Although 92% of Belgian companies want to innovate by collaborating, only 47% turn to start-ups to do so. That's according to the fourth edition of the Corporate Venturing Barometer from Antwerp Management School (AMS) and PwC Belgium. The report examines the collaboration between established companies and start-ups in Belgium. The results show that large companies often cooperate with start-ups with only low involvement, which contributes to the so-called ‘innovation gap’ in our country.
Corporate venturing is a strategy whereby large companies (corporates) partner with or invest in start-ups or young companies. This is occurring more and more frequently: in 2019, only a quarter of companies collaborated with start-ups, now almost half (47%) do. The main reasons for not collaborating? Many companies find it too complex, for example due to legal uncertainties about intellectual property. In addition, they often lack the necessary knowledge on how to successfully collaborate with young companies.
Motivations and challenges
Companies that partner with start-ups or scale-ups do so for a variety of reasons. The main motivator is to explore new products and markets (64%). Access to new technologies (47%) and building an ecosystem with new players (47%) are also high on the list
The survey also probed what challenges corporates see when partnering with young companies. A major obstacle is the lack of internal knowledge on how to successfully collaborate with start-ups (55%). Next to that, integrating collaboration into the daily operations of the company proves difficult, mainly due to lack of time (50%). Finally, different decision-making processes within companies and start-ups often cause difficulties (36%).
Innovation gap
It is striking that companies still mainly opt for forms of cooperation that require little time or resources, such as attending networking events (82%) or offering guidance and advice (55%). Collaborations that require more effort, such as supporting start-ups through accelerator programs (21%), investment through venture capital (21%) or acquisitions (18%) are less common.
“Many large companies start with collaborations that require little commitment because they are still in an exploratory phase,” explains Robin De Cock, professor of Innovation and Entrepreneurship at AMS. “Some respondents expressed a desire to avoid acquisitions because they believe it would hinder the momentum and speed of a start-up. Still, collaborations with limited involvement can eventually lay a good foundation for more intensive forms of collaboration. It is important, however, that these collaborations fit with the company's vision and strategy.”
Moreover, only 42% of companies think they have the right KPIs in place and less than half (44%) feel they have the necessary skills to further develop corporate venturing. This points to an 'innovation gap': companies want to, but often fail to implement the right structures and processes. Also, 53% still focus primarily on internal innovation rather than working with external partners such as start-ups.
Pascal Janssens, Partner and Enya Steenssens, Senior Manager at PwC Next Level conclude, “Corporates do want to collaborate with start-ups, but often lack the right knowledge or structures. Some collaborations remain quite superficial, making it seem like corporate venturing is more about strengthening the image of the corporate than effectively innovating together. C-level executives need to see corporate venturing not only as an opportunity, but as an essential part of their core business. That requires daring to take risks and investing time, money and talent, combined with consulting experts for the right choices.”
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About the research
The research was conducted by Antwerp Management School and PwC Belgium's Next Level team, led by Prof. Robin De Cock, among 75 established companies in Belgium, represented by innovation leaders and managers. The participating organizations are on average 70 years old and have an average of more than 4,800 employees in Belgium. Respondents came from 19 different sectors, including Healthcare (14%), Construction (14%), Food (8%), Logistics & Transport (8%) and Finance (8%).
About Antwerp Management School
For over 60 years, Antwerp Management School (AMS) has focused on value creation for organizations and businesses by emphasizing the sustainable transformation of individuals, teams, and organizations from a global perspective. With its high-quality management programs and research, the school provides a powerful impetus for economic and social activities in Belgium and beyond. Approximately 70 faculty members inspire 900 students annually in our Master’s and PhD programs and executive courses. Additionally, we welcome 3,000 professionals in B2B solutions and events. The school is known for its personal approach, which is highly valued by over 26,000 alumni from 96 different countries. More information on Antwerp Management School on www.antwerpmanagementschool.be/en.
About PwC and Next Level
At PwC, our purpose is to build trust in society and solve important problems. We’re a network of firms in 151 countries with more than 364,000 people who are committed to delivering quality in assurance, advisory and tax services. Find out more and tell us what matters to you by visiting us at www.pwc.com.
PwC refers to the PwC network and/or one or more of its member firms, each of which is a separate legal entity. Please see www.pwc.com/structure for further details.
The PwC Next Level team focuses on value creation for and between ventures, companies and investors. On the one hand they support start-ups and scale-ups in their growth trajectory and strategic development, on the other hand the team offers customized solutions for already established companies that need strategic support in (setting up) corporate venturing activities.
