Manju Bansal explains how the SAP Startup Focus guides innovation, helping both companies and innovators scale new heights of success
The Fortune 500 list started in 1955 and at the end of 2016, only 60 companies (12 percent) were still on that list. In the intervening six decades, the rest have either gone bankrupt, merged with or were acquired by another firm, or they still exist but their revenues have fallen so they don’t make the cut any more. In fact, even in this century alone, more than half the companies that existed in 1999 do not exist on the list today. The lifespan of a company on the Fortune list has dropped from 60 years in 1955 to about 12 years now, and forecast looks to be even smaller.
So, what happened?
When Gary Kasparov played against IBM’s Deep Blue computer almost two decades ago, he is said to have remarked before the match that he was “trying to help defend our dignity”. Since the dawn of the industrial revolution in the late 1700s, technology has continued to cast a very long shadow on our lives, mostly changing it for the better but also inevitably upending the status quo in ways unimaginable.
Innovate or else
Every day you hear about young startups that are disrupting the status quo and redefining entire industries in the process - think Uber, Facebook, Airbnb, etc. In a globalised, hyper-competitive world, the old rules don’t seem to apply any more and ‘innovate or lose’ has become the norm, even for established enterprises with dominant market presence. However, innovation is a tricky business and not one that is easy to deliver on. Market leaders are realising that for them to deliver growth means adopting a fundamentally different approach to innovation, i.e. if we cannot do it organically ourselves, let us partner with someone else who can help us find that pot of gold.
Increasingly that means working with a tech-savvy entrepreneur with an agile DNA, who looks at problems with a fundamentally different lens. Like Campbell Soup did, for example, when it launched a $125 million VC fund to invest in early stage food companies to squeeze some growth in the mature processed foods industry. However, we also know that in the real world, it is not easy for a Fortune 500 size company to partner with (let alone buy from) a small startup. And that is where SAP comes in. As the global leader in enterprise applications serving almost 350,000 customers worldwide, we are committed to supporting the enduring success of our customers. One of the ways we do it, is by building an ‘ecosystem of innovation’ that brings startups, partners and innovators of all stripes together to help our customers win in their markets. Simply put, we help bring innovation to the enterprise.
Focus on startups
SAP Startup Focus is a global programme that works with young companies worldwide and helps them build commercially-viable solutions on SAP’s technology (including but not limited to SAP HANA and the SAP Cloud Platform), which we then help sell to our installed customer base. The programme exists to foster innovation outside of the traditional SAP ecosystem and to encourage, inspire and energise startups to use the power of SAP technology to develop compelling solutions. Some years ago, the prevailing feeling among startups working with larger organisations was one of anxiety, i.e. “how will I protect my intellectual property or will it ever be a fair arrangement?”
Today, open innovation is much more established as a concept and we see startups wilfully embracing larger companies. The realisation is very clear on both sides – startups have the agility and the solution innovation, whilst large companies have the commercial scale and deep customer relationships that the startup needs. Often it comes down to a simple fact. In practical terms, how easy is it for a young startup to work with an established corporate without being squished by the embrace, and how easy is it for the customer to derive value from what the startup is offering?
The programme started in mid-2012 and since then we have had over 5,500 startups from 60 plus countries that have expressed an interest in working with us. We apply some old-fashioned human intelligence to identify a subset of those startups that are a good fit with SAP, and which will likely be of interest to our enterprise customers (e.g. in areas like IoT, predictive analytics, machine learning).
Once the startup solutions have been certified and/or validated by our technical staff, we work with SAP field sales personnel and our partner community to continue the go-to-market journey. The validation and/or formal certification process is critical because we want the customer to have the confidence that the solutions they are evaluating are a curated bunch that meet certain quality criteria and which would not mess up the rest of their IT landscape.
A key ingredient for our long-term success is finding high quality startups who are building things that our enterprise customers will care about. This is a nontrivial challenge, and which cannot be easily addressed without enduring partnerships with networks like the European BIC Network (EBN). Whilst we use social media, events, referrals, thought leadership and the like to reach startups, having someone like EBN on the ground with its credibility and reach truly allows us to access the next generation of innovators that we seek.
What makes us unique?
There are several incubator or accelerator programmes that exist in many large companies. Only SAP Startup Focus however, offers not only technology but also the human expertise needed to develop a viable solution and a powerful customer channel to sell those solutions through. The programme is 100 percent free for startups, and does not ask them to either give up their precious equity or pay any fees. Some of the things that we offer startups include:
- Technology: Access to SAP technology (including the HANA database platform and the SAP Cloud Platform, among others
- Resources: Access to SAP solution architects / technical experts and marketing and sales enablement support
- Customers: Access to our global customer base to sell market-ready solutions (for qualified startups that meet certain criteria)
- Money: SAP Startup Focus does not invest cash into startups (like a traditional venture capitalist would do), but we do make introduction to VC firms in our network and to SAP.io, which is a SAP entity that invests in early stage startups
- Community of entrepreneurs, partners, investors and thought leaders in the enterprise big data space
Nothing succeeds like success
The SAP Startup Focus programme was kicked off in mid-year 2012, and in the past five years, we have had considerable success. Consider some of our achievements to date:
- Over 5,500 startups that have expressed an interest in working with us, with over 900 of them being accepted into the ‘development accelerator’ phase and are actively developing solutions on SAP technology
- Over 260 fully productive, validated solutions available for our customers (this approximates to one new solution being introduced every week for the entire five-year duration of the programme’s existence)
- Startups from 60 plus countries participate in the programme
- Solutions are being developed for 22 different industries and multiple lines of business
- Scores of deals concluded in 2016 alone, with significant revenue accruing to the ledgers of the startups involved
What our startups are building
While there is a very wide range of solutions that our @SAPStartups are building, here are a couple of illustrative examples.
Meteo Protect: Based in Paris, France, Meteo Protect offers financial products that protect companies and institutions when weather conditions adversely impact their business or profits, or generate additional costs. As weather uncertainty increases exponentially, so does the potential for negative impact on all kinds of businesses, including farmers, transporters, retailers, etc. If you are an electric utility that has wind turbines, what do you do if the wind drops? Or if you are a farmer and unseasonable hail pummels your cherry crop, now what?
Semantic Visions: Based in Prague, the Czech Republic, Semantic Visions offers technology that can predict supply-chain disruptions in real time, and is especially designed for large manufacturers that have thousands of suppliers worldwide. Disruption on a global scale often begins as tiny, insidious events flying well below the radar of major news outlets, often covered only in local non-English media, if at all. To capture this information, Semantic Visions has developed a unique cross-language semantic analysis technology that enables it to extract knowledge from Web content, in whatever language it is written.
Choice Holdings: Based in Luxembourg, Choice employs sophisticated algorithms to accurately predict the possibility of fraud and the associated financial return for each customer in the utilities industry, where fraud is an $85 billion problem annually. It is an evolutionary system designed to learn and adapt as thieves develop new tactics to steal energy and water.
For a young startup to sell their solutions to a large corporate is much like climbing Mt. Everest; a daunting initiative that you wouldn’t consider attempting without the right Sherpa team on your side. For entrepreneurs, the SAP Startup Focus programme becomes that critical Sherpa team to help guide them to commercial success, and to assist in navigating the many pitfalls that they will see along the way. To learn more please visit startups.sap.com or follow us on Twitter at @SAPStartups. If you know of a startup which is focused on the enterprise big data space, please do reach out to Manju.Bansal@sap.com
With over 84,000 employees in 130 countries and revenues of €22 billion, SAP is the world leader in enterprise applications in terms of software and software-related service revenue. However, what is an industry leader today began as a garage startup a few decades ago. In 1972, five entrepreneurs in Germany had a vision for the business potential of technology. Starting with one customer and a handful of employees, SAP set out on a path that would not only transform the world of information technology, but also forever alter the way companies do business. Now 45 years later and 350,000 customers stronger, more than ever, SAP is still fuelled by the pioneering spirit that inspired its founders.
Manju Bansal leads SAP's effort to engage with the startup community worldwide and build its innovation ecosystem. He is Vice President and Global Head of SAP Startup Focus, the accelerator programme that helps promising startups in the Big Data, predictive and real-time analytics space develop new applications on SAP technology and accelerate market traction. Manju has been at SAP since 2007 and over the years has held various leadership roles in Solution Marketing, the SME business and Ecosystem & Channel marketing. Prior to SAP, he was the founder of Thinknotes, an innovative content delivery platform that connected consumers, physicians and pharmaceutical companies and created personalized content repositories to help consumers manage their unique medical situations. Manju is an SAP Mentor and an Industry Mentor at the Easton Technology Management Center at UCLA. He holds an MBA from the Anderson School at UCLA with additional executive education completed at the Harvard Business School, and has been widely published on MIT Technology Review and Forbes. On a personal note, Manju has climbed several peaks in the high Himalayas and bicycled thousands of miles in countries around the globe.
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