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What innovation platforms are there at Daimler and who is behind them? At #venturewednesday on Wednesdays, we give insights behind the scenes of the Daimler ventures and their exciting task: the future of mobility. This time: The Startup Intelligence Center.
What do the technological trends of the future look like? What can we learn from the innovative stakeholders who are redefining the mobility of tomorrow? Which startup solutions are the most suitable for a specific problem? Questions like these keep me busy during my work as a startup scout at the Startup Intelligence Center of Daimler Financial Services.
The Startup Intelligence Center (SIC) is the point of entry for all young companies that are interested in cooperating with Daimler Financial Services and its subsidiaries. The SIC’s global network consists of in-house innovation drivers and specialist experts as well as external partners such as the Startup Autobahn, Capital Factory, The Bridge, and Factory Berlin.
The SIC creates transparency and connects all of the startup activities within the area of financing and mobility. With our expertise as scouts and intermediaries, we form a bridge between the world of startups and the world of our company, and we support the projects in the business units and the markets. In addition, we use innovative technologies to develop potential new business models.
You might be wondering if I’ve always wanted to be a startup scout in a big company. Well, the answer is no. I studied economics, and like most of my fellow students I wanted to become a banker or a consultant.
But because I was privately very interested in innovation and digitalization, I participated in hackathons during my student days. At one of them I met the people who would later on become my colleagues, and for the first time ever I realized that I could combine these two worlds in my career. And that’s how I slid into my dream job without really planning to.
Startup scouting as a service
My search for the perfect startup typically starts with a work order from a specialist unit. We call this process “startup scouting as a service.” First of all, I need to form a precise understanding of the problem my colleagues are facing. The feedback from our customers is our top priority.
For example, we discovered that after our customers had informed our in-house insurance service about damage to their vehicles, they were unable to track the repair process. When I find out the details of such work orders, I ask critical questions and find out to what extent my colleagues would be open to working together with an innovative company and taking an approach they had never thought of using before. As soon as we’ve cooperatively defined the scope of the work, I start my search.
Quantity goes before quality
I first make a comprehensive list of startups — the “long list.” To make this list, I use databases, market research, in-house sources, and help from our external partners such as accelerator programs. Accelerators are promotional programs for young companies. They help these companies to grow fast by providing them with suitable mentors and resources.
In this first step, the focus is on quantity. I want to receive as much information and data as possible so that I can use it to conduct a thorough analysis. Depending on the specific theme and the market maturity, this kind of list can quickly grow to include between 50 and 400 startups.
Finding the top startups
In the second step, I begin the process of analysis. I shorten the long list by applying the criteria of the specialist unit and our own quality standards. And I keep shortening it until it consists of only about 20 startups. I assign points in order to make sure I’ve considered every aspect. My assessment takes into account the startup team, the company’s degree of maturity, the customer base, the relevant partners, and the company’s compatibility with our strategy.
I assign different weightings to the various startups, depending on the themes they deal with. For example, for mobility startups that want to build up an ecosystem, partnerships are extremely important. For startups in the area of finance, we look to see whether they fulfill the regulatory requirements. After that, we start the qualitative analysis, paying particular attention to the startup’s business model.
A personal meeting
If a startup has already sent us a concrete proposal for a cooperative project, or if we need additional information, we contact the startup and invite it to make a presentation, which we call a “pitch.” This gives both parties — us and the startup — the opportunity to get to know each other and understand the other’s business model.
The project is launched
If the two parties want to work together, I continue to support my colleagues from the specialist unit during the pilot phase of the project in my capacity as an innovation manager. We jointly develop a prototype in order to receive real-life feedback from the customers. In the example that I mentioned — reporting damage to our insurance service — we created an application in order to show how the tracking process might look in real life. During this phase, you can find us, armed with our questionnaires, in the Mercedes-Benz Museum or at our showrooms so that we can directly receive feedback about our idea from potential end customers.
If the feedback is promising, we try to arrange a long-term partnership with the startup. And if an investment opportunity develops in the course of the project, we cooperate closely with our colleagues from M&A Technology and Venture.
They give us their expert advice on how to find the right structure for such an investment. Whereas the people in our startup scouting unit focus on cooperation in the form of pilot projects, the people at M&A Technology and Venture are more interested in investment decisions.
One of the things that fascinate me about my career as a startup scout is that on the one hand the work is very analytical. You have to work your way through lots of startup profiles, observe the market, and draw quantitative conclusions. But on the other hand, you also have to be communicative and be able to do networking and conduct negotiations. Those are the two completely different aspects.
It’s a profession in which you deal with trends, business models and, above all, people. How do you connect the interests of the startup with the interests of our company? Where are the shared interfaces, and how can you really create added value? Should you take a risk for the sake of future gains? The qualities you need for this profession are: creativity that enables you to think outside the box, the courage to talk about your ideas, and stamina that lasts until you’ve convinced everyone of your idea.
New week, new tasks
In my job, every day is different and I have the freedom to organize my day as I wish and to pursue the themes I’m interested in. Sometimes I start the week by clicking through databases. On the Wednesday I might have a Design Thinking workshop for a new innovation project, and I might end the week by flying off to a startup event, because I’m always on the lookout for new business models and interesting innovation projects for our company.
For me, the big highlight was the way I worked with my colleagues to create our “startup scouting as a service,” because at that point Daimler Financial Services still didn’t have a process of this kind. Sometimes it feels as though we’re still a small startup ourselves. It’s also incredibly enriching to be able to work with so many different kinds of people from all over the world. And when after weeks of scouting and months of negotiations I see the signatures on a partnership contract, for me that’s a motivation to start every day with happiness and gratitude.