“Our Program Includes Potential Paid PoCs & Access to VCs For Startups”

2223

Abhay Tandon, director & head, Lowe’s Innovation Labs – India, in an exclusive conversation with Electronics For You team, sheds light on how Lowe’s is working on corporate innovation in India. With its Innovation Labs in Bengaluru India, Lowe’s is helping startups create and deploy tech solutions in the retail space.

The lab runs a cohort program for startups where it gives them access to VCs and technology teams. Based on PoCs of solutions, the team also decides the amount of funds given to startups. Startups, irrespective of the stage they are in, can contact Lowe’s Innovation Labs.

Here are some more excerpts from that conversation…

Q. How long has innovation been a mandate for Lowe’s in India and since when has that been driven from India?

A. It initially started in India in 2016. Globally, it had started in 2014. Due to a global mandate, there was a period, when we were not running the program in India. We re-started this mandate about five months back to better align with Lowe’s enterprise mission and priorities and built it from scratch with higher clarity, alignment and rigour towards tapping into the Indian innovation ecosystem and beyond.

Lowe’s Innovation Labs is what’s next for home improvement retail. Through emerging technologies, the Labs accelerate the experiences our customers and associates expect today and develop the capabilities that will power tomorrow.

Lowe’s Innovation Labs in India will focus on partnering with technology startups, enablers and other potential partners towards the same global intent of the labs. These partnerships would leverage the Indian startup ecosystem to co-develop solutions that can be applied to Lowe’s and create a win-win for all the stakeholders.

Q. The focus is more on what’s happening or on what’s going to happen in terms of technology and solutions?

A. The philosophy of innovation in India has changed. With this change in philosophy, we have had changes in priorities. We have changed our thinking and how this thinking gives back to the organisation. A lot of things have been discontinued, some have been revamped with more focus and clarity. The Innovation Labs has a dual focus: to accelerate the experiences our customers and associates expect today, while simultaneously developing the capabilities that will power tomorrow.

We continue to work with some of our partners. But our thinking has completely changed concerning the operating model in which corporate innovation works in India. This is not just restricted to Lowe’s, but we want to reinvent the corporate innovation at large.

Q. Can you shed some light on your background (past experience) and how it has enabled you to come up with such an interesting proposition for start-ups?

A. My previous stints in the startup ecosystem have involved working at a VC fund, an investor network, growth consulting firm, startups and corporate innovation roles at Fortune 100 companies. Basis the experience, I have developed an understanding about the key stakeholders in the ecosystem and what it means to create a win-win scenario for all the stakeholders involved.

Q. Can you shed more light on how are you driving innovation at Lowes and how start-ups are an important part of the equation?

A. Firstly, we have created a “win-win” program, where all the stakeholders involved can go back home happy. A major change that we wanted to bring in was that when we partner with a startup through co-innovation or a plug-and-play solution and validate that a POC, the POC is paid. This helps startups value the PoC more and invest their time and efforts with more accountability. At the same time, it also adds corporate skills to the solution. It also shows the seriousness of the corporate network into looking for the right solution and deploying it at scale.

Secondly, in India, accelerator as a term, has become a misnomer, especially for catering to early stage startups. We want this program to be stage agnostic. What it means is that we can work with a three-people team or with a large/growth startup. It doesn’t matter the amount of funds that the startup has raised; how big their operation is and how many deployments they have done. We can work with any startup – small or big by co-developing a solution or through a Plug n Play partnership. In the end, the solution should be interesting.

The term accelerator should stand true for startups, corporates as well as all the other stakeholders. Through corporate innovation we are ensuring that.

Q. Does every startup get a paid PoC?

A. When partnering with early-stage companies, you are basically co-building a solution. Sometimes those early startups are going to be building something very, very disruptive. Sometimes, it will be in the growth phase and sometimes it will be beyond the growth phase, thereby having a more Plug n Play approach.

When we partner, we personalise all our partnerships. When we are going for paid POC, this does not mean that every startup gets a standard amount of funds.

The team at Lowe’s evaluates the scope of work for each startup. Some of them may need more money to execute the Scope of Work, while others may not need as much.

There are a host of other benefits as well but we want to personalise these benefits. For example: not all these startups want to be seated out of our campus all the time; they have other clients as well. For the work that we do together, we can host some of the key team members or operate in a virtual way, depending upon the need of the hour. We have created a 50-seater space which they can choose to use or not. This allows us to remain flexible, agile and focus on our partnership mandate on specific innovation themes.

Q. How do you identify the right startups from the ones that approach you? How do you approach startups?

A. As our innovation lab is re-building it’s presence in India, it is difficult to talk to all the startups across India while sitting out of the Bengaluru office. Therefore, we visit key hubs across major Indian cities (Delhi, Mumbai, Chennai, Bengaluru and Hyderabad) as they comprise of about 78 per cent of all the startups in the country. For the same, we did road shows in five cities.

We tell start-ups that they have to lend their technical knowledge on emerging tech to us by co-developing a solution through a PoC validation and we will provide them a platform to test their solution and potentially deploy across the US market, provide access to a global network of mentors, as well as pay for the time that they invest in the same.

Q. Do you also focus on deep tech or are you more interested in the ones which have got a solution or a plan for retail?

A. We are looking for deep tech solutions primarily. The startups we are looking for are divided across three brackets. The first category of a startup, should be working on a retail problem by applying deep tech.

The second one is operation tech, which means any startup that is bringing operational efficiencies to any large organisation like Lowe’s through Emerging Tech. It could be fintech, HR tech or legal tech, so on and so forth. For example: Any stores, manufacturing units or conventional offices could have IoT requirement from an energy efficiency standpoint.

The third bracket is emerging tech where we are looking at technologies such as robotics, haptic, nanotech, drones, blockchain and more. For example, haptic tech is right now being applied to medical technology. What if in the next two to three years, it gets applied to retail as well and is commercially viable?

Q. How does your initiative–‘cohort’ fit into this? Are road shows more like an outreach program, which are done on an annual calendar basis?

A. For us, the cohort is going to be from April every year and demo at about the end of the year. The intent behind providing this platform of a launch day and demo day is for startups to navigate the ecosystem. When we do these kinds of events, we invite all external as well as internal stakeholders.

Typically, when internal stakeholders come in, they see a solution being applied to Lowe’s. If they get interested in a solution and startup, the startup could potentially get more use cases within the same corporate.

Our startups, on the other hand, get the exposure or the platform to talk about what they need to achieve and accomplish. These platforms are basically to tell that the heroes of the day are the startups and this is what they have done.

Q. Is there a duration or time frame attached for startups to join or for the program?

A. The program is usually three to six months long. Lowe’s Innovation Labs is open to working with start-ups throughout the year. Irrespective of the month or the year, if we get a genuine problem from a business stakeholder or if we find a very unique start-up who can add a lot of value to a stakeholder’s business, then we are open to partnering throughout the year. If we introduce time restrictions, then that will beat the whole purpose of bringing innovation to our organisation.

Q. What are the common confusion or myths you find start-ups grappling with—which stop them from approaching Accelerators like yours?

A. Startups tend to feel that Accelerators are meant for only early stage startups which may not be the case. Different models can allow for a stage agnostic environment for startups.

Q. Are there any challenges you are facing with the program that you have started?

A. The program is just getting launched and like every program, we might have initial problems while setting up a new model and we are sure that those would be small and we will be able to manage them effectively.

Usually there are integration issues between tech stacks of organizations and startups and we are already working on a model to streamline that process.

Q. How can startup’s reach you? If a startup already has a solution, is there a way to find out whether Lowe’s has already implemented such a solution?

A. Our website (lowesinnovationlabs.com) has all the information on the kind of areas that we have already worked upon to a certain extent. When startups approach us, we can have a discussion and talk to them. Even if there’s something that’s already deployed, a faster, better, cheaper and more scalable alternative solution will always provide a scope to improvise.

Q. Do you look at taking equity in these startups? Is there also some kind of a non-compete when you ask for solutions, they develop for you? Or can they just sell that same solution to your competitors?

A. Taking equities is not in our model. Whenever there is pitching up of POC, there is always a strategy for ROI. It is a win-win for both startups as well as corporates to be equally involved. If the PoC looks interesting and we think the roadmap ahead is good from a collaboration standpoint for a long run beyond the vendor, then we can deepen our relationship with startups.

Coming to non-compete, it has been personalised based on individual cases. What that means is not all the solutions are going to be co-developed. A lot of them are going to be plug-and-play. In that case, the IP could remain with the startup. If there’s co-developing, then we have to figure out who is contributing what.

For example, if both parties are equally participating in building a product or a solution, then it could be a shared IP model. We have to evaluate it on a case-by-case basis. If something very unique has been co-created, then there will be a certain period of non-compete. However, it will only be for a specific period of time.

If it is a Plug n play solution, then there will be no need for non-compete because it has already been deployed with other clients.

Q. The government of India also has certain schemes. initiatives and funds for accelerators. Are you working with the government?

A. We are not in partnership with the government from an innovation perspective. We will have to understand deeply their initiatives from a corporate standpoint where corporates and government can partner together on innovation. But we are always open to collaborating with them, given a specific need.

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