Aykut Hocaoğlu

27.01.2022 - 09:09

Collaborations of Institutions and Start-ups in the Institutional Open Innovation Competition

27.01.2022 - 09:09

Digitalization and being a quick fish in the market has become a serious competition area among large institutions in the 2000s when industry-intensive production gave way to information and technology, and the added value shifted to technology and innovation rather than mass production and cost advantage. As a matter of fact, this competition is no longer limited to large international institutions or local markets. A patent on autonomous driving technology developed at a Chinese university, for example, could jeopardize the future of a global automotive company worth billions of dollars. Similarly, a small fintech start-up in the United States can re-establish the game in banking and finance, one of the world's most regulated industries in the world. Similar examples can be found in almost every industry and technological hierarchy. In a world where the rules of the game are changing so quickly and aggressively, and the field of competition and its actors has expanded so much, open innovation practices and the success of institutions in these practices are one of the few factors that shall ensure the survival of the companies. Without a doubt, collaborations between corporations and start-ups are the most important and exciting area of open innovation applications. This is a simple and sympathetic task when you need to just talk about it, but it is a difficult task to master when it comes to practice. The dynamics, business practices, and expectations of the two parties are significantly different. Even time works differently for these two parties. For a start-up, a unit of time feels 5-6 times faster than it does in a corporate setting. In this article we prepared with Hamdi Ergök, we will discuss the most common applications in collaborations of institutions and start-ups, which are both indisputably necessary and difficult to implement, as well as the benefits of these applications.

1. Organizing Hackathons and Start-up Competitions 

Hackathons are 40- to 50-hour competitions in which employees collaborate to create innovative ideas and products that address the company’s various requirements and problems outside of their job descriptions. Over time, this concept has started to be realized with the participation of different actors included in the entrepreneurship ecosystem besides company employees. One or more problems that the company wants to solve are shared with the participants at the start of the event, and entrepreneurs are expected to develop ideas and product prototypes to solve these problems during the event. Companies have begun to use hackathons and start-up competitions more effectively and widely in recent years.   


  • Development of innovative ideas and product concepts
  • Entering or reaching greater depths in the entrepreneurship ecosystem (meeting new ventures, stakeholders, and mentors)
  • Accessing talents
  • Increasing brand awareness in the entrepreneurship ecosystem
  • Contributing to internal cultural transformation by rendering company employees and managers a part of the activity.

2. Institutional Acceleration/Incubation Programs:

It is one of the applications through which corporate companies can gain a better understanding of the start-up world in order to communicate and establish relationships with them. Incubation programs cover the support provided to initiatives at a slightly earlier stage (usually the idea stage) in the validation and development of their concepts. A physical office/laboratory environment is usually provided in addition to the training and mentoring support. This could take 1-2 years, depending on the program's goal, target audience, and industry. Such programs are run by corporations primarily to develop new initiatives (to create and/or develop an ecosystem) in the fields in which they operate and wish to be involved in the future. In most cases, there are no concrete output-based goals for cooperation set at the end of the program and no expectations for wage or share.  Acceleration programs are programs that the start-ups that are involved in any stage of the product and market development process for a variety of reasons (customer validation, product-market match, product diversity, market expansion, access to new markets, investor and customer acquisition, etc.). Rather than training, 1-1 mentorships and business development support are provided in areas where it is required by the business or that are included in the program's focus. Some accelerator programs also provide financial assistance to initiatives in exchange for a percentage (3-7 percent) of the company’s stock. Acceleration programs can take from 3 to 9 months, depending on the structure and set-up of the program.  


    • The formation and/or development of the ecosystem in the relevant area is provided
    • The trends in the relevant industry/field are followed
    • It is ensured that new technologies are integrated into the company’s fields of activity
    • Allows establishing relationships with talents in the start-up ecosystem
    • Employees of the institution are provided the opportunity to mentor and collaborate with start-ups in their field
    • Experience is gained about the business methods of start-ups, and it is ensured that the employees of the company understand this point of view, approach the ecosystem, and transfer the acquired knowledge into the company
    • Financial relations are established with start-ups (becoming a customer, product/technology development, patent licensing, selling the start-up's products through its own channels, and purchasing direct shares or future options) 

    3. Opening Defined Calls Focused on Collaboration