The disruption economy is often portrayed as a fight by the old guard against up-and-coming start-ups, but increasingly, the Davids and Goliaths of business are finding benefits in collaboration.
One Goliath taking this path is Ascott, the serviced-residence business unit of property giant CapitaLand, which has actively teamed up with start-ups both in and out of Singapore.
Mr Kevin Goh, chief operating officer of The Ascott, emphasised that "staff are constantly challenged to think about how to future-proof our company". He said "start-ups offer fresh perspectives for hospitality and we see great value in partnering these companies to further Ascott's growth".
It is working with Singapore start-up Red Dot Payment to implement a secure online payment gateway to ensure customer data security. Red Dot has developed a customised payment solution, including services such as credit card tokenisation, which helps to ensure that the credit card details of Ascott guests are kept more securely.
Red Dot Payment co-founder Randy Tan said Ascott is the largest corporation it has worked with.
"The number of security tests we had to go through, as well as the number of stakeholders who we had to meet, helped to improve my standard operating procedures, and helped me to think more about what each stakeholder is looking for," he said. The partnership has given it the credibility to find partners outside Asia, he said, while Ascott also linked it up with partners in Europe. Red Dot, which has funding of less than $10 million from investors, including Skype co-founder Toivo Annus, is targetting the hospitality sector in the United States this year.
Likewise, Mr Amir Nivy, founder of Hapticus, a Singapore-based start-up that develops mobility solutions to help people with disabilities to use transportation that suits their needs, began an ongoing collaboration with luxury car company Infiniti, through joining its accelerator programme in Hong Kong.
He said the experience was "critical" and "helped us to gain a better understanding of our core value and validate that our system is attractive for key players in the mobility landscape". "Often, high-potential early-stage companies just need an opportunity to take their business to the next level and corporate collaboration can offer just that," he added. Hapticus is raising a round of funding and will expand its operations in the Asia-Pacific this year, he said.
On the other side of the fence, Hong Kong-headquartered Infiniti also found benefits in working with start-ups for engaging its employees. A spokesman said that the accelerator was a "wonderful initiative for its employees, as it inspires them seeing the founders overcome business challenges, and learn a different approach to solving problems in their own work''.
While many start-ups are keen to work with large corporates to gain access to more resources, as well as acquire new customers, the downside often comes down to the gargantuan nature of the corporate.
Ms Michelle Katics, co-founder of start-up Portfolio Quest, which provides simulation training to banks, said that the biggest challenge is that "communication across the bank may not be strong".
"We've had global contracts with banks, and then we receive in-bound cold-call requests from their staff in another department who has no idea we already work for them. Often we feel it is necessary to facilitate some of the internal communication ourselves," she said.
Mr Nivy added that while start-ups focus on innovation, corporates have to follow processes. "The key to working with a corporate is to understand how they operate, how they make decisions and what cycles they go through," he said.
Trade agency International Enterprise Singapore, which facilitated the Ascott and Red Dot Payment partnership, said with more companies looking to internationalise, it is expecting more demand for such tie-ups. Mr Kow Juan Tiang, its group director of environment and infrastructure solutions, said: "For start-ups, one common issue is the lack of overseas track record, which makes it more difficult for them to break into new markets and sell solutions to overseas clients.
"We expect more demand from companies for such win-win collaborations as internationalisation will be key for companies to sustain their future growth."