Another interesting discussion and another interesting outcome! My company is working with a large financial services company, on a particular service. They have been involved with us for quite sometime, and I am sure they would have got a pretty good idea of our product. Now the question I got was “What stops them putting up their own team and start work on a similar idea? Why do they have to come to us?”
My though process was, since they being a large company, they would have had enough resources, both in terms of man power and money, they could just take away our idea and start implementing it all by themselves. They could easily bypass us.
But it seams that it was not so. These big companies are too much involved in what they are doing. They don’t have time to think about new ideas or implementing them. Their current work keeps them preoccupied to try anything new (certainly there are a few exceptions). That’s why they turn to startups for new ideas. They would prefer to invest some money to buy this new idea, rather than implement it on their own. The effort involved in starting something new in these large companies (it seams) is nothing short of an experience of getting a building plan approved at your municipality. So the best way out for them is work with small startups, see if their ideas actually work in the market, and if so latter buy them at an extra premium or pay heftily for their services.
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