Close panel

Close panel

Close panel

Close panel

Innovation and collaboration go hand in hand in the digital economy

The transformation of the economy opens the door to collaboration between big corporations and startups: they need to understand each other and collaborate. It’s a beneficial relationship for all, but one which is not always easy.

In the digital economy, the company that survives is not necessarily the biggest, but the one that adapts best. And the pace of innovation can be dangerously fast for large corporations, which tend to react slowly due to their inertia and size. The good news for these companies is that once they realize they have a problem, they are committed to finding a solution: creating innovation ecosystems in which startups play a leading role, with different formulas.

This change in large corporations' innovation policies was one of the main topics in the Pacific Alliance South Summit, an entrepreneurship summit organized by Spain Startup in collaboration with the Instituto de Empresa and which was held in early December in Bogotá (Colombia).

At this summit, companies of all sizes from Spain, Colombia, Mexico, Peru and Chile (these four Latin American countries make up the Pacific Alliance) shared their experiences, while at the same time startups on the lookout for funding tried to persuade large international funds of their virtues.

The first step to solving a problem is recognizing that you have one, and in general the representatives of the large corporations were very frank. They are creating innovation ecosystems with startups, mainly because they recognize the need to do so. “Large corporations are slow-moving, and external innovation allows us to be agile”, says Javier Fernández, Country Manager for Gas Natural Fenosa in Colombia.

Federico Flórez, Head of Innovation at Ferrovial, engaged in self-criticism: “Large corporations create a lot of barriers for startups. We are slow. We have to recognize it and improve.” Oscar Cabrera, CEO of BBVA Colombia, stressed the “highly complex nature” of internal innovation: “We have a lot to learn from the startups, which allow us to carry out transformation processes in a much more provocative way.”

At BBVA, Cabrera explains, “all our innovation policies are aimed at improving the customer's digital experience. And we want to offer the customer something which really stands out. For example, we are working on the facial recognition of our app users, to know their reactions, and once they are analyzed, to be able to offer a better user experience.”

The startups, which have the possibility of growing with the help of a large company, through all kinds of agreements, also had their say. Hernán Acuña, head of the innovation hub for the electricity company Enel in Chile, gave the startups some specific advice: be patient. “They should bear in mind that working with corporations takes time, but they shouldn’t despair,” said Acuña.

In addition to patience, they also need to take into account that all companies, whether large or small, stand to gain from working together, “Otherwise, there are distractions and energy is wasted, economic resources and time are lost, something which is crucial in such a competitive environment,” says Gabriel Sánchez, a lawyer specialized in mergers and acquisitions at Posse Herrera Ruiz + Cuatrecasas, one of the most important legal firms in Colombia.

The relationship between startups and large corporations can be complicated, as they are very different creatures: the former have the brand, solid business foundations and economic power; the latter, speed and a dynamic, innovative approach. But because they are so different, they both stand to gain if they reach agreement.