Open Innovation’s innovations

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Open Innovation’s innovations
Corporates are articulating their needs and opportunities for innovation; and using intermediaries to search for innovators with ideas, and to provide candidates with a period of intensive development.

Innovation has been the top priority for corporates and their CEOs for a year or two now, but it has proved tough to deliver. Searching the firmament for young stars that might support life while one’s colleagues get on with the existing business is a lonely task. So Scanning the periphery requires altogether different tools and the mindset of an enthusiastic poly-math. Revolutionising an established business is a rare feat.

For at least the last decade, the rapid evolution of enabling technologies has provided competition with a new source of opportunities. Now the nature of innovation has produced another stimulus to technological competition. ‘Disruptive’ innovations threaten not only to outdate single organisations (eg Kodak) but to reshape entire industries (eg publishing).

So organisations are now looking for their new products and services, processes and business models across the entire spectrum of technologies; and their research and developments functions are turning into search and deploy functions, whose task is to scout for new technologies that might serve the functions and customers of the business in entirely new and different ways – before their competitors do so for them.

The knack is of course not only to identify some new invention that might lead to marketable new products or services etc, but also to be able to develop it rapidly into a useable or commercialisable form and bring it to market or into use. These distinct aspects of the open innovation movement can be seen in the more systematic and extensive use of scouting for interesting ideas; and in the use of periods of intensive development for potential candidates.

Several organisations have adopted the approach of articulating their needs and opportunities for innovation, and inviting interest from entrepreneurial talent. A consortium of corporates in the Food and Drink Industry assembled a shopping list of areas in which innovative ideas were sought, and then ran a day with the Cambridge Institute for Manufacturing to which interested parties were invited for discussions. BAe has run a similar day under the auspices of the KTN; and Philips (with techUK) has just invited interest from people and organisations with potentially innovative products or ideas in the areas which they have identified as among their needs and opportunities for innovation.

FinTech Lab London was sponsored by a group of banks whose interest was in developing possible new products by participating in an Accelerator (with Accenture) – in which carefully selected small business were brought together for 13 weeks of intensive development and introduction to relevant people in the banks – a model that other clusters will undoubtedly follow. Startupbootcamp has recently run a similar Accelerator in London under the Fintech banner – for SMEs with IT products that might be of interest to financial institutions. Other examples include Traveltech, Wayra Lab (Telefonica) which runs a continuous programme of Accelerators – each of 16 weeks, John Lewis, and Barclays Bank. (As short periods of high intensity, Accelerators have an application process that is open to all, but is usually competitive; they provide pre-seed (subsistence) funding; they focus on small teams, not on individual founders; they provide fulsome support, with intensive mentoring; and work with cohorts or classes rather than single businesses; all in exchange for equity.)

BioCity’s latest initiative in Nottingham combines a search process with a development programme, and we will probably see other clusters, and perhaps other organisations following this route in the near future, and looking to established intermediaries, perhaps local organisations working in partnership with local incubators (franchised by Techstars or Startupbootcamp?), to help them organise their searches.

John Whatmore
January 2015

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A new Accelerator – in retail

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John Lewis, the latest corporate to launch a technology incubator
Organisations of many kinds are increasingly looking to incubators for their innovations – new products, services, processes and business models, but incubators from which they can quickly elicit something useful. Accelerators like this one – to be held at Level39, Canary Wharf’s innovation centre – are becoming increasingly specialised – to sector, such as this one in retail.
John Lewis is to launch a technology incubator called JLAB that will give one start-up a £100,000 investment in return for an equity stake in their company, and they’re hosting the programme at Level39’s Innovation Quarter, in Canary Wharf, where innovations are nurtured in a menagerie
of Hackathons, hatcheries, Accelerators and Incubators.
This development follows in the footstops of Finovate and Fintech Lab London, the former a programme that invited a large number of SMEs with technology that might be of value to the big banks to come and make the briefest of pitches – all in one day. Fintech Lab London brought together a small number of carefully selected SMEs to enable them to introduce their products to the big banks through a 13-week programme in which chaperones from the banks helped them to meet relevant people in the banks.
John Lewis has partnered with entrepreneur Stuart Marks, who invests in companies specialising in big data. “There are one or two retailers that have their own in-house development teams. The one that comes to mind is Tesco, who have developed Huddle internally. But there is no one in the UK that has done what we’ve done – this is not a corporate venture fund, this is about inviting companies from the outside to come in but with a very John Lewis centric approach that is unique”, said Stuart Marks.

A variety of seed-beds is helping banks to confront change

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The internet has thrown transactions into a cauldron of change

In a world in which innovation is mandatory, corporates are using and creating opportunities to explore new technologies that could influence their business models and even change their culture. And banking is in the spotlight.

The financial world is facing an earthquake of disruption as mobiles begin to become managers of people’s money; and as they play an increasing part in almost all kinds of transactions. Walmart’s discovery that as many as half its customers who order goods online could be in its stores at the time has highlighted the role of mobiles in transactions; and the rapidly growing volume of peer-to-peer transactions on the internet has highlighted the way in which the internet can displace intermediaries.

The internet is already playing a rapidly increasing role in banking, and the banks are now busily exploring ways in which their online activities will develop; and they are readily looking at innovations that SMEs have to offer. Consequently London is the place to which to bring your ideas.

Fintech Lab London has just completed its second iteration – in which it brought five SMEs to Canary Wharf, each with a bit of wizardry for the financial industry that might be of interest to the banks – its aim, to help them introduce their products through a 13-week development programme in collaboration with the banks. Level39, its location, sits in the middle of one of the world’s most intensive clusters – in Canary Wharf, so not only can it host intensive development programmes like this one; but it can also provide incubation space for the best of them to grow on.

Now Startupbootcamp FinTech is bringing its development programme to London – in partnership with financial institutions including MasterCard and Lloyds Banking Group, which will provide access to a network of industry professionals, and is opening its doors to applicants in August. Innotribe is running the semi-finals of its Startup Challenge competition in London, in which 15 startups and growth-stage companies for the financial industry will pitch for a place in its Finale in Boston later in the year. And Barclays is going a step further in planning to run its own Accelerator – with Techstars later this year; while Banco Sabadell in Barcelona has already done so.

These approaches are about bringing emerging technologies to potential business users, such as 3D printing to the vehicle industry in the East Midlands, TSB grant winners to Life Science businesses in Nottingham, games innovators to Dundee, new playwrights to the National Theatre’s Studio etc. Long ago Mercedes Benz established a culture of encouraging innovative thinking among its suppliers: what is new is the formalisation of this approach, the wider world from which relevant innovations are being sought, and the intensive development programmes like Fintech Lab London and Startupbootcamp FinTech.

May 2014

Finance alone is not enough

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Support is as essential an element in business development packages for hi-growth ventures as is finance: finance alone is not enough

The London Stock Exchange’s new programme designed to support the development of hi-growth businesses is the latest example of the need for support programmes alongside sources of funding; and support is the subject of a recent Nesta report.

The London Stock Exchange has just announced that it is working with Imperial Business School to offer a programme of bespoke management courses for a small number of ultra-hi-growth companies, together with access to a blue-chip collection of the City’s advisory and investment community, in order to help them to attract private investors and develop the right strategies for growth. Too many of these businesses, says the CEO of the London Stock Exchange, struggle to raise finance and sell out too early, and this programme will prepare them to gain access to the next layer of finance, including private equity and venture capital.

As Nesta, among many others, has pointed out, SMEs with hi-growth potential are the most important segment of our economy; and we might expect to find some of them in incubators, science parks, enterprise programmes and angel syndicates. The Technology Strategy Board has concentrated its funds on specific development hurdles – for technologies, sectors and clusters that have been identified as offering hi-growth potential in the UK. However, these focus respectively on space and on funding – more than on business development.

Level39 in Canary Wharf is an innovation centre that offers all sorts of support for early-stage ventures – from Hackathons, to Accelerators, co-working spaces for startups, and incubator space for SMEs. TechCity has developed its eco-system, where co-working spaces have thrived and specialised, to which supporters and funders have been attracted. Clusters have an energy of their own; and financial, medical, digital, retail, tourism and other hubs are being spawned; and they are taking root in other cities.

Fintech Lab London is an Accelerator programme designed to introduce a small number of carefully selected SMEs with products that might be of use to the banking industry with the help of chaperones from the Canary Wharf banking community. Accelerators like Techstars and Wayra Lab are multiplying, they are extending their scope – in their concern for entrepreneurship, and looking to support issues beyond apps and websites. They are extending their involvement both to earlier and to later stages; and they are becoming more specialised and thematic, and more institutionalised. (Accelerator programmes are moving away from learning sessions and towards personal learning support; away from huge networks of mentors and towards tailored and managed teams of mentors; and away from random relationships with VCs and towards more intimate connections with limited cohorts of funders.) And some incubators and science parks have attached the same importance to business development – to strategy, to the help of mentors, to business learning and to funders as do Accelerators.

Nesta’s recent publication ‘Good Incubation: the craft of supporting early-stage social ventures’ draws together experience from a number of such ventures, but much of that experience applies as much to ventures of all kinds, where its focus is on:

  • Talent spotting and selection – identifying big issues and teams to tackle them,
  • Mentoring – finding and engaging with people who can help on various topics and at the various stages of development,
  • Access to networks – peers, customers, users, investors etc,
  • Co-location – both shared working space, and event and training space,
  • and finally Finance.

The Stevenage Bioscience Catalyst has an Experts Panel, an entrepreneur-in-residence, and a business development executive; it runs regular meetings for its tenants to speak to and engage with one another, more formal “SBC Connect” events where they can present to a GlaxoSmithKline R&D audience, a series of science seminars, joint poster sessions, and information sessions about how to access leading-edge technologies/lab facilities. Belgium’s Plato programme is a full-blown programme of regular meetings for SMEs which have been matched up not only for sector but also for maturity. And each such group is provided with a couple of mentors from large companies.

Can we expect to see VCs and Angel groups working closely with business development programmes in the future, each working in aid of the other?

John Whatmore

April 2014

Is Level39 at Canary Wharf the future of Innovation

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Eric van der Kleij suggests that innovation centres are a valuable way of providing comprehensive support for new hi-growth businesses – in their best markets; and every city should have one.

 

Who better to ask about the future of innovation, than Eric van der Kleij, formerly Head of Tech City at Shoreditch, and now Head of Level39, Canary Wharf’s innovation space. Accelerators, he responded will specialise; they will spawn natural pre-cursors and after-care, they will proliferate and they will be more about revenue than about investment – more about growth than about funding. And innovation spaces will be a natural feature of cities and clusters.

He believes that Accelerators will become more thematic, citing The Bakery in London, with its Adtech focus, and the Tramperies, whose progenitor Charles Armstrong, has just opened the ‘Fashion Pub’ – a workspace for fashion designers and startups in Hackney. Other new specialist programmes include Ravensbourne College of Art’s incubator programme in Media Technology and Design, and UCL’s IDEALondon space with its focus on future media, healthcare and mobile.

And Eric sees a future for the Technology Strategy Board funded Catapults, designed to propel forward specific areas where technologies promise innovation. Hack Days, of which Level39 has run many in the past year, can help to identify commercialisable IP, and the Catapults need good leaders who can manage the tech transfer process, and help them to get allied with authentic startups.

He sees innovation spaces not only running Accelerators, but also running Hackathons, whose prize winners will enter Accelerators; and as at Level39, innovation spaces will offer tailored accommodation in co-working areas to hi-growth companies coming out of Accelerators (some of which can grow at twice the rate of their less curated entrepreneurs.) The future that he sees is of thriving, self-sustaining and independent clusters, consisting of startups/young businesses, users and funders.

And he thinks that every city will have an innovation centre; and he reels off the names of innumerable cities the world over that have beaten a path to his door to learn about how Level39 does what it does – cities with whom he has made Friendship Agreements.

He is quick to add that every such innovation space has to work with its own context; and he cites one city in a country with few roads, where the prize for winners of a competition to enter the Accelerator included an SUV – inscribed with banner details of that person’s new business – which would enable the participants all to reach the Accelerator daily.

So what is Level39? At first it was one complete floor of One Canada Square, the tallest building at Canary Wharf, which provided desk spaces for early-stage businesses (in retail and financial technology) because of its unique ‘connectious’ environment (with mentors and more experienced entrepreneurs), most of them already post-revenue – some desks in communal rows, some in small glass-fronted offices, some in larger spaces, with an attractive central area (with its 3pm Cookie Bell for getting people to meet up, and its infamous electronically controlled coffee machine!) In addition there are three Sandboxes – areas which organisations take in order to wrestle with particular issues, each of slightly different proportions and lay-outs; and there are Board Rooms, and a handsome auditorium and beside it a large restaurant area. (For a fuller description, see http://wp.me/p3beJt-65)

Now a second floor of One Canada Square has been added. Two successful Accelerator programmes have prompted the equipping of a tailor-made space for such programmes. Last year’s Fintech Lab London, a 12-week Accelerator programme designed to help up to a dozen small businesses introduce new products to the big banks located at Canary Wharf is about to be repeated (see http://wp.me/p3beJt-3); and Dassault Systemes, Europe’s second largest software company, invited startups to come and develop customer solutions in one special area of its expertise – both these programmes run by teams separate to the incubator space. The new space has rows of bench-type desking, all with essential IT, and a couple of small meeting rooms. In addition, this new floor has a number of rooms set aside for hi-growth companies emerging from Accelerators, along with a kitchen/rest room (with its Subbuteo table.) And more space on this floor is about to be equipped similarly.

Established with the imaginative support of Canary Wharf’s landlord  (who was concerned about the future of the area), Level39 has proved that Incubators and Accelerators have closely complementary roles and that a comprehensive innovation space is a viable concept. But insiders cannot turn the taps on; it needs influential outsiders to help nudge into being the policies that can bring them into existence. And any city can adapt the concept to its advantage.

 

John Whatmore                                                                  January 2014

The Centre for Leadership in Creativity, London

Level39, Canary Wharf – a throbbing new Innovation Centre

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This unique tailor-made innovation eco-system has been carefully designed to meet the varied needs of those who are looking for innovations and those who are seeking to develop them in this part of London; and to bring them together in successful collaborations. What it does and how it does it might have some useful lessons for all those involved in innovationism.

With a simple remit – the development of the area (Canary Wharf) – Level39, 1 Canada Square, opened by Boris Johnson in March of 2013 and headed up by Eric van der Kliej – formerly CEO of Tech City, has quickly become a lightning conductor for those looking for innovations and those with innovations to offer in the kinds of businesses in this area.

Creating the connections and providing a ‘connectious’ space is what its Ideaspace is about – providing space where ideas can be found, developed and connected – without being overwhelmed by the legacy of any corporate culture.

Among its early work was the hosting of the Accenture-backed Fintech Innovation Lab London, a 13-week Accelerator in which a dozen of Canary Wharf’s big banks participated. Seven SMEs – drawn from all over the world – with innovative technologies of potential value to the banks, were housed at Level 39 and provided with a ‘chaperone’ from each of the banks to help them find their way around the labyrinth of people with buying interests and requirements in the bank.

Level39 is now hosting a number of other innovation and acceleration programmes – created by ‘Pivotal Innovations’ which provides custom-designed programmes for corporations and governments looking to innovate and grow.

One of these is the Future Cities ‘Catapult’ Centre (supported by the Technology Strategy Board), which in partnership with Pivotal Innovations is convening cross-sector dialogues (starting with executive breakfasts) with key stakeholders and thought leaders – in finance, real estate, industry and government. The debates will explore viable solutions including critical issues in financing future cities.  They will explore models (eg Rio de Janeiro, Portland Oregon, Songdo in South Korea) and will ask what will interconnected, high-tech, smart cities be like. What new kinds of partnerships might be needed? What investment models might be called into existence? And what enabling policies might make it all happen?

Dassault Systemes, Europe’s second largest software company, has chosen to partner with Level39 and Pivotal Innovations as it expands its strategic focus on financial services in the UK. Its 3D FinTech Challenge 2013 (http://www.f6s.com/3dfintechchallenge2013/info) invites startups to develop solutions for the visualisation of client data in financial services, as a way to condense and simplify such data, such as capital exposure, risk and identity, of which it is often difficult to get a clear perspective, into “single views”, which can be readily understood and acted on. This collaboration too has involved a series of breakfasts with senior executives from London’s banking and insurance industries. Dassault is also showcasing some of its current technology at Level39, such as 3D visualisations of cities like London and Paris on giant touchscreen display units, as an innovative way of presenting information

Designed by Gensler, who also designed Google’s and Facebook’s offices, Level39 has a very wide variety of spaces. It has attracted early-stage businesses eg in retail and financial technology, to take small scale spaces – both entrepreneurs and intrapreneurs – because of its unique ‘connectious’environment. It has 77 drop-in desk spaces, in all sorts of configurations – either for individuals or for startups – most of those startups already post-revenue.

It also has spaces that are specially tailored for innovationism: there are four ‘Sandboxes’ – for Hackathons, for cafeteria-style meetings, for board meetings or discussions, and for presentations, as well as a superb conference room – all with great views over Canary Wharf. Facebook recently held a 48-hr Hackathon in one Sandbox; and the local banks recently held one whose aim was to test their security systems – by trying to hack into each other’s!

It has a cafeteria area with its unique iPad controlled coffee machine; and a Club Lounge will open shortly – for meals, where you can meet and entertain guests (and where you can get a discount if you also agree to commit a certain amount of time to mentoring.)

So what is its secret? In addition to the spaces, perhaps its most valuable asset is Pivotal Innovation’s capabilities in generating and curating provocative innovation events and programmes; and its ability to bring together people with common interests and purposes but who don’t yet know one another.

Its extraordinarily rapid growth (it will shortly open more drop-in spaces on Level 42) and its vibrancy suggest that it has some magic that might be of interest to other cities, like Bristol, Manchester or Liverpool; to other retail centres like Blue Water, Brent Cross or the Airports; to other clusters like the Thames Corridor, Science Parks or Dundee as a centre of the games industry; or even to the NHS or the MoD.