Blockchain is still in the early days of enterprise adoption. To tackle this head on, IBM recently launched the new Columbia | IBM Blockchain Accelerator, which is a non-dilutive set of programs for building and scaling successful enterprise blockchain companies globally.
The core component of these programs is enabling the successful collaboration between startups and corporate partners. IBM has completed more than 500 enterprise blockchain projects and launched scores of active business networks, and it’s clear that building and scaling a successful blockchain project and business network is no easy task.
As a result of this experience, there is a belief that there is a huge opportunity for enterprise blockchain networks to be launched and scaled successfully when companies like IBM and its peers partner with the best startups in the world. In particular, the IBM NETWORK program for growth stage startups curates the best high-growth innovators from around the globe to partner with IBM and its enterprise customers with the goal of co-creating category-winning blockchain business networks.
Here are four reasons that this startup plus corporate partnership model works extremely well:
1. Blockchain is a team sport
The success of enterprise blockchain projects is dependent on businesses working together in new ways. Building blockchain business networks — which can take the shape of consortia, governance councils, non-profits and others — requires many participants who may normally be peers or competitors to collaborate effectively. This is a challenging concept for many enterprises who are used to vicious competition in their market.
We’ve found that building networks works much better when multiple parties are seated at the table from inception, as opposed to being driven by one founder and attempting to onboard partners later in the process. The balance of startup plus corporate entities working together to build a network is typically an easier starting point; there is no entrenched competitive history and both parties bring a different set of skills and resources to the table.
2. Startups have a maniacal focus on the network’s success
Another major challenge we’ve seen with founder-led networks driven by one big company is that often the project is one of many “innovation” initiatives and can get lost in the prioritization puddle. Blockchain is still new and not always easy to implement, especially with the business model disruptions it can cause. While most corporate partners have lots of enthusiasm at the beginning of a blockchain project, it can lose steam on the journey to completion.
What startups bring to the table is a singularly focused, concentrated effort to make the blockchain project and business network successful. They don’t have 20 other initiatives or product lines to juggle. Often the success or failure of the blockchain business network means the success or failure of the company itself. So, you better believe the network will have 100 percent of the startup’s focus and energy! They’ll do everything in their power to keep things moving forward, usually dragging the larger, slower corporate partners along with them.
3. Building fast and slow
It is exactly this difference in skills, resources and urgency that works beautifully together to build blockchain networks. Startups move fast. They have smaller teams but tend to attract higher quality technical resources who are motivated by the potential upside of startup equity. They are nimble and agile and can adapt to new information quickly. Enterprises can move slow, or at least slower. They have entrenched processes and policies to navigate, which is not necessarily a bad thing. When activated properly they have resources and gravitas in the market that is exponentially more impactful than smaller companies.
It’s no surprise that startups and enterprises operate differently, and this healthy tension (when harnessed productively) can lead to each partner lifting each other up to new levels when collaborating to build blockchain networks.
4. You must scale fast to win
Finally, we’ve come to understand that there will likely only be one dominate business network for each blockchain use case. This market typically leads to a winner-take-all in each category and is based on who can aggregate network participants and transaction volume fastest.
With startup plus corporate partnerships, each taps into their own ecosystem to drive this adoption, typically using different strategies and tactics appropriate for each entity. This combination can lead to the rapid scaling needed to make blockchain networks a success.
In fact, this point is so important and this combination of partners is so powerful that it’s the core focus of the IBM Blockchain Accelerator NETWORK program.
We’re still in the early days of enterprise adoption of blockchain and the journey is under way. The collaboration between leading startups and enterprises building blockchain networks together will be an exciting ride. The opening credits have started, so grab the popcorn and enjoy the show! Or even better, join the cast.
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