What to learn from BMW Startup Garage?

Camilla Karhukorpi

Written by:
Camilla Karhukorpi
Chief Corporate Venturing Programs

BMW has understood superbly that they should not be one institution with one single business model that won’t ever change. They have not only built an innovation ecosystem where different products, services and business models interact with each other – but also consciousness throughout the company about the industry’s on-going and coming disruption.

Earlier this week at BMW Startup Garage in Munich we heard from BMW employees a great variety of open questions about where the mobility is going in the next 10 years. Will there be so many car brands? Will people care about brands? Do people want to own cars? Can car become your personal assistant to help you manage your everyday life while commuting from place a to b?

After working three years with the leading Nordic corporations around open innovation and corporate venturing, we

it somewhat unique how eager the BMW employees from businesses seemed to be to work with growth companies and to ideate new services and business models. In the core businesses, the innovation unit wasn’t seen at all as a “group of troublemakers” (as it sometimes is) but as a support platform for all business development.

So, what makes BMW Startup Garage different from other innovation labs and why is it so welcomed among BMW employees? We don’t have the right answers, but only our best guesses.
 

Integration

Opposite to quite many innovation labs, BMW Startup Garage is well integrated in BMW’s core business. This way the BMW employees have taken lean and open innovation methods as ordinary tools for their everyday business development.

 
Venture Client Model

Bernhard Schambech the Head of BMW Startup Garage simplified BMW’s venture client model saying: “Rather than investing in startup, we buy from startups.” By entering into a commercial agreement, they get the best commitment. Not only internally or from a startup, but from both sides.


Scouting over open calls

During the BMW Startup Garages existence, the most successful collaboration stories have come from actively scouting the right partners for existing needs. To speed up collaboration there should be a challenge to be solved and an identified need for a proposed solution. There are numerous great mobility startups in the market and lot of inbounds coming and it’s impossible to decide which ones you should collaborate with and what to do with them.
 

Time

BMW Startup Garage was established already in 2015 giving it few years to find the right way to operate their startup collaboration, learn through experience and BMW employees to see the benefits of new ways of operating. No innovation practice is ready right in the beginning but it needs time and flexibility to find it’s best form for your company, and time for your employees to see lean and open innovation as normal optional way of operating.

  

Despite having the same challenges as everyone else (finding the right KPI’s, having corporate procurement protocols and terms of agreements, to name few), altogether the BMW’s approach to startup collaboration seems to be a win-win model – also when asking from the startups. The enterprise gets to innovate together with the disrupting growth companies and the growth companies get a testbed to evaluate their product for scaling: if they can make it with the industry leader, they can make it in the market.