Global Capability Center (GCC) builds partnerships with startups and invests up to 15% equity to accelerate the captive center’s product development.
Experts say this often involves white labeling products developed or manufactured by startups. White labeling is when one company rebrands a product or service developed by another company under its own name.
GCC is a purpose-built offshore center set up by foreign companies to bring IT and other related business functions in-house, and has been expanding at a breakneck pace in India over the past few years, attracting more and more global Companies are considering building one. Software services and products.
In addition to equity, GCC actively engages with startups through a variety of collaboration models, including accelerator programs and strategic partnerships. These models enable GCC to tackle specific and difficult use cases with a faster time-to-market strategy.
Based on the program’s location, GCC typically takes stakes in equity programs ranging from 5 to 15 percent, according to accessed data. money control From management consulting company Zinnov. Additionally, the GCC often introduces structured programs for early to growth stage startups to drive innovation from centers in India, said Karthik Padmanabhan, managing partner at Zinnov. Ta.
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Additionally, startups often receive mentorship, funding, and access to infrastructure from the GCC, making it easier to develop and validate products and solutions.
Lalit Ahuja, Founder and Chief Executive Officer of ANSR Inc. It has become the mainstream operating model.” is the company that builds, manages, and extends GCC.
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Ahuja said money control Start-ups propose “product ideas” and “additional features” from an engineering perspective.
E-commerce, generative AI, information security, data analytics, banking products, etc. are some of the key areas where collaboration is seen.
“The investments that companies are making are obviously relatively small investments, in some cases around $100,000. It’s more about optics and getting some skin in the game,” Ahuja added.
GCC companies actively engaged with startups include Bosch, Honeywell, Adobe, NetApp, Cisco and Intel, Zinnov said.
proof of concept
As part of the collaboration process, GCC will undertake proof-of-concept (PoC) initiatives with startups to assess the feasibility of their products and solutions. These PoCs typically run for three to six months and serve as a litmus test to gauge the feasibility of a startup’s service. If the PoC is successful, GCC could become a customer for startups and lead to the integration of their innovations.
Snehil Gambhir, partner and director at Boston Consulting Group, explains that GCC typically provides startups with a problem statement and then supports pilot development.
“If the pilot is successful, the solution will be scaled up and rolled out across the organization,” Gambhir said. He said retail giant Target was one of the first to realize the value of partnerships with startups.
In fact, investment banking firm JPMorgan Chase & Co.’s India GCC, which employs more than 50,000 people, recently hosted a forum that brought together dozens of startups. JPMorgan Chase said the event helped benchmark current solutions for emerging technology capabilities.
“We engage with startups in a variety of ways, including partnerships and investments,” said Vivavari Jahagirdhar, head of India GCC at JPMorgan.
time is of the essence
GCC leverages the inherent agility of startups to accelerate the delivery of products and services. Startups offer quick solutions that require quick turnaround and provide the flexibility needed to quickly incorporate and integrate them into GCC.
“The GCC is obviously a large global organization, but if some of these problems have to be resolved quickly, only startups can be agile,” said Srikanth Srinivasan, vice president at industry group Nascom. ” he said.
Srinivasan explained that large-scale GCC takes a long time to build products and solutions due to the complexity of the process. “What big companies can do in weeks or months, this startup can do in days,” Srinivasan added.
white label solution
The practice of white labeling products is also emerging as a new trend. Essentially, GCC takes products developed by startups, incorporates them into products, and delivers them to end customers.
For startups, the branding aspect is of little importance as the main goal is to bring the product to market and gain attention. It doesn’t matter to them whether their product is white labeled or not.
At the end of the day, whether a product is white-labeled or not, startups focus on awareness, revenue, and profitability.
“You have global companies in your backyard…and because the GCC now truly represents companies,[cooperation between the GCC and startups]will catch up over the years,” Ahuja said. he said.
