Rethinking Our Approach to Innovation| Part One: Partnerships

Geopolitical tensions. Record inflation. Supply chain issues. An ongoing global pandemic. These are just a few of the major crises facing corporates today. Enterprises will need to remain agile in this ever-changing global business landscape – transforming their business models, undergoing strategic pivots, and rethinking how they approach innovation – if they hope to not only stay alive but thrive. Technology will remain a critical tool for executing on all fronts, and that’s why I’m doubling down on investments in the startup sector.

Not only an important source of innovation, these young companies have the potential to be the core drivers of economic development and job creation in the future. And while we have seen a resurgence of entrepreneurial activity over the past two years, the current economic downturn and possible recession has resulted in a particularly difficult environment for these new businesses to raise money. VC funding is drying up – with financing in the U.S. down 24% from Q1 2022 to Q2. On a global scale, financing fell 38% over the same time. For entrepreneurship to continue to prosper, we all – VCs, government, and legacy companies alike – must find ways to support and build up young companies that have the ability to innovate at tremendous speeds.

“Now we are calculating the bets and taking a more risk-oriented approach in smaller companies, where you can partner with them, or you can make investments to allow them to do what they are great at, which is driving disruptions, driving new architectures, and then being able to grow with them as you see these markets in transition.”

– Antonio Neri, President & CEO of HPE

To explore what that support looks like, I regularly invite leading industry executives and CEOs on my Chambers Talks podcast to discuss emerging trends and technologies, lessons learned, and disruption. During my discussion with Antoni Neri, the President & CEO of HPE, we discussed HPE’s approach to innovation, the role startups can play in driving disruption, and the power of partnerships. As we look ahead to the future, leaders and enterprises will be required to rethink their approach to innovation if they want to avoid getting disrupted by the market and their competition. In this first article in what will be a series about rethinking innovation, we will explore partnerships specifically.

Photo 1: Annual JC2 Ventures Trip to Alaska

As the founder and CEO of JC2 Ventures , I, myself, am focused on driving digital innovation through partnerships between startups and enterprises – something I’ve worked closely on with Antonio and others to ensure it is always a win-win relationship. While startups are innovative and can move at tremendous speed, enterprises are the best at scaling. The two are inherently stronger together. I’m a firm believer that VC’s must do more than simply invest and walk away – they need to nurture, coach, and support the companies in their portfolio. That’s why every year, I take a trip with the JC2 Ventures startups CEOs to Alaska where we share experiences, build culture, learn from each other, and ultimately strengthen our ecosystem. By mentoring and supporting the disruptive startups in our portfolio so they can innovate even more quickly, while also giving enterprise CEOs the opportunity to meet our startup teams during JC2 Days , we have been able to build a process for empowered partnerships between “big and small” that I think is replicable.

Photo 2: JC2 Innovation Day with IBM

A great example of this is the partnership between Virsec, a startup in the JC2 Ventures portfolio that helps organizations protect software workloads at runtime, and IBM Cloud. The two have joined forces to provide customers with the ability to move security operations (SecOps) workflows beyond traditional detection and response, delivering a more precise outcome-protection. As a result, organizations will be able to adapt quickly in the fight against cybercrime – a pressing issue in every board room across America (and the world) right now.

The exciting part is innovation is not a one-size-fits-all approach. Partnerships, of course, are only one of the many ways to approach innovation. Enterprises that want to avoid getting disrupted, however, will need to take a multi-pronged approach. In addition to building empowered partnerships between startups and more established players, I believe enterprises must encourage internal innovation and explore external innovation in the form of acquisitions targets.

Follow along over the coming weeks, as we rethink and redefine our approach, together.?