Corporates Are from Mars, Startups Are from Venus

Corporates and Startups don't speak the same language. This causes misunderstandings and frequently leads to bad outcomes and failed startups.

A large telecommunications company guarantees uptime to its clients of 4 or 5 nines, meaning 99.99 or 99.999 percent. Making your startup an integral part of their service means you need to be able to deliver against this expectation, a second iteration of your MVP won't be good enough, office hour support won't be good enough, contractual guarantees are needed from legal and the list goes on.

The startup thinks it has bagged a major customer, all development is redirected to ensure the clients features are built, the roadmap is abandoned, this client will cement future revenues and investment. Meanwhile the corporate is assessing a new architecture it might deploy in 18 months but might never see the light of day. 

Perhaps the above is a bit black and white but please think carefully before accepting the advances of a large company. A large customer is often a demanding one, demanding all the attention of the start-up. How do you approach such a partnership with a large company? 

Here are three pieces of advice that increase the chances of success. 

Don't lose your trajectory out of sight by developing too much tailored work for the customer. We often see start-ups developing all sorts of things for that one specific customer that doesn't really fit into the wider vision and product roadmap. This takes the start-up off course. As a result, income from other projects will come in more slowly. Also, keep in mind that your sponsor in the large company might switch jobs or move to a different employer. Make sure you already know a replacement, somebody who can take over the project if your contact person drops out.

Give your customer advice on how to navigate the way ahead. Be aware that your product will have an impact on your customer's business processes. The customer expects a solid plan, explaining who in the company needs training, what impact the product has on the business processes, and how its users will be supported. Often things go wrong somewhere between your proof of concept, which proves that your technology is applicable in the business, and the final implementation of the project. Don't start such a proof of concept if you haven't yet worked out how you will deliver your product. Also, be careful not to end up on an innovation track with a large company, these are designed to evaluate possible innovations, these can take a lot of time and often don't result in a paying client.

Show your clients you are dependable. This can take many forms. You have conducted a PEN Test, are GDPR compliant, you are financially stable or  have investors on board willing to back you. Be prepared for questions about tests, audits, and certificates. You may get questions about what procedures you use for software updates. Companies active in food or health care should probably start their trajectory towards CE-recognition (in Europe) and FDA recognition if they also want to conquer America. It is not necessary to invest in all those certificates from day one, but at least be prepared. A mention in an analyst report from Gartner or Forrester can already help your credibility.

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