Hacking the business model

Hacking the business model

< Back to Articles | Topics: Positive business environment

Contributors:

Joey Fitzpatrick

Build a better mousetrap and the world will beat a path to your door, it has been said. The same principle no doubt applies to scratch and win tickets — so a recent Atlantic Lottery hackathon was designed to do just that. A call went out to local designers, who were challenged to come up with innovative themes, designs and mechanics for the next generation of scratch tickets. With $4,000 in prizes up for grabs, a total of 10 teams presented 21 new ticket designs.

Atlantic Lottery has held six of these hackathons, tackling a range of topics, over the past three years at the company’s corporate innovation outpost at Volta Labs.

“We’ve developed multiple prototypes that are in various stages of development,” says Michael Sandalis, Manager of Innovation Execution and Outpost Lab Lead at Atlantic Lottery.

An innovation outpost is a space where companies can explore innovative ideas and develop prototypes outside the constraints of the corporate structure.

“When you’re not being inundated with meetings, answering emails, etc. it allows more time for reflection,” Sandalis explains. “It gives you a space to explore and come up with new solutions.”

One of two things typically happens when a company launches a prototype at an innovation outpost, explains Chris Crowell, VP Corporate Innovation at Volta.

“If a prototype fails, it fails quickly and at low cost. Those are the type of failures you can learn from, and they don’t impact the larger organization.”

But if the experiment is successful, when it is brought back into the parent organization, it now has a proof-of-concept and perhaps some market data that validates the plan.

“So the risk profile for your new venture is dramatically reduced,” Crowell says. “Once you’ve demonstrated that the product is viable it’s a whole different ball game.”

The innovation outpost model has proven successful at the Kitchener-Waterloo hub known as Communitech, where participants read like a who’s who of Canadian firms, including Manulife, TD Bank, Canadian Tire, Thomson Reuters and CIBC.

Beyond the benefits for project delivery, the sandbox concept can have a dramatic impact on organizational culture and behaviour, Crowell adds.

“You’re creating an environment where it’s OK to fail, as long as you’re learning from it,” he says. “You cannot have an innovative environment if people are afraid of failure.”

New surroundings

A lot has changed since Volta first opened its doors in 2013 on Spring Garden Road. An attractive new setting occupying three floors at the Maritime Centre provides 60,000 square feet of space, making it the largest innovation hub outside of Toronto.

“It’s a bold move for Atlantic Canada, and something we’re really proud of,” Crowell adds.

One of the centrally located offices at Volta’s new digs is occupied by the law firm McInnes Cooper, one of the founding sponsors of Volta.

“With a number of clients in the emerging business sector, being there physically — and as a member — helps us stay close to our clients and know what’s going on in their industry,” says Julie Robinson, a partner in Corporate Finance and Securities with McInnes Cooper.

Because McInnes Cooper works with both emerging companies, and the venture capital investors who can help those companies grow, the branch office at Volta is a natural fit. The firm has acted for approximately 20 Volta member companies on venture capital and angel investor financing, including companies who now have or previously had office space at Volta and other Volta members.

Besides working in proximity with existing and potential clients, simply being immersed in the world of technology and innovation brings its own benefits, Robinson adds.

“This helps drive our own internal focus on innovation,” she says. “We want to be involved in developing new ideas and new solutions that we can then bring to our existing clients and to our future clients.”

McInnes Cooper also provides presentations and helps develop curriculum at Volta Academy on issues around corporate structure and the incorporation process.

“This has to be done right, but what we were hearing from clients was concern about cost — companies wanted to be able to do this themselves,” Robinson says. “So we’ve actually launched a couple of packages for emerging business clients that wholly came out of working with clients in that industry and at Volta in particular.”

Disruptive technology

Volta is still the place where young, tech-savvy entrepreneurs can launch their ventures. Volta’s Cohort program is designed to inject investment and management expertise into early stage, high-calibre companies. Successful applicants receive $25,000 in funding, mentorship and working space at Volta. The first wave of the program came in November 2017, when five companies were selected from 15 applicants.

Among those successful companies was Trip Ninja, which got its start four years ago when co-founder Andres Collart saw an opportunity for disruptive technology in the travel sector.

“I was planning my first trip to Europe and I wanted to visit five destinations,” Collart recalls. There was no effective tool for planning a multi-destination trip, and that’s the niche that Trip Ninja’s licensed technology has now filled. They take a customer’s travel dates and the destinations they want to visit and find the lowest cost flights available.

“Our technology is licensed to travel agencies so that they can better service their customers by finding the lowest possible fares,” Collart points out.

Cohort members meet regularly with Volta board members, where they deliver progress reports and discuss challenges. The mentorship and personal contacts made through the program have been critical to his company’s continued growth, Collart adds.

“One member of the Volta board was extremely helpful in us raising our last round of investment,” he recalls “He provided coaching and strategy, and also opened up his network and provided personal introductions to potential investors.”

Oceans of data

Sightings of great white sharks, whales and other large marine species off Nova Scotia’s coast have been creating quite a stir recently. The stories are told anecdotally, through mainstream and social media. But, these one-off reports fail to capture these sightings in a systematic way. And when taken out of context, can have costly implications for tourism and fishing industries alike.

“There is no one place for the millions of ocean explorers to track and quantify their observations in order to convey what is happening to their industry and the ocean around them,” says Dr. Christine Ward-Paige. Her company, eOceans, provides an activity tracking app for individuals to log and share their experiences. The data collected provides a deeper understanding of the oceans at individual, community and global scales. She launched the company in 2013 while monitoring global shark populations.

“It was created as a place where people around the world can get involved in citizen science,” she explains.

Much of the data is collected and logged into eOceans’ database by recreational divers. The company collects data on sharks, rays, jellyfish, seahorses, turtles, marine mammals, garbage and oddities. She is currently collecting and analyzing data for the tourism sectors in Fiji, Thailand, Indonesia and marine-protected areas across the Atlantic region.

Ward-Paige incorporated in January of this year, and in May was accepted into the Volta Cohort program.

“Volta provides a stimulating and motivating atmosphere for people who want to change the world and thrive,” Ward-Paige says. “There’s a lot of talent coming out of the academic institutions in the province, especially in oceans, big data and technology. With the support of innovators at Volta I am confident that my success will be accelerated.”

Having startups and established companies sharing real estate and sharing ideas benefits both parties, as each has its strengths and weaknesses. Big companies have customers, brand recognition and resources. But they’re often slow-moving, risk-averse and resistant to change. Startups lack the deep pockets, but they’re quick, nimble and not afraid to take risks.

“The outpost is a place where big companies can get a little bit of that startup DNA into their organization and acquire the methodologies and mindsets they need to become more innovative,” Crowell says. “They also attract the kind of talent that makes them more disruptive, nimble and faster to market.”

< Back to Articles | Topics: Positive business environment

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