This is part of a series of conversations with business leaders exploring legacy, clarity and transformation.
Let’s start with you – how did you come to specialise in innovation?
I was raised on a dairy farm in Australia. My family couldn’t make enough money from milk, so my uncle turned it into ice cream. I was surrounded by entrepreneurs for my whole childhood. When I graduated I joined Unilever, the biggest ice cream company in the world. I had the opportunity to exercise my intrapreneurial muscle when I was appointed director of Unilever’s new businesses unit, but I always had a bit of an itch to start my own business.
And Co:Cubed has been going for three years now. What does Co:Cubed do?
We bring together the scale and impact of large corporations with the innovation and agility of start–ups. In every sector there are start–ups disrupting the status quo, and we help corporates to partner with them to bring their innovation to scale. We work with the whole FTSE 100: fashion, communications, energy and everything in between.
So people call you in when they sense a disruptive threat to their business model?
A corporate will often recognise that disruption is coming. You’ve got shareholder power, and the erosion of barriers to entry. Economies of scale doesn’t offer the same advantages they used to, as the market is shifting to economies of scope and data. So a corporate might appoint a Chief Innovation Officer and make a plan, and then we come in to help them optimise and execute it. We’ve got a huge amount of experience. We know the route, and we can help them to avoid the frustration or failures that they might experience if they were doing it all themselves.
This is what we hear too – proven companies recognise the challenge of new business models or new technologies. They know they need to innovate to stay relevant. For us this means reinvigorating their brand, finding ways to keep the company’s legacy connected to a changing market. But in your field, what does innovation look like?
Innovation already exists. It just hasn’t been scaled. Corporates don’t have to invent the future. Their job is to partner with start–ups to scale it, and that’s our particular expertise. We can help to identify the problems that they need to address, and then we go to our global network of start–ups to find interesting solutions.
That’s similar to our process. We help to identify the problems and perceptions a company needs to address, and we discover which parts of their origins still resonate. The answers usually exist already, they just need to be reframed. Though one of the challenges we find is that it can’t just be a cosmetic change. You have to embed the change in the culture. Obviously you need the leadership signed up to it, but you also need those who are going to champion the change internally.
That’s the key, that internal engagement. Solve that, and you’ve solved the problem of innovation. It’s a bit like having a diversity team. If you only diversify your diversity team, you haven’t done anything. And just doing innovation in your innovation team isn’t enough. You need to empower and enable it across the whole company. The job of innovation leaders is to inspire and facilitate innovation, not do innovation.
If organisations keep finding ways to express their strengths to a moving market, and express the relevancy of what they do best, there’s no reason for them for them to be overtaken.
And the model of innovation that you’re working with is partnering start–ups and corporates – what’s the value of partnering here?
I’ll give you an example. We recently worked with a pharmaceuticals company who needed a brain training app to accompany a new health supplement. They’re very good at putting products on shelves, but not so good at creating apps. It could take years if they built it themselves. Or they could buy it, which would be expensive. Why not look at partnering with one of the great ‘brain gym’ apps out there already? They get the innovative start–up solution, and the start–up gets the benefit of being able to deploy their technology at scale. So we’ve started with a corporates’ problem, and used partnership with a start–up to inspire a solution. Between building it yourself as an intrapreneur, or buying it through corporate venture funds, there’s a giant chasm of partnership options in the middle. It’s always worth exploring them before you invest in either ends of the traditional options of buy or build.
So you get the established business working with the potential disruptor. Although disruption is another overused term. Are organisations facing a genuine do–or–die moment? Or have they just spotted a potential new revenue stream?
There are a few who are facing an existential threat, but usually it’s the latter. And it’s not really the incumbents versus the disruptors anymore. A number of new–age companies like Uber, WeWork or Slack, are struggling right now. It costs money to acquire new users, and many them are relying on VC–funded growth, which isn’t sustainable. You’ve got to build credibility and trust, which the traditional brands have already done. You’ve got the challenge of regulatory compliance that the big brands have overcome. These are huge obstacles for a start–up, and partnering offers a fast track to the scale that will make them viable. Imagine if you can take the technology and the passion of the innovators, and marry that with the corporate that has the brand, the trust, the credibility, and the regulatory approvals. Bring those two things together, and you’ve got something unstoppable.
That’s important, because it’s easy to get carried away in the excitement of start–up culture and forget the value of an established business. The corporates have both tangible and intangible strengths here – the scope and infrastructure of a big corporate, but also the trust and familiarity of an established brand. There’s no shortcut to that for a start–up. If organisations keep finding ways to express their strengths to a moving market, and express the relevancy of what they do best, there’s no reason for them for them to be overtaken. In fact, the start–ups and the corporates need each other.
That’s why we describe what we do as building the corporates of the future. The corporates of the future won’t own and operate everything. They’ll be more like a network of partnerships.
Is that a fairly counter–cultural view, given how much innovation is done badly.
Yes, there’s a high failure rate. Real transformation takes time, but people see disruption coming and they’re desperate for change. It’s not surprising that you get innovation leaders who over–promise, with no accountability and big budgets. There’s a huge graveyard of expensive innovation projects that failed to pay for themselves and were shut down. We know those pitfalls, and our partnering approach can be a valuable alternative.
And what does your brokering do that people couldn’t do for themselves?
Firstly, we bring business model expertise and a deep understanding of partnership options. Secondly, we bring a global network of over half a million start–ups which we monitor. And thirdly, we partner with 20,000 spotters on the ground who help us find the next big thing. Our roots go deeper into innovation ecosystems than any other company. The result is that our clients meet and partner with the best solutions to their problems in the world.
We also support from a strategic perspective. To do partnerships well we have to build platforms for engagement. Just like you’ve got an employee brand and a corporate brand, we build a partner brand: a brand to attract and retain great partners. Then we embed that through internal engagement.
That’s interesting, because ultimately the most exciting start–ups could take their pick of who they work with. If you want to attract their interest, developing and embedding a renewed brand is right at the centre of that process. And that’s the heart of our work, helping established businesses to stay relevant.
Yes, and we haven’t seen anything yet. The digital transition is going to give rise to all kinds of new business models and new opportunities. I do think that we’re building the corporates of the future – we’re pairing corporate scale with start–up innovation, to transform opportunities for both.