How the Lean Startup Movement Could Benefit Big Corporations

How the Lean Startup Movement Could Benefit Big Corporations

Startups are proving to be the molders of the future thanks to the idea of innovation and disruption they represent. Unlike corporate bigwigs, startups appear to be more agile and nimble. We often associate startups as the source of breakthrough products and services not only because of the prevailing culture but also because of proven successes like Uber, Airbnb and Netflix. However, the question remains: are startups the future of business?

If we’re to look back in history, most technologies cropped out of R&D labs of big corporations. As many companies continue to prove, R&D continues to be a crucial element of the innovation formula. It along with well-designed business models have brought us the breakthrough technologies we enjoy today.

What startups have been doing for the past twenty years is leverage existing technologies from large corporations. Some big companies lost the chance to take advantage of their breakthrough results, making way for startups to flourish. Thanks to the interplay of things, startups also cannot thrive without funding or the financial machinery of big companies. It has become a two-way street that has been benefiting the two parties involved.

As Alex Rampell of Andreessen Horowitz likes to put it: ‘the battle between every startup and incumbent comes down to whether the startup gets distribution before the incumbent gets innovation.’ The third wave of startups will encounter distribution problems while large companies will find it hard to innovate. This is where the partnership between the two industries takes over. The lean startup movement has helped the business world see how successful startups work. There is a difference between searching and executing. Large companies are now beginning to understand these best practices and how to adapt them in their business context.

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