Collaborating with Startups: Lessons Learned

A startup partner once reminded Kelly Van Dyke that he represented a third of his company and had already said yes. She still needed to consult stakeholders inside PepsiCo. Her response was to joke about the tiny fraction of the organization she represented, and the fact that her answer was still uncertain. Both wanted to move forward. Their authority to do so was very different.

In this episode of Innovation Rockstars, PepsiCo's Director of R&D External Innovation explains why successful partnerships require that difference to be understood on both sides. Her team scouts technologies that can help internal R&D teams make progress. Finding something promising begins the work. Matching its maturity to the application, agreeing what is essential and helping partners navigate each other's constraints determine whether it can become useful.

Start with the R&D team's problem

Van Dyke describes external innovation as a service to the people developing products and solving technical challenges inside PepsiCo. The team works with partners across beverages, foods and technical compliance to understand their priorities and where external technology might help them progress faster.

That purpose informs the company's Want, Find, Get and Manage approach. The first question is what the internal team needs. Scouting then has a defined problem to address, rather than a general instruction to return with something exciting.

External innovation also sits alongside other routes into the organization. Van Dyke distinguishes her R&D focus from the venturing group's interest in businesses and consumer products, and from pilots supporting areas such as IT, supply chain and marketing. The teams share contacts and discoveries. A company encountered by one group may be relevant to another, even if it does not fit the first conversation.

Match the search to the kind of uncertainty

Some needs recur. Van Dyke names sugar, salt and fat reduction as areas where open submissions can bring relevant technologies to the team. Other requests begin with knowledge already accumulated: an internal database of companies previously contacted can provide a useful first set of leads.

More difficult problems may require something to be developed jointly. In those cases, the team needs a clear account of success, an understanding of available capabilities and a view of the gap between them and the desired result.

Her team's varied technical backgrounds and networks are important here. Different expertise opens access to different researchers, universities and companies. Conferences, accelerators and investor relationships broaden the search further. The value comes from connecting the right knowledge to the problem, including knowledge beyond the team's usual contacts.

Fit the partner to the stage of the work

Van Dyke contrasts two situations. A technology intended for established Lay's production lines may need to operate at substantial scale. A new business exploring an unfamiliar product category may have different volume requirements and more room to develop the solution as it learns.

The same startup could be a poor fit for the first assignment and a useful partner for the second. Treating technical promise as sufficient evidence of readiness risks frustrating the startup and the internal team alike.

Expectations about support also need adjustment. A small company may not have the equipment, specialists or information systems a multinational supplier can provide. Van Dyke recalls colleagues noticing how different a startup project felt. Her answer was that it was different, and the team needed to plan accordingly.

That is more than an appeal for patience. It is a reason to examine what the proposed collaboration actually requires before assuming the partner can meet the company's usual requests.

Separate the essential evidence from the familiar request

When an internal team describes its ideal requirements, Van Dyke asks which ones are indispensable and which are simply desirable. Then the discussion can focus on how to obtain the evidence that matters.

If a startup lacks a capability, there may be another route: support from the corporate team, an introduction to a specialist or help finding a contractor. Her example of expecting sophisticated analytical equipment in a startup's kitchen makes the mismatch hard to ignore.

“What is the nice to have? Now, let's go back and start with the must-have.”

The principle is to solve the information gap together, while being honest about the resources each party has. On the other side, startups need to understand why corporate decisions involve more people and can take longer. The joke about how much of the company each person represented works because it makes that difference visible without turning it into a confrontation.

Share the development burden where interests overlap

Van Dyke points to sustainable packaging as an area where collaboration reaches beyond a single startup and corporate customer. She describes work around paper bottles with Pulpex, involving multinational companies from different industries.

The participants have different applications, but a shared interest in the technology developing successfully. She presents this as precompetitive cooperation, with several organizations contributing to a capability they could each use. It illustrates an alternative to assuming every technical challenge must be solved inside one bilateral relationship.

There are still choices to make about where a small external innovation team spends its time. Van Dyke acknowledges demand that exceeds available capacity. Calling everything a priority does not remove that constraint.

Her advice is to keep the consumer's problem in view and question whether an obstacle comes from the challenge itself or from the way the organization currently works.

“Don't shut something down just because it's hard.”

Asked for her own proudest innovation moment, she chooses a tangible product: the Gatorade protein bar developed by a team she led. Seeing people eat it prompts a delighted recognition that her team helped create it. That end point gives the partnership work its purpose. The scouting, negotiations and technical problem-solving matter because they can eventually put something people value into their hands.