How Large Enterprises Build Businesses Through Venture Building

Venture building is a strategic move large enterprises are adopting to foster innovation and secure future growth. This approach allows companies to create new revenue streams, diversify their portfolio, and stay competitive in evolving markets. With vast resources, established companies can incubate and scale new ventures more effectively than startups.

This article discusses how large enterprises use venture building to create new businesses. It highlights advantages, successful examples, key strategies, and the critical role of corporate support.

Advantages of Venture Building for Large Corporations

Venture building offers massive benefits to large companies. It helps them diversify their earnings and become more agile. Let’s look at these benefits:

• Diversification of Revenue Streams

Large companies use venture building to grow their business models. Managing revenue growth helps sustain and create new ways to make money. It reduces reliance on old products and services. This protects against changes in the market and technology.

• Enhanced Agility

Companies set up special teams or new units for venture building. This makes them quicker at innovation and responding to market changes. It gives companies an advantage in today’s fast-moving business creation environment.

• Using Existing Assets

Companies can boost new ventures by using what they already have. Assets like intellectual property, insights into the market, and a strong brand are useful. They provide a firm foundation that helps new projects grow fast and well.

• Access to Talent and Resources

Well-established companies have lots of money and skilled people. They can give new ventures the experienced professionals and funding they need. This increases the ventures' chances of success.

Successful Examples of Corporate Venture Building

Corporate venture building has led to numerous success stories across industries. Let's explore examples that illustrate how companies have used this strategy to foster innovation and drive business creation:

• Accenture Ventures

Accenture launched ImpulsoTec. It's a company that trains tech experts. The venture helps society and grows the business. It shows the benefits of building ventures. Accenture Ventures aligns new projects with goals for innovation. Ventures like ImpulsoTec boost Accenture’s position in the market. They also meet its social goals. This method shows Accenture’s dedication to impactful innovation using its resources.

• Amazon Web Services (AWS)

AWS Activate supports startup development with resources like credits and training. This helps startups use Amazon’s tools to grow fast. A key success is creating services that let startups build artificial intelligence (AI) tools cheaply. AWS’s method shows how its infrastructure supports new businesses. This program shows AWS’s focus on innovation and support for entrepreneurs.

• Google’s Area 120

Google’s Area 120 lets employees focus on startups while earning their salary. Successful projects like Grasshopper, a coding app, came from here. Google uses this to keep making new products. Area 120 helps nurture new business ideas within Google. It supports ongoing business growth.

• Unilever Foundry

Unilever Foundry connects startups with Unilever’s brands. This drives growth and meets trends like sustainability. One project created biodegradable textiles with Algiknit. Unilever shows its commitment to sustainability through these projects. The Foundry mixes external ideas with Unilever’s resources. It boosts Unilever’s products and market position.

• Microsoft’s AI for Good Initiative

Microsoft’s AI for Good uses AI to solve big problems like healthcare. It made Seeing AI an app that helps the visually impaired. This shows Microsoft’s focus on using technology for social good. The initiative links business creation and growth with solving societal issues.

Key Strategies in Enterprise Innovation

Venture building is how companies start new businesses or products from nothing. They spot gaps in the market, check if there is demand, and refine solutions quickly to build successful businesses. This section looks at key strategies that guide venture building.

Identifying Opportunities

Searching for viable business chances is key in venture building. This stage aims to find market gaps that can become profitable ventures with new solutions. Let’s see how:

• Discovering Problems Worth Solving

The first step in venture building is spotting problems that need solutions. Companies use methods like environmental analysis and opportunity mapping to find promising areas for innovation.

• Market Demand Validation

After identifying potential problems, the next step is to check if there is a market demand. This involves deep market research to ensure the solutions are viable and meet consumer needs.

Designing Solutions

Creating effective solutions is central to venture building. This stage involves developing new ideas and making them into real products or services that meet specific market needs. Let's understand the process:

• Ideation and Innovation Sprints

The venture building team participates in idea sessions and innovation sprints during this stage. They work on building business cases and designing solutions. This includes making value propositions and business operating models that solve the identified problems.

• Maintaining Focus on the Core Problem

The team needs to focus on the main problem to ensure the solutions work. This stops them from getting distracted by attractive designs that don’t solve the original problem.

Incubation and Iteration

This phase is about improving the product with ongoing feedback and updates. Turning initial ideas into workable and competitive solutions for the market is crucial. Here's how we can do that:

• Developing Minimum Viable Product (MVP)

In the incubation phase, the team makes an MVP and tests it in the market. They make changes based on what customers say to improve the product. This ensures it meets market needs and is ready for a bigger rollout.

• De-Risking Through Iteration

Iteration is key to making the product safer to launch. By continuously testing and tweaking the MVP, the team can fix any issues and make the product better and more appealing to the market.

Accelerating Growth

When a venture starts to do well, the focus changes to growing the business and increasing its impact. This last phase is crucial for turning a promising venture into a successful business.

• Scaling the Business

As the venture becomes popular, it’s time to grow the business. This involves confirming that the market wants the product and the business model makes money. Companies often add funding and support at this stage to encourage quick growth.

• Key Performance Indicators (KPIs)

For successful growth, companies monitor KPIs like revenue, the number of users, and the value created. These metrics maps help assess how well the venture is doing and its chances for growth.

The Role of Corporate Support in Nurturing New Ventures

Corporate support is essential for new ventures to grow and last. This support includes leadership involvement, proper governance of revenue growth, and using corporate resources. These elements help nurture projects from their start to their maturity.

Leadership and Governance

Strong leadership and governance are crucial for supporting new ventures in companies. Let’s see how they impact the success and adaptability of new business efforts:

• Senior Leadership Involvement: Top leaders are vital for new ventures to succeed. Their active role ensures that these projects get the needed resources and attention. Leaders need to back these projects and create an innovative environment.
• Effective Governance Structures: New ventures with governance allow for quick decisions and adaptability. This usually means setting up teams with specific talents. These include serial entrepreneurs, software engineers, and product designers.

Corporate Resources and Capabilities

Using corporate resources and skills is essential for developing and expanding new ventures. Let’s explore how these resources provide a strong foundation for these ventures to succeed and compete.

• Financial Resources: Big companies can give significant funds to new ventures. This financial support is critical for their fast and successful growth.
• Access to Talent: Companies have a broad pool of skilled professionals. These experts are essential for new ventures' success. Their marketing, product development, and data analysis expertise can speed development and improve innovation.

Wrapping Up

Venture building offers large enterprise innovation as a powerful strategy for driving growth. By leveraging their resources and capabilities, these companies can create new businesses that diversify their revenue streams and enhance their agility.

With the right strategies and corporate support, large enterprises can effectively incubate, scale, and sustain new ventures, positioning themselves for long-term success in an ever-evolving market landscape.

Ready to elevate your business through innovative venture building strategies? Connect with GrowthJockey today and unlock the full potential of your enterprise. Let's create successful new ventures together and lead your business toward future growth and success.

FAQs

1. How do big companies track the success of their new businesses?

Big companies use Key Performance Indicators (KPIs) to track success. These include revenue growth, market share, and customer numbers. These indicators help them see if the new business is doing well. They also look at customer feedback and product performance. This data helps them decide how to improve or expand their new ventures.

2. What problems do large companies face when starting new businesses, and how do they solve them?

One big problem is staying quick and innovative. Big companies often create special teams for new projects. These teams work independently, which lets them make fast decisions and keep innovating. They use resources like funding and technology to overcome obstacles. This structure helps them adapt faster to new trends and technologies than their main operations.

3. How does starting new businesses help big companies in the long run?

Starting new businesses helps big companies grow and stay strong. It reduces their reliance on old ways of making money. This helps them deal with market changes and stay competitive. New ventures can tap into new markets and technologies, keeping the company ahead of industry trends. It also boosts their reputation as innovators, attracting talent and investors.