What is the venture client? The innovation model for corporations and startups

Ana Vilar García

Corporate innovation has many different models, but collaboration between corporations and startups is usually one of the most successful. In this type of collaboration, there are different models and approaches, and venture client is one of them. This model is called to be one of the most relevant in the innovation landscape and is as beneficial for the corporation as it is for the startup. Learn what a venture client model is, and discover if this is the ideal innovation model for your company.

How does the venture client model work?

  1. Identifying needs and challenges

A venture client program usually starts like any other innovation model: by identifying a need or challenge in the company. This first step can begin either by discovering a certain startup that offers strategic services for the company, or simply by identifying a need and making a call for startups that can solve it.

Whatever the procedure, both have in common the fact that the identified need or challenge cannot be solved internally with the company's own resources. Outside help from a startup is needed.

  1. Preparing the venture client program

Once the needs have been identified and analyzed, it is time to start organizing the venture client program, which includes: setting a budget, defining which units will participate in it, duration of the program, and its impact on the roadmap and strategy of the company.

  1. Startup scouting and pilots

When the program has been defined, the call for startups can be made public. Here, companies that meet the established conditions can apply and pitch their services.

The committee in charge of evaluating these startups will filter and choose those that best suit the established criteria. Next, the pilot phase is entered – a pilot is carried out to prove that the need can be solved with the startup’s service. In this case, it can be a small test that is implemented in the company.

  1. Implementing the solution and consolidating the venture client relationship

If the pilot of the selected startups is successful and fits into the company, the relationship between the corporation and the startup is formalized. Within this phase, several cases can occur: the startup can be invested by the company, it can be acquired, or licensing the startup's service. All of these possibilities are optional and largely depend on the maturity of the startup and the strategic needs of the company.

Why is the venture client model so relevant?

According to a joint study carried out by MIT and Capgemini, collaboration between corporations and other external agents such as startups will be key to innovation and staying ahead of the market. According to this study, startups in open collaboration with large companies will be responsible for changing and leading the innovation landscape, leaving internal innovation programs in a second, less relevant place.

Startups will be one of the main sources of innovation in the coming years and it is expected that the venture client model will be the main source of innovation in 2025, being especially relevant in the sustainability sector — the main focus in innovation for many companies.

How to determine if the venture client model is the right one for your company?

Collaboration between startups and corporations is one of the most successful innovation models out there. Thanks to the fact that both types of companies complement each other and benefit, their union is ideal for innovation because the projects take the best from each type of company.

However, corporations have many ways to benefit from the entrepreneurial ecosystem and the venture client model is not the only one. The venture client model may be for you if you are looking to test new solutions quickly, without having to use your company's resources, and accessing the service even before it reaches the market – and therefore also your competitors.

There are other types of popular corporate-startup collaborations, such as the startup-as-a-service model. In this case, the corporation decides to create a startup of its own that meets those needs, generally with the help of a venture studio. This solution is equally fast, low risk and suitable for companies with different levels of innovation maturity. Unlike the venture client, the corporation ensures that the startup is part of its entire portfolio of companies, while in the case of the venture client it is only a service provider.

If you are looking for your company to innovate by creating new business models, contact the Corporate Lab team. Our venture studio and team of entrepreneurs can help you create a startup that integrates into your company, without interfering with your roadmap, without draining resources, and delivering a validated and profitable source of income in no time.

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