Business Design Through an Open Method

Taking an idea from concept to reality can be difficult for startups. Entrepreneurs with great ideas often struggle to get the attention of prospective customers, which can make it difficult for them to grow into robust scaleups that have a strong customer base.

The Gap Between Startup and Scaleup

Plenty of startups can build a working product. Far fewer can turn it into a business with a steady base of paying customers. That middle stretch, from first prototype to repeatable sales, is where many young companies stall.

Big companies are often the customers that would make the difference, but they’re hard to reach. Procurement takes months, security reviews are strict, and a buyer at a large firm is taking a personal risk by choosing a supplier nobody has heard of. A startup with a better product can still lose to an established vendor simply because the vendor feels safer.

In order to facilitate that transition, IBM has published the Bluemix Garage Method, an open design method to help startups take an idea from conception to execution. To support this initiative, IBM has created innovation spaces for startups and enterprise to converge.

What a “Method” Means Here

A development method is a shared playbook for how a team goes from idea to working product. The approach IBM promoted pulled together three ideas that were already popular in the industry.

Design thinking starts with the people who’ll use a product, studying their problems before deciding what to build. Agile development builds software in short cycles, so a team can test a small piece with real users and change course quickly. DevOps joins the people who write software with the people who run it, so new versions can be released safely and often.

None of these was invented for the Garage Method. What IBM offered was a way to combine them, written down so that a startup and a big company could work from the same playbook. That matters when the two sides are building something together, because they otherwise tend to work at very different speeds.

One of the most significant contributions that this initiative will make to startups is to help them connect with IBM’s enterprise customers. Startups will be able to leverage IBM’s staying power to move from the startup to scaleup stage by offering their solutions to IBM’s enterprise customer base.

From Bluemix Garage to IBM Garage

Bluemix itself didn’t last as a brand. In October 2017, IBM announced it would merge Bluemix and SoftLayer into one IBM Cloud brand, retiring both names. The Garage carried on without the Bluemix label, and IBM’s Garage Method pages now lead to IBM Garage.

Today IBM pitches the Garage mainly at large organizations rather than startups. It describes IBM Garage as a way to “de-risk transformation,” bringing together “enterprise design thinking, agile development and DevSecOps practices, accelerated by generative AI tools.” Its approach runs in stages: a team uses design thinking and research to understand the opportunity, builds and tests a minimum viable product using Agile and DevOps practices, then hardens and scales it across the business.

The emphasis has shifted, though. Where the 2016 pitch was about helping startups reach enterprise buyers, IBM now frames the Garage around tracking the business value of each project, with a governance tool it calls the IBM Garage Experience. The client stories it highlights come from large organizations, such as the US Open’s fan experience and Woodside Energy, which put the Garage approach at the centre of its own accelerator.

What It Means for Startups

The idea at the heart of this program still holds: one of the fastest routes from startup to scaleup is a partner who already has the customers you want. Large tech companies, banks and consulting firms all run partner and co-selling programs for exactly this reason.

Those partnerships work best when the startup knows what it’s giving up and what it’s getting. A big partner brings credibility and introductions, but it may also want influence over the product roadmap or a share of the revenue. Founders who go in with a clear idea of which customers they want to reach, and why the partner’s customers need their product, tend to get the most out of these arrangements.