Internal ventures and external startups are fundamentally different. The former, born within existing companies, have access to resources, customers, revenue, and an existing brand. Conversely, external startups are initially resource-poor, starting from scratch with no customers or revenue, and must create their brand.
Despite these advantages, internal ventures face unique challenges. They must navigate existing corporate structures, processes, and culture, which can often stifle innovation. They are also subject to internal politics and conflicts, which can divert resources and focus away from the venture.
The success of an internal venture relies on the ability to operate independently, with its own processes and culture. It must be shielded from corporate politics and have a clear mandate from senior management.
The Lean Startup methodology, which prioritises learning and iteration over elaborate planning, can be an effective tool for internal ventures. It allows them to validate their business model and customer demand before scaling up, reducing the risk of failure.
In conclusion, while internal ventures have certain advantages over external startups, they also face unique challenges. To succeed, they must operate independently, adopt the right methodologies, and be shielded from corporate politics.
Go to source article: http://steveblank.com/2014/03/26/why-internal-ventures-are-different-from-external-startups/