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Collaborating with startups

This research report is a must-read for everyone in publishing

I mentioned in an article yesterday that what’s happening in the startup community is one of the key takeaways from TOC NY 2013. I’d like to drill a bit deeper into that subject and a recent report from Dosdoce helps me do just that.

If you’re not familiar with Dosdoce and their CEO/Founder, Javier Celaya, you need to be. Dosdoce analyzes the use of technology in culture and Javier is one of the smartest people in publishing. Their latest report was released last week during TOC NY and is called How to Collaborate with Startups. You’ll find some background information about the report here and a PDF of the report is here.

How to collaborate with startupsI just finished reading How to Collaborate with Startups and found it to be the most important document I’ve come across in quite awhile. You should read it from start to finish as well, but here are some of the more interesting excerpts:

91% of the publishers participating in the survey openly admitted that a more active role should be taken in the encouragement, creation and development of startups.

Good, so now let’s take some action! See below for specifics…

79% of publishers participating in the study pointed out that a real way of contributing would be to analyse the way in which technology may be used and applied in each particular publishing firm, in other words, whether technology would contribute any real value to each publisher and why.

Interesting. So rather than having a startup simply pitch its platform or solution, why not also invite them in to help the publisher determine what role technology can play in general?

Many of the digital entrepreneurs declared that they very rarely received feedback from publishers.

Ugh. Sounds like most of the “collaboration” up to now is really nothing more than a one-way conversation.

59% of publishers nonetheless revealed their willingness to allow part of their contents to be used in testing technology since they considered this one of the best ways of contributing to the development of a startup.

59% is a disappointingly low figure here. So the other 41% aren’t even willing to experiment? Sheesh.

26% of publishers participating in the study indicated that they had never held a meeting with a startup.

I’m assuming (hoping?) this 26% is part of the 41% from the last point.

Our experience in this area has demonstrated that management in the cultural sector tends to consider these new companies potential competitors, for which reason they are ignored. Other management teams agree to meet them with a view to extracting information on their vision of the future in the sector, without any real intention of working with them. Other, more arrogant, publishers feel that their broad knowledge of the sector, coupled with certain internal resources, are quite sufficient to face any digital challenges.

And now we get to the heart of the matter. We’re afraid of competition, especially when it’s from a startup. I’ve definitely seen some of the arrogance referred to here and it’s remarkable given the opportunity startups represent.

Why most meetings between publishers and startups are scarcely productive: their objectives and expectations are totally different. One group goes into a meeting with high expectations of making a business deal, whereas the other group’s only curiosity is to keep up with the times and discover advances in technology, no strings attached.

I’d say both parties are at fault here. I see why the startup wants to focus on selling their solution but they need to be more open-minded in helping the publisher identify their real needs. And from the publisher’s side, we can’t just treat startups like they’re disposable and not engage in actionable business plans.

Just as most companies can boast to having Media Relations officers or an Investment Relations officer, digital entrepreneurs would approve of a Startups Relations officer. We are referring to a “mentor” within publishing houses who may identify and support the most innovative projects with a view to implementing them to create a new, more open, fresh and creative corporate culture without sacrificing the publisher’s identity.

This is a brilliant idea. Right now there’s often no accountability on the publisher’s side. But creating a senior level job with the responsibility of nurturing startup relationships is very smart. There have to be clear, measurable goals in place, but I like this concept a lot. And don’t let this person just wine and dine. They need to prepare regular reports to the organization to show what progress they’re making and why they’ve chosen the startups they’re working closest with.

The results indicate that there is a surplus of startups with solutions related to e-commerce and online marketing, whereas scarcely 4% of the startups offered technology solutions to other essential processes in the publishing world such as copyright management, internal manuscript publication, etc.

Here’s where more two-way dialog can help everyone. We don’t need yet another ecommerce startup that’s just like a dozen others. But if the startups don’t hear that from the publishers what’s to stop them from proceeding? I’ve had the benefit of working closely with a lot of startups over the past couple of years and when I see overlap I connect the leaders of both organizations to see if they can work together on the solution. We need to do more of this.

Startups (up to 74%) are prepared to open their doors to their shares and consider it appropriate for a representative or officer of a publishing firm to join their management team with a view to co-management.

I love the idea of an equity stake for the publisher(s) who help startups bring their vision to reality. It’s a win-win and makes sure both parties have skin in the game.

36% of publishers participating in the survey admitted that the poor image of the sector due to its scarce investment in innovation in the last few years is likely scare off more investors.

So let’s take some of these ideas and invest in the startup space ourselves!

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  • http://MainStStark.com Jeff ‘SKI’ Kinsey

    >> So let’s take some of these ideas and invest in the startup space ourselves!

    Great idea. If you or any of your readers are serious, let’s talk. –ski
    –mobile: +1 330.437.6713

  • Charlie Schroder

    Rings true to my experience on both sides of the table (and it generally is a very big table, with buyers and sellers lined up on either side). Another central issue: impact of new technologies/methodologies/digital product offerings are difficult to “model” in terms of potential ROI. A senior-level “Startups Relations Officer”, with an investment budget to incubate and co-manage is a fantastic model. Any such thing in the works at one or two of the trade publishing players?

    • jwikert

      I’m not aware of any such positions today, Charlie.

  • http://twitter.com/stephenbetts Stephen Betts

    I think another issue here is that publishers are reluctant to work with start-ups in a way which will then allow the start-ups to sell their services to other publishers. This can be another stumbling block to getting a partnership off the ground.

    • jwikert

      That’s a good point, but I also think publishers just have to decide early on whether they can get comfortable with others using the technology. If not, maybe they should consider acquiring the startup.

    • http://www.facebook.com/humberto.neves Humberto Neves

      Interesting point Stephen. But that is due to the service nature – consulting. They help, they learn and they re-use. I think if a startup want’s to provide an added value to a publisher it must be aligned with their editorial strategy, so it can go digital maintaining the same vision they have for print. So The result of this doesn’t fit all publishers the same way. The innovation comes more from the deep collaboration than from a replicate process.

  • Elizabeth Dimarco

    I agree! Javier’s ideas were the best at the conference. Glad you’re giving them air time. As a first step, perhaps one or two publishers could engage him to help establish and create the context around their “Startup Relations” departments.