In the rapidly growing aerospace industry, startups face increased competition to differentiate themselves from established players and deliver innovative solutions – but achieving success in this space requires more than just a ground-breaking product or service. Organisational excellence and the ability to evolve are key factors in establishing trust and standing out in the market, writes Jacqueline Davidson, Programme Director at Aerospace Xelerated and Principal, Global Accelerators & Innovation Programs, at Boeing.
Record levels of investment and a record-breaking number of deals funnelling into the startup space sector in recent years paints a rosy picture of potential success and growth for innovative startups; but the journey is never that easy. The major challenge for all aerospace startups is the high barrier to entry. Let’s be honest, the industry is not a sexy one – it’s complex and things don’t scale quickly. So, it can be incredibly difficult for new companies to navigate the long and gruelling path to revenue and certification.
From what I’ve seen, successful startups in aerospace are ones that take the time to focus on the challenges and pain points of the industry as a whole. From the outset, they bolster their business models with strategies designed not just to boost value, but to deliver the most compelling solutions. These companies are patient and look to secure steady revenue streams from other industries to sustain themselves through the time it takes to make the financially securing and significant inroads within aerospace.
How startups can succeed and become leaders in aerospace: Find a niche and evolve
Identify and find solutions that address issues faced by specific segments of the industry, whether it’s the flying public, the airline, the pilots, the flight or maintenance crew, the original equipment manufacturers (OEMs), or the wider supply chain. Putting that challenge or pain point and a solution in front of the industry doesn’t mean it’s always a ‘slam dunk’. Identify your stakeholders who need the solutions, and work hand in hand to ensure products and services are relevant and timely. Access to these stakeholders can be a challenge, especially when they have competing priorities, but if you are able to secure a meeting it’s crucial that your solution is relevant to that stakeholder and the current time. This is especially important in the current environment, where the effects of Covid-19 have dramatically changed the industry landscape. Take the time to refine and improve solutions to whatever is happening in this moment. Clearly define and communicate the mission, values, and goals. By adapting solutions to meet specific challenges, startups not only help solve real problems for their customers, but establish that they want their customers to succeed and in turn, establish that all important ‘trust’.
Form connections
From the outside, aerospace may seem like a giant sector, but it’s really very small when it comes to key players. Startups that have a personal connection to the industry, such as friends or family who have worked in aerospace, or with a passion for the field, will have an edge. Like any industry – it’s often a case of who you know over what you know. Fortunately, for startups, once you have the foot in the door, the importance is placed more so on ‘what you know’, but the key is being able to get in first. Ideally, startups will bring industry experts on as advisors early, before they get too far down the line of product development. Ask these experts for their input – Is this solution something that’s relevant to your business? Is this something that you’d pay for with limited budget? Is this something that will help address your businesses, or customers, problem or pain points or challenges? Look for data points from multiple people, including focus groups, and take that data to guide the next stage of ideation.
By creating a culture and environment that supports innovation and risk-taking, while also being open to feedback and collaboration, startups can start to differentiate from other more established players. Fostering a culture of openness can also help form strong partnerships with some of these more established players in the industry.
Take risks but have a backup plan
Of course, no one will (or should) take risks when it comes to safety in aerospace, but startups in the early development stages that push for what they believe in can stand out. Being able to ‘right size’, or adequately portion risk, will help the industry evolve and sometimes founders are better suited to do that than the large industrial stakeholders. Passion combined with the ability to take risks, be proactive and work quickly is a recipe for success. The industry is slow-moving, so the speed and cost at which a startup can move are a major advantage. However, a successful startup also requires a steady revenue stream. It’s not ideal to bank all of your success on aerospace. Unless you’re just very fortunate and blessed with lots and lots and lots of cash flow, or a strong investor, the wisest approach is to find alternative ways to sustain your cash flows because it’s going to take a long time to see steady revenue in this industry.
How aerospace corporates can help startups
Corporations need to have a founder-friendly approach to establish trust with startups. Recognise that these companies are in a vulnerable position, especially when it comes to working with larger, established companies. Startups may be concerned about losing control over their ideas or intellectual property or worry that they will be taken advantage of (some rightfully so!). Let’s be honest with ourselves that large corporates don’t always have the best track record in supporting these sub 50 people businesses. Having a founder-friendly approach can help to alleviate these concerns by demonstrating that the corporation values and respects the contributions of the startups’ founders and is willing to work collaboratively and fairly.
It’s vital as a corporate to involve the key personnel that will be championing the startup as early as possible to ensure they feel and see the result of being involved in the startups success within a given corporate. This helps to build trust between the two parties, which is crucial to the long-term success of the collaboration.
If you think you have an innovative solution but are struggling to be heard by anyone or have lacked support, please reach out. Get in touch as I’m happy to help.
