December 7, 2019

The New Model of Corporate Innovation and Venture

As this new global revolution unfolds, how do startups engage with large corporations and foundations in the most effective way?

By Susan Belknapp, California Business Journal.

Silicon Valley-based Vinaj is fusing Fortune 1000 companies with early-stage entrepreneurs.

Empowering more “equitable commerce” was integral to CEO Anish Srivastava’s vision for his innovative company, Vinaj, which specializes in helping large companies grow and new companies launch.

What makes Srivastava’s philosophy so novel is that he melds both models together.

“I’ve spent half my career in startups and half my career in corporate venture and innovations across industries,” he says. “This is the experience that brought me to create a firm that focuses on innovation consulting and investing in startups. I saw a gap in the market where there is activity around incubators, accelerators, venture investing and innovation. Larger corporations are involved with the startup ecosystem, but many wrestle with engaging effectively and deriving value.”

Vinaj’s mission of catalyzing commercially-viable digital growth at the intersection of large companies and startups  has been accomplished as it marries customer pain points by conducting primary research, secondary research and developing user-experience-led prototypes.

A new venture for global corporations

There have been numerous studies showing greater investment in innovation by Fortune 1000 companies “and it’s not just happening in United States – it’s happening globally too,” Srivastava says. “These large companies aren’t just investing — they’re looking at ways to work with and find ways to leverage startup solutions as part of their digital transformation endeavors.”

Anish Srivastava

Anish Srivastava

In fact, last year corporate venture capital passed traditional venture capital for the first time. This is the first phase of a longer-term trend.

“Large corporates recognize they need help from agile innovators who learn and adjust quickly, which you find externally in the entrepreneurial sector,” Srivastava says. “They are trying to figure out ways to upscale their workforce and encourage more entrepreneurial activity to foster more adoption by leveraging new capabilities. It’s what they’re all striving for. And this is where we come in. They know they want to do this, but they need the help with the how.”

Step one is focusing on real customer pain points and delivering experience that saves time, money and effort. Executives know their businesses and industries intimately, but with innovation – because it’s an art and a science – it’s not as straightforward a path. So the question for those businesses is, “How do you harness the capabilities from the external entrepreneurial community and meld them with the internal employee talent base companies already have?”

A new symbiotic relationship

Given the history of corporate-acquisition dynamics, the general public has a David v. Goliath perception when it comes to small innovators working with large companies. With this concept of corporate innovation and venture investing, how do the startups collaborate within the corporate structure without being swallowed up entirely?

“This is a key point,” Srivastava says. “How do companies treat external entities? There are multiple ways they might look at startups: as vendors, as investment opportunities, and as acquisition targets. Depending on the strategy of the business unit most interested in those solutions, they pick from one of those three choices.”

While Vinaj is sector agnostic, industry areas of focus include HealthTech, Telecommunications, AgTech and Sustainability across technologies such as AI, data science, edge computing and wearables. “The idea is that the corporates have huge assets and revenues, distribution channels and a very strong customer base,” Srivastava says. “What’s really interesting is that we’re seeing a lot of startups solving real customer problems using a combination of technologies. We’re seeing a lot of new innovation in the market.”

Where Vinaj differentiates is that it is highly-focused on new growth and bringing it to market. One tagline Srivastava uses is: “Commercially viable innovation.”

“Our original mission was to catalyze commercially viable digital growth at the intersection of large organizations and startups,” he says. “Startups are coming in with novel solutions and the speed at which they’re able to adapt to evolving needs from customers is at a pace much faster than the large companies are used to. They need each other and this is the intersection where there has been a lot of friction and there continues to be. I think that’s where we’re being sought and that initial mission that we have continues to be the same.”

Groundbreaking venture for emotional health

Srivastava has taken the concept of supporting startups a step further with an offshoot of Vinaj called Telosity, which is committed to investing in early-stage startups with solutions to assist young people with their mental and emotional  well-being.

One of Telosity’s first portfolio companies was acquired by Meredith Corp. This is expected to raise the reach and profile of the “emotional wellness” platform, and the company dedicated to meditation and mindfulness. Telosity hosted a recent pitch session in Santa Monica, Calif. where startups with solutions to assist with emotional well-being, especially for young people, were able to share their wellness startups to very encouraging results.

“We had six very impressive startup pitches,” Srivastava says. “They presented their ideas and it was awesome to see the passion, resolve and creativity of the participants. We were, as a team, very pleased with the growth of this ecosystem and humbled that so many people were willing to partner, collaborate and help each other out. I have a very optimistic outlook about where things are going in the community and how entrepreneurs are trying to solve this major problem.”

Copyright © 2019 California Business Journal. All Rights Reserved.

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