​Motorola Solutions banking on the help of startups

Motorola Solutions venture capital arm has invested in over 200 startups in the United States, Canada, and Israel to date, and is on the hunt for more.
Written by Aimee Chanthadavong, Contributor

For a long time enterprises saw startups as inhibitors of their business. But most recently, more and more multinationals are beginning to seek help from startups, and some, such as Motorola Solutions, are investing in them too.

Motorola Solutions launched its venture capital arm in early 2000 when the company realised there was potential in helping startups, Paul Steinberg, Motorola Solutions chief technology officer, told ZDNet.

"What we typically use them for is access to innovation that is expensive to do or we just don't have the skills for but is important. It's also an accelerator because they're operating at startup speed and can move rapidly," he said.

"What we'd typically do is thread together investment pieces that will meet X, Y, Z of this idea...if we can find something in the startup community that has the right core capabilities then we'd apply it into our space. We're always on the look out to grow the portfolio properly."

Steinberg further said for the venture capital arm to be headed up by the company's technology made sense because it signalled the company's ability to think creatively when looking for new sources of innovation.

"Giving it the tie to what the innovation has actually done within a technology point of view has given it a lot more length for these investments in the corporation, but also a better lens to look at what is important in the company," he said.

"I'm seeing more and more companies hook it up that way. It's really important, and often missed, that by spending a lot of time looking externally at the startup community because there is always someone doing it better than you are, it keeps you humble."

Motorola Solutions has invested in over 200 companies to date, with Steinberg noting that the company invests in six to eight new startups per year with many of them from the United States, Canada, and Israel. He added that in the last year-and-a-half the company has been making a lot of investments in its venture capital community.

Steinberg added that when it comes to investing in Australian startups, they're ideal for two reasons: The first is Australian startups might be doing it better than the rest of the world, and the second is that Australian startups are typically innovating in areas relevant to Australia.

Earlier last month, Motorola Solutions' venture capital arm led a $14 million Series B funding round for Eyefluence, a startup that has developed an eye-interaction technology platform augmented reality, virtual reality, and mixed reality devices.

CyPhy Works and SceneDoc are also two other startups that Motorola Solutions that have invested in. ChyPhy Works is working with the company to develop drones specifically for public safety use, while SceneDoc is developing a mobile investigation and field document platform to help first responders to document sciences of an incident.

But Motorola Solutions are not alone in seeing the advantages of startups and enterprises working together, but there are also challenges in making that happen. During a discussion in July, a group of venture capitalists, startups, and KPMG representatives agreed that there is a lack of trust between startups and enterprises, which are hindering the success of both parties in Australia, according to a group of venture capitalists, startups, and KPMG representatives.

At the time, Benjamin Chong, Sydney Seed Fund general partner and Right Click capital partner, said the reason why so few conversations happen between startups and enterprises is because startups do not trust enterprises with their ideas, and believe that enterprises will instead claim them as their own.

"Some [startups] are saying: 'The last thing I want is Mr Innovation from Commonwealth Bank and wanting to know what's underneath here', and then, voila, the next thing I know it's in the next iteration of Albert'," he said.

"I really agree there does need to be a conversation. There needs to be a passing of information and value across larger organisations and startups with great ideas, and for this to happen there first needs to be a bridge of trust.

Most recently, the Australian government announced it was going to inject AU$1.1 billion to incentivise innovation and entrepreneurship, reward risk taking, and promote science, maths, and computing in schools, as part of its National Innovation and Science Agenda.

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