The Friendship of David & Goliath

 @daphnipolis uses to send a weekly newsletter, always interesting but with an editorial I think they do not publish in the internet… so I will, as it is a very good article, interesting as it backs the (not so) new trend accelerators are promoting, some of then even changing their current business model… by Paul Bazin.

Bold emphasis is mostly mine.

Our curse in Europe is that despite all our efforts we are not as sexy as the US with their big champions. That’s understandable: They have built worldwide tech giants since the 80s. Of course, we have our own champions, the “Criteos“ and “Spotifys“, but they don’t have the same visibility across the world to date. 

If you like to look at the bright side of things, you can mention that foreigners are very often surprised by the quality and the energy of the ecosystem. That is exactly what happens to Paul Graham. We might have an undervalued asset to showcase our know-how: France's multinational corporations represent 8% of the biggest companies in the world. And guess what: As they are well-known throughout the world, they could be really good ambassadors. 

But to do so they should be real actors of the tech ecosystem, you say? That’s right! They should be and they need to be.  

We often consider that startups and big corporation are the David and Goliath of an economic battle. Big corporations are seen as the old generation. The expert one, where you needed to be the biggest know-how in a specific field to work your way up. Startups are at the opposite. In order to have a new look you need to think different, thus you need to have a global and broad knowledge. Brian Chesky never worked in the hospitality domain before disrupting it with Airbnb. Startups bring this fresh and new look that big corporations desperately need. Meanwhile, to share this vision, startups need money, visibility, worldwide networks, facilities, the list goes on… 

 

There are two types of startups that interests MNCs:
• The competitive: The ones that are attacking big corporations head on by capturing market share. Those provide the new vision.  

•The mutualistic: The ones that are offering tools and technology to reinvent themselves. Startups can benefit from big companies by using them as a distribution channel (think what Apple did to the mobile industry) or clients (think of many B2B SaaS companies), big enterprises are using startups to reinvent themselves by making better use of their data, being more efficient, more customer centric, the list goes on... Those escort MNCs in their digital transformation.  

Startups and big corporates should be viewed in a co-evolution process. The morphology and behaviour of the one is impacting the other. 

Bottom line: Goliath needs David and David needs Goliath.
Big corporations should provide visibility, know-how, money in exchange of a fresh vision, and tools for their digital transformation.  

This way of seeing the relationship implies a big mentality shift: MNCs must be seen as a leverage opportunity to scale, and not as the enemy anymore. Having international players close to us is a chance for the ecosystem to grow.