What is a startup challenge?

Innovating with external impulses from creative crowds

In Startup Challenges, public and private organizations communicate their innovation needs to find innovative ideas and solutions outside the company. During a Startup Challenge the participants, primarily startups and entrepreneurs, develop tailored solutions for new or improved products, services, processes, or customer experiences for the company. Participants receive regular feedback and coaching from mentors before presenting their results to a jury of experts in a final pitch event. Besides gaining experience and industry connections, there is often prize money or a paid pilot project for the winners.

What is the goal of a Startup Challenge?

By organizing Startup Challenges, companies usually aim to find a custom-fit solution for one or more specific or individual innovation needs. There are Startup Challenges with very broad search fields, in which widely spread ideas and solution approaches are sought. Often, these Challenges are intended to target innovation activities in a particular country or region or to identify innovative solutions to address global problems, such as climate change. In contrast to Innovation Challenges, in which the participating innovation partners can also be established companies, a Startup Challenge is aimed exclusively at young companies, that have been founded less than 10 years ago.

What are the advantages of a Startup Challenge for companies?

Using Startup Challenges, companies can actively bring in new ideas from outside to enhance innovation. Often, challenges that are not part of a company's core business can only be resolved internally with much effort and expense. It may make sense in this case to work with external partners. Particularly startups can provide solutions through innovative technologies and ideas that can be implemented quickly and cost-effectively. However, a search for the best-fitting startups often turns out to be time-consuming, especially as a newcomer in the startup ecosystem. Startup Challenges offer a great advantage here. The concrete call for proposals allows startups to learn about the current innovation problems faced by companies and independently apply if they can offer a solution. The Challenge application already filters startups, making screening the constantly changing startups market easier for companies.

Are you still looking for qualified participants for your Startup Challenge? Then Ambivation can support you with a Startup Scouting. A structured procedure will identify the best-suited startups for your Startup Challenge or other open innovation projects, and pave the way for a successful collaboration.

How does a Startup Challenge work?

Depending on the industry, the time period as well as the application process and selection criteria for Startup Challenges can vary. It is up to the organizing companies to decide for what topics they are looking for external ideas before they start the Challenge. Frequently, the published innovations questions or problems in Startup Challenges are referred to as „challenge statements“. 

After the Startup Challenges has been published, the application phase begins. Subsequently, participants can fill out an application form, in which they describe their idea and introduce themselves. Some Startup Challenges may also require an application video. Often, the application criteria relate to the development stage of the idea and if e.g. a technical component shall be part of the solution. Many Startup Challenges also allow applications from research teams, students and individuals in addition to startups. 

It is a special feature of Startup Challenges to mostly have a very short application phase of six to eight weeks and interested participants have to find the Startup Challenge very quickly in order to submit their application in time. As a consequence, it is critical that the Startup Challenge is advertised widely during the application period in order to attract many qualified applicants. If you are hosting a Startup Challenge yourself, please feel free to enter it in our form to publish it on startup-challenges.com.

As soon as the startup challenge application period has ended, all submissions will be reviewed and a list of pre-selected companies will be announced. Once selected, the most promising teams will be mentored and assisted with further development of their solution proposals. Also, the startups often receive a pitch training to prepare for the final pitch event, where the Startup Challenge winners are selected by an expert jury. The winners of a Startup Challenge may receive prize money, a financing offer, admission to an accelerator program or a pilot project. If their solutions can be successfully implemented, this is a great opportunity for startups to gain long-term collaboration partners and to expand their network.

What should be considered when organizing a Startup Challenge?

For the successful design of a Startup Challenge, specific innovation projects must first be identified by the organizers. The success of a Startup Challenge depends on a well-defined innovation problem that can be framed as a solvable challenge. This allows companies to help participants focus their brainstorming and solution-seeking efforts in the right direction. 
In addition to the definition of the problem, the selection criteria and requirements for the applicants also play an important role. Since startup challenges can be designed very differently, the criteria must also be adapted individually to the respective challenge. To this end, companies should be aware of the specific goals they want to achieve with the Startup Challenge and how further collaboration with the winners should be structured afterwards. On the one hand, clear and specific evaluation criteria help the organizers to select the most suitable submissions. On the other hand, they also guide the participants in adapting their solutions to the Startup Challenge in the best possible way.

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Besides the content of a Startup Challenge, its appealing design should also be considered. Startup challenges that are visually appealing through photos and videos are particularly inviting. For Startup Challenges, the title has to be short and concise, while the description should explain the background, goals, requirements and process in as much detail as possible. At one glance, applicants should know exactly which innovation problem has to be solved and how they can apply for the challenge.

Example of a Startup Challenge: The BMW Group Open Call 360° Sustainability Challenge 2021

In 2021, the BMW Group called on startups worldwide to participate in the "Open Call 360° Sustainability" Challenge. The aim of the challenge was to achieve the BMW Group's sustainability goals with the help of innovative impulses from young companies. In 2015, the BMW Group established the BMW Startup Garage to promote cooperation with startups and the use of innovative technologies. 


The Challenge defines seven fields of innovation in which startups can apply with their products and solutions: Recyclable Materials, Sustainable Supply Chain, Energy Efficient Production, Mobile Intelligence, Intelligent Building Management, Customer-Oriented Mobility and Future-Proof Technologies. In addition, there is the possibility of a wild card for a topic that cannot be assigned to any of these fields but is still convincing.
The application period ran from the end of April to the end of June 2021. The incoming startup innovations were evaluated by the BMW Startup Garage. The decisive factor for selection and advancement is how the solution contributes to the sustainability of the BMW Group in the defined innovation fields. The selected startups received an invitation to pitch at the end of July with the chance to win the BMW Group as a customer. The final winners were awarded prizes at the IAA Mobility in Munich in September 2021 and gained access to the BMW Startup Garage venture client program.


Discover the top sustainability startups of the "Open Call 360° Sustainability" Challenge 2021 in this video of the final pitch event at IAA Mobility in Munich. (Youtube link).

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