Post by account_disabled on Oct 17, 2023 23:15:55 GMT -6
It is normal for an innovative company to come across products of great value, but have difficulty adapting them to its current portfolio or market – it is like an outlier, which does not fit in with the other businesses. It may be time to launch a spin-off company, ensuring the appropriate structure so that this product can develop on its own. In this article you will learn more about how the spin-off model works, what its advantages are, when is the right time to use it and what steps are necessary for its implementation. What is a spin-off? In a nutshell, a spin-off is a company that is born when a product or tool developed in the organization demonstrates the potential to sustain, on its own, a new venture. The term has been used for some time, but has been gaining momentum with the expansion of startups .
As these companies test new solutions very quickly, they end up coming up with valuable answers, but which cannot be cultivated by the business, enabling the emergence of a spin-off company. What are the advantages of the spin-off? Maintaining a product that could become a spin-off often leads to conflict, with two possible negative outcomes: either it stops growing, becoming a wasted europe mobile number list opportunity, or it requires more and more attention, to the point of affecting other businesses carried out by the company. In a situation like these, carrying out the spin-off is the most appropriate solution, presenting the following benefits: Focus distribution Both the initial venture and the spin-off will have teams and resources dedicated to specific objectives, preventing divided attention within the same company from harming one of the initiatives. Explore a new market The spin-off usually does not fit with the needs of your current market, and its implementation allows you to approach new consumers, with diversified products , business models and marketing . Low investment and low risk An initiative does not become a spin-off unless it is already showing good results within the parent company, so there is a great chance that it will be successful on its own. Furthermore, initial research and development costs have already been covered, reducing the investment required to launch the new company.
Experience It is normal for a team to be moved from the parent company to lead the spin-off project. These professionals will already have experience with the product and the market, facilitating the performance of the new venture, which will not have to navigate blindly while it is established. Spin-off in practice An example of these benefits is IndustriALL , software that emerged at AEVO and became a spin-off at the beginning of 2020. While AEVO Innovate , our core product, presents diversified tools that have transformed it into the largest innovation management software in Latin America, IndustriALL has resources focused on industrial companies, whose specific demands justify the existence of a more specialized organization to maintain it.
As these companies test new solutions very quickly, they end up coming up with valuable answers, but which cannot be cultivated by the business, enabling the emergence of a spin-off company. What are the advantages of the spin-off? Maintaining a product that could become a spin-off often leads to conflict, with two possible negative outcomes: either it stops growing, becoming a wasted europe mobile number list opportunity, or it requires more and more attention, to the point of affecting other businesses carried out by the company. In a situation like these, carrying out the spin-off is the most appropriate solution, presenting the following benefits: Focus distribution Both the initial venture and the spin-off will have teams and resources dedicated to specific objectives, preventing divided attention within the same company from harming one of the initiatives. Explore a new market The spin-off usually does not fit with the needs of your current market, and its implementation allows you to approach new consumers, with diversified products , business models and marketing . Low investment and low risk An initiative does not become a spin-off unless it is already showing good results within the parent company, so there is a great chance that it will be successful on its own. Furthermore, initial research and development costs have already been covered, reducing the investment required to launch the new company.
Experience It is normal for a team to be moved from the parent company to lead the spin-off project. These professionals will already have experience with the product and the market, facilitating the performance of the new venture, which will not have to navigate blindly while it is established. Spin-off in practice An example of these benefits is IndustriALL , software that emerged at AEVO and became a spin-off at the beginning of 2020. While AEVO Innovate , our core product, presents diversified tools that have transformed it into the largest innovation management software in Latin America, IndustriALL has resources focused on industrial companies, whose specific demands justify the existence of a more specialized organization to maintain it.