Let’s continue to explore corporate innovation, with the Target Accelerator Program case study.
We’ve met “both sides of the table” when visiting Bangalore’s top tech conference NASSCOM Product Conclave a few weeks ago, talking both with the teams of Target, and with Kyron, which operates their accelerator.
For a quick introduction, Target is an American retailer, one of the largest in the world, with operations mostly in North America. Their challenge is dual, as they must catch up with world leader Wal-Mart (whose Labs will be the topic of another post), and avoid being squeezed by Amazon, which has similar revenues.
These two graphs will give you an idea of the situation 😉
Target Accelerator Program: re-inventing retail in the digital age
More broadly, Target is a good symbol of what’s happening to retail in the digital age. E-commerce, if still nascent, is bringing too many advantages to the shopper, as we wrapped-up a few months ago.
- Prices are lower in e-commerce, as there’s less space and staff needed to operate
- Product range is higher (potentially infinite) with virtually no limitation from warehouses
- Experience is better, with no queues, no heavy bags to carry, and tedious drives
The Target Accelerator Program aims to drive innovation again, and tap into India’s tech ecosystem, whose reputation is based primarily on the network of Indian Institute of Technology (IITs), a tradition of IT outsourcing, and a solid diaspora of techies with key positions in the US, from Vinod Khosla (Sun Microsystems) to Satya Nadella (Microsoft) or more recently Sundai Pichar (Google).
The startups screened by Target benefit from $30,000 in funding and a 4-month acceleration operated by Kyron, a global accelerator and seed fund, whose founder Lalit Ahuja is an Indian technology industry veteran (he’s the CEO of ANSR Consulting, the world leader for establishing Global Inhouse Centers, known as GIC).
According to Vikram Ahuja, who works at the Innovation Labs at Kyron, “the focus is on retail, in-house marketing, analytics and mobile. We work closely with Target to identify startups with innovative products and they work closely with Subject Matter Experts (SME’s) from Target to understand how they can use technology to solve some of Target’s most mission-critical problems”.
The first batch of 5 startups chosen for the acceleration offer a good idea of the diversity Target is looking for:
- Turnaround Vision uses 3D modeling for a 360-degree product view
- Konotor helps set up a two-way messaging channel between mobile users and brands
- MuHive is in the field of Social CRM
- Unbxd offer a dashboard aggregating several data for merchandising
- InstaClique helps retailers lower their bounce rates
Corporate accelerators in India: climbing the outsourcing ladder
The fact Target chose Bangalore and India to setup its accelerator is also a sign of the adaptability of the Indian ecosystem to the new demand of global companies. After years of outsourcing IT and support functions, Indian companies such as ANSR Consulting are able to level up their game and provide outsourced innovation services.
Vikram Ahuja shares how being embedded in Fortune 500 companies has helped them to offer corporate innovation: “This allows a unique opportunity to understand some of the most critical problems faced by large corporates and help connect with young startups that are disrupting domains of retail, media and financial services.”
Most of the speakers we saw at Bangalore’s NPC had anyway one foot in the Silicon Valley, and the other one in Bangalore, and their go-getting attitude overseas has created more than a generation of successful Indian entrepreneurs, who are now in an amazing position for global companies.
What’s next for Target and Kyron?
Interestingly enough, the story doesn’t stop here. Target has already integrated some key skills they learnt while being exposed to startups and acceleration, and Kyron is moving forward with them as well. The point of view of Vikram, working on the “service provider” side, is enlightening on this point.
“Target integrating some of these skills in-house is a natural evolution of the corporate accelerator setup. I definitely believe that corporates need a lot of these skills available inhouse (talent acquisition, entrepreneurs-in-residence, industry-trends analysis) to be able to keep with the disruptions in their industries and engage with the disruptors (startups) better.”
A bit like agencies, accelerators will need to move the needle and offer new value for their corporate clients. “From a Kyron perspective, our value-add is our ability to engage startups, structure a program that brings together multiple stakeholders together and have a first-person perspective of the challenges that startups face. Having a front-row seat into the changing startup ecosystem in India and having first hand experience with corporates, we bring a very unique perspective to this entire equation.”
We’ll follow-on the Target Accelerator Program as it evolves, and will publish soon a piece on Wal-Mart Labs, who is amazingly active on innovation too, and, guess what, with again smart Indians in key positions.