BMW Group has launched a second lab, aimed at helping startups to develop software and tools to support their businesses.
Like a similar programme last year, the new programme, based in BMW’s UK headquarters in Farnborough, will look for about five startups to support.
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BMW is particularly interested in entrepreneurs looking at developing tools in certain business areas: to improve the retail process both online and physical; improve business processes through automation; develop software to support the industry move to people paying to use cars rather than buying them; and regtech, which is software that makes meeting regulations easier. These are areas where BMW and other companies in the motor sector face challenges as a result of disruption.
The introduction of support for internal staff with ideas, which BMW has labelled as intrapreneurs, is an addition on the previous programme.
Jonny Combe, general manager of product and channel development at BMW Financial Services in the UK, said the programme helps BMW keep up with changes in the industry. He said last year’s programme, where BMW worked with startups over a 10-week period, has resulted in continued business relationships between BMW and four out of five of them. These are: insuretech startup Wrisk, which created a motor insurance app service; online marketplace Drover, which has a vehicle bookings platform; cloud-based payment platform provider Divido; and a data analytics tool from supplier Cazana.com.
The software from these companies is used at points where BMW or its sales and support partners interact with the customers to improve services.
“We decided to repeat the programme but broaden its scope with the introduction of the intrapreneur lab for our UK-based staff,” said Combe. “This is for those in the business who have an idea of a new commercial venture but have never been able to bring it to life.”
The company said there are numerous benefits to supporting startups, which can go on to sell to BMW’s competitors. “We are not looking for exclusivity and are conscious there might be something we developed with them which they could subsequently go on to provide for other people in the industry. We are fine with this because we see the benefit of first mover advantage,” said Combe.
”The experience we get working with startups that inherently see things differently is valuable,” he said.
The startups are developing software that is already making a difference to BMW’s business. It is currently testing out the Divido payments platform at some of its retailers and this could be rolled out across BMW’s UK network. Divido enables customers to spread payments with the supplier receiving all the funds upfront.
“We started off with a pilot of Divido with four retailers, and in the first few weeks it was clear there was customer demand there,” said Combe. “That’s why we rolled it out to a further 50 and are planning to roll it out to our network of almost 150 retailers in the UK.”
Combe said BMW’s internal IT department is fully engaged in the programme with the UK CIO an important mentor to the startups. The startups also work with the IT department to ensure they have the access they need to company data to support development.
Each startup has an executive mentor and there are subject matter experts from within BMW to support them.
The application process for the programme is now open, and 25 startups will be chosen to pitch to senior executives from BMW’s UK business. About five will make the final cut.
BMW is not alone as a carmaker looking to work closely with tech startups. For example, Ford is putting a team of specialists together for its smart mobility innovation office in the Here East complex in east London. It aims to be in close contact with people with different skills and experience, and will incubate ideas through the centre.
Speaking in June at the launch of London Tech Week, Steven Armstrong, president of Europe at Ford, said the motor industry is at an inflection point, with tech startups converging with 100-year-old companies in the market. “Rather than being afraid of it, we are excited about the opportunities it will bring,” he said.