confluence 2013 - a better innovation model
DESCRIPTION
TRANSCRIPT
Confluence 2013
ECOSYSTEM DRIVEN INNOVATION APPROACH
Zinnov Confidential
6th March 2013Hyatt Regency Santa Clara,California
Sana N Choudary
Zinnov | 2
Where am I coming from
4 Innovation Approaches
Case studies and reasons for failure
1
2
3
My proposal on what would work?4
Agenda
• CEO and Founder of YetiZen• 2 Arms
1. Innovation Lab--Hub for global game developer community
2. Only games vertical focused accelerator—force multiplier to scale post product and traction companies
• YetiZen companies/games you may recognize
Where am I coming from
• Game Acquisition Space hot– 2011: $2.827 billion*– 2012: $3.477 billion*
• Incredible increase in strategic acquirers/investors approaching YetiZen
Where am I coming from
* VentureBeat: http://venturebeat.com/2013/01/25/the-deanbeat-game-acquisitions-rise-23-percent-to-3-4b-in-2012/
Build
Buy
Incubate
1
2
3
Partner4
4 Innovation Approaches
Famous Build Failures
• Gameboy + phone = clunker non-Gameboy/phone
• Thought process--gamers carry both lets combine them
Build Failure – Nokia’s N-Gage
• Real factors important to consumers—size, usability, comparable pricing
• Not being aware of changing consumer needs
• Lesson—Established cash cow can create tunnel vision
Famous Buy Failures
• $104 Million Acquisition for network tech stack + users
• Left to stagnate then shut down almost 2 years later • Shutdown Process with no developer consideration
– 1 month's notice to developer near update rush time due to pre-Apple's Appstore Holiday freeze
– key platform stakeholders needed for their new platform• Miscalculated Apple's Gamecenter competition • Lesson—startups time in customer development
allows significant customer learning, lots of those earlier lessons are not codified and lost by time of buy
Harder as most get quiet internal deaths
Public Example
Famous Incubation Failures
• Microsoft’s planned iPod killer • Way too complex• iPod vision through the Microsoft approach• Core business success driver--feature heavy
products• Consumer preference for simple usability • Lesson--companies have a strong tendency to
keep doing what made them successful. When innovating to disrupt entire business channels that approach doesn't work
Famous Partner Failures
• Best Buy partnership to power nationwide buy back program
• “Peek under the hood” proprietary analytics tech• Best Buy moves forward without Techforward $140
Million• Techforward Asset Sale• VC funded lawsuit • Court decision favor of Techforward• Early intent to deceive PR diaster• Lesson—competitive culture often out of habit not
reasonable risk/benefit analysis.
Date before you mate — partner first, quick acquisition after achieving objective milestones
But partner by putting skin in the game with an ecosystem hub (example accelerator)
So What Works?
• Buy into deep current knowledge of space
• Educate internal stakeholders prior to deals with individual startups (ecosystem hub help)
• Begin from the get go with a relationship where both your company and the ecosystem hub have comparable leverage essential for creative disruptive thinking
• Validate your perspective of evolving customer needs regularly, even post partnering with a startup
• Obtain unbiased views on cultural fits with startups since ecosystem partner is in it for long haul
This allows you to:
