The power of Co: a new model for innovation at corporates.
At Co:cubed, we’re passionate about helping the world’s biggest brands connect to the world’s most innovative startups. And there’s never been a more important time to do this. In fact, over the last 12 months, the amount of startups that have started-up and the amount of funding that has come into the startup ecosystem has exploded enormously. Just last year, the number of startups in the US went up from 4.4 million in 2020, to 5.4 million in 2021. And 44.4 million was already a record year for entrepreneurship, when it comes to funding, the amount of money that’s going into this has over doubled in the last 12 months globally.
The amount of innovation that is happening in and around your categories has never been greater.
It doesn’t matter which company you are, if you start to look at the amount of money being poured into innovation in the startup ecosystem, versus your own R&D budgets, for instance, you’ll see there’s a huge amount of opportunity to engage with “outside innovation”.
Our question for you is, how is your brand engaging the world of innovation that is happening beyond your four walls? Are you looking at how you might be able to copy what’s happening and build that disruption in house? Are you looking at how you might consolidate through a big acquisition spree? Are you perhaps looking at how you might partner and exploring opportunities?
Brands have wrestled with this topic for decades. When I was at Unilever, we launched the New Businesses Unit in 2009, which was our attempt to engage with the outside world and engage with the outside world through creating disruption internally. We spent 10s of millions of pounds trying to launch our own businesses and failed dramatically.
If you’ve been in the innovation space for a while, you’ve probably seen the three horizons of innovation. It’s a paradigm that moves from incremental to new horizon to disruptive innovation. The narrative normally goes something like: incremental innovation is fast. It’s low risk, it’s things that you should be doing and it’s generally low hanging fruit.
But when it comes to disruptive innovation, the narrative has always been that it takes a long time. It’s very high risk. And it’s a high investment. This was definitely my personal experience from my time at Unilever, where we gave ourselves five years to create the future of Unilever. We gave ourselves a 40 million pound budget to get those ideas off the ground. It was incredibly high risk, in fact, so high risk that none of the 22 ideas that we launched, ended up happening.
We had a 100% failure rate.
This is not just a Unilever story, this is happening in corporations right around the world. And at Co:cubed, we believe it’s time to turn that narrative on its head to explore, how can you have transformational innovation? But how can you do that in a way that’s fast? How can you do things that are truly leading edge? And how can you go from high impact launches in a way that doesn’t require a huge investment, like what we had at Unilever.
When it comes to disruption, there are three options to make that happen.
You can build, you can buy and you can partner.
Traditionally, brands have looked at either end of that spectrum. It’s either been about how to build or how to buy. It’s what we did in 2009, where we said, let’s build the future of Unilever, or how can we buy and that’s, you know, a Unilever what we did with the Dollar Shave Club, for instance, and looking at entering into male grooming space in quite a disruptive way.
At Co:cubed, we’re passionate about the middle ground, about how to partner effectively. In this space, there is a huge array of different partnership opportunities that exist; licensing, supplier agreements, OEMs joint development agreements, there’s a huge number of other things that are not on here. And our encouragement to brands is exploring the question: how could those sorts of things perhaps help fast track your journey into the future?
Time to get practical: let me share an example from one of our clients, which was in fact, Unliever.
An oral care brand owned by Unilever had an ambition to create a “smart toothbrush”. They had this ambition for well over a decade. And in fact, over those 10 years, they spent over many millions trying to create their own toothbrush.
This started in 2009, before iPhones were a thing. Their idea was to have a screen that would live in your bathroom. You would connect to the tablet via a cord to your toothbrush and brush your teeth. It would then track how you were brushing, you’d put a USB card into that and take it to your dentist. If anyone would ever actually care. But it was invented by a whole bunch of people that were obsessed by oral care and assumed the whole world was as well.
You’d be glad to know that it’s never launched.
So as Co:cubed, we went back to them and said, look, we know you’re looking at going into smart toothbrushes. Funnily enough, it already exists. And there’s a company called Playbrush that allows you to connect via Bluetooth to an app on your phone and then chase out monsters in your mouth.
We went from introduction to Playbrush to in-market with a Signal playbrush in nine months and it was launched across the whole of France. It took the Signal brand into a completely disruptive space for the oral care segment where Signal was able to have a direct relationship with consumers.
We helped them explore; how can you go into services to how you go from products into services? How do you go from selling through retailers, through to having a subscription model? And how do you go from just products into devices and other areas as well.
The launch did not take 10 years, and it didn’t cost 40 million pounds and it didn’t fail. It was done in nine months. It cost a couple of 100k. And it was launched across the whole of France. And I think it’s a great example of how brands and startups can work together hand in hand, taking startup innovation, and bringing that to life at the scale of a corporate.
Another brand is Reckitts. They came to Co:cubed and said, look, we’re launching Neuriva, which is a brain health supplement, and improves cognition a little bit. If you take this supplement by itself, it improves cognition a little bit. If you do take the supplement together with a brain gym, it improves cognition significantly.
Their question was, how do we create a brain gym? We’re looking at building one, but that’s going to take the next two to three years for us to get the clinical results. We could buy one, but that would cost about 20 or 30 million quid to buy. And we don’t want to spend that much on it.
We said, it already exists. It just hasn’t been scaled yet. Let’s look at how you can partner.
We ran a global search and identified a company called CogniFit. We went from brief to in-market in 6months. The brain health system was launched across the whole of the US and it became the number one health care brain health brand in the US. It was not just the launch of an app, it created an amazing brain health system that reminds people to take the supplement.
These are not huge, massive capital investment projects. These are investments that can be done with a couple of 100k. And it’s not high risk. The only risk here is what happens if we apply a global brand on top of this startup innovation.
We think this model of innovation is a gamechanger and it’s what we’re passionate about making happen at cocubes.
We now work with 40 of the FTSE 100. We help connect them to the 12 million startups that are in our network.
Here are 5 tips before working with startups
- Think beyond the bottle.
Think about how your brand can show up and the lives of your consumers in new and fresh ways. Think beyond the product or service constraint that you currently operate within. What might a digital companion app look like for your brand, for example? How might you take your brand into services? What product extensions might you apply to your brand? Then think about what startups can help you there.
- Make sure you’re finding the world’s best.
If you go into a process hungry, you end up eating crap. And what we want to encourage you to do is go into that process with a real discipline around how you search and curate those startups to make sure that you’ve got the best brand in the world working with the best startup in the world.
- Keep it logical.
If you’re having a brainstorming session and you’re coming up with a toothbrush that involves a screen on the wall, and according to the toothbrush and a USB card that goes to a dentist, you’re probably overthinking it. A lot of brands love to obsess about the fact that their brand is in the heart of consumers’ eyes. Think about what the logical extension is that consumers would expect about brands that’s not always upfront and easy to explore.
- If you do identify a new green, you know, “Blue Ocean” for your brand to go into, then think about how you can partner.
- The future already exists, the future of your brand already exists, the devices or services, the experiences that you’re looking to take your consumers into, already exists.
They’re part of our global network of 12 million startups. So think about how you can partner first, before you look to either build or buy.
If you’re interested in this space, we’d love to help you. This is a service that we call Opportunity Intelligence. It’s a solution where we’re always on the lookout for new options for you to extend your brand into new spaces.