How a $19 Billion Truck Maker Scouts Relevant Startups in Silicon Valley

By Scott Kirsner |  October 21, 2021

Paul Konasewich speaks to an InnoLead group at the PACCAR SiliconValley Innovation Center in early 2020.

Paul Konasewich is the Director of Business Development at PACCAR’s Silicon Valley Innovation Center, which the Washington-based truck manufacturer opened in 2017. It focuses on emerging technology areas like advanced driver assistance, artificial intelligence, vehicle connectivity, augmented reality, and electric and hydrogen fuel cell powertrains. The center often forges partnerships with startups to help move its projects forward.

We interviewed Konasewich as part of our recent research project, “The Changing Landscape of Corporate-Startup Engagement.” Before joining PACCAR, Konasewich oversaw alliances for Honda Innovations Silicon Valley, part of the Japanese automotive company’s R&D organization.

Startup engagement activity is “way down.” Over the course of the pandemic, Konasewich says, “We kept doing our activities, but largely with companies we already knew. The reality is, we’re pretty busy already and we have a small staff, so we had lots to keep ourselves busy with companies we already knew.”

But online events can engage peers throughout the company. Earlier this year, Konasewich hosted three “tech days” online so that his colleagues around the company could get to know startups focused on vehicle electrification, autonomy, and new manufacturing capabilities. “The online format was better than in-person for that event. I was able to get people from around the world to engage. We hosted it on Microsoft Teams, and we found channels that already existed in Teams oriented to those topics. It also makes it a lot easier to record the meeting. My intern sliced and diced it, and we posted videos on our intranet with the startups’ slide decks, so that becomes an evergreen resource.” 

The online format was better than in-person for [the ‘tech day’] event. I was able to get people from around the world to engage. 

No ideas on cocktail napkins. “It needs to be an actual company with funding,” Konasewich says. “The technology in the lab, with people who haven’t yet committed to making a company, is academically interesting, but tends to go nowhere. Tap me on the shoulder when there’s a seed round, a CEO, and full-time employees… Until there’s something we can see, it’s really hard for us to jump in.”

Connecting to the venture capital community. “We’ve been in the Valley for about four years,” Konasewich says, “so there’s some awareness that we exist. I think we’ve talked to all of the major [VC] firms at some point. They typically reach out because they’re considering an investment in something that’s related to us, and they’d like to know our point of view. Sometimes, I’ll reach out to them to get their opinion on a given startup. You need to build those relationships over time, rather than right when you need them.”

Tap me on the shoulder when there’s a seed round, a CEO, and full-time employees… Until there’s something we can see, it’s really hard for us to jump in.

Faith-based ROI. “Having a center in Silicon Valley is very expensive. Doing it involves much more of a faith-based ROI, to tell you the truth. I compare it to going to church. You don’t go to prove that god exists; you believe that god exists, so you go to church. I just believe in my soul that this is important. The people trying to get the ROI [model] to them to be here will never make that case.”

A truck engine on display at the innovation center.

Success stories. “In January, we announced a big partnership with Aurora, an autonomous technology developer, because of the center. We knew the whole space of autonomy developers very well, and we had pretty clear criteria about who we wanted to be talking with, and who we felt just wasn’t going to do well. Our view would’ve been a lot more fragmented if we didn’t have a center here. I walked Aurora into the center two years ago.”

Advice for others. Konasewich says that for large companies, the biggest problem isn’t identifying emerging technologies that will be relevant to a product or service. Rather, “it’s how is your company going to usefully engage with it. You need to get honest about whether [your startup scouting activity is about] cultural enrichment, or actually creating new products. Both are good, but I see a lot of intellectual dishonesty, where cultural enrichment is presented as creating new products, but the core organization isn’t set up psychologically, financially, or incentive-wise to do that sort of stuff, so it predictably falls flat.”

When a startup engagement strategy is working productively, he says, there are systems and people in place to integrate new ideas and technologies that may take the company in new directions — not just add new features to existing products. “That’s where it’s hard; that’s where it gets real,” he says. “And that’s where the opportunity is as well.”