say that they are dedicated to innovation because it feels like the right thing to do, but then when push comes to shove, aren’t as devoted to driving innovation. Chevrier feels L’Oréal was an ideal partner because their innovation mission became a company-wide mission. The company has been crystal clear from top to bottom that they would be innovating with startups. They even enlisted the company’s rank and file to vote on which startups should be selected for partnerships.

Where Chevrier sees it go wrong for some innovation partnerships is in the friction points between an executive deciding that the organization needs to try something, and the actual execution of that something. Some of the departments you have to deal with in between, like procurement, may be blockers. These blockers are missing the point, according to Aubut, who believes that entrepreneurship is at the core of evolution. An organization evolves in one of two ways. Either people change at the point where they start to feel the pain acutely; or, some organizations evolve to the point where change becomes part of their DNA. Aubut thinks L’Oréal is the latter type of organization, an organization that didn’t wait to create a technology stack and foundation to deploy innovation across the institution. “We’re more than open. We want to create the future with those organizations now.”

Finding the right partners

Aubut may look like a company man, but he wasn’t always the guy you’d find in an established business.  He was an entrepreneur himself when he met the CEO of L’Oréal Canada at the time who told time that the company wanted to own digital beauty, he immediately understood that the company was looking to be bold. When they start to move, they move. Aubut appreciated that the company had entrepreneurial values, with very clear goals and focus about where they wanted to go. And, an openness to take a calculated risk on hiring outside the beauty community: “I’m not a cosmetician,” Aubut jokes.

To Aubut, there are a few traits that make a startup a good partner. First, the startup must first have the attitude of solving problems and being solution-oriented. The founder and their team must have the right attitude to make sure that the entire organization understands that everyone has to work together to make something exceptional. Furthermore, the organization cannot be scared of trying new things and being agile and able to adapt to the organizations they’re partnering with. That seems to describe Sampler to a T, as it has added different product lines to solve problems better.

If you enjoyed this piece, you might enjoy listening to my whole interview with Chevrier and Aubut on my podcast, FUTUREPROOF. It’s all about innovation and the innovators creating the future we’ll all soon be living in. If you enjoy, subscribe on iTunes, Stitcher, or wherever you get your pods.

Feature Image Credit: Getty Images

By Jeremy Goldman

Sourced from Inc.

By Devang Mehta

Good educational pedigree often results in numerous downstream benefits in the start-up ecosystem

You’re reading Entrepreneur India, an international franchise of Entrepreneur Media.

I often get asked, how important is the founder’s educational pedigree when judging the overall appeal of a start-up’s team? It’s an important question and while individual opinions vary, I’ve seen a general convergence amongst the VC community on this issue.

I believe that education matters more when the founding team is young (let’s say average age 25 or less) for the simple reason that a lot of what they have achieved in life is at academic institutions. Success in academia is by no means a guarantee of future success, but it is a good proxy of the ability of the team to produce great products, especially in knowledge-driven industries like high tech. I believe academic success is also a good proxy of the ability to put in long, disciplined hours towards achieving ambitious goals.

An interesting spin on this revolves around the advent of acqui-hiring — a trend which is beginning to shape (albeit a very smart part) of M&A in India. The philosophy is simple – all other things equal – a young team of engineers from reputable institutions is more likely to get acqui-hired than a similar team from less prominent institutions. A good example of where academic success actually translates into success in the business world. Again, with the caveat, that this is a very small part of M&A activity – so just don’t start a company if you are from IIT/MIT/Stanford/CMU in hopes of a payout from the start-up world. Nonetheless, the theory stands – acqu-hiring happens when the knowledge and know-how is extremely valuable to the acquirer — and this raw technical horsepower is better honed at reputable technological institutions.

As the median age of the starting team gets higher, say closer to the 30’s then academic qualifications get eclipsed, to a great extent, by success in the business world and other ‘real-world’ experiences. So, if one is comparing two founders – one from IIT (just an example of a good University) and the other from University B, and the latter has had a better career path, post-graduation, worked  in an entrepreneurially minded company, then the scales are balanced or even tilted slightly in favor of the person from University B.

Other ‘Perks’ of Good Educational Pedigree

Good educational pedigree often results in numerous downstream benefits in the start-up ecosystem. Most of these revolve around the kinds of people that one can attract to the ecosystem – investors, employees, interns, business development partners, and more.

The central theme, obviously, being the fact that the strong alumni relationships that exist at these institutions.  Both in terms of sheer size but also (and this is something I notice), is a sense of school pride that arises from graduating from august colleges.  Founders from these colleges, especially the more outgoing ones, are often able to build a good aura around the companies they build – and this tremendously helps in attracting the right team, investors, partners, media attention, and more. This acts as a source of comfort for early-stage investors like us – to know that the founding team has the wherewithal and the resourcefulness to bring together the right set of actors at appropriate phases in the start-up’s evolutions.  An ability that most will agree is the very difference between success and failure in the early stage industry.

So, Why Not Invest Just in Ivy League Graduates?

Lest you be numbed by what seems to be a continuous endorsement of top-rated academic institutions, I want to remind you – founding team pedigree is just one aspect of Team appeal – and Team is just one aspect of the overall appeal of a start-up. Many staggeringly successful companies have been founded and built by entrepreneurs that have actually dropped out of college. In many other cases, entrepreneurs from less-than-stellar colleges have outperformed peers by building better products, superior marketing strategies,  sheer execution finesse and resourcefulness in attracting and charming stakeholders in the ecosystem.

There is also a dark side in investing in ‘Ivy leaguers’ – a sense of entitlement that comes from the academic pedigree – and something which translates directly into demands for higher valuations and other start-up-friendly terms.  I’ve seen situations where investors, mesmerized by educational pedigree, sign off on significantly unfavorable terms than what the situation normally mandates. Clearly a case of misplaced enthusiasm and irrational understanding of a dynamic that should be used to differentiate between teams in marginal situations (all other things being equal). And not, to be the sole deciding factor in deciding which start-up to invest in.

What does all this mean for aspiring founders? If you’ve made it to a reputed institution, make the best of it! Build strong networks within the student community – these will be of tremendous value to you throughout your entrepreneurial journey. And if you did not make it to a top-rated school , there are plentiful opportunities to realize your entrepreneurial goals – go ahead and hone your skills and serendipitous moments will come by!

Feature Image Credit: Shutterstock 

By Devang Mehta

Partner, Anthill Ventures

Sourced from Entrepreneur

By Michelle Castillo

By Michelle Castillo

Sourced from CNBC