The Lean Enterprise

Just as the innovation colony’s managing directors are like VCs, its innovation teams are like startup founders, and their remuneration can follow a corresponding pattern. Founders typically take 50 percent of an appropriate salary plus a 20 percent equity stake in common stock. (Employees who come aboard after the founders often take 90 percent of

Keep in mind that your innovation thesis is a working hypothesis. It’s a tool to guide the innovation studio’s activities, but it’s also a tool for learning, and it should evolve as you become familiar with the market and the innovation colony’s capabilities. Make it a living document shared by the key stakeholders. Start with an observation about

Incubating internally offers the lowest momentum of the three enterprise innovation strategies. As opposed to investing in a business that’s already growing or acquiring a startup that’s well on its way to product/market fit, you’re starting from a whiteboard.

It’s like, “How about we give you $30,000 and 30 days and you come back with a prototype.” Then the engineers say, “Do you know how much money it will cost me to set up to make a prototype? My yield will go down, my waste will go up, my metrics will go in the toilet and I’ll get screwed at my annual review.” It’s not that the incentives are set up

The constraints of resource dependence, legacy competencies, and brand identity are deadly to creativity and risk-taking. An enterprise that seeks to be innovative must find a way to escape them.

Mondelez International (formerly Kraft Foods) offers a 90-day accelerator program that connects mobile startups with brands like Oreo and Chips Ahoy.

The key is a new corporate structure that we call an innovation colony. Like the economic and political colonies of previous centuries, an innovation colony is a settlement staffed by employees of the mother company, but it’s distant enough that the company’s traditional management practices are not in full effect.

Part of your experimental effort should be devoted to segmenting the market, or verifying assumptions about who your most receptive customers will be.

Enterprises imagine that such timid programs will enable them to exchange soft assets such as contacts and mentorship for insights, relationships, and ideas that will help them become more innovative. But they miss four crucial points: First, as startup founders ourselves, we can tell you that startups don’t want to learn from corporations. We don’