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Tuesday, June 28, 2022

The big change – how corporations started knocking on startup's doors

Editor’s note: This is a guest post by Sami Kuusela

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I have to say I’ve never had my timing this right in any business. Since last autumn I’ve been helping the biggest companies in Finland to connect with startups. Selling my services has been almost too easy.

This all started a year ago when I wrote a book about startup culture for EVA – a policy and pro market think thank. The pamphlet was called “Hoodie Dude and the Businessman” and it was delivered to every business influencer in Finland (and still downloadable on EVA’s website).

First my point was to moan how stupid the Finnish corporations were when they did not understand startups. Once again we Finns were not as good as Americans. I was focused on showing how wide the gap between corporations and startups was, and I was pointing out there is no exits inside Finland. I was blaming the corporations like a teenager hating his parents.

Maybe it was my background as a journalist and a bitter entrepreneur that made me so negative. I did not realize that being negative was not leading to anything but paralyzing the sad situation.

But then I started to meet with the corporate executives. And they were not at all what I expected. The brightest people in corner offices realize that the times have changed and now the giants must start attracting the little ones.

I started the drop my prejudices. The corporations were not evil, they were not killing the innovations – and yes: there was lots of extremely clever people working in big companies who were genuinely interested in startups.

I had to change my message: it was not actually the corporations that were to blame for the terrible situation. The real reason for the missing link was the suspicion among startups towards corporations.

It is understandable. Many Finnish startup founders still remember the old times when only way to go abroad was by being a subcontractor of Nokia or some other big company. And when most of the revenue was coming from one client, the power was given to a customer who behaved like a dictator.

The change in the business ecosystem – and attitudes – has been extremely fast.

Only few years ago we were begging the meetings from the corporations. “Please can we meet” was often replied with silence.

If we got a meeting it usually ended badly. Either the answer was straight “no” or the partnership required accepting impossible terms and endless negotiations with the corporation lawyers. No one benefited.

When Nokia and some other giants failed, many of us became bitter. We decided to never partner with a corporation. We wanted to be free.

Then startups happened.

In the new world small companies are recruiting the best talents and creating the sexiest products. It is no longer cool to work in a big company, it’s better to put up an own company or help a friend with big dreams. The best corporations know this.

Now the corporations are in a situation where the lines behind their doors have vanished and they have no access to the new business culture called startups.

The bravest big movers are acting already. The M&A activity is picking up, and new partnership models are created every day. The most modern big companies understand that startups need freedom to grow and reach their goals. And big ones have a muscle to help the small ones who dream big.

But no company should be altruist. The corporations can benefit hugely from startups. Great new products and best people can be acquired if the attitude is changed from “I am Caesar, I will help you if I feel like it” to “Dude, come and meet us, let’s talk. We need you.”

And while making more money, going to work might get a bit funnier. The stiffness of a corporation can ease and maybe someday we’ll see a traditional CEO with a hoodie?

All around the world corporations are getting closer to startup world and becoming more and more open. Today that is the only way to survive.

Not only tech giants like Google and Facebook are acquiring small companies – every industry has a need for startups. For example we had a great project with a Finnish metal giant Rautaruukki to whom we were able to find many potential Finnish startups to buy or partner with.

Now it’s time to show to the startup world that Finnish corporations can be great. The best place to start is the Arctic15 where the boldest big companies are pitching to startups. Yes, that’s right. The startups will not be pitching. They will be judging the corporate pitches. Sweet, isn’t it?

Sami Kuusela is a serial entrepreneur and a journalist whose Hupparihörhö (Hoodie Dude) company is connecting startups to corporations.

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