An insider view on corporate-startup collaboration.
We invited Mario Mayerthaler, Head of A1 Group Innovation Telekom Austria, as a guest speaker to outline how A1 is approaching the startup opportunity and what lessons were learned. A1 is actively engaging with startups through its Startup Campus, as well as directly through its different business units.
Why does A1 collaborate with startups?
As a leading telco in its footprint, A1 is the pacemaker in terms of digitalization for B2B and B2C. Digitalization itself opens up new possibilities and we want to create the ecosystem together with startups.
We see that startups are going into verticals in which we are not present, or that startups extend the value chain in verticals in which we are.
As such, we are trying to create value together, offering different models of collaboration between startups and us as group. We are searching for innovation, revenues and spirit, and we are very happy with the developments.
What do you point out as the key success factors for corporations wanting to maximize impact from startup collaboration?
From my perspective, it is quite simple:
Expectation Management: Promise only what you can deliver. It is absolute useless to promise guidelines and deals that will not come to the ground.
Be honest: Some things in a big corporate take time, but as a corporate you really have to make it happen
Secure your backing: If you are responsible for cooperation with startups, secure your backing and your guidance…and use it!
Which main barriers still exist between startups and corporations?
Most startups believe (and they must believe) that their products are the best in the world, so it must be quite easy for corporates to sell these products. But it is not. Corporates have quite high margins on their core products, and are driven by revenue goals in core business – this makes the selling of 3rd party products difficult.
On the other side, corporates often do not understand that those 3rd party products can secure their core revenues in the future. This can happen because, for customers, the additional value added from a 3rd party product might make the difference between a commodity and real value.
In general, of course, the way of thinking is different in itself: startups are eager and fast, corporates are slower but structured and process-oriented.
These are two different worlds and that makes it all so interesting.
Can you share specific success stories from A1 in your engagement with Startups?
I would take out two real success stories:
Parkbob digitalizes cities, meaning that they create an on-street inventory of parking rules and restrictions. So at the moment they know, in 40 cities in Europe and in the US, where you are allowed to park and where not, where you need to pay for parking and where not, etc. They are the only ones who have this inventory, and the interest from OEMs and Tier 1 suppliers is quite high.
This year, Parkbob will increase the number of digitalized cities to 100, because they have a unique technology enabling them to do that super fast.
R2O created a best-in-class cash registry solution for all operating systems, available through a subscription model on mobile, desktop and tablet. They are a market leader in Austria and are now heading to Germany. Last year they made EUR 2,6 Mio worth of revenues, and their team is composed by 45 FTE – all that only 3 years after founding!
We are really proud of that development as now we are truly picking up the pace and, due do legal restrictions, there is everywhere in Europe a need for such solutions.
Overall, we see that our program is working out quite well, as all the startups have investors and growing KPIs.