The Lean Enterprise

One thing to know before forging ahead into an early-stage investment is that startup founders in general don’t trust corporate investors. Enterprises, unlike well-connected, highly experienced venture investors, are perceived to add little or no value beyond the money they offer.

Beneath the managing directors, the innovation teams consist of three to five people likewise combining business, technical, and design backgrounds. Small teams can react quickly to market shifts and, as we’ve seen, they can accomplish as much or more than much larger teams of the past. They’re cross-functional groups that avoid the silos typical o

Idea brief. An idea brief sets the stage for determining whether a given idea is worth pursuing. It’s a page that documents your product idea, the circumstances that inspired it, your hypothesis, and a list of underlying assumptions.

Incubating internally offers benefits beyond putting your company’s innovation efforts on firm footing. Of the three strategies, it’s the most capital efficient.

One more step prior to running any experiment: Decide on the learning that will constitute a successful outcome.

Starting with the team, the thesis may be something like, “Teams that have traits x, y, and z are likely to produce blockbuster products.” Starting with products, it may be more like, “Products with capabilities x, y, and z will grow fastest among enterprise customers.” The market-focused approach can yield a thesis such as, “Markets that are evolv

Third, it’s important to have physical separation. If a corporate startup is to be successful, it can’t be in the same physical location and building as the thing it’s trying to disrupt.

Ideation by itself is worthless. Ideation plus acceleration is not worthless, because at least people learn a process and something of value about new opportunities. To give the best ideas a good chance of being launched, though, there needs to be an infrastructure for incubation.

Incubating disruptive products goes against the grain of older, larger companies. It requires creativity, flexibility, collaboration, and speed, qualities that dissipate as a company grows out of disrupting its initial competitors and settles into nurturing and protecting its existing lines of business.

A viable thesis is based on where the market is going in the future, not on what your company has proven itself to be good at in the past. So the first order of business, before you sit down to formulate it, is to become familiar with the current market.