Corporation innovation Oct 2017

The Coca-Cola Company’s creation of Red Garage Ventures to Drive Internal

Disruption

Franki Chamaki

Founding Director Red Garage Ventures & HIVERY

Classified – Confidential | Page 2

Going to cover…

1. Importance of clear innovation goal

2. Leverage internal assets to create a competitor advantage

3. Experiment (i.e. Learn by doing)

1. Incremental innovation:

Sometimes called continuous

improvement.

2. Radical

innovation: Sometimes called

revolutionary, typically leveraging the same

business model.

3. Transformational

innovation: Sometimes called

disruptive innovation -this changes strategy.

Creates a new business model.

Return

Risk

Existing Business

Model

(70%)

New Business

Model

(10%)

Leveraging existing

Business Model

(20%)

Classified – Confidential | Page 3

Where to play? Define your Innovation Agenda

Risk

Lean, Six Sigma, Continuous

improvement etc.

Partially known Unknown

Return

Known

Classified – Confidential | Page 4

Horizon 1

Defining your innovation agenda helps define your approach…

Pilots, Agile, Scrum etc.

Lean Start-up (a lot of experimentation)

This means different type of governance regimes, execution approaches and more importantly different kinds of KPIs/reporting and incentives

Cokes Assets + Start up thinking

=New business model

Managers not

Explorers

Version 1.0

Inside not

outside

Version 2.0

Connected not

depended

Version 3.0

Learning by Doing

Sydney was the first prototype

Coke invests in founders, helps set up a separate independent entity

provides seed funding, becomes the first customer, and then takes a minority share if and when the

business becomes viable.

Recruitment &induction

Senior levelSupport Independence

Internal Advisor

Buenos Aires

Rio de Janeiro

Mexico City

San FranciscoBerlin

Bangalore

Singapore

Sydney

Tel Aviv

London

Shanghai

Coca-Cola Entrepreneurial Program

“Founders program” was launched in 2013 to “co-create” with Coke solve big problems

Launch• Coke scouts and

selects 1-2 founders

• Funders contract / convertible note

• “Deep immersion” of challenges and assets

• Founders launch new company (startup)

• Startup begins searching for problem/solution fit

• Coke supports lean startup andtracks progress

• Develop commercial agreements to scale solution across Coke

• Startup scales the company—beyond Coke

• Coke converts or chooses to follow-on in additionalfunding rounds

• Collaborate with Coke to test assumptions

• Startup iterates on product, expands customers beyond Coke

• Coke helps connect relationships with external investors and media

Build Prove ScaleSet-up• Coke commits to

seed funding and

• Appoints a local Business Unit (BU) Advisor

Coca-Cola Entrepreneurial Program

Buenos Aires

Rio de Janeiro

Mexico City

San FranciscoBerlin

Bangalore

Singapore

Sydney

Tel Aviv

London

Shanghai

Coca-Cola Entrepreneurial Program

In December 2016 the program closed for new ventures. Re-focus back to the core business

Circular

Economy

Distribution

Big DataWelling

Hydration

Esens

Asset:

Expertise &

relationships

Asset:

Big dataAsset:

Waste

Circular

EconomyDistribution

Big DataWelling

Hydration

Esens

Innovation:

Design

Thinking

Innovation:

Hackathon

Innovation:

Trend &

collaboration

Circular

Economy

Distribution

Big DataWelling

Hydration

Esens

Focus:

Science

Focus: Scale Focus: Model

① Define the agenda

② Think assets as

platform

③ Learn by doing

④ Just on the edge⑤ Skin in the game

Franki Chamaki

franki@redgarage.coRedgarage.co