Ekaterina Petrova: "An accelerator’s efficiency is measured by the deals made"
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4 July 2019

Ekaterina Petrova: "An accelerator’s efficiency is measured by the deals made"

The GenerationS corporate accelerator changed its positioning as the country's largest accelerator and became a platform for the development of corporate innovation tools not only in Russia, but also abroad. "Invest Foresight" talked to Ekaterina Petrova, the director of the corporate accelerator, about how the work is organized and why the Russian state-backed accelerator pursues the policy of opening up foreign markets.

"Invest Foresight": Ekaterina, please tell me what GenerationS is. Last year its model of work was changed. What was the reason for that?

Ekaterina Petrova: We have been working since 2013, when big business in Russia did not know how to work with innovations and did not know what kind of tools existed, and startups, in their turn, did not work with the special mechanisms to attract investment and corporate partners. Also, there were no consultants who could help these parties to find common ground. At that time our task was to create an ecosystem and to measure the demand for innovations in general.

In 2015, GenerationS introduced its first range of corporate accelerators. Corporations became partners of the industry tracks at that time, they could test this tool within a short period of time in a mode quite safe for themselves, with minimum investment. Over time, the partners appreciated the advantage of working with technology companies. Gradually, they began to develop tools for "open innovation" on their own - creating their own R&D centers, internal accelerators, and working with startups more selectively. There was a request for "closed funnels" and the creation of untypical products. Therefore, in 2018 RVC abandoned industry accelerators in favor of corporate ones, we realized that the time had come to change the model - to complement the product portfolio with technology consulting.

Today we help both the corporations to spell out the right questions to the startup and the startups to find the right answers. When a startup comes to us with a specific solution - perhaps very promising, but raw - we must have the technology to develop the project so that it can offer this idea, this technology to the market.

— When you come to a company, what do start with?

— First, a strategic session must be held to assess the readiness of the partner to innovations. After all, creating your own accelerator is not really the step from which a company should start working with an innovative environment. All startups are different, are at different stages of development and may require different support tools. Some of them need direct investment, some others needs a platform for product testing, and some of them require industry expertise.

Before starting the search, it is necessary to determine the innovation strategy and the problems that the company wants to get solved with the help of technologies. When deciding to work together, it is necessary to realistically assess how clearly the partner can articulate its innovation priorities and offer support resources. Once we are convinced that we have reached a common understanding of the tasks, we propose an implementation strategy. By the way, it must not necessarily be an accelerator in its entirety, it may be a simpler product.

— Can you please give some examples of such products?

— When changing the format, we developed several products that differ depending on the "level of development" of the partner. Now we do our best to stick to the deadline of 12 months from launch to implementation, to work out all the stages in manual mode with all the internal units so as to get a high-quality result. There are special internal corporate educational activities - we train our employees - we have our own course on the development of internal corporate entrepreneurship. And there is a special product on studying the international experience of setting up innovative processes in corporations leading in their industries and on the immersion in an innovative ecosystem of foreign countries. In accordance with the partner's tasks an individual program is developed, which includes workshops, exchange of experience with corporations, pitch sessions of the startups. For example, for the VTB and Otkritie banks we did programs to acquaint them with Singapore's fintech eco-system. The colleagues visited the offices of the largest banks, the latter shared their experience in working with innovations (for example, DBS Bank, ОСBC, etc.) and foreign accelerators (Techstars, Plug and Play).

— How ready are Russian companies to work with startups in general, and what difficulties do you face when dealing with them?

— The main difficulty in our work is that currently the supply of accelerators exceeds the demand of corporations. That's why it's important for us that the customer corporation should have a vision of the result it wants to get and that an innovation team be formed. Our task is not only to find innovative solutions on the market, but also to create an environment for the employees to work with innovations further. Startup acceleration nowadays is really fashionable and in demand, everyone is trying to launch corporate accelerators, but often there is a situation when an innovative solution is found and there is no infrastructure for its integration into the company.

— Is competition in technology consulting harmful or helpful?

— It gives us the opportunity to improve our products and create new values so as to be different from others. We treat each customer’s requests individually and do our best to avoid routine repetition and "standard" solutions. At the beginning, we work on the strategy together with the corporation, based on the existing problems and the solutions or programs already implemented, and thus we develop a "road map" for the product’s implementation.

— You had a huge technology platform created. Do you use it in your work too, or do companies build their own?

— We keep using it, it's one of our competitive advantages. The platform allows corporations not only to see the incoming "funnel" of startups, it also features the online courses, expertise, acceleration program, tracking, etc. Moreover, we have provided the possibility for the corporation to communicate with the startup online so that it could quickly resolve any issues that arise.

— Do other accelerators have similar platforms?

— Many accelerators have various platforms for working with startups. There are platforms that collect applications, there are platforms where other problems are solved locally. But there is no comprehensive platform on the market that would combine all the existing functionality of an accelerator. By the way, while working on this task, we interviewed our partners, that is, accelerators from the U.S., Canada and Europe, with whom we discussed the functionality of an effective platform that be convenient for corporations - what should be done.

— And as for startups, what do you teach them? You were among the pioneers creating and developing accelerators, did the acceleration program itself change during this time?

— Unlike many other programs, we rely on finding and "wrapping up" complex technological solutions. An acceleration program consists of several directions: educational, with an emphasis on the development of the business, and technological, aimed at implementing the technology into the business of the corporation.

The educational part includes a series of lectures and workshops on business modeling, financial models, legal registration of transactions, etc. This program allows the projects to better bundle up their product or technology, having regard to the business involved, for successful work on the market with other customers.

The technological part is piloting the development on the infrastructure of the corporate partner. Corporations provide projects with access to data, clients, technical expertise, laboratories, and if necessary, GenerationS resources can be used to run a pilot of the solution at leading universities or technology parks.

In addition, there is mentoring support, which includes individual project work with an industry or business manager. Piloting is also supported by external industry experts, both Russian and international, who have experience in implementing similar solutions or those close to them, capable of supporting the corporation.

Startup teams that successfully go through an acceleration program and meet key performance indicators (KPIs) with their pilot get the opportunity to attract investment or establish a long-term partnership with the customer. Our performance is measured by actual deals and the products that the corporation makes together with the startup that produces them.

— Is there no prejudice that you're still a state-backed development institution?

— Of course there is, you can't help but admit it. Many questions and suggestions have been raised by partners regarding the working procedures and bureaucratic issues. But when our team starts working as an accelerator and shows results, we are not assessed as a state-backed development institution, but as a team that has competence, professionalism, and provides quick feedback and flexibility. In addition, a state-backed accelerator can afford things that a private accelerator cannot. For example, we do not take a share in startups and the acceleration program is free for them, the projects have access to all the opportunities RVC provides, from working with venture funds to support through the National Technology Initiative (NTI).

— In addition to changing the priority from business to corporate acceleration, you have started to work actively on the international market. What is this segment for?

— I do not believe that innovation can be done locally. Any more or less technological solution requires international cooperation, and all our international activities are aimed at creating a global integrated innovation space. That's why at the end of last year it was decided to expand GenerationS presence not only in Russia. Having analyzed the development strategies of successful accelerators, the first step was to apply for participation in the international association Global Accelerator Network (GAN).

It is an independent association established by the Techstars accelerator in 2011 in partnership with the U.S. government's Startup America Partnership, a program for technology startups. The network unites the largest accelerators from all over the world, today it includes 90 accelerators from over 30 countries, GenerationS is the only representative from Russia.

Then, at the end of the year, we took part in the international forum Corporate Startup Summit, which took place in Zurich, Switzerland, in order to understand if we could interest someone not only in Russia, but also in Europe. The European Community recognized us as the best in the category The Best Corporate Accelerator; the Russian GnS surpassed the Swiss F10 FinTechIncubator&Accelerator and the German ProSiebenSat.1 Accelerator, which were also short-listed.

In May we signed an agreement to develop a range of corporate accelerators in the Kingdom of Bahrain. By the end of next year, we will open two programs in which Russian and Middle Eastern entrepreneurs will participate. Zain Mobile Telecommunications, the largest telecom corporation in the Middle East, has already become a partner of the first selection of projects.

— Why was it Bahrain?

— We see the potential for cooperation between Russia and the Middle East. And Bahrain is an excellent starting point for interaction with the whole region - no taxes, a developed fintech-ecosystem with a sandbox for startups at the Central Bank level, government support for startups in the form of grants and subsidies. The local partners have appreciated the experience of GenerationS in corporate acceleration and want to bring our model to their market in order to engage Arab corporations into the startup environment to develop a local innovation ecosystem, as well as to engage our corporate partners into cooperation with startups from the Middle East. Such a partnership will create a platform for mutually beneficial cooperation between Russia and the MENA region.

— If you look at GenerationS clients, you have more Western companies (Unilever, Ferring, Airbus, Enel) than Russian ones. Why so?

— The Western market is more mature. Many of them already have an innovation policy in place and they know exactly what they want to find. And of course they are interested in Russian projects, they see their high scientific and technological potential. Working with foreign partners generally promotes the innovative image of Russia on the international arena, which helps Russian startups to scale up abroad, and we attract more foreign investment to the Russian market.

— How are technologies from Russia perceived abroad?

When working with the international market, you feel absolutely clearly that innovation is out of politics. For example, if a foreign corporation is considering several projects from Europe, the U.S., Israel and Russia, a Russian startup may be treated more skeptically only because other countries have already created the image of more mature players, in terms of the innovation ecosystem. However, this does not work for all industries, for example, in a number of areas in which we have firmly established ourselves, there are industries in which Russia is a leader, as there are programs to develop such specialists (for example, cyber security or aerospace development).

— Do you engage Russian startups to work in international companies or do you work with foreign startups as well? In which countries are startups interested in participating in the Russian accelerator?

— The geography of searching for startups is based on the needs of the customer company. We can engage both Russian and foreign startups. Most often, international corporations come to us for projects from Russia and the CIS, as they already know the innovation ecosystem abroad quite well, having their own internal team of innovation "scouts". But, taking into account the closed nature of our universities, it is often difficult to find technologies from Russia and the CIS, and we help them. On the contrary, Russian corporations are well aware of the landscape in Russia and are interested in studying the market of foreign projects. For example, 70% of Ilim Group's startups were foreign projects from such countries as Sweden, Finland, Canada, the USA and Georgia.

As for the total number of foreign projects in the GenerationS statistics, their share is about 10%, as we focused more on the Russian market. Now, with the increasing demand for international projects, we aim for their share of over 20% in each accelerator.

— What challenges do you expect in the coming year?

— In addition to working with new corporate partners, we have a task to develop a range of regional franchises in Russia, we are now analyzing the regions that may be interested in this. Franchisee customers of GenerationS can be various subjects of the innovation ecosystem: universities, business incubators, technology parks, development corporations, clusters and innovation support funds. They will be able to independently launch the selection and acceleration of projects under the GenerationS brand, enter into contracts with corporate partners in their regions.

Another big task to work on is the GenerationS Family alumni club. The community has reached a point where GenerationS alumni are interested in sharing their experience and can support "newcomers", so we decided to arrange it offline. This year, 2 face-to-face meetings were organized, where successful startups shared their experience, and we, in our turn, told the projects about support opportunities available to them even after the training is over.

All photos are provided by the press service of RVC JSC

T. Katkova was interviewed

Source: Invest Foresight

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