At a Glance – Startup as a Service

Traditional business models are experiencing serious disruption

As flexible, imaginative and innovative startups pose a challenge to incumbent companies (case in point: FinTech), firms are recognising that they need to change. One new strategy which could help corporations to keep up with ambitious startups is SaaS – not software, but rather startup as a Service. This new business approach provides businesses with the resources of a startup or startups, and can happen internally or externally through a provider.

Legacy companies are no strangers to building relationships with startups. Jaguar Landrover, for instance, announced the creation of a spin off venture called InMotion in 2016 to invest in promising young companies, assimilating the startups into the Jaguar Landrover empire. Startup studios, where big businesses foster and create talented startups, have been instrumental in the development of Startup as a Service. However, instead of setting up internal studios, companies can find Startup as a Service providers. Examples include Mint Digital, Exit3x and Aimforthemoon.

The advantages of Startup as a Service are clear, allowing big companies to benefit from innovative spaces without constraining talent to corporate limitations. If the startup pursues a product or service that fails, the corporation’s stakeholders and shareholders don’t suffer the consequences. However, if the startup is successful, this reflects well on the investing company. Of course, businesses still need to inject considerable resources into any studio, startup or provider they work with. As a tidal wave of startups casts a shadow on traditional business, this investment in certainly worthwhile.