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- Herausgeber: Books on Demand
- Kategorie: Fachliteratur
- Sprache: Englisch
This book is about the strategic building of technology ventures, either through self-creation or professional guidance in corporate accelerators. It outlines the Acceleration 2.0 framework, based on latest research concerning business acceleration, corporate venturing and startup development. The “business Acceleration 2.0 framework is explained in three case studies. The comparison of the case studies from the ICT industry explains the dynamic development of startups, including the needs and wants as well as strengths and weaknesses. Overall the book provides a guideline including all important terms and elements to successfully realize a business plan and to build a startup accordingly. In essence this book supports the efficient growth of young companies by providing a guideline to follow and supports young companies during the starting, funding and building phase of the business.
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Veröffentlichungsjahr: 2015
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Vision without action is merely a dream.
Action without vision just passes the time.
Vision with action can change the world.
Joel A. Barker
About the author:
Alexander Bergfeld was born in Munich, Germany in 1981. Coming from a diplomatic family, Alexander already travelled the world during his childhood.
He holds a B.Sc. Environmental Science from the University of Manchester, UK and a MBA General Management from the Munich Business School, Germany.
Alexander has extensive international experience in Business Development and Project Management. He successfully accelerated several startups in Europe and the US and consulted international corporate acceleration programs.
Acknowledgements
This book would not have been possible without the valuable contributions of several people who supported me in various ways – be it through advice, guidance, expert knowledge, inspiration or moral support.
I would like to express my deepest gratitude to the following persons:
Frank Bannys, Uwe Rödiger, Dr. Rudolf Gröger, Dr. Stefan Baldi, Georg Bauer, Fernando Burgos Herce, Dr. Hellmut Kirchner, Tanya Carter, Douglas Carter, Markus König, Sascha Herzog, Ferdinand Heisig
Last, but certainly not least I express my deepest appreciation to my family and friends, who were not only great supporters, but also always welcomed me back home, advising me to critically reflect upon my work and challenging me to always keep pushing forward.
My mother, who always supported me in my passion and dreams, giving me wings and roots at the same time.
My brother, who has not only been a strong supporter and companion, but also a challenger and nomadic partner in knowledge and technology transfer between continents.
My friends who encouraged me to stay on course in times of difficulty.
Without all of you I would not be where I am now and would never have become the person I became. Thank you!
While I happily share the credits of this work with all the persons above, possible errors remain my sole responsibility.
Alexander Friedrich Bergfeld,
Lake Starnberg, Germany, June 2015
List of Contents
Executive Summary
1.
Global Innovation
1.1.
Innovation in global markets
1.2.
General Setting
1.3.
Definition of the Problem
1.3.1.
Objective of this book
1.3.2.
Goal and scope of the book
1.4.
Approach & Structure of the book
2.
Terminology
2.1.
Startup / Venture
2.2.
Accelerator
2.3.
Marmer Stages
2.4.
Key Success Factors
2.5.
Key Performance Indicators
2.6.
High Performance Venture Development
2.7.
Venture Capital
2.7.1.
Venture Capital assessment criteria
2.8.
Venture Capital stages
2.9.
Pre-seed & seed stage
2.10.
Innovation
3.
Combining academic and practical approaches
3.1.
Combining Marmer and the six stages of VC
3.2.
Comparison of goals and interest
3.2.1.
Goals and interests of a startup
3.2.2.
Goals and interests of an accelerator
3.2.3.
Comparing the goals and interest of startup and accelerator
4.
The Venture Development Tool
4.1.
Key Success Factors covered by the tool
4.2.
The eleven measurement factors
4.2.1.
Business Basics
4.2.2.
Product / Service
4.2.3.
Marketing
4.2.4.
Sales
4.2.5.
SWOT Analyses
4.2.6.
Operations
4.2.7.
Management
4.2.8.
Human Resources
4.2.9.
Legal Aspects
4.2.10.
Finance Management
4.2.11.
Investor Relations
4.3.
Scoring
4.4.
How to use the model
5.
Case Studies
5.1.
Startup A
5.2.
Startup B
5.3.
Startup C
6.
Summary of the tool
6.1.
Venture development tool for other industries
7.
Application of the venture development tool
8.
Instructions
8.1.
Business Basics
8.1.1.
Business Plan
8.1.2.
Business Canvas
8.1.3.
Balance Sheet
8.1.4.
Cash Flow
8.1.5.
Profit & Loss (P&L)
8.1.6.
General Company Description
8.1.7.
Vision
8.1.8.
Mission Statement
8.1.9.
Business Philosophy
8.1.10.
Organizational Culture
8.1.11.
Basic Competitor Analysis
8.1.12.
Basic Customer / Client Analysis
8.2.
Product / Service
8.2.1.
Product Life Cycle
8.2.2.
Concept Testing
8.2.3.
Prototyping
8.2.4.
Bug fixing
8.2.5.
Beta-Version
8.2.6.
User Experience
8.2.7.
Proposition Development
8.2.8.
Minimum Viable Product
8.3.
Marketing
8.3.1.
Ansoff Matrix
8.3.2.
Customer / Client Profile
8.3.3.
Competitor Analysis
8.3.4.
Market Analysis
8.3.5.
5 C’s
8.3.6.
4P’s
8.3.7.
STP
8.3.8.
Positioning Statement
8.3.9.
Customer Relationship Management
8.3.10.
Customer Acquisition
8.3.11.
Customer Retention
8.3.12.
Unique Selling Proposition
8.3.13.
Point of Differentiation
8.3.14.
Promotional routes
8.4.
Sales
8.4.1.
Revenue / pricing models
8.4.2.
Direct Sales
8.4.3.
Lead Generation
8.4.4.
Sales Forecasting
8.4.5.
Metrics / Conversion & Activation
8.4.6.
Sales B2B & B2C
8.4.7.
Negotiation Skills
8.5.
SWOT Analyses
8.5.1.
SWOT-based Strategies
8.5.2.
Personal Development Plan
8.6.
Operations
8.6.1.
Operational Planning
8.6.2.
Product / Service Design & Development
8.6.3.
Customer / Client Service Strategy
8.6.4.
Staff requirements
8.7.
Management
8.7.1.
Team analysis
8.7.2.
Managerial Training
8.7.2.1.
Management and Leadership
8.7.2.2.
Leadership styles
8.7.2.3.
Team Management
8.7.2.4.
Team building
8.7.2.5.
Conflict Management
8.7.2.6.
Team Dynamics
8.7.2.7.
Discipline
8.7.2.8.
Internal Communication
8.7.3.
Knowledge Management
8.7.4.
Board of Directors
8.8.
Human Resources
8.8.1.
Human Resource Planning
8.8.2.
Strategic Growth Planning
8.8.3.
Hiring Process
8.8.4.
Team communication
8.9.
Legal Aspects
8.9.1.
Hierarchy of laws
8.9.2.
Company Name
8.9.3.
Legal Status
8.9.4.
Registering a business
8.9.5.
Tax aspects
8.9.6.
Employment law
8.9.7.
Agent / Distributor
8.9.8.
Duties and liabilities of a CEO / Managing Director
8.10.
Finance Management
8.10.1.
Role of the CFO
8.10.2.
Working Capital Management
8.10.3.
Financial Ratios
8.10.3.1.
Liquidity ratios
8.10.3.2.
Debt ratios
8.10.3.3.
Profitability ratios
8.11.
Investor Relations
8.11.1.
Elevator Pitch
8.11.2.
2-5 minutes Pitch
8.11.3.
Pitch one pager
8.11.4.
Pitch booklet
8.11.5.
Pitch training
8.11.6.
Presentational skills
8.11.7.
Pitch surgeries
8.11.8.
Pitch evaluations
8.11.9.
Company valuations
9.
Readings
List of Tables
Table 1 Correlation Marmer Stages and Venture Capital Stages
Table 2 Comparison of Accelerator and Startup interests
Table 3 Key Success Aspects & correlating Acceleration Factors
Table 4 Scoring Guideline of the venture development tool
Table 5 Example Scoring of initial assessment (Startup A)
Table 6 Scoring during the Acceleration – Startup A
Table 7 Scoring during the Acceleration – Startup B
Table 8 Scoring during the Acceleration – Startup C
Table 9 Business Plan Structure
Table 10 Hierarchy of segments
Table 11 Business canvas structure
Table 12 Vision example
Table 13 Factors that add to a Mission Statement
Table 14 Six cultural dimensions
Table 15 Positioning Statement
Table 16 Value
Table 17 SWOT Questions
Table 18 SWOT Structure
Table 19 SWOT Strategies
Table 20 Five operational key activities
Table 21 The five main activities of Management
Table 22 Management skill sets
Table 23 Manager vs. Leader
Table 24 Leadership Styles
Table 25 Team management methods
Table 26 Four approaches to team building
Table 27 Five modes of conflict behaviour
Table 28 Roles, norms and values
Table 29 Four disciplines for a successful execution
Table 30 Team communication aspects
Table 31 Advice for creating a Board of Directors
Table 32 Some legal principles on company names
Table 33 Controlling & Treasuring
Table 34 Working Capital Formula
Table 35 Liquidity, Profitability & Risk in regards to Working Capital Strategies
Table 36 Overview of balance sheet, income statement & income statement & balance sheet ratio
Table 37 Pitch structure 2-5 min
List of Figures
Figure 1 Five ways for corporates to innovate
Figure 2 Structure of the book
Figure 3 Accelerator / Incubator timing in comparison to the Marmer stages
Figure 4 Four stages of acceleration (adapted from Becker & Gassmann 2006)
Figure 5 Marmer Stages - Adapted from the Startup Genome Report
Figure 6 The progress of a startup throughout the Marmer Stages
Figure 7 Key Success Factors towards a vision / goal
Figure 8 Key Performance Indicator towards a goal
Figure 9 Key Performance Indicator in combination with Key Success Factors
Figure 10 Venture Capital trends over the decades
Figure 11 Six stages of Venture Capital, including Pre-Seed
Figure 12 Marmer Sequence
Figure 13 Venture Capital Sequence
Figure 14 Marmer and VC in sequence (visualization only)
Figure 15 Marmer Stages with corresponding business factors
Figure 16 Combination of the venture development tool with Marmer and VC Stages
Figure 17 Radar Chart illustration of the individual scoring of a venture
Figure 18 Using the KSF in order to showcase a new KPI of acceleration
Figure 19 Radar Graph of initial scoring - Startup A
Figure 20 Radar Graph of scoring after 3 months of acceleration – Startup A
Figure 21 Radar Graph of scoring at the end of the acceleration - Startup A
Figure 22 Overall development Startup A
Figure 23 Radar Graph of initial scoring - Startup B
Figure 24 Radar Graph of scoring after 3 months of acceleration - Startup B
Figure 25 Radar Graph of scoring at the end of the acceleration - Startup B
Figure 26 Overall development Startup B
Figure 27 Radar Graph of initial scoring - Startup C
Figure 28 Radar Graph of scoring after 3 months of acceleration – Startup C
Figure 29 Radar Graph of scoring at the end of the acceleration - Startup C#
Figure 30 Overall development Startup C
Figure 31 Balance sheet structure
Figure 32 Cash Flow Structure
Figure 33 Profit & Loss Structure
Figure 34 Competition radar
Figure 35 Product / Service development key areas
Figure 36 Product Life Cycle
Figure 37 Prototyping sequence
Figure 38 Stages of Software Development
Figure 39 Minimum Viable Product Sequence
Figure 40 Marketing Analysis Model
Figure 41 Ansoff Matrix
Figure 42 Five steps to a customer profile
Figure 43 Customer Profile Example
Figure 44 Detailed Competitor Analysis Grid
Figure 45 Create, Capture & Sustain
Figure 46 5 The 5 C's of the Market Analysis
Figure 47 STP and the 4P's of a market analysis
Figure 48 Segmentation Criteria
Figure 49 Target Market Selection
Figure 50 Market Segment Strategy
Figure 51 Product Submarket Strategy
Figure 52 Niche Strategy
Figure 53 Multi-niche Strategy
Figure 54 Five Aspects of Customer Retention
Figure 55 Needs and Wants
Figure 56 Outbound vs Inbound
Figure 57 Lead Generation
Figure 58 B2B & B2C Similarities and Differences
Figure 59 Zone of possible agreement
Figure 60 Negotiation through compromise
Figure 61 Personal Development Plan aspects
Figure 62 Personal Development Plan – Life Roles Example
Figure 63 Strategic questions for Operational Planning
Figure 64 Leadership & Management
Figure 65 Five modes of behaviour in a conflictual context
Figure 66 SECI Definition
Figure 67 Ten operational Functions of Human Resource Management
Figure 68 HR Tasks in development – Recruitment
Figure 69 Tasks in development – Development
Figure 70 Tasks in development – Retention
Figure 71 Tasks in development – Retirement
Figure 72 Hiring Process Flow Chart
Figure 73 Order of Precedence
Figure 74 Criteria for choosing a legal form
Figure 75 Applicable law – standardized within the EU
Figure 76 Duties of a Managing Director
Figure 77 Liabilities of a Managing Director
Figure 78 Three main finance management decisions
Figure 79 Working Capital Strategies
Figure 80 Elevator Pitch outline
Figure 81 Growth trend graph
Figure 82 Potential Structure of a pitch one-pager
Figure 83 Types of communication
List of Equations
Equation 1 Current Ratio
Equation 2 Acid Test or Quick Ratio
Equation 3 Cash Ratio
Equation 4 Debt Ratio
Equation 5 Debt to Equity Ratio
Equation 6 Capitalization Ratio
Equation 7 Interest Coverage Ratio
Equation 8 Cash flow to Debt Ratio
Equation 9 Interest Coverage Ratio
Equation 10 Return on Assets Ratio
Equation 11 Return on Equity Ratio
Equation 12 Post-money valuation
Equation 13 Pre-money valuation
Equation 14 Dilution of shares
Equation 15 Equity dilution
Executive Summary
This book is about startup-specific acceleration during corporate acceleration programs. It enables an efficient development of promising ventures in the global race for innovation.
It looks at current academic and practical approaches of startup acceleration. So far, neither academic nor public literature has applied an overarching perspective, providing a venture development tool for the first stages of the entrepreneurial journey of a venture. The difference in measuring progress will be highlighted as a main result.
However the complexity of successful venture building is heavily based on the quality of the idea. The venture development tool, demonstrated herein does not assess the quality of an entrepreneurial idea, but provides a guideline for a holistic development of a young company.
The need for corporate acceleration programs is developed, explaining why corporate companies need to put more focus on innovative products / service and business models. The main terms used in this book are being explained and current academic and practical approaches are highlighted.
In essence the venture development tool is explained, providing the first overview of why the various key success factors have been chosen.
The venture development tool is based on eleven factors which have been identified as essential criteria during a startups development, they range from business basics, over marketing to finance management and investor relations. It can be applied to startups from various industries and in various developmental stages.
The results of the tool are presented in three case studies in which three startups in different developmental stages have been analysed over the period of six to eight months. The startups analysed in this book shall serve as a general example. Their names have been kept confidential due to NDA.
Additionally the effects of a proper usage and the requirements for it will be summarized, leading to a guideline of key success factors, which are criteria for the individual acceleration indicators. This list of key success factors works as a guideline for the acceleration of early-stage startups and can also be used as a checklist for established companies.
1. Global Innovation
Corporate companies, like Apple, BMW and Telefonica appear to be omnipresent. But these companies are under constant pressure. Comparably new companies quickly appear on a global scale and challenge established industries and companies through disruptive business models, products and processes.
A current phenomenon, the training and education of young companies / startups by established corporate companies, is a reaction to the danger of disruptive innovation. Large companies more and more enter the field of corporate business acceleration with the goal to even better understand innovation and to improve their existing business models.
One reason is that in today’s business environment continuous innovation is a matter of survival. In case a company cannot innovate fast enough it faces severe challenges such as rising competition, loss of customers, or even the risk for its survival.
The need for continuous innovation has always been important. We have to consider innovation as controlled risk-taking in ever-changing environments. Innovation became a pre-condition for staying in the market only since the start of globalization.
The average lifespan of leading companies has decreased significantly in the last century. In 1920, the average lifespan of a leading US company, listed on the S&P 500 index, was between 60-70 years. This lifespan decreased to 15-20 years in 2010. It is assumed that by 2030 approximately 75% of the S&P 500 Index will be replaced by companies that have not yet been heard of.1
What has changed?
1.1. Innovation in global markets
The globalization and the digitalization of industries play a vital role for the innovation strategies of corporate companies. International markets are moving closer together which leads to decreasing information costs as well as decreasing transaction costs. Both consequences have significant implications on the options for corporate companies on how they innovate.
Globalization intensifies the pressure that Porters five forces put on traditional markets. In a globalizing world, the five forces shape entire industry landscapes2. Four out of the five forces increase the need for corporate companies to focus on innovation. These four forces are:
The threat of new entrants as Porter’s fifth force however is increasingly becoming even more important as young technology companies develop innovative business models and processes.
Ventures with the potential to disrupt established industries tend to be in a very early research stage of their prospective markets. They are able to discover new business trends or opportunities swiftly as they are at the base of where customer needs are happening. By being very reactive and flexible these startups can perceive and identify unnoticed customer wants and needs and respond quickly by including them in their products and solutions. Corporate companies, which are characterized by established and successful processes and structures, are substantially less flexible than these companies and have longer decision-making processes then startups.
Through this pro-reactive flexibility startup companies have the opportunity to establish strategic disruptive innovation and so can thus create new markets and business models relatively quickly. Disruptive innovation has the potential to replace existing technologies or services and suddenly affect established industries and markets.
Nowadays all established companies can face a disruption of their industries caused by innovative startups that do not necessarily have to be competing in the industry or with a similar business model.
Many large companies do not succeed in developing disruptive innovation themselves due to several disruptive innovation barriers such as risk-averse corporate climate, innovation process mismanagement or dominant business concepts. For corporate companies it is a massive challenge to develop disruptive products and services as their success is difficult to forecast without any prior history. Corporations prefer strategic and operational control while disruptive products and service may need flexibility in order to become successful. Hence corporate organizations need to constantly improve their internal practices and procedures in order to stay competitive. Creating better products or services is at the heart of innovation.
Disruptive innovation tends to have an emphasis on product or service attributes. This explains why disruptive ventures have the potential to challenge established industries, because they can react more quickly to customer feedback and needs due to their smaller size. A faster reaction to customer feedback, together with a focus on the product and service gives disruptive companies the potential to lure away customers, to capture large market shares and to confront established companies with an innovative way of doing business, which might be in conflict with established ways. Especially business-model innovations tend to be particularly disruptive to established companies as they are harder to replicate innovative business models single products or services.
However, inventing new ways to do business is not easy. But for a corporate company it can be of interest to observe how different business models can succeed in order to be able to improve existing corporate models.
In order to stay competitive, corporate companies need to be aware of any potential threats or potential opportunities arising from the innovative startup environment and they have to constantly transform their products and services and even business segments. Corporate companies need to make certain that adequate knowledge and technologies are identified in order to maintain a leading innovation status.3
1.2. General Setting
Successful innovation is based on the development and integration of new knowledge into established processes. Efficient innovation is a combination of capacity and creativity, with creativity being the ability to flexibly produce work that is original and unexpected, high in demand and useful. Companies can integrate new knowledge through different options. There are several ways for corporate companies to stay innovative.
Five main ways to generate new knowledge and create new insights are:
In-house Research and Development (R&D)
In-house R&D is a common way for corporate companies to stay innovative. In order to grow more rapidly, some companies even form strategic alliances and share R&D resources and costs. In-house R&D tends to be expensive. Therefore this option is often reserved for large corporate companies with the required financial assets. The creation of innovative products and services can nowadays not rely solely on internal information sourcing anymore, but also has to consider external knowledge to develop innovative products or services. The globalisation and digitalisation result in an increase of available knowledge, combined with marginal costs for storage and transmission. Hence established companies can no longer rely only on Internal R&D to maintain technological competitiveness. An advantage of in-house R&D is that it provides control of and ownership over the new knowledge, which can lead to a technological competitive advantage. Disadvantages are that it is costly and relies mainly on internal information sourcing.
External R&D / External knowledge acquisition
The importance of external R&D has increased in recent years as a result of globalisation and digitalisation. The capital requirements for external R&D tend to be lower than for internal R&D and also the risks and damages of failure are reduced. External R&D is only a complementary option for internal R&D due to the tacit nature of innovation. Meaning external R&D will not lead to success alone but needs to go hand-in-hand with internal knowledge creating processes. Advantages of external R&D and knowledge acquisition are that they also include external information sourcing and are not as costly as in-house R&D. Disadvantageous is that it entails a risk of loss of technological know-how and hence the loss of technological competitiveness.
Sole market observation
Market observation is a complementary tool to identify incremental innovation, since it helps to identify and to clarify the customer’s wants and needs. It is a passive tool to monitor market developments and hence cannot be used to discover disruptive innovation. Disruption innovation in its core means now products in new markets of which the potential customer was not even aware yet. It requires a certain proactiveness towards the market it creates and towards potential customers. Sole market observation is not efficient to identify new markets for which product requirements are not yet defined. Sole market observations are a comparably low cost alternative and good tool to capture feedback from the market and customers. However they are disadvantageous since they are only passive observations and hence cannot be used to discover disruptive innovation or disruptive trends.
Corporate Venturing
Corporate venturing is an element of corporate entrepreneurship. It is a process, in which teams in a corporate company have the opportunity to use the assets and resources (e.g. market position, brand, etc.) of the corporate company to their advantage in order to create, develop, introduce and manage a new business that is distinct from the parent company Fostering innovation to maintain a competitive advantage is at the heart of corporate venturing. Corporate venturing consists of two forms, namely internal or external. Internal corporate venturing is the creation of organizational entities that reside within an existing organization. External corporate venturing on the other hand is the co-creation of a new business activity, in which the corporate company leverages external partners to successfully create a new venture.
An advantage of corporate venturing is that it can result in new business entities which reside in the existing organization. Successful corporate ventures can also be the result of strategic partnerships between companies and lead to entirely new companies. Corporate ventures have better access to financial, human and organizational resources than young technological companies in the free market.
However the usage of organizational resources such as the brand recognition can present threats. Failures of the corporate ventures can indirectly harm the reputation of the mother organization. Not always the best options are being supported due to established frameworks and potential politics within the corporate company
Incubation / Acceleration programs
Business accelerators can be seen as a late-stage incubation programs that are either privately funded or corporate run programs that mentor, assist and support young companies for equity or other forms of return on investment.
A business accelerator is hence a business entity that enables young entrepreneurs and upcoming companies to develop their business ideas in a sustainable way through an array of trainings, counselling and mentorship, investment, as well as other resources and services. Business incubators can be seen as mentorship entities that provide guidance for companies through childhood while business accelerators mentor and guide young companies through the adolescence of their company development.
Similar to an incubator, the accelerator guides startups through their company development. An increase in the number of incubators / accelerators results in increased competition for the most promising and attractive startups.
Advantages of incubators / accelerators are that they are close to the entrepreneurial scene where ideas of disruption are generated and hence give the corporate mother the opportunity to monitor upcoming ideas. Supporting disruptive ideas gives the corporate organization the opportunity to either react on the disruptive change or to in-source it. Disadvantageous is that building an incubator / accelerator is very costly in terms of time, finances, planning and requires a lot of commitment. Physically building an accelerator is only the beginning, as it also has to be rooted in the surrounding entrepreneurial environment in order to attract promising startups. Establishing a successful acceleration / incubation program is a long-term investment that may not provide quick results and therefore it may not be the most beneficial way for corporate companies to seek innovative products / services or business models. However being close to the entrepreneurial scene the corporate company can learn a lot from startups and vice versa. That may be one of the reasons why more and more corporate companies establish their own acceleration programs.
Conclusion: All of the above mentioned ways to integrate new knowledge into a company provide advantages as well as disadvantages. Recent developments in the incubation / acceleration program context, put this topic into focus, as they demonstrate an increasing interest of corporate companies in this field.
Figure 1 Five ways for corporates to innovate
1.3. Definition of the Problem
The globalization of markets, increasing international competition, the disruption of markets through new technologies and business models as well as the digitalization of products and services require that corporate companies place great importance on innovative ideas.
While innovation is moving to the forefront of corporate agendas, several corporate companies have started to develop structures in which they can capture the value of innovation in the emerging knowledge-based economy. Innovative business ideas, products and business models can disrupt entire industries in a short amount of time. In order to adapt to such circumstances corporate companies need to review and redefine their overall innovation strategies and processes. Developments in recent years show that many corporate companies attempt to do so by establishing incubation or acceleration programs.
However, the recent corporate accelerator market evolution demonstrates that more and more corporate companies are running or intending to run their own accelerator or incubator program in order to stay innovative.
In October 2012, the National Business Incubation Association (NBIA) estimated more than 7,000 incubators to be active4 worldwide. The Seed-DB database estimated 213 acceleration programs5 to be active worldwide.
Mainly the number of digital accelerators focusing on e-commerce, digital, telecommunication, and IT is increasing. One reason for this might be that the product development of digital ICT products does not take as much time as the development of non-digital products.
Due to the startup environment having a strong momentum corporate accelerators need to move fast in order to identify and support the most innovative young technological ventures or to recognize those which could become a threat.
The increasing competition between accelerators, as an effect of the rising number, also increases the difficulty to attract the most talented ventures for their own accelerator programs.
Therefore it is difficult for corporate accelerators to find and identify the technological ventures with the most potential for innovation and to accelerate them. Even if the most promising early-stage companies have been identified and enter the acceleration program, the survival of their businesses is still not guaranteed.
A rule of thumb states that nine out of ten product attempts still fail.6 That means that approximately 90% of all startups in incubation or acceleration are prone to fail and on the long-term will put a massive pressure on incubators / accelerators by not being able to return or exceed the investment put into them.
So under the current circumstances, corporate companies are more likely to waste money on acceleration programs than to generate a positive return on investment. A negative return on investment can weaken the competitive position of the corporate company. Corporate acceleration is now a critical innovation option for corporate companies and currently the success rate of corporate acceleration is far too low. Therefore establishing and running corporate acceleration programs needs to be seen as a long-term investment for identifying, and possibly insourcing promising products / services and/or business models.
This book takes these aspects into account in order to outline a process to more efficiently accelerate young ventures. It provides corporate companies an overview of what they have to consider in order to successfully support and accelerate young ventures and also provides a guideline for young entrepreneurs to develop their startups in a holistic manner. In doing so the book increases the likelihood of corporate or private accelerators to generate a positive return on investment. It is a book to be read by young entrepreneurs, startups, innovation managers and business leaders who are interested in organically growing their businesses.
The venture development tool demonstrated herein also supports the due diligence of acceleration candidate selection and continuatively helps to foster the efficient growth of young ventures by identifying, visualizing and then eliminating weaknesses.
