On this week's episode of Inside Outside Innovation, Robyn and Brian talk about why startups fail, the best workplaces for innovators, and the digital detox on college campuses. Let's get started.

Inside Outside Innovation is the podcast to help innovation leaders navigate what's next. Each week, we'll give you a front row seat into what it takes to grow and thrive in a world of hyper uncertainty and accelerating change. Join me, Brian Ardinger, and Miles Zero's Robyn Bolton as we discuss the latest tools, tactics, and trends for creating innovations with Impact. Let's get started.

Podcast Interview Transcript with Brian Ardinger and Robyn Bolton

[00:00:40] Brian Ardinger: Welcome to another episode of Inside Outside Innovation. I'm your host, Brian Ardinger, and with me, I have our co-host, Robyn Bolton.

[00:00:46] Robyn Bolton: Thank you. Glad to be here as always.

[00:00:48] Brian Ardinger: We are excited to continue on giving our audience the best insights into what we're seeing.

[00:00:54] Robyn Bolton: Let's get to it.

[00:00:55] Brian Ardinger: The first article is an article I read in Wildfire Labs called Why Startups Fail Patterns From $2 billion In Startup Failures.

In the article, it talks about some of the research that shows that failure patterns are more consistent than success patterns or success formulas, which makes sense. There's a lot more ways to fail and probably a lot more consistent ways to fail than there are ways to win. The article talks about like, how can startups be more focused on understanding where failure points are? And then what can you do about it?

They had some research in there. CB Insights took a look at startup failures and revealed that 42% failed due to no market need. 29% ran out of cash and 23% had team issues. So I think everybody can relate to those particular common problems and, and not only in the startup realm, but also in the corporate innovation realms. With that, what was your first take on the article?

[00:01:48] Robyn Bolton: My first take was 42% failing because there's no market was like come on. Like step one is finding a problem that's worth solving. It should absolutely not be that high, but also knowing that people tend to fall in love with ideas and not problems, kind of not surprised.

[00:02:09] Brian Ardinger: It'd be interesting to see what that number is at the very beginning because actually might be higher than 42% because I think a lot of times we don't hear about the initial idea. Initial idea is probably closer to 90% and that's not right. Yes. When you first get off the ground and it's, you know, 42% by the first or second pivot.

Yes. I think that is a common issue. There's so many reasons why I've seen it manifest itself from the standpoint of like, again, you get somebody who's interested in a particular topic or they see something that bothers them and they start going off in a particular solution and don't necessarily realize that may be a problem, but it may be problem number 355 on the list of problems to solve. And therefore, you don't get market traction or enough immediate application to it to trying to solve that particular problems.

Doing things like customer discovery and making that a primary part of the first idea innovation efforts is probably a way to help mitigate that particular pitfall.

[00:03:03] Robyn Bolton: I always say it's the hill I will die on. Start with talking to your customers or your desired customers and actually listen. You know, ask them open-ended questions and listen. Because I think we also all fall back on like, do you like this idea? And no one's going to call the baby ugly. They know you spent time on it. So you have to ask open-ended questions.

And the other thing, and I've seen this come up more and more in conversations that I'm having with other folks in the innovation space, is this realization that a lot of the tools that we use, especially in corporate innovation, you know, business model canvas, lean startup, things like that are actually best used to develop an idea of once you already know that there's a problem. And in the rush that both entrepreneurs and corporate innovators have of like, oh my gosh, we need to like do something, get something out in the market.

We have all these tools that are proven that are great for getting things out into the market. We naturally gravitate to the canvases and to the frameworks that are like, this is how you go do stuff.

[00:04:06] Brian Ardinger: You can use those canvases in a way, even at the earliest stages, but you have to look at it from the standpoint of like, this is our best guess day one, and these are going to change, and as long as you're open to changing it. The reason why I do like those particular tool sets is that it is a little bit easier to change than, back in the day when you had to write a hundred page business plan and 65 Excel sheets to justify it. At least it's much easier to take a look at a business model and say, okay, I'm going to take that sticky note off because I talked to a customer and it's like idea wasn't exactly where it needs to be. So, we need to change the sticky note out and try something else or change the model in some way.

But I think a lot of people, again, they go through the. First canvas or the first iteration, and say, okay, this is the plan. We're going to execute the plan. Versus saying, this is a snapshot in time and our assumptions in time. How can we move this particular thing forward and make sure that the canvas maintains reality with what's going on in the marketplace?

[00:04:57] Robyn Bolton: Yeah, and I think the key is. Post-it notes on the canvas, don't write on the canvas.

[00:05:02] Brian Ardinger: Right.

[00:05:02] Robyn Bolton: Because then it feels permanent. Post-it notes.

[00:05:05] Brian Ardinger: The other thing, in this particular article, they talk about solution sets or things, and I encourage people to go take a look at Wildfire Labs. Talk about a clever way to think about the major ways and pitfalls that folks go through. It's fail, fit, acquisition economics, internal alignment, and liquidity planning.

And so, I thought we could talk a little bit about each of those particular ways to checklist, I guess to look at a particular idea. So obviously fit, we just talked a little bit about it, but you know, how do you evaluate the solution? Is it urgent customer need or is it a minor inconvenience in trying to understand that relativity and the fit of the problem.

But not only that, but I think fit to the people trying to solve that problem. And you've probably seen this in the corporate realm as well. You know, a lot of companies go shooting off towards the, the shiny object, whether or not it's a fit for their company or they're good at it or whatever.

[00:05:54] Robyn Bolton: So many companies when they start their innovation journey, so to speak. They're really hesitant to put any sort of constraints on the work. They're like, blue sky, do anything white space. And the reality is there's always constraints and those are actually really helpful.

Thinking about fit as is this a fit with our capabilities? If it's not, are we willing to go acquire or bind those capabilities? If we're not okay, then we gotta stick with our capabilities. Is it a fit with where we have a right to play and win in the market? And again, if the answer is no, that's okay. Maybe that becomes a licensing opportunity or something like that. But yeah, I love the addition of thinking about, especially in corporate, is this a fit for us as the corporation, as much as is this a fit for the market?

[00:06:47] Brian Ardinger: When I'm talking to corporates, a lot of times people tell me what their particular problems they're going after and or they'll frame the problems that they're talking about as, Hey, we need this because we need more revenue. That's a problem for you as the company, yes, as the corporate, but is that a problem for the end customer that you're trying to solve?

And so trying to understand, again, fit. I think it's just a lot of times a mindset. You're always in that realm of, okay, bigger, better, growing revenue and that. And so you look at it from the lens of the corporate versus flipping it and looking at it from the side of the marketplace.

[00:07:17] Robyn Bolton: You have to look at both sides. Otherwise, it's going to be a throwback. But it's kind of like the South Park episode with the underwear gnomes, where the no are collecting underwear is step one. Step three is profit. And they're like, what's step two? It's we're innovating for revenue. Great. What's step two like? Who needs anything? Yeah, exactly.

[00:07:37] Brian Ardinger: The second letter in the fail was acquisition economics. And this is looking at how do you acquire customers and calculate how much does it cost to get a new person into the funnel and onboarded and that. And I think this is where corporates can have a significant advantage because they typically have some customers, they have methodologies and models and that for how do you acquire customers.

They probably have a little bit better way to measure it a lot of times versus a brand new marketplace. But acquisition economics is something crucial. If you can't make enough money on who you're selling it to, and if costs too much money to get somebody to actually try or use your product, you're in line for that failure cloud there.

[00:08:15] Robyn Bolton: Certainly companies, corporates, they have their tried and true models on what's required for acquisition spending. You know, what immediate plan needs to look like, et cetera. You know, that's both good and bad, right? They have their playbook, which they know, but maybe the innovation, the idea needs something different.

With startups, they do need to think about the acquisition costs. They can probably be a little bit more creative, but there's probably also a little, this idea is so amazing. If we build it, they will come. So, it's a good reminder, I think, for both sides to say, okay, you have to think about acquisition cost. And if you've done this before, make sure you're approaching acquisition in the best possible way.

[00:08:58] Brian Ardinger: And like, where are you getting funding from and things along those lines? I mean, you look at a, there are some startups that we're able to deploy a methodology that most people can't like. Think back to Uber where they had so much venture capital, they could acquire customers a lot of different ways, just throw money at the problem.

And then eventually when they went public, they had to figure out, okay, how do you right size this? And actually, we're burning a lot of cash trying to acquire these particular customers. So really understanding where you are in that cycle, how much does it cost and, and will that continue to be the case moving forward?

Third letter is I internal alignment and obviously startups, small teams, et cetera. That's one of the biggest failure points is founder disagreements contribute to about 13% of startup failures according to the research. I've actually seen other statistics where's actually higher than that at x? Sometimes it's number one. Yeah, in startup. But when it comes to the corporate side, internal alignment, what are your thoughts on that?

[00:09:49] Robyn Bolton: It's also a key cause of failure for corporate innovation as well. And it's often because, you know, you have the business owner, you have the CFO, you have the COO, and everyone is viewing things through their own lens appropriately enough and with their own priorities in mind. And a lot of times early on, innovation's exciting, let's go innovate.

Let's all use the word, but we're all probably thinking something different. And we probably all have different benchmarks for what it needs to do or look like or generate. And it's not really until things start getting real, i.e. We have to start making big investments that senior decision makers dig in and that's when you find out that there's misalignment.

[00:10:35] Brian Ardinger: Yes. I think the other thing is just team culture. Obviously with existing teams or existing corporate environments, sometimes you can pick those players. Sometimes you have an existing culture that has to be worked at, whereas a startup, you have some advantages from the standpoint, you can pick the team from the get go, but that also is challenging to do. Different size, but definitely a problem point and a pitfall to avoid whether you're building a startup or building a corporate innovation exercise.

And then the final one was liquidity planning. You've got to be able to make money and drive revenue and don't burn all your revenue along the way, where obviously a corporate stands out from that perspective. They should have a little bit more access to that capital if they're willing to in particularly invest in that.

I think where the challenge is oftentimes is a lot of corporates don't allow enough time or don't want to put as much capital as it really takes to get a brand new idea off the ground. And so that's some of the challenges on that side.

[00:11:27] Robyn Bolton: Absolutely. And the other thing, especially if the idea is being developed in, you know, a corporate innovation lab or you know, an innovation space that's separate.

It's not liquidity, but you have to find a home for the innovation somewhere where there is liquidity and that is often what kills so many. Corporate innovation, especially pilots that are up and revenue generating and now it's time to scale, but there's no home for them in a business unit P & L. That's a problem.

[00:11:57] Brian Ardinger: Yeah. We talk about the baby bird problem. You know, you, you incubate something and you, it's this little bird outside the nest. And if you want to get back into this, it's very hard a lot of times. Yeah, because again, they're designed to execute on the existing business model, not the new one. That you've just come and changed their way of thinking.

[00:12:13] Robyn Bolton: Oh, by the way, this is going to be cashflow negative for a couple of years, but don't worry about that.

[00:12:19] Brian Ardinger: The second one I wanted to bring out, you sent this over to me. Fast Company has just released their 100 Best Workplaces for Innovators. So, this is a list that fast companies come up with to take a look at the best workplaces for innovators.

And I oftentimes, I don't think we talk about that, like what makes a good workplace for innovation and what are the, some of the things that people look for. And so I'll start off with the methodology that they used is they said to earn the best workplaces for innovators recognition, all the winners had to complete an application that addressed the questions looking at projects, investment, company-wide programs, and workplace culture.

And then their editors evaluated the application and conduct additional research and then came up with their top almost 100 companies that are on this particular list. It was fascinating. I love your take on what you saw in the list and some of the things that stood out to you.

[00:13:08] Robyn Bolton: Speaking of alignment, I don't feel like there was a lot of alignment amongst the editors as they reviewed the applications as to, you know, how to weight each of the areas because just looking at the top three. I mean, you have Motorola as number one, the Glow Companies, which is an education company at number two, and then VML, which is an advertising and marketing agency at number three.

And those are such vastly different companies. That I am certain are vastly different workplaces from each other for innovators. So, kind of saying, Hey, this is the top 100. Wait, that assumes that all innovators are the same and like doing the same kinds of innovation and are capable of it. I have questions about the top 100. I'll say that.

[00:13:58] Brian Ardinger: It was interesting to see the breadth and depth of the types of companies that submitted and were put on the list, and unfortunately you couldn't read into each company's given a paragraph of the things that they included in their application, but it was difficult to really unpeel what that meant.

So a company like VML based in Kansas City, just down the road, it was more of an advertising agency. Thinktank for different companies. Motorola has been around forever and they're touting their AI driven public safety initiatives that were very customer focused or customer centric. You've got a company like Mattel and they're touting their internal innovation accelerator.

A company like Zebra was focusing on the fact that they had dedicated 10% r and d budget, but they're really focused on patent creation and, and patent applications. And then you have things like SoundCloud in the entertainment space where their nugget in the article was talking about their clouder first program that recognized and nurtured non-linear career path.

They were looking at what makes a good workplace for innovators at SoundCloud was like, how do we create a, an environment for non-linear ways to move around and contribute to the company? So I found it very interesting.

[00:15:04] Robyn Bolton: I think further proof that we tend to treat innovation in all of its forms is a word, is like chocolate, and it's just we spread it all over everything. As if everything is equally good with chocolate, which many things are, but some things are not.

[00:15:18] Brian Ardinger: Bacon. It's always bacon.

[00:15:20] Robyn Bolton: It's always bacon. Always bacon. And so the same thing here. You know, Motorola's, as you mentioned, are high up there because of patents. Okay. You know, I'm an innovator. I don't get particularly jazzed about patents. I'm in no way qualified to work on patents. Motorola would actually not be a great place for me.

So, you know, I think there's that. I think there's also it it comes back to the definition of innovation of it's not just doing new stuff, it's about having impact.. And creating value. All of these innovation efforts, whether they're patents, whether they're non-linear career paths, what value are they creating? That has to come into the equation.

[00:15:58] Brian Ardinger: I encourage everybody to take a look at the list. If nothing else. It just gives a good insight into, you know, there's obviously a lot of AI assistance, there's a lot of that kind of stuff in there. There's Johnson and Johnson talking about their $17 billion in r and d talking about how they funded multiple internal incubators and innovation hubs.

That I, I find it fascinating. I encourage people to take a look at it, to see the variety of both inside and outside innovation that's happening and how that's applying to the workforce there.

Our third article, the title is Meet the Students Who Don't Use Laptops. It's a article from Dazed, it's back in the UK, I believe was published. I thought this was a nice follow up to our episode, talking about writing a few weeks ago.

The article talks and is interviewed a number of students focused on this idea of like, how are people using new technologies like AI and that and the results of the conversations where a vast majority of students are relying on laptops. While there's a growing small contingent of folks that have become the new Luddite in the world and skewing technology for old ways to reengage their brain in that, we seem to be seeing this more and more, at least in the popular press.

[00:17:03] Robyn Bolton: Absolutely. And it's funny, you know, it's much as in our past episode I was, we need to write more. Writing is critical to thinking. In this article, there are photos of students showing their handwritten essays, and I think my right hand immediately cramped up just seeing pages and pages of handwriting. So I love it. I love that there is a reaction to the All Tech all the time to going back and being a Luddite.

I think as usual, the ideal spot is somewhere in between and there's a place for handwriting, and there's a place for technology. But the ricochet, the kind of pendulum swinging is a sign that we'll eventually find our way into everyone's personal kind of ideal spot.

[00:17:47] Brian Ardinger: And the challenge is digital detox sounds great on paper, but it's very hard to make that happen and continue to thrive and excel in a world that's continually focused on technology and providing tools that make you stronger, faster, better.

But there is a growing body of research that's saying, Hey, it's not a panacea as well, where you know everything from your, higher cognitive thought processes can change based on the tools that you use and, and how you use them.

[00:18:12] Robyn Bolton: It's funny because even, you know, this semester I'm teaching at a Boston area university and everything is online. Even the course pack for my students is a digital one. It's not even printed out. Kind of on that other hand. Like, oh man, if I have any luddites in my class, like I am the problem now. It's tough. Like you said, it's tough to get away from the technology and fully digitally detox just because technology and digital is just a huge part of our lives and more and more part of our institutions, but we, I think we're starting to figure out the In between.

[00:18:46] Brian Ardinger: If folks want to send us articles to take a look at in future episodes, please do send that over to us. The last section that we try to have every week is something we're calling Tactics to Try. Robyn, you have anything you want to start with?

[00:18:58] Robyn Bolton: So I have been experimenting this week, not just with AI, with LLMs. I always use, you know, Claude and Chat GPT, but in building my own AI agents. So I've been not an endorsement shout out, I've just been using Lindy AI. It's the first one I came across. It is both fun and challenging, and I can definitely see how there will come a day where there could be very high revenue companies with one or two people.

Because you just have an army of agents working. So I encourage folks, if you haven't started playing around with creating your own AI agents, give it a shot. It's very, very interesting and could actually make your life a little bit easier.

[00:19:42] Brian Ardinger: The tactics I want to talk about, there's a couple things going on in our local ecosystem that I thought I'd shout out. One thing I've been thinking about this week is the power of being around other innovators and explorers and creatives. And how important that is to include in your repertoire. A couple of things that are coming out that I'll talk about from our local ecosystem, but this is happening in every city around the the world right now.

These things that allow you to play or try or, or build things, hackathons, things like that. But this weekend is the Jumpstart Challenge here in Lincoln, Nebraska. This is a, something that started maybe eight or 10 years ago. Where the Chamber of Commerce found a local company and had that local company present one of the industry problems that they were seeing.

And then the group of entrepreneurs heard the challenges, formed teams, and had a certain amount of time to kind of test or try or, or build some particular solutions and then pitch that back to the company. And the winner would have a chance to actually work with that corporate to test it, to build it out, et cetera.

And you know, we did this 10 years ago when we first started as a way to engage the startup entrepreneurship community around here. And it actually ended up creating a couple of different companies over the years. A company like Noble that started with the Bryan Healthcare Challenge and solve that particular problem that they had thrown out from an industry standard, and then got to work with them as a kind of a beta client, and then eventually got into an accelerator N motion, got it invested in and eventually built that company, and then last year sold and was acquired by NRC, which is a local company here as well.

So we've seen it work in practice from, you know, how do you take a nugget of an idea that somebody in the ecosystem saying, Hey, this is a problem in our industry. Can somebody else help us figure this out? And so not only is it a way to play in that particular space, but it also brings people together. And even if nothing comes from the particular challenge or whatever, being around other creative folks, other builders, other folks that are willing to try and experiment and do things. Goes a long way to help build an ecosystem, and I encourage folks, if you're feel like you're.

In your own cubicle and, don't know how to do this. There's plenty of stuff out in different ecosystems that are happening that allow you to spread your wings and be a part of it. So I encourage people to do that. And jumpstart challenge is one thing that's happening. Teams that form themselves, they'll have a chance to build between Saturday and then the beginning of the Silicon Prairie Startup Week where they'll have a chance to showcase what they're doing.

And so, yeah, I just thought it was an interesting topic to throw out there and encourage people to get out there and be a part of the ecosystem. Learn what it takes in real life to roll up your sleeves and be an innovator.

[00:22:07] Robyn Bolton: Go be with other humans. It's so important.

[00:22:10] Brian Ardinger: That is another episode of Inside Outside Innovation. Thanks for coming out. We'll look forward to seeing you next time around.

[00:22:16] Robyn Bolton: See ya.

[00:22:17] Brian Ardinger: That's it for another episode of Inside Outside Innovation. Today's episode was produced at engineered by Susan Stibal. If you wanna learn more about our teams, our content, our services, check out insideoutside.io. Or if you want to connect with Robyn Bolton, go to milezero.io, and until next time go out and innovate.