Unleashing The Unicorn Within

Large companies have all the necessary resources and capabilities to disrupt themselves and drive significant growth. There is no reason why they cannot create innovative startups from within or outside their organizations.

• Blockbuster company had multiple opportunities to create a platform like Netflix, but they didn't. See where Netflix is now.
• Marriott could have developed a similar concept to Airbnb, but they haven't. Look where Airbnb is now.
• Toyota had the potential to launch a ride-sharing service like Uber. It missed that opportunity and, as a result, lost the opportunity to double its revenue.
• Furthermore, Stripe, a successful online payments platform, could have been created by Wall Street executives like Jamie Dimon, but they didn't.

They had all the necessary resources and capabilities to disrupt themselves, but they didn't. As a result, they lost out on tapping into tremendous opportunities.

To drive meaningful growth, large companies have to embrace the Silicon Valley ethos, breaking free from inertia and orthodoxies that often stifle transformative change. To achieve that goal, you must build your own growth engine, leveraging different instruments like venture building, venture investing, targeted M&A and strategic partnering.

A Brief Introduction to Venture Building

The first step in the Venture Building process is ideation. This could involve different activities. If you have a clear idea to start with, this stage is about challenge framing, setting the aspiration and guardrails for the venture. If you have a lot of ideas, this stage is about reviewing the portfolio- how do we sort the ideas and figure out which ones to prioritize?

In other cases, you may know which domains you want to explore but you don’t understand the current state of the competition and marketplace, which calls for domain exploration and ecosystem mapping. Or, you can run an internal venture competition if you need to generate more venture ideas and to find your internal entrepreneurs.

Once the top ideas are selected, the next stage is incubation. This stage includes three phases: customer pain assessment, product/service development, and business design. What do people need? What will we build? And how will we make money? This phase concludes with a robust business, execution and operation plan- not just a demo pitch.

Finally, the most challenging phase is the acceleration phase involving three stages: build to validate, build to automate, and build to grow. In all three stages, don’t just focus on product. Give enough attention to also continue to test and validate around go-to-market tactics, the business model, the operations/unit economics and the team.

Critical Enablers for Venture Building to Succeed

On the one hand, you must have the will to kill. Maybe there is no pain. You’re unable to find prospects and convert them. Or, you can’t build what the customer wants- or the tech is too far out. Maybe you can’t get the unit economics to work. In those cases, it’s better to kill the venture. Killing ventures is not failure.

On the other hand, you want to do this at scale, otherwise you’ll never have the financial impact that makes a difference to your board. That’s why you need to institutionalize venture building through an internal venture factory. That factory should be designed to create and launch a portfolio of high-quality new ventures, recruit and develop a pool of highly motivated and exceptionally talented entrepreneurs, and develop an executive team capable of managing a portfolio of new ventures like top-tier VCs.

Finally, when it comes to beating startups at their own game, it's important for companies to seize the "mothership advantage". A growth engine involves four teams: the new venture team, the new venture boards, the venture factory or CVC team, and the new venture advocates.

While the first three teams are focused on venture building and investing, the new venture advocates play a crucial role in creating a supportive ecosystem within the mothership. These advocates ensure support and help with various hurdles such as legal, procurement, and marketing and sales.