This is a long way of saying that if you want achievement-oriented entrepreneurs to innovate on behalf of your company, you need to give them a generous share of the upside. People who have good ideas and are willing to shed blood, sweat, and tears to make them a reality won’t do it any other way.

In general, the experimental process is an iterative approach divided into three phases: build, measure, and learn.

Given the unpredictability of these market trends, the only sensible approach is to embrace uncertainty and build your strategy around it. Your efforts must be geared toward relentless experimentation so that you can discover opportunities as soon as they emerge.

Innovation team members likewise should receive a 50 percent salary plus ownership in their startups (see Incubate Internally (Chapter 9)) with the proviso that their combined equity adds up to no less than 51 percent.

Second, you can’t afford to weigh a startup’s valuation too heavily in your decisions. Nor should you, given the upside potential.

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.

try to describe people who share a common activity, goal, or problem that would make them receptive to your offering, such as “people who live in urban areas and play basketball in their spare time.

Colonies have single, critical functions to perform on behalf of their enterprise masters: to foster disruptive innovations.

The upshot is twofold. First, as a strategic investor, you should be ready to offer generous terms. Ambitious founders may feel that they can look elsewhere, so you need to make the deal worth their while.