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Dream-Chasing Startups Find Home at SAP.iO

Feature Article | April 4, 2017 by Camille Bui-Nguyen

Startups around the globe are invited to chase their dreams and build their tech at SAP.iO.

“We have to get up, get out, and get on with it.” These were Bill McDermott’s words at last week’s launch of the SAP.iO Fund, a new innovation program that incubates startups inside and outside of SAP.

“As long as you’re authentic and you’re really running the software, we will put our full weight and strength with you,” he said, adding that the event marked an open invitation for startups to jump on board by using SAP HANA to build their franchises and dreams on the SAP.iO platform.

Seeded with an initial investment of $35 million USD, the SAP.iO Fund’s mission is to make early-stage investments in internal and external startups that will grow and diversify the SAP ecosystem.  In short, the fund is investing in entrepreneurs building great business software.

Among the fund launch’s dream chasers was big data analytics company Paradata.

Paradata joined startups niki.ai, Quantiply, PlaceSpeak, and Deep Relevance in presenting and pitching their companies to members of San Francisco’s early-stage innovation community in the new SAP.iO headquarters in the city’s SoMa district. The group included individuals from top-tier venture capital funds, angel investors, startup accelerators, corporate venture funds, promising early-stage startups, media, and SAP partners and advisors.

First Startup Funded by SAP.iO 

Using its own machine learning technology, Paradata hopes to make the supply chain and manufacturing of electric components more transparent and efficient by creating “golden database of parts,” as Paradata’s Chief Marketing Officer Jeff Zanardi called it.

“Paradata is bringing big data to the supply chain through machine learning and artificial intelligence,” said CEO Debra Ringer during her presentation.

She explained, “the amount of data that SAP has accumulated about suppliers, risks, data sources, and feeds attracted us because we’re building data about electronic components and marrying it with suppliers. This has given our customers – both SAP’s and Paradata’s – a much more holistic, comprehensive view of the component.”

This is not the first time SAP and Paradata have joined forces, with the two having already explored how Paradata’s focus on the electrical component supply chain can complement SAP Ariba procurement solutions.  Now, SAP and Paradata are sharing resources and information between both companies – creating an open model of innovation that challenges the conventional mold of startup-investor relations.

“Instead of just being financial, it’s creating something cohesive and additive to the industry,” Ringer said.

SAP.iO Ignites Employee-Led Startups

However, the innovative relationship and ecosystem being cultivated and fostered by SAP.iO doesn’t stop at external startups like Paradata.  The fund also invests resources in employee led startups. This arm of SAP.iO, SAP.iO Innovations, encourages intrapreneurship within SAP’s employees, while still allowing them to maintain their full-time status.

Atlas is one of the startups participating in SAP.iO Innovations, which is run and managed by SAP employees.

Henning Kollenbroich heads up the fledgling company. He said, “Atlas works on location analytics. What we empower you to do is whenever you encounter a location data set, we enable you to analyze that data and make business decisions based on that data.”

For example, if a store or restaurant wanted to open a second location in a new neighborhood, Atlas would be able to analyze and bundle various geospatial data like foot traffic, census data on the median income of the surrounding area, or customer segments and where they prevail in a certain area to help customers make informed business decisions.  While this process would usually require an independent team of geospatial specialists and analysts, Atlas can bring that power directly to the business user and decision maker.

“We’re able to blend these formerly disparate data sets together and bring them to the user in one place,” Kollenbroich explained.

Looking at the bigger picture when it comes to the work SAP.iO is doing with external and internal startups like Paradata and Atlas, it’s clear that SAP is dedicated to developing technology that supports customers’ journeys to digitalization.  Not only that, but it’s transforming the dynamic between corporations and startups, by providing resources, insight, and opportunities in a reciprocal way.

“We’re looping in these early-stage promising startups and giving these entrepreneurs and small businesses a real shot at playing the field in a way they wouldn’t be able to otherwise,” McDermott said. “We have a message for entrepreneurs: if you have a bold dream to solve one of the world’s most significant challenges, join us and let’s chase your dream together.”

SAP.io Sparks Internal Innovation

A large part of SAP.iO Innovations is incubating internal startups such as Atlas, which can be done via two paths.

“The trick with the incubation inside SAP.iO is that they are 100 percent owned by SAP, so incubation comes out of the entrepreneurship program or by being an entrepreneur-in-residence,” said Kollenbroich.

Atlas’ incubation fell under the latter method with an entrepreneur-in-residence.  According to Kollenbroich, the entrepreneur-in-residence is an expert at startups who is brought into SAP externally to aid in the development of ideas into tangible products and services. For Atlas, its entrepreneur-in-residence previously had an external startup, returned to SAP, and worked with a different group within the company before being recruited as an entrepreneur-in-residence and founding Atlas.

As for goods and service conceptions, SAP.iO typically identifies a broader topic or trend, which is then examined and analyzed by the entrepreneur-in-residence to identify opportunities for SAP and its internal startups to build products around.  In doing so, it’s leading the charge on internal innovation by identifying and expanding upon incoming business trends – like Atlas’s geospatial analytics.

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