Making External Data Liquid
The “amazing unboxing experience” Michael Litt was after began with a walk from his software startup company to the nearby tech innovation centre in downtown Kitchener.
Three years after co-founding Vidyard to host online marketing videos and track how people watch them, Litt needed to figure out how to cut a deal with a major camera manufacturer to make the idea – supplying clients with what Litt calls a “studio in a box” – work financially. Communitech, the thriving support hub of the Waterloo Region tech community, ultimately provided the solution – Vidyard ended up teaming up with a larger camera company to get its needed gear at cost.
“It’s been a wonderful experience,” Litt said. “One of the biggest challenges we had when we started was getting access to big companies.” The startup-corporate partnership shows how both sides can benefit when tech startups team up with established corporations under a relatively new model that is gaining steam. A new Thomson Reuters Lab™ , which opened at Communitech this year, also hopes to use the model to reach new startups and drive innovation, The company is among a select group of other corporate neighbours who began moving in two-and-a-half years ago.
Brian Zubert, director of the new Thomson Reuters Lab, said the operation aims to promote innovation by analysing “big data” to find useful insights and patterns. The lab’s team of data scientists will explore and identify new products, services, insights, or analysis that are worth pursuing further. “We’re ok with failure,” said Zubert. "The idea is that failing 'quickly and cheaply' on new projects is preferable to the traditional way of developing products." Another aim is to connect with startups at Communitech and in the region’s broader tech ecosystem, staying abreast of the latest innovations while capitalizing on great ideas and driven entrepreneurs. The Lab is also funding research at the nearby University of Waterloo and has plans to hire co-op students starting in January.
That is music to the ears of Ben Bittrolff, co-founder of Silqe, a Kitchener startup that aggregates and enables the search of corporate financial filings. If Silqe were to partner with Thomson Reuters, it would give his company all-important credibility and some welcome cash flow. For the time being, at least he knows who to talk to. “It’s a point of contact for us because these organizations are really big and they’re tough to navigate,” Bittrolff said.
Already with a foot in the door at the Thomson Reuters Lab is Bryan Smith, CEO of ThinkData Works, a Toronto company with strong ties to Waterloo through its universities. The two companies are working to integrate ThinkData’s cache of open data on government purchases with Thomson Reuters’ vast store of financial information to provide clients with a fuller picture of companies.
“What we bring to the table is an innovative way of thinking about new products and services, and the ability to really, really scale things out quickly,” Smith said. “What they bring to the table is that established network of clients.”
Mike Kirkup, director of the Velocity support program for tech entrepreneurs at the University of Waterloo, said mutual benefits, understanding and respect are key if the model pairing startups and small offshoots, or outposts, of large corporations is to stand the test of time. There is a risk that without a code of conduct, he said, some big players may simply copy new ideas and develop them in-house, cutting startups out of the equation.
“Our typical advice [to startups] is to stay with the ‘what’ and the ‘why’ and never talk about the ‘how’,” Kirkup said. Mona Vernon, who runs a larger, year-old Thomson Reuters Data Innovation Lab in Boston, agrees there must be clear rules and clear benefits for both parties. A former startup entrepreneur herself, she knows, for instance, that long development processes with no money coming in can strain or sink the little guys.
Iain Klugman, CEO of Communitech, said the partnership model is actually an old idea – harkening back to the Skunk Works project of aircraft company Lockheed starting in the 1950s – that is making a comeback as established companies recognize their innovation limitations. It’s also an alternative, he said, to flocking to Silicon Valley to be close to emerging technologies that could elbow them aside, or undertaking time-consuming acquisitions that often don’t pan out.
“Startups and small companies need customers, while big companies need culture and new ideas,” Klugman said. “That’s the value exchange. That’s the win-win.”
Check out the original article on Thomson Reuters.