Plenty of large companies are launching competitions to help them connect with startups operating in and around their industries.
But Scarlett Sieber, Senior Vice President of Open Innovation at BBVA, the Spanish banking giant, says they often underestimate how much effort it will take to make sure the best startups want to participate — and to get them working with the right business leaders in the company.
Sieber, a former entrepreneur herself, was a speaker at the Chief Innovation Officer Summit in New York last month. (An audio clip from her talk is below, along with several slides.) We spoke with her after the event to get her advice on running successful startup competitions. The bank, headquartered in Madrid, has 50 million clients in more than 30 countries; 2014 revenues were $35 billion. It has run the Open Talent startup competition for seven years.
Work to Provide the Most Value for Startups that Participate
“We focus a lot on what can we do to get people and startups excited about this. Try to put yourself in the position of the startup. If you’re just getting off the ground, a $10,000 prize could be a big deal, but there are hundreds of competitions going on. How do you differentiate which ones are worth applying for? They want to know, ‘How is this going to be helpful to me?'”
To be helpful, BBVA made sure that the finalists in its competition got plenty of face time with company executives. Before they came to an in-person event called BBVA Day, Sieber’s team sent out surveys, asking them who they wanted to meet with. “Most of them said they wanted to talk to people from compliance, legal, and risk, so we made sure those people were there,” she says. “They all gave presentations, and startups could have a kind of speed-dating conversation with them.”
Finalists got to dine with top bank executives and have more free-form conversations over the course of the meal. They also got help honing their presentations. And the six winning startups participated in a two-week long Global Immersion Program — one week in Mexico City and one week in London — which gave them even more access to bank executives.
Sieber says that startups think carefully about applying to accelerator-style programs when the organizers make a small seed investment and get equity in return. As a result, with Open Talent, BBVA doesn’t ask for a slice of equity, and it offers 30,000 Euro to each of six winning companies.
Get Business Leaders Involved Early in the Competition
“Initially, when we had the winners, we’d go to business units and say, ‘Here’s a lending company, you’re in lending, why don’t you work with them?’ This year, though, we got the executives involved very early on. We asked many of them to be an initial screener for applications. There was a small group of 10 of us — including representatives of many of the relevant business units — who went through the top 40 [applications] for each region and winnowed them down to top 20.” Sieber and her colleague Marisol Menendez, Open Innovation Manager, also interviewed business unit leaders about technologies and topics they found exciting, things they found frustrating, and the types of startups that they might want to partner with.
Those conversations led to Sieber putting together a spreadsheet that included not just the startups who won the competition, but other entrants who are working on things that may be relevant to those business units within BBVA, so they could consider who they might want to collaborate with once the competition had wrapped up. “I want to provide value for the companies,” Sieber says. “That doesn’t only mean the winners or the finalists. You need to work for the companies, and help them find other opportunities.”
Explain Clearly What Kind of Startups You’re Looking for
In the first six years of the Open Talent competition, any sort of startup could apply. In 2015, BBVA decided to make the program specific to financial services, or fintech, ventures. Here’s how it described the types of startups it was looking for:
Don’t Underestimate the Need to Promote
Sieber says one of her objectives in 2015 was to get more U.S. startups applying to Open Talent. That meant getting out to events around the country, and promoting Open Talent in e-mail newsletters that entrepreneurs read, like GarysGuide in New York and StartupDigest in cities around the country.
“Face to face interactions were really valuable. I’d go to a big event in Chicago and speak to 2,000 people. Our message might only resonate with 100 people, but fifty would come talk to me afterward, and it gave me a chance to talk about why it’s worth applying to.”
In talking with entrepreneurs, “you don’t have to give them the secret sauce,” or inside information about how to win. “But you can tell them it’s good to explain what your company can do for the bank, and why we should be excited about that,” she says.
Of the 166 applications that came in from U.S. companies, Sieber says she’d met or spoken on the phone with a majority of those. “It does take a lot of hand-holding. You can’t just put up an application page and hope good people will apply.”
Measure What Really Matters to You
“The number of pilots and proof of concepts that come out of Open Talent is an important metric for us, and it’s one of the reasons we shifted [the competition] to be fintech-specific. Before, there wasn’t an obvious fit within the bank” for many of the companies that came out on top. Of the six winners from the 2015 competition, “there are four very obvious opportunities for pilots and proof of concepts,” Sieber says, and she knows of at least one that will get started this month.
BBVA also has an internal program that can connect the startups with bank employees willing to be beta testers for new services or technologies, she says. “We are a bank of over 130,000 employees, so this is a great test case to get more data and feedback on how your idea is working,” she says.
Metrics, she says, are key to most innovation initiatives in large organizations. “This isn’t just about startup competitions, but it’s about venture funds or innovation centers,” Sieber says. “Not knowing why you’re doing it is a big problem. What does success look like? What can you measure to tell if you’re getting there?”
To download Sieber’s complete presentation, visit our Resource Center.