How a large company can get "out of the box" accelerating startups

1. Driving Corporate
Innovations
How a large company can get “out of the box” accelerating startups
Ilya Kuznetsov,
VP Corporate Programs
Nick Mitushin,
Investment Director

2. Cambrian explosion
542 M years ago
2
© Leonard Eisenberg 2008

3. Cambrian explosion today…
3Source: The Economist, Jan 18th 2014

4. …builds innovation gap for
large companies
4
49% Average Growth Rate
2% Average Growth Rate
US labor productivity, Bureau of Labor Statistics
Source: http://dupress.com/articles/from-exponential-technologies-to-exponential-innovation
InnovationGap
Deloitte combined cost-
performance index for:
1. Computing power
2. Data storage
3. Bandwidth

5. 5

6. The anti-malware
industry challenge
1. Antivirus becomes a commodity
2. PC Windows base is not growing,
mobile is on rise
3. A different need and perception
of security of mobile users
6
Global Device Install Base by Device Type
Source: Gartner
Security beyond antivirus

7. 7
Plan to overcome
the innovation gap
1. Connect with the startup community
2. Learn how startups disrupt industries
3. Embed findings into the company

8. 8
Protect the world from cyberthreats
‒ Accelerate your sales and revenue growth
in just 3 months
‒ Turn your cybersecurity solution into
a successful product
‒ Make security your competitive advantage
‒ The best teams will compete for
an $80k prize fund!
Security Startup Challenge

9. 9
240 submissions from 34 countries
24 startups selected from US, IL, RU, UA,
DE, NO, SG, IN…
Look for best startups globally

10. 10
Plan to overcome
the innovation gap
1. Connect with the startup community
2. Learn how startups disrupt industries
3. Embed findings into the company

11. The Cloudifile case
11
Synchronize any folders
with Dropbox – and protect them

12. Key lessons learned in 2 weeks:
1. Positioning problem (CAC in tests = 730$)
2. Users only encrypt specific docs and
pictures several times a month
3. Cloudifile works best on a desktop,
not that well on a mobile
4. Users prefer dedicated storage
Conclusion:
To adjust the app the team needs to spend about
the same amount of effort they’ve already invested (1 year) 12
Fail Fast ≠ “shame” of “C”
Fail Fast = more “A”
A
B
C
D t Time
Success

13. 13
The Excalibur case

14. Speed of the startups
motivates to move faster
14
13% conversion from website visit to Logging in
3.7% -> 13% conversion from website visit to logging in with Excalibur
2 weeks Funnel changes

15. 15
Plan to overcome
the innovation gap
1. Connect with the startup community
2. Learn how startups disrupt industries
3. Embed findings into the company

16. Create coopetition for
better speed and learning
External Startup Funnel In-house Ideas Funnel
• M&A
• Joint Funding
• IP Acquisition
• Talent Acquisition
• Insights
16
Live-data
MVPs

17. Do real-life due diligence
with small budget
ACCELERATE
GROW
SUSTAIN
~10%
~50%
~40%
• Success rate < 50%
• $0 to $10K budget
• Cost of risks < 10%

18. Build traction-driven roadmap
Development
DeliverablesUsersTractionPhase
Product
Pitches
Clickable
Prototypes
Validated
Personas
Prototypes
Launch
MVPs
Betas
Pivots,
Key Feature Development
Paid Users
PrototypingProduct DefinitionIdeation
Leads
Active Early
Adopters
Problem/Solution fit Problem/Market fit Ramp up
Key Feature Discovery,
Technical Feasibility
User Acquisition Discovery,
Quality
18
Concept
Discovery
Coopetition with startups for better speed and learning

19. 19
R&D with the “cambrian”
building blocks
1. Find the right startups
2. Create coopetition for speed and learning
3. Do real life due diligence with small budget
4. Build traction-driven roadmap

20. 20
http://www.linkedin.com/in/iliakuznetsov
ilia.v.kuznetsov@gmail.com
http://www.linkedin.com/in/nickmitu
nmitushin@abrtfund.com
Grow with
“Cambrians”!