How to build new ventures while maintaining your core business

Pursuing innovation while protecting your core business is not unlike tending a garden with one hand and reaching for the stars with the other. Just as a gardener waters their plants to ensure they continue thriving in the short term, business owners must also protect their core business by maintaining customer satisfaction, brand reputation, and financial stability, among other priorities. At the same time, they should be exploring ways to leverage the core business assets in a bid to grow market share.

To achieve this balance for your organization, here are six things you should keep in mind.

1. Embrace the startup mindset

Why is it that so many innovative businesses, from Uber to Chat-GPT, come out of early-stage startups instead of well-established corporations? One reason: because startups are packed with ambitious, fast-moving teams that never stop asking questions.

To successfully build a new business, you need to embrace the startup mindset. This means being agile, adaptable, and willing to take risks. You need to be comfortable with uncertainty and willing to pivot at short notice if things aren't working. By embracing the startup mindset, you can create a culture of innovation and experimentation that will help your new business thrive.

2. Leverage your existing resources

One of the benefits of building a new business within an existing organization is that you already have resources at your disposal. You can leverage your existing infrastructure, technology, and talent to help build and grow the new business.

One powerful way to deploy existing resources in service of building new ventures is to embrace what Microsoft innovator J.D. Meier has called “federated innovation". This means funding hubs at the edge of the organization whose aim is to scout new horizons. “Then you can bring those learnings back to the central organizational muscle so they can help the current business model evolve,” Meier explained in an exclusive interview with U+.

3. Establish clear goals and metrics

To ensure that the new business is seamlessly integrated into the core legacy business, it is essential to establish precise goals and metrics. These goals and metrics should be strategically connected to the overall vision of the organization, and should be periodically reviewed and adjusted if necessary.

By implementing transparent and measurable goals and metrics, your senior leadership team can more easily track and analyze progress. At the same time, opportunities for enhancement can be identified, and the entire team can work cohesively towards a shared objective

Another important consideration is that new ventures should be tracked and judged in a very different manner than your existing scaled businesses. New venture metrics should be focused on market sales traction and customer acceptance as well as future growth and profitability potential. Existing businesses, on the other hand, are judged on established, mature KPIs, usually with lower growth expectations and an emphasis on profitability.

Finally, a successful innovation operating model counts learning as an important value for measurement, since learning ultimately translates into revenue.

4. Foster a culture of collaboration

According to a recent academic survey, 75% of employers rate teamwork and collaboration as "very important”, while 39% say their organization doesn’t communicate or collaborate enough. If your organization has a similar gap, you should work to address it at once.

This is because collaboration and communication are critical for both building and maintaining businesses. You need to foster a culture of collaboration where everyone is working together towards a clear, common goal. This means breaking down silos and encouraging cross-functional teams to work together. By fostering a culture of collaboration, you can ensure that everyone is aligned and working towards the same objectives.

5. Monitor the market and adapt accordingly

Pay attention to the dynamic market environment in which you operate and remain adaptive to its ever-evolving trends. This will require continuous and comprehensive monitoring of the market landscape, with an astute eye for detecting emerging trends and patterns that may impact your business.

With this insight, you can then recalibrate your business strategy to ensure that it remains relevant and competitive, consistently exceeding customer expectations and securing market share.

6. Be patient and persistent

Building a successful new business requires patience and persistence. It is important to invest the necessary time and resources and to not give up in the face of failure. Being adaptable and willing to pivot when needed is also crucial. By staying persistent and committed to the long-term vision, you can increase the chances of building a sustainable and thriving business while keeping your central one in good health.

Conclusion

In conclusion, starting a new business while maintaining a core legacy business is a challenging task, but – as with a patient gardener – it can be achieved with careful planning, strategic management, and the right culture. By following these steps, you can successfully grow and expand an innovative new business while ensuring that the core legacy business continues to thrive for a long time to come.

The U+ Method can help your organization efficiently and effectively build innovations across sectors without jeopardizing your core. To date, we have used this method to bring 100+ products to market, creating over $2 billion in value for Fortune 1000 companies. Check out U+ success stories here.