- Many of those innovation efforts, however, still fail. In Radford’s case, she convinced management to give her a direct line to the CEO and resources to hire top talent, among other demands. That set-up has helped P&G Ventures get at least one product on store shelves, with several others expected to hit the market soon.
- P&G Ventures relies on so-called speed teams, or cohorts that are able to bypass standard company procedures to more quickly secure funding to invest in startups, place media buys, or pay suppliers.
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“We got here from hard work, patience, and humility. So I want to tell you: Don’t think the world owes you anything because it doesn’t. The world doesn’t owe you a thing.”
That simple message was stated by actress Jennifer Lawrence in the movie “Joy,” about a successful, self-made entrepreneur named Joy Mangano.
It resonated deeply with Leigh Radford, the head of Procter & Gamble Ventures, and the culture she was trying to build in the company’s innovation arm. The movie is “about risk taking and just the can-do attitude to make the impossible happen,” she told Business Insider.
Now every quarter, Radford’s team rents out a movie theater to watch to watch films like “Joy” and “Hidden Figures” that push entrepreneurial messages of breaking boundaries and taking risks. Afterwards, the group — which includes individuals from Procter & Gamble’s research and development, supply chain, finance, and marketing departments — discusses how the main themes of the movie can be applied to work or personal lives.
It’s just one way Radford pushes the Silicon Valley hustle mentality at Procter & Gamble Ventures, a startup studio within the sprawling consumer goods giant that has produced products like household insecticide Zevo and beauty wand Opté Precision Skincare. Home Depot and Target carried Zevo this past summer, while Opté will officially launch in 2020.
Such “innovation arms” are increasingly common in corporate America. Models vary, but several top programs employ a combination of both internal teams focused on developing new products and an external venture arm that seeks to invest in or purchase promising startups. Procter & Gamble’s is the latter, though it also has an incubator called Signal Accelerator and recently launched a partnership with venture firm M13.
Despite the abundant resources large businesses have at their disposal, many internal innovation projects fail. The problems can be cultural, like not giving employees the protection to take risks.
In other instances, however, entrepreneurial-minded people may find corporate America slow and stifling.
“That’s one of the biggest fear entrepreneurs have is [that] they’re going to get lost in the corporation and they’re going to lose their agility and speed,” said Radford.
Radford, who started P&G Ventures in 2015, recently outlined how her group overcame that challenge. Much of it started with creating a foundation that allowed the unit to operate independently from the rest of the company.
4 demands for Proctor & Gamble’s CEO
When Radford was initially approached by then-CEO A.G. Lafley about starting P&G Ventures, she was skeptical.
While she knew the company could offer invaluable advice when it came to building and scaling products, she was also aware how difficult it could be to innovate inside a giant.
So Radford had four demands:
- A direct report to the CEO and access to the board of directors;
- Resources to hire and retain top talent;
- The center needed to be highly visible within P&G, and;
- The team needed flexibility from organizational constraints to stay out of the crosshairs of the other business units.
Once those were all agreed to, Radford went to work. To get up to speed quickly, she began to tap into her network for advice. She also figured out quickly what areas P&G Ventures would focus on.
To prevent competition, the team would seek out companies that had promising products that Procter & Gamble didn’t sell, like caregiving and independent aging. That made conversations with other business units easier because it became all about “incremental topline growth.”
“Our base businesses are doing a great job innovating on their own and finding ways to disrupt their own businesses, but we focus on something very different,” Radford said.
The Speed Team
Based on Radford’s initial outreach, one thing became abundantly clear: her team had to be able to move quickly.
She knew P&G was great at supporting billion-dollar business lines like Bounty and Dawn. But supporting newer ventures with valuations less than $100,000 would require a whole new set of processes.
“We’ve got to bring agility, we’ve got to bring speed; these entrepreneurs are not going to wait for us,” she said.
First, Radford began tracking all the items that took longer than 24 hours to get resolved. Anything past that timeline and she’d personally roll up her sleeves to elevate it. Radford also formed cross-functional teams on key areas like payments, media buying, and supplier registration to figure out what pain points could prevent startups from working with P&G Ventures.
One critical barrier, for example, was getting funding approved and to the startups. It shouldn’t be too surprising that a corporation the size of Procter & Gamble would want to do ample due diligence in the organizations it chose to invest in.
But Radford knew they couldn’t afford to wait the standard 60 days it took to get payments processed. She worked with leadership and took the process down to just 11 days. “It’s risk, but it’s balanced risk and that allows us to be very responsive to the outside world which is critical to being credible,” said Radford.
Another instance was media buying. The P&G Ventures team knew that for its startups to be successful, they needed to be able to market directly to consumers and do it quickly. Radford convinced management to let the team purchase media directly, instead of working through a buying agency — a process that can take upwards of two months.
‘We kill things fast. We kill things early.’
Like any other business unit, P&G Ventures needed to produce results.
The team evaluates its investments on a 10-year basis, similar to how a standard venture fund determines the appropriate rate-of-return on its startup funds.
“We kill things fast. We kill things early,” Radford said. “If we believe there is not a solution that is meaningful and differentiated in the market, we let go pretty quick.