Corporate start-ups sit in a sweet spot between corporate venturing and an external start-up. These initiatives have the luxury of the big brother organisation watching over them, but it also comes with the policies and procedures of the big brother.

Over the past 2 years, I was involved with a B2B Regtech startup that offered a SaaS solution to clients. Our startup advanced from concept to scale during this time and listed below are the key learnings that helped bring us to this phase.

This report has been written with a goal to share learnings, and to create awareness amongst similar initiatives and corporate innovation strategy teams on best practices and challenges that start-ups face within the corporate environment.

What Worked Well

Vision – It Begins with a WHY

To point all noses in the same direction; Why are we doing this? What is our vision? What is our moonshot? Where is that dot on the horizon? Visions directly impact the formation of the value proposition, competitive space and approach to reach the intended vision. It is important to know why we are in the market, how to position ourselves for a win and what we want to achieve.

Strategic Sponsors

They are the networking and influencing backbone to open doors and to advocate for your product offering or service to the internal organisation or external market. To avoid disengagement, these sponsors need to be well informed and appointed at the right time so they can provide the support during that particular stage. There is nothing wrong with changing sponsors over the course of the startup.

A Hustler Lead

Someone with the network and know-how to navigate, represent and lead the initiative through the different stages and influence key stakeholders within and outside he organisation.

Customer Centric Approach

Customer centricity can largely differentiate the value proposition from competitors in the market. Experimentation with strong data-driven metrics (qualitative or quantitative) enable better-informed decision-making and can be used for the optimisation of processes and enhanced understanding of customers. Continuous feedback from customers helps gain buy-in from them as well as serve as proof-points for business stakeholders and your initiative.

Team Capability and Culture

A right mix of hard skills that encompass business, technical and innovation capability can take the idea from concept to market whereas: Empathy, active listening and conflict management are soft skills that glue the team together.

Creativity goes hand in hand with innovation; higher creativity leads to more innovation. Cultures that stimulate and promote creativity and innovation is an imperative for seeking a competitive advantage. Strongest associations for creativity were related to psychological safety in the workplace and interpersonal relationships in the workplace (Tala et al, 2016). Studies also show that teams that have gender diversity (C. Díaz-García, A. González Moreno & F. J. Sáez-Martínez ,2013) and cultural diversity (Max Nathan & Neil Lee , 2013) were more likely to introduce radical new innovations into the market and more likely to develop new products than those with homogenous leadership.

Team Way of Working

Introducing an agile way of working can enhance a closer collaboration between the business, development, and operations team in a bid to reduce lead time and increase deployment frequency whilst maintaining a high-quality service and customer centric approach.

What You Need to Watch Out For

Business Model

It is crucial to know how a business can eventually sustain. Although business models pivot over time, the key to finding the right business model is to experiment and validate models including the price point in the market. Experimentation is key; let the data speak!

Focused and Measured Goals

“At least we have goals defined” if you have heard this statement before, well it is a breather but a long journey to get your objective setting on track. Given resource availability and time constraints within a startup, it is key to focus on a few probable wins rather than betting on all horses. There are several frameworks on how to set targets and measure strategic implementation of initiatives; Key performance indicators (KPIs), Object Key results (OKR) framework, Spotify Rhythm and ‘The art of action’ are a few. Mastering any methodology takes time and each framework has its pros and cons. Suggest incorporating the best practices of different frameworks and adapt it to the situation at hand.

Objective setting and tracking can help the team to:

  • Prioritise long, medium- and short-term goals
  • Communicate a clear intent of the prioritised goal
  • Empower cross functional teams to own the solution to the problem
  • Allow teams to set metrics in-order to track progress
  • Adapt tactics based on data and insights from experiment outcomes

If you are a relatively small team (<10-15 people) suggest to include everyone in objective setting. This is one way you can make teams accountable and responsible for how they can contribute, shape and achieve goals.

Legal, Risk and Compliance Constraints

Can delay the launch of products into the market. It can take over a year to get a sign-off from the legal, risk and compliance teams. By then the competitive landscape can change and go-to-market plans may need to be adapted. We suggest a separate team or additional resources to support the team within these areas. Also, corporate legal, risk and compliance requirements should be eased to fit the pace of the start-up. By no means is this an indication of ‘no rules’, but an easing to enable growth and a continuous step-wise maintenance to ensure full compliancy.

Bring the Innovation Back to the Business

Initiatives need to be aware that the processes and incentives per department within the corporate need to undergo a mindset change to accept innovations into their department. Most departments are not ready in terms of processes, policies, and systems to adopt products or services that arise from innovation teams. It is important to gain early buy-in from the business if the innovation projects need to be adopted internally. The business needs to be involved and commit prior to scaling. An executive sponsor from the business should be appointed to support the scaling phase within the business.

Crossing the Chasm

“There is something fundamentally different between a sale to an early adopter and a sale to the early majority” (George A. Moore, 1999). A segmented approach leads to a focused sales and marketing strategy to acquire and retain clients.

Customers weigh the benefits or value in using a product or service. Each segment can have potentially different needs and hence the same product offering, or service may not prove 1-1 beneficial to all segments.

In addition, new client acquisition is costlier, and it could take away the teams focus in retaining and servicing existing clients. Taking a data centric approach (value driven) to choosing the right customer segment helps avoid this struggle. A fail fast approach also validates the segment in the early stages, which brings us back to why experimentation is crucial.

Cultural Bias Within Innovation Labs

Culture plays a crucial role in a corporate start-up. The initiative may come across as the child playing within the safety net of the parent. However, this also creates a risk-averse mindset within the start-up and could impact decision making that could prove beneficial to the start-up.


In summary, a corporate start-up is complex and tough. The privileges of being within a big corporate can be felt but the pains and tedious policies and procedures also come with the package. This should not necessarily be the future direction for organisations who foster corporate start-ups.

Corporate start-up can enjoy being a start-up and yet be autonomous by providing them with the right support to go-to-market faster and thus realise return or reduce risk sooner. They also need to give accountability to take more risk within an acceptable tolerance, to avoid hitting critical path blockers during delivery.

On the other hand, corporate startups help organisations to continuously innovate and stay ahead of the market. Especially given the COVID crisis, it is important that organisations rethink their business models, engagement with employees and their network relationship with external partners and consumers. Innovation is key to reactivation of the economy and eventually the long-term survival of the organisation. So, let us continue innovating!

About the Author

Michelle Gomes is a strategic thinker and experienced agile product management consultant with over 15+ years of experience working across a breadth of industries. Her passion lies in advancing products from concept to market in an agile and commercial savvy approach. She has been mainly involved in Digital transformations, new product development and API based product services.


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