 depending on where you are. And so it's really nice to have you guys here today at our regular China Institute webinar. So my name is Guangzhou. I'm a reader in international management at the School of Finance and Management at SOAS. I'm very delighted that we will have a fantastic seminar today which will be given by an excellent international business scholar and Professor Xiamen Prashantam, if I pronounced the name correctly. Now before I introduce him and the subject let me remind you that for the webinar you are more than welcome to raise questions or comments through the Q&A box which is at the bottom right hand corner of the screen. If you would like to raise the question anonymously you are more than welcome to do so but if you can actually provide a little bit information about who you are and that will be really helpful to and for giving me certain kinds of better sense of your questions and picking questions to the speaker. But your wish will be respected, neither your name or other things which will identify your identity will not be disclosed at all. So now let me actually give kinds of introduction but I think you know it's not going to really describe us comprehensively as Professor Prashantam is about because he has been working in international business and strategy over the past decades and currently he's the Professor at China Europe International Business School in Shanghai and then before joining SEAPS and he also taught at Nottingham University Business School in China and the University of Glasgow so he does have a good relationship you know with the UK academic community. So as you have already focused on seeing the title of today's talk and then he is the person who actually put forward the idea of dancing with glory, which talking about partnership between large corporations and startups and then his work not just based on the perspective but also based on his fieldwork and insights by talking and by you know researching those large corporations and also the small new ventures. So like I said it will be our honor to have him today and for the next one and a half hour to talk about his research because his research has been widely published in high impact journals such as Journal of Business Venturing, Journal of International Business, Study so on and so forth and if you are quite familiar with international business and entrepreneurship and you show that his work has been read and you know appreciated by both the academic community and also the practitioners and he will show you and the latest the book The Gorillas Can Dance Lesson from Microsoft and added corporations on partnering with startups because this book definitely offers lots of managerial implications both in large corporations but also in small startups about how this kind of partnership can deliver value for both sides. So today we would like to hear what he's research about and his insight is about. Now I will hand over to him for the presentation and then we will come back with the Q&A for some inspiring and exciting conversation on this topic. Now the floor is yours Shamin. Thank you so much Juan for that very kind introduction. It's wonderful to join you from Shanghai. Just a couple of things to make clear at the start. This is not going to be exclusively at China talk. This is going to be about this phenomenon of large companies partnering with startups. China features a fair bit in my work but this was a study that was done on a global basis so I just want to clarify that. Also to say that I've written a lot for academic audiences and I've written also for practitioner audiences in outlets like Sloan Management Review or Harvard Business Review and this book is in the latter category. It's written for more of a practitioner audience. It's underpinned by a lot of academic research so the presentation that I will make is based on this book which is predominantly written for an academic audience. So now is the moment of truth where I discover whether I can share my screen properly. Just give me half a take. Okay well so hopefully you're seeing a slide with the image of my book. Juan are you seeing that? Okay so great so the title of my presentation is the title of my book Gorillaz can dance lessons from Microsoft and other corporations on partnering with startups and this is something I've worked on for over a decade and a half now. In 2005 I graduated with a PhD from Strathclyde University in Scotland so this is me on the 4th of July 2005. So it's as all the academics in the audience know that's a very important date when you graduate with your PhD and that same day after the ceremony we had a meal to celebrate and this is my PhD supervisor Stephen Young. Stephen Young passed away last autumn. He was a scholar-scholar and people like Juan who know the international business community in the UK well will know that Stephen Young was a pillar of the UK IB community along with his co-author Neil Hood. Hood and Young were a very prolific scholarly duo with very complementary capabilities in fact Neil Hood had one foot in academia, one foot in policy and ended up being the vice chair of the of Scottish Enterprise the Economic Development Agency of Scotland while Steve was very much a purist academic. One of the things that they got to study over the years was how large multinational enterprises were operating in Scotland particularly American companies like IBM that had established a subsidiary you know about four decades ago this was after Europe had rebuilt thanks to the Marshall Plan. American companies were coming into Europe and using the UK as a beachhead for entering the rest of Europe. Commercial offices typically in the southeast or in the London area where most of you are based I guess and manufacturing facilities in Scotland and these scholars studied how these large multinational subsidiaries evolved over time some of them tried to become more entrepreneurial do more innovation and so on. I was about the fifth or sixth in a line of PhD students who joined from the second half of the 1990s onwards looking at the internationalization of smaller entrepreneurial funds and about the time I graduated as I was looking ahead to you know building up my research portfolio I was asking why do we look at these two sets of firms in parallel is there not scope for them to work together and for us to study the interactions between these companies and as it happened Neil Hood who as I said was vice chair of Scottish Enterprise he said well it's funny you should say this because we are trying to help the likes of IBM who have been around for a while and now trying to do more innovation as opposed to manufacturing to connect with our very talented smaller entrepreneurial firms here in Scotland and those companies would love to partner with these big companies and have access to their scale and commercialize the innovation of the process and so one of the first articles I wrote on this phenomenon was based on this policy initiative in Scotland it was published in a journal called international business review in 2006 and then in 2008 I published the article that was sort of my first major success as an academic it was published in a journal called California management review which is a little bit of a hybrid of an academic and a practitioner journal and was called dancing the gorillas and this was from the point of view of the smaller company talking about how they may engage with big companies and I had a few cases in Scotland a few cases in Asia and the reason for the title is I had met an eminent strategy professor about the time I was getting interested in this phenomenon in 2006 at a conference called the academy of management conference and I mentioned to him what I was discovering in Scotland and so on and he said I think many of these smaller companies have no choice but to learn to dance with the big gorilla so dancing with gorillas became a phrase I lashed on to and had this piece with Julian Berkinshaw of London Business School a California management review and then over time I kept trying to conceptualize this more I worked with a professor called Peter Buckley who is also a very important international business scholar and we talked about this as a division of entrepreneurial labor between larger companies and smaller companies the large companies being good at exploiting their existing capabilities and smaller companies being able to explore new capabilities and together they're able to do more that they can do together I also collaborated with Georgia and we talked more about how this phenomenon was unfolding in emerging markets like China and India and I joined forces with Julian 12 years after our 2008 article for this 2020 article in gyps where we try to sort of consolidate all the things that we had observed over time but also add the idea that these partnerships could be useful for the sustainable development goals so as I said my presentation and the way the book is written is mainly for a practitioner audience but before getting there I just thought I'd give you a flavor of the underpinning academic work and now I'll get into the actual summary of the the key ideas from the book and the company that I've had the pleasure of studying for a very long time the lead case study if you will in the book is Microsoft in fact Microsoft was famously referred to as by Steve Jobs as a company that was good at partnering he once said Microsoft's one of the few companies we were able to partner with that actually worked for both companies Bill Gates and Microsoft were really good at it because they didn't make the whole thing in the early days and they learned how to partner with people really well but you know like many large companies Microsoft had learned how to partner with other large companies for even for Microsoft they had to go through a process of learning how to engage with startups and this began at the turn of the century when Steve Barma hired Dana Lewin who helped to establish the Microsoft campus in Silicon Valley and began a process of engaging with the startup ecosystem there and back then in 2001 Microsoft had made a major strategic decision to go into enterprise software meaning software that other companies would use and they had created something called the dotnet platform and so they wanted other software companies to build software products on top of their underlying platform technology and the business model was simple each time the software partner would sell a license of its software the underlying technology of Microsoft would be sold but they realized that they would also need startups to come because they needed the energy the dynamism of startups they also realized that Microsoft was a bit of an outsider in Silicon Valley so Dana Lewin who as a young man had worked with Steve Jobs and Apple and had started a couple of ventures in Silicon Valley was the face of Microsoft in a Silicon Valley and it took him about seven years before in 2008 Microsoft launched its first startup specific partnering program called Bispark followed it up with a more exclusive version of this because thousands of startups joined Bispark to avail of the free software tools that were on offer and they created this exclusive version of the program called Bispark one where hundreds startups among these thousands the hundred most innovative startups were given the option as you work closely with Microsoft these were all very top-down efforts coming down from headquarters but it also inspired managers in other parts of Microsoft like Zach Weisfeld who was a Microsoft manager in Israel and felt oh we are the startup nation we should also play an active role in this and so he actually experimented with the new format without the blessing of headquarters as happened sometimes in subsidiaries and created an accelerator whereby startups could work with Microsoft for four months and when headquarters got wind of this idea they thought it was great and actually Zach then spoke to his counterparts in China and India and so in 2012 on the heels of the accelerator in Tel Aviv an accelerator in Microsoft Beijing they have this facility in Jungwansun and one in Bangalore were established and this is Satya Nadella who at the time in 2012 when these accelerators were being set up he was the president of one of the business divisions in Microsoft who is driving cloud computing and as you know very well I'm sure startups have been able to develop much faster because of cloud computing they no longer have to have a high fixed cost for technology infrastructure they're able to use to pay as they go you know to use software on tap as it were and so you see this guy who was championing cloud computing was very relevant to startups and after he became CEO saying Microsoft loves startups and this is James Chow who runs Microsoft for startups in China pretty much saying the same thing so over time you saw this big mighty company that at one time had this major problem of being a one-trick pony they were fantastic in the PC world then struggled as the world changed and moved towards the mobile internet founded footing again particularly through cloud computing and all the while was improving how it engaged with startups and did so around the world so this story which is what the opening prologue in my book tells us that even a technology giant can face destruction and so the way in which the startup partnering was aligning with the evolving strategy suggests that it's important to think about the why why would a big company engage with startups the matter in which they experimented with different ways to work with co-create with startups speaks to the how and the fact that they did this in different parts of the world suggests is also useful spatial dimension we should also consider the where so I've used this as the basis for my book and the way I've structured it so there are a couple of chapters on each of these and I'll give you just a very brief idea of what I talk about in each so let me start with the why and the starting point is very straightforward entrepreneurship is relevant to large companies too and this as you know very well is because you know what makes the company successful as they develop and grow can also be a little bit of a liability as it becomes apparent that they need to change and so finding ways to be more proactive more innovative be willing to take risks is something that not just startups need to consider but also big companies and the starting point is often as Clayton Christensen of Harvard Business School talked about disruptive innovation startups on the outside entrepreneurs and startups can pose a bit of a headache to managers and big companies by coming up with alternative solutions different ways in which these big companies are disrupted Amazon disrupted the traditional booksellers Netflix disrupted the traditional video rental companies and so on and so for managers often the trigger to be more entrepreneurial is they're seeing startups on the outside posing challenges to them and digitalization is of course accelerated this so so entrepreneurs pursuing opportunities that help them to challenge what incumbents are doing through business model innovation they adopt become part of ecosystems and of course have a much more nimble culture but as I said big entrepreneurial isn't just for startups is something big companies around the world have recognized and so managers seek to be entrepreneurial and in some cases they do so by seeking to institute intrapreneurship this is a term that's been in and out of fashion over the past three decades it's basically about how can we within big company do things entrepreneur create new business opportunities and when I teach this in class I often use the three and post it notes case because this is a legendary example of intrapreneurship many of you probably know the story of how a scientist for silver Spencer was part of a project to develop a new adhesive that actually failed but he was very fascinated by the semi-sticky substance in his spare time during lunch breaks he'd go around doing brown bag seminars for other colleagues to tell them about this new product and to ask for ideas of how it could be used and eventually after a few years someone from the marketing department who used to sing in a choir said you know this is so frustrating when the bookmark keeps slipping from the him book maybe I can use the semi-sticky substance to make a semi-permanent bookmark and that resulted in in the post it notes and three m's have sought to institutionalize this by allowing employees to have 15 percent of their time to work on site projects that could benefit the company and I think this remains very important but in addition you're also seeing intrapreneurs and you saw a few examples like Dana Lewin and James Chowell Zach Weisfeld at Microsoft who are seeking to connect their companies with entrepreneurship on the outside in other words they are seeking as managers to connect with entrepreneurs and indeed even the more classic intrapreneurship type programs are recognizing the value of engaging with startups. Kapil Kane is director of innovation at Intel China in Shanghai and he has been running something called the growth x intrapreneurship program for Intel employees to encourage them to come up with new ideas using Intel technology which they then help to commercialize and one of their projects using Intel camera technology to create a smart door solution whereby you smile at the door and the door opens one of their business units was going to take nine months to bring this to market and then they discovered a startup in Hangzhou called LifeMart which showed interest to work with Intel and took it to market in three months and so even in these classic intrapreneurship programs there can be scope to work with startups and their broad recognition is there's a scope for a win-win on the one hand at each side has something that the other would like the large corporations have resources legitimacy scale the startups have creativity and agility on paper it sounds like a match made in heaven but if it was so easy to work together then a lot of companies would be doing this very successfully and there would be no need for my book but in fact what I found is that there's something that you might think of as the as a paradox of asymmetry which means that partnering with startups isn't easy Jeremy Bassett who founded Unilever Foundry in London says it's very difficult for a large organization to stimulate the same sort of incentives of flexibility that exists for an entrepreneur we come from this background of plan and perfect we research things very well when we launch things we really invest in them this is the antithesis of what is needed in an entrepreneurial environment in other words even though big companies have good intentions and seek to be entrepreneurial they are fundamentally different from startups and in a sense as I say this is a bit of a paradox in that the very differences that big corporations and startups attracted to each other also make it difficult or at least not straightforward to partner with each other and these asymmetries are of at least three forms one is the asymmetry of goals big companies and startups want different things and at different time scales there's asymmetry of structure finding role counterparts in two big companies is relatively straightforward a vice president marketing can talk to their counterpart much more difficult when a startup and a big company are engaging with each other and an asymmetry of attention which is to say that big companies see an ocean of startups out there with fancy power points decks and names and they can't tell which ones are worthy of their attention the startups know which companies big companies are out there but they struggle to get the attention of the people that matter and so in terms of the how and now we're moving to the second part what I've observed across time and space in different parts of the world across different industries consciously or otherwise the companies that are doing this well in terms of engaging with startups have unpacked these asymmetries and found ways in which to address them and that leads me to thinking about this systematic way of engaging with startups and this is a three four process to address each of the three asymmetries the first of which is clarifying the synergy the second of which is creating interfaces and the third of which is cultivating exemplars the synergy piece helps to address goal asymmetry the interface structure asymmetry and exemplars attention asymmetry so let me talk to each of these in turn now it comes to the synergy everybody talks about win-win and it might seem blindingly obvious for me to say this but it's important to clarify what the win on either side is and you'll be surprised at how fuzzy this can be and at a broad level of conceptualization we can think of two major synergies one that I call building block synergies and the other pain point synergies and I've sort of described the building block synergies already when I was talking about Microsoft especially information technology companies have these technology building blocks that they want startups to come and build solutions on and when the solutions are sold the underlying technology of the big company sold as well it's a very straightforward win-win of revenue sharing and so the big company has an incentive to co-sell solutions developed by startups especially if they are very innovative and effective and have a good market and in this way startups are more likely to get traction in the market but there also companies from traditional industries I mentioned Unilever already but there are companies in the automotive industry for example like BMW and Nissan banking companies like Barclays I mean just across a range of industries companies that over the past half a decade or so have really sort of come to grips with the need to digitalize but found that they have pain points and so look for solutions and and startups therefore can help to address their pain points and these companies can become important clients to these startups not in a arm's length exchange relationship but because digitalization strategic importance as strategic partners and so the win is that you sell the from the startups point of view you sell to the corporation from the corporation's point of view they're able to adopt these technologies earlier quickly and get customized solutions in terms of the interface and here I'm talking about specific entities that can be a startup's first port of call when they're trying to engage with big companies so in BMW it's called BMW startup garage in Nissan they had something called infinity labs particularly focused on their luxury brand called infinity in the case of Unilever I've already mentioned Unilever Foundry and so these very specific identifiable interfaces where there are managers whose KPIs key performance indicators include having to talk to startups there are two broad types I would observe one that I call cohorts and the other funnels and I say to my MBA class the MBA class is like a cohort you know getting it is difficult but once you get in everybody who gets in more or less completes the process you have a fixed period of time to be together structured around a curriculum and peer interaction is an important part of the process corporate accelerators are a good example of this Microsoft Pioneer this nearly a decade ago as I mentioned in Israel China and India and then set of accelerations in other parts of the world including in London by contrast the funnel is like the job search process after an MBA so many fewer finish the process than begin candidates get screened out in stage gates as you go along and you may not know who else is part of the process so SAP which is also a big IT company when they set up their first startup partnering initiative in 2015 chose to do this out of Palo Alto California even with their German company but this was a funnel approach if you were as you as a startup wanted to build on top of say their HANA technology platform you could submit your prototypes to SAP these would be rigorously reviewed by a team of engineers in Germany about 40% would then go through to the next stage where the commercial arm would then rigorously screen these startups and in the end about 10-15% of the original ones would get go-to-market support and so this is a different approach each one has its pros and cons the cohorts the accelerators for example are good for serendipity unexpected collaborations may occur two startups that didn't know each other from Adam they form a three-way partnership with the big company the funnels are good for predictability and it's easy it's easier to have predefined goals and then search for startups that help to achieve these goals but what I find most distinctive of the companies that do this effectively that is partner with startups is that they make an effort early on to cultivate success stories and by showcasing these exemplars of success stories they're able to attract more high quality startups in the way that a business school with a famous alumni is able to attract other good students but also increasingly I find that's very important to persuade internal audiences within the big company who might be skeptical because you see the person who's in Unilever foundry it's his or her job to talk to the startups but they can only give startups meaningful collaborative projects if people in the business units brand managers for example are willing to do this and brand managers may be risk averse so by seeing what's possible with other startups they may be more inclined to do this also startups may be worried that big companies may take undue advantage of them and then by seeing these success stories a they have a better idea of what success can look like and have realistic expectations have a better idea of which gorillas are worth dancing with but also will have more confidence to proceed and exit their attention and attract the attention of startups but there's another piece to the how and that is not only is it important to identify the the the partnering process a systematic way involving a synergy interface an exemplar for big companies that want to do this on a regular basis they need to need to embed this within the company as a partnering capability and a distinct one distinct from their ability to partner with other similar large companies and for this it's a process that involves first of all initiating startup bartering then expanding it and then finally systematizing or institutionalizing it within the company and this of course takes genuine effort it can be a painful learning process but it's important for companies that are serious about winning the hearts and minds of startups and what I've observed in terms of initiation is that entrepreneurial individuals play a very key role and often find ways in which to make a start in some cases it could even happen by piggybacking on an existing initiative so when Walmart in China a couple of years ago decided to engage with startups they actually went to Microsoft who have an accelerator and said can we talk to some of your startup alumni and the cohort of Microsoft fed this new program called Omega 8 which is very much a funnel and helped them accelerate the process of searching for startups and it suited Microsoft as well because it was in their interest for their startup alumni to work with big companies because in the process they would be using Microsoft technology more and more so getting started as Simon Sinek said I think big starts more but start and I think for many companies getting that initial step going is often challenging in Israel when Microsoft's Zach Weisfeld got that corporate accelerator going that was an example of initiating getting started as well however if companies want to then make this and and sorry this picture on the that you see now is a Greg or Jimmy who is one of the co-founders of BMW startup garage and he said my philosophy has always been forgiveness rather than permission and even in a fairly traditional industry like automotive he said he got things going and initiated it but that's not going to be enough for companies that want to take this to to really institutionalize this they will have to expand it do this time and again. Shilpa Patel was helped to set up the Nissan program for Infinities the luxury brand of Nissan which headquarters in Hong Kong they did an accelerator and she found that she had to actually engage not just with the startups on the outside but also people on the inside to win their support and working with senior managers top managers make sure that she had their commitment and buy in and support so for example getting the CEO to write about this startup accelerator program in his newsletter thereby signaling that this was important and also getting on board peer middle managers in business units who would then be willing to give meaningful projects in other words this expansion piece is about spanning boundaries within the organization and outside and over time I've had many people like Shilpa saying that actually engaging with startups on the outside is the easier part of the job because one startups know that a big company is serious they're quite happy to engage with the big companies but actually it's harder work on the inside getting people on board and this becomes important she was able to get the program in Hong Kong repeated on an annual basis but also had additional programs established in Singapore and Canada and finally companies that are serious about the systematized this and make this very consistent with their core strategy this is something I saw in Bayer the German pharmaceutical company Hezos Del Val who you see on the screen started this is what he calls a passion project in 2012 and this is the getting started bit he just gave small bits of money to students and said can you come up with mobile phone apps so this was 2012 right mobile internet is young and new and then in 2013 he went well why does it just have to be students it can be startups in Germany and then the following year but why does it have to be startups in Germany it can be startups from anywhere in the world and then from 2016 onwards he encouraged Moscow the Russian subsidiary the Spanish subsidiary the Chinese subsidiary to also run these programs and by 2018 it had become so big that they actually made this a very systematic program with three pillars and they replaced Hezos because they felt now at this point you actually need a very different type of manager to be managing this and they brought in in fact a more senior person and had this very much aligned with the core strategy of the company and of course nowadays there's scope to engage with third-party specialists for many years Barclays for example worked with this company called Techstars to help set up their corporate accelerators and my point therefore is now this partnering capability startup capability is has come to be viewed as something distinctive finally let me just quickly talk through the the geographic part big multinationals in particular have scope to engage with startups around the world and in different formats that Microsoft tried out over time they kept engaging with different parts of the world starting with the west and then going to emerging markets and here my message is that what I've observed is that companies like Microsoft that engage with startups in different parts of the world have learned how to adapt or adjust what they do in different parts of the world so and when you deal with startups it's often in a subnational region I mean a country like Israel or Singapore maybe small enough to refer to the Israel's ecosystem of the Singapore startup ecosystem but when you're dealing with the United Kingdom or China it's it tends to be much more at a subnational region and so the default setting is often the high reputation location the innovation clusters in advanced markets like Silicon Valley or the Thames Valley region here you find a critical mass of both the big companies and startups and it's relatively straightforward to engage with in the ways we've been talking about but in these smaller places that are less well known for technology entrepreneurship like Glasgow for example it becomes more difficult because you lack a critical mass of startups and big companies and here the role of policy public policy actors becomes important and I've already referred to Scottish Enterprise and I would argue that these actors have to be entrepreneurial too in this case in Scotland they set up this bespoke policy measure to connect the likes of IBM or Sun Microsystems with local startups they acted as an honest broker and they were able to to serve both a matchmaking function and also a facilitated role in the collaboration but now moving to emerging markets and this would be a particular interest to those of you with an interest in China so as you know China has some incredible innovation clusters like in Junghwan Sun especially around software and Shenzhen around hardware and in these kinds of areas too it's possible for big companies to partner with startups although there is some adaptation that's needed the partnering practices they would have in Silicon Valley or London largely because on the one hand there's a lot of appetite for entrepreneurship but these are still relatively immature ecosystems of course by now China has rapidly matured but still in terms of you're more likely to find a first-time entrepreneur in China or India than in Israel or Silicon Valley also in terms of experience with enterprise relationship with big companies this is still relatively in relatively terms a new experience of course China has these amazing B2C unicorns that we're all familiar with but in the enterprise space it's in relative terms more nascent compared to Israel or Silicon Valley and so it's possible here but need some adaptation and for me the most fascinating of these cases is Ningbo Ningbo has a great tradition of entrepreneurship just not for technology entrepreneurship as compared to say Hangzhou in Zhejiang province but even here I've seen examples of IBM partnering with local startups and that's because as in Scotland policymakers had to play an important role to to to connect these big companies and startups but unlike Scotland it happened in a less sort of explicit way where they had bespoke policy measures instead they very cleverly used existing policy measures like the smart city program to connect these companies and what they said was we will split the entire smart city pie into a small number of pretty big sizeable chunks smart logistics because it's a port city smart education smart healthcare etc and we'll give the entire piece to just one company and all of a sudden the deal size was big enough that big companies were interested IBM got the first contract after tendering for smart logistics but the other part of the cunning plan was they knew that no single company can deliver the entire project they would have to work with local companies for implementation and they also knew that these local companies in a city like Ningbo would be small entrepreneurial firms and in this way IBM ended up working with a small startup called smart logistics which in turn was also able to bring in other small startups to contribute various components for the first pilot that IBM had and also over in the last few years pre-pandemic I've been able to visit a small campus that my school has in Accra Ghana and been observing how these Western multinationals like Microsoft and IBM are engaging with startups there but also how entrepreneurs in Africa are looking to the east and to China for example for inspiration and finding that they can actually relate a little bit more with emerging market multinationals and are seeking to learn from them too very finally when we also take a global perspective and this is something I learned particularly from my work in Africa there can be scope for these kind of partnerships to be a force for good to contribute to the SDGs to in a sense be part of SDG 17 which is partnerships for the goals and by taking the same process that we've been discussing the synergy the interface and the exemplars but broadening it to fit societal concerns for example looking at synergy not just as a win-win but as a win-win-win also looking at scope to address SDGs to have an interface that also includes non-traditional actors like the United Nations or NGOs like Reach for Change which in Ghana is playing the role that a company like Techstars played for Barclays in New York and London but there's no Techstars in Africa or Impact Hub which is a social enterprise platform these additional types of entities can be very useful and important in connecting big companies and startups and often it's not not just the big companies in terms of their corporate arms but also in terms of their foundations and most importantly the exemplars are hybrid in the sense that they have economic payoffs but also social benefit SDG 3 health has become very important during the pandemic cloud physician is a startup in Bangalore partnering with Cisco that offers remote support for intensive care units in hospitals particularly in smaller towns and they had an important role to play when India had a horrible second wave of COVID in May last year in terms of clean water and sanitation Cusini is a startup in South Africa that develops water filters using frugal innovation and they have partnered with DHL to install their facilities in 50 hard to reach places in South Africa and of course climate change now arguably the most important issue facing the world but wiser in China working with a Chinese startup called Mittero to turn some of their beer can waste into eco-friendly materials and just before the pandemic Microsoft announced the launch of their global social entrepreneurship program which sort of also echoes this importance and finally whether or not you're interested in startups or big companies I think the broad message that I have that I think this work suggests in terms of the why how and where of partnering is that it relates to some important mindsets the why relates to entrepreneurial mindsets the how to the collaborative mindset and the where to the global mindset and of course this applies in the relatively narrow context that I've been talking about but surely also more broadly to organizational transformation as well as more generally for social impact and as Paul Paulman the former CEO of Unilever says it's imperative for larger organizations to partner with more nimble startups to help create a better world and that's what I hope this book will play a small role in contributing towards thank you thank you so much for your fairings and a lot of storytelling based on your interviews and also your first hand collected data so I'll start out because I think it's really you know in the heart of my research area as well talking about this kind of entrepreneurial behavior especially talking about the global mindset because we have seen such a global connected community where more and more small business actually have been embedded into this kind of big partnership or what we call entrepreneurial ecosystem that they have to work with the large corporations but in your discussion your particular focus on more hard core right about the strategic vision about the corporate governance how about the soft side because we all know the small and immediate size firm entrepreneurial firm they do have a different outlook of their cultural perspective and also the power in balance between and the two sides in this kind of Benedict relationship definitely matter so what's your insight so great question and I've written a lot in the past from the perspective of the smaller company so dancing with gorillas was very much the the take for the startups and the book is written for people in the big companies and my opening comment is actually when startups have a better understanding of where the big companies are coming from it can help them to partner better so for example when we wrote the paper in 2008 called Dancing with Gorillas with Julian Birkinshaw we talked about how this is a process not an event so the smaller company should try to form a relationship consolidate the relationship and and then extend the relationship and then as I studied what big companies were doing more and more I realized that actually what I was discovering in terms of synergy interface and exemplar is exactly what the startup knowingly or unknowingly is responding to when it does those three steps that we had talked about the forming consolidating and extending so I think by understanding the nature of the synergy that the big company has on offer then the startup can decide how to form the relationship by understanding what the interface is that gives them the basis for consolidating it and then if they're able to become an exemplar then their scope to extend it so that's what I would begin by saying but you make a very very good observation that from the smaller company's point of view in particular there's a power asymmetry and so and a lot of this comes down to people in the end right though we talk about companies working together a lot of it comes down to people and by the way the companies that are doing this well I think are making a strong effort to have people working at the interface and the big companies who have an empathy for startups and in some cases when big companies acquire a startup I know you've done a lot of work on acquisitions they end up actually getting some entrepreneurs within the company you know the people who used to run those startups and are willing to hang around for maybe a couple of years and sometimes those people become very effective to use in these interface entities but coming back to the startups perspective so because of the power asymmetry the advice that I give to startups is when they form consolidate and extend the relationship they need to do two things at the same time which sounds contradictory but they have to hold these contradictions in their head and that is to be optimistic and pessimistic in equal or not necessarily equal but in parallel and what I mean by that is so when you're forming the relationship you understand what the synergy is of course the startup needs to put its best foot forward be proactive find ways in which to get connected but at the same time there needs to be a little bit of caution to make sure to ascertain that the big company is serious at least prima facie to be exploring these partnerships so for example if BMW is saying we're interested to engage with startups and cybersecurity see whether cybersecurity is indeed a strategic importance to BMW and in this case it won't be difficult to ascertain that it is true and that it's an area of relative weakness for BMW so you go ah so you know at least they seem to be serious but the other thing is also if you're operating would say BMW in China to see are they really committed to China do they have a long term commitment here are they or are they just really using this as a way to understand what's going on in terms of consolidating the relationship again in terms of the proactive putting your best forward side of things startups need to align what they're doing with their core strength so what sometimes happens is startups are talking to big companies and then they're given an opportunity that's sort of tangential to what they're really good at and sometimes they're tempted to take this because you know it gets your foot in the door and I think that type of thinking makes sense in certain contexts but not in this because you get only one chance to make a good first impression and so it's sometimes better to let go of an opportunity because startups as you know have very often a niche expertise and so they want to wait for the opportunity that allows them to truly shine and leverage their competence but at the same time on a more pessimistic note to recognize that things can go wrong the big company may pull the plug at any point they have more options they have more power as you say you know and even if they are not being unethical per se they can still walk away midway and so to break the process into milestones so that even if the project stops midway the startup has something to show for their efforts plus it allows a process of selective revealing the challenge for the startup is to show enough for the big company to be interested but not so much that the big company doesn't need them anymore and then again in terms of extending you know leveraging the the relationship to extend it so testin is a startup in beige or was a startup in Beijing that engaged with Microsoft in China and then when they set up an office in San Francisco they engaged with Microsoft in the US Microsoft was very helpful for them to get some visibility early on so that's the positive proactive side but at the same time don't assume that you will only work with one company have options and this is something this start company in Beijing did very well they also engaged with Intel they also engaged with Lenovo and they kept their options open and so that's what I have found useful from the startup perspective thank you so much I think yes I did recall my field work you know about those entrepreneurs especially they actually aimed at exiting so that's why they were purchased by the big of corporations and one of my long lasting longitudinal perspective did see that how those kinds of individuals especially those you know original entrepreneurs who can really contribute a lot to bridge the two different identity firms and then try to work out but then you know in the long term it's unique certain kinds of mechanism and interface because you can't just rely on individual because if this particular person leaves the company then it can't be a totally different story thank you for that what do you think about what COVID might change or how the impact of COVID changed this kind of multinational firm and a small media-sized firm corporation would we see a totally different behavior? So this is a good question so I showed a picture of a guy called Gregor Gimmie who was a co-founder of the BMW startup garage program and I said his mantra was seek forgiveness rather than permission well he has since left the BMW startup garage and set up his own consultancy called 27 pilots and when COVID happened he created a new initiative called startupsagainstcorona.com and basically helped to connect startups with big companies that were now having new pain points because of COVID like for example the need for managing workforces remotely. So one of the big clients that signed up was Lafarge Hulson the big Swiss cement company and they ended up working with a startup from Pune India who had a solution to help them manage their workforce remotely and one of the first places they established this was in Latin America. So actually I think what one of the things that COVID has done clearly is to accelerate the adoption of digitalization by large companies in traditional areas that have been industries that have tended not to be very digital savvy and from that perspective it has in fact increased the opportunity set for startups to engage with large companies and I think also what happened during this pandemic period is somehow there's also been a lot of attention being turned towards climate change and even though this was an issue that has been around for a much longer period of time somehow the parallels between COVID and climate change and have somehow I think drawn more attention to it there's a greater sense of urgency and so and I this is the other thing I'm observing during the spirit of COVID even though it's not directly related to COVID somehow in parallel sustainability seems to be now the new driver of collaboration between startups and big companies where digitalization was saved five six years ago and so these are a couple of things I've been observing but of course what the casualty has been the face-to-face interactions and and except for China a lot of other parts of the world now you find these accelerator programs have become virtual and so on so it's wonderful that these things still go on but I'm pretty sure something is lost in not having these water cooler conversations and so on and meeting in person. Yeah I think I share quite similar worry with you but I think one of the most important feature due to COVID we have seen increasing number of startups so if we look at figures about the registration of new business in the US, in the UK and even in China or the other emerging market we can see lots of new business ideas especially tailoring to the social needs right but lots of social entrepreneurial ventures actually have boomed over the past two years which is a quite exceptional feature under these points of the pandemic environment but then baffinately it takes a much longer to see whether those kinds of venture ideas can survive at first place and how they can be incorporated into the big business landscape because most of the time you know at the end of the day we're talking about three pillars we also have to think about economic and return of those kinds of small business and how to see how do we work out and what are more questions is about more particular about China to be honest because I know you have been living in Shanghai for quite a long time and also the surrounding area so you have seen like you just mentioned the boom of the B2B business and the B2C business in China leading by those large digital giants like Zindong like Alibaba and Xiaomi. So back to your general framework what do you think and a different practice between the relationship of startups and the large emerging economy multinational firms let's put this way compared with you know those kinds of traditional advanced economy like IBM like Microsoft that you mentioned because things definitely have changed dramatically over the past 20 years while back that time large multinational firms from the european or from america dominated the market right when actually graduating from China wanted to find your first job then Microsoft all those kinds of a global fortune companies were always a priority but now it seems a quite different picture so what's your observation over your stay in China and your research there? So a couple of observations the first is that when you think about these large western companies then it feels as if they are less nimble less agile and one of the strong reasons they're looking at these startups is because the startups are very agile but when you look at these large chinese technology companies they it feels like they are still very agile so that's the first comment I would make they are still moving very fast I met someone who just moved from originally from China he used to live in San Francisco and work for LinkedIn and then he came back to China and he joined Tencent and Shenzhen and he was saying you know I thought we moved pretty fast in Silicon Valley but China is even faster what would take four weeks in Silicon Valley I'm expected to do in two weeks here so so first of all I would say that's a little bit different but also I think VAT in particular have developed this role as corporate investors in a way that's the relative importance of which is much greater compared to Silicon Valley and I remember a couple of years ago reading this report about funding for startups in the US corporate venture capital used to constitute only about five percent now that may change because now corporate venture capital has also had a boom but in general it was an important source but not by any stretch of the imagination the most important one but in China it's 40 percent of risk capital nearly half and off of which 90 percent comes from DAT so the role of these big technology giants is very different so on the one hand I think they themselves are seen to be moving quite fast but also they have this important role as investors and there is a little bit of a cold war kind of scenario where in any new area when two or three startups ultimately turn out to be the likely winners one is usually backed by Ali one is usually backed by Tencent and maybe one by Baidu or something and so that also there's that slightly different field which is once you get involved with one of these tech giants it becomes difficult to engage with another especially once you get the investment but until you get the investment actually startup entrepreneurs here seem to be very pragmatic I met an entrepreneur at a Tencent accelerator in Shanghai and he was from Hangzhou so I said a little bit odd for me to see a Hangzhou entrepreneur here in Tencent what happened that did you not go to Ali and in front of the Tencent manager he was saying yes yes I was initially working with Ali for a couple of months but then they decided to stop the relationship and so I came here and so I looked at the Tencent guy and said are you okay with that and he said yeah I mean it's okay they can talk to anybody so you know there's that pragmatism that dynamism and yeah these are very interesting times to be seeing these dynamic ecosystems evolve and develop yeah I think it's interesting because when we're talking about how fast the China's or the Chinese market has been digitalized and you know especially those large digital giants like you said the kinds of exclusive right in terms of the competition so it's not surprising when the end financial wanted to actually go public last year and then it was suddenly actually got to pause because the government definitely going to do something and in order to regulate and then to provide more competitive environments rather than more closed certain kinds more but also interesting thing is that when I talk to those kinds more entrepreneurs or actually most of them actually are serial entrepreneurs in China because this is quite different from the picture in in the other countries because China now seems to be more and more serial entrepreneurs in the market because that's what we're talking about the network and their mindset and also their experience will help the cooperation with large multinational firms but at the same time the whole environment seems to be a little bit squeezing them out because it will be very difficult for the small startups to actually stand on their own even though they may have for you know certain kinds of niche market to enter or super real technology they have to work with those kinds of giant and they have to be partner ways so this seems to what I have observed is that something that you discover as well in that market so for sure the I think the importance of engaging with with these big company ecosystems I think is certainly true and I think these startups also have the options of engaging with western multinationals as well as these technology giants from China and I mean in many cases they're able to do this in a relatively complimentary way one of the startups from Shenzhen Yimian which is into sort of they help big companies to to process their data and get insights out of the data they were I met them because they were part of the Nissan Accelerator in Hong Kong the Infinity Labs but they had previously been in the Microsoft Accelerator as well as in one or two of these VAT type accelerators and so it seems as if they've been able to find different benefits to get from these different companies also I think some of these Chinese startups that have engaged with international companies have also found ways to leverage the international networks of those companies and I mentioned tested in Beijing when the internationalized into the US they tapped their relationship with Microsoft another startup worked with Walmart in China to address one of their pain points in in the retail outlets and actually Walmart was so impressed they deployed that technology in their US stores as well for a completely different pain point in China it was to address the hassle of buying loose vegetables and fruit you know you have to go put the vegetable in a diet in a plastic bag stand in a line wait for an IE to weigh it and then put a barcode and these guys use their image recognition AI technology to develop a one-click solution you can put the plastic bag on a weighing scale and some images come up and you see the one that is relevant you know the particular vegetable fruit it's a one-click solution you get a sticky piece of paper with a barcode and boom you're done and Microsoft Walmart thought this is very good not only for China but also to solve a very different problem in America which is in store theft so I mean for really sophisticated startups in China and the ones that have learned to engage well with large corporations I think there are many opportunities no doubt there are constraints for various reasons but there's still scope and I do see skillful entrepreneurs engaging with the companies. Yeah I think thank you so much Shiming for your observation and I think that's a point a phenomenon and I think we're so lucky to be able to live in this kind of fast-changing environment not just like you in China or we in the Western world because as I said it's a global connected market and with lots of changing dynamics going on and then which definitely create lots of business opportunities for small business and I'm quite sure that the cohort will may have actually come up with some certain kinds of big ideas right which we will see in the future but most important thing is that we have to recognize that the partnership always important while in the past we're talking about competition is the key drive for the marketization but now we have seen one more important thing is the cooperation but definitely how to deal with the cooperation how to deal with the partnership is always difficult question not for academic to evolve but also especially for practitioners to experience over the years and because case by case and then you know different scenarios will change so it will be such a fantastic talk for you to give us some of your your ideas and your insights and I really appreciate that and I hope that the cohort also actually have a benefit from your talk and we definitely look forward for more cooperation in person you know and in the post-COVID area but thank you so much for your time today. Thank you thank you it's a great pleasure to join you all and yes I really look forward to meeting in person actually maybe three three or four years ago I had to examine a PhD and we actually ended up this was for someone from King's College London but we ended up doing it at SOAS because the internal examiner was at SOAS then and so SOAS is such a fantastic institution and I have very high regard and for my sins I've actually in the past had to read a lot on social anthropology for some work that I did on how companies make strategy through episodes strategy episodes and we used some ritual theory and I've read a lot of work unusually for an international business person from from SOAS and I mean the core anthropology stuff apart from the international business world and people like you it's a very privilege to have had this chance and I hope people got some interesting nugget or two out of this and it was great to converse with you so thank you very much. Yeah sure definitely we would like to welcome in person to SOAS members you know on the one day's come but thank you so much again and then I think I'm going to end today's webinar and thank you everyone for your participation and for your attendance and we'll come back with the next week's webinar and I hope you're going to see you guys again there. Bye.