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The Importance of Being Flexible: the Way Start-ups Reformatting Their Business in Crisis

06.05.2020
Source: The Roscongress Foundation

The innovative industry also suffered from the crisis associated with COVID–19: many start-ups were at risk. But there are those who managed to reformat their business in time for current needs. Ekaterina Petrova, Director of GenerationS Corporate Accelerator, spoke about successful examples from its practice. Many of them will be presented at the International Festival of Science and Innovation Science Fest which will be held on July 24–26, 2020 by the Roscongress Foundation.

This year, our accelerator turned 7 years. Over the years, we managed to collect about 16 thousand start-ups into our infrastructure from over 30 countries and about 400 corporate and ecosystem partners. In 2018, GenerationS has become the best corporate accelerator in Europe according to Corporate Start-up Summit.

The main focus of our accelerator is joint projects with corporations for which we are carrying out start-ups scouting under current requests and needs. Over lifetime of GenerationS we have managed to build up a fairly wide pool of clients from very different fields — from metallurgy to the pharmaceutical industry.

Among our alumni (as we call start-ups that went through acceleration programs) there are wonderful success stories. Many of them have managed to grow their business and even scale it to the foreign market. Of course, the current situation has not bypassed innovation: we see how many companies are forced on suspending their innovative activity, which is somehow related to the search and implementation of advanced technologies, and start-ups that are very difficult to maintain their business in the current realities. However, we also have examples of projects that did not fall under the influence of the crisis and which were able to reformat their business in time to meet current needs and requirements.

For example, Russian start-up Elementaree, which is engaged in contactless food delivery, founded by Olga Zinovieva. Here is a true success story: from the emergence of an idea — the tempt was to create such a food constructor that makes it possible to cook delicious dishes with a minimum waste of time on the process itself, before attracting financing. Of course, on the way, there were difficulties associated with finding investors in Russia. It was extremely difficult to find among them precisely those who were ready to believe in a change in habits and views on cooking. But despite all the obstacles at the beginning, we managed to build a well-functioning business, which in the current situation could not only stay afloat, but quickly enlarges.

Another example is start-up Bioenergia which developed the Wisesoil solution, which makes organic waste profitable thanks to an innovative technology for their processing. Today, in view of the prevailing conditions, the company has promptly launched a new direction — a line for the production of antiseptic drugs. The first orders are being finalized.

One of our alumni, the SIMKOMAT project team, has developed a solution for the remote issuance of SIM cards. The largest telecom operators in the world are among the customers. Now the company has also launched the production of protective guards for doctors. The guards are printed on a 3D printer at the company's production site in Izhevsk. At first, all personal protective equipment (PPE) were sent to Moscow hospitals, but after some time the company decided to switch only to the Udmurt Republic, where its second office is located. This step was made for three reasons. Firstly, very little PPE flows into the regions, and its much more needed there. Secondly, in terms of logistics, it is faster and cheaper to deliver to the region where production is located. Thirdly, you can see how the help reaches the addressees. At the moment, the company has delivered more than 500 protective shields to various hospitals, but the number of requests is growing every day. The company also buys safety goggles, incubation boxes and special respirators, and transfers to the hospitals in need completely free of charge. In this situation, it is very important for start-ups to be flexible, analyze and understand what solution they can offer the market here and now, but also not to forget about the initial focus of their business, because the crisis will end sooner or later, which means that the processes will need to be restructured again. It is important to create universal business model that works effectively in two directions at once.

Speaking about large companies, it is important to emphasize that digitalization is gaining momentum: corporations were forced to accelerate the transfer of many processes to digital-format so as not to lose efficiency. A good example here is the banking sector, which is the leader in terms of digitalization processes. Of course, financial technologies will be in focus and will not lose their relevance after the crisis. As for the other sectors, at this stage, it is still too early to talk about which solutions will be in demand when the situation normalizes.

If you think more broadly, then of course, large companies will continue to function normally after the crisis, but start-ups, unfortunately, are in a big risk zone. This alignment cannot but affect the innovation ecosystem as a whole, because it is formed by start-ups in particular. Therefore, it is important to provide comprehensive support to small and medium-sized enterprises.

Throughout this April, we have been carrying out a whole bunch of webinars for both corporations and start-ups on the most relevant topics related to reformatting business processes, maintaining an innovative corporate culture, launching pilot projects remotely, etc. This format of interaction is now very relevant and useful to our target audience, where we show by the example of speakers from various companies that this is possible and give practical business advices.



Reference

GenerationS is a platform for the development of corporate innovations; the largest corporate accelerator in Russia and the CIS. Organized by RVC in 2013. GenerationS implements comprehensive programs for the development of corporations: intracorporate — on the development of internal entrepreneurship; acceleration — on scouting and acceleration of external projects; international — to train employees in the methods of building and conducting innovations on the basis of corporations — international leaders.



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