With annual sales exceeding $98 Billion annually, BMW’s are considered to be some of the best-engineered cars in the world. BMW also owns the BMW Motorcycle, Rolls Royce and Mini Brands.

With its standing as a premiere brand delivering solid financial results, BMW could rest on it laurels. Much lesser companies have not adapted to the impact that digital transformation can have on their market share. Instead, BMW has taken steps to lead the innovation race in the automotive sector.

Two years ago, BMW created the BMW Start up Garage to deal head on with the changes facing the auto sector. The motivation behind BMW Start Up Garage is the need for BMW to gain early access to new technology in the automotive industry. This allows BMW to gain hands-on experience with these emerging technologies while working with start-ups. BMW Start Up Garage was founded by Gregor Gimmy and Matthias Meyer. Ana Carolina Alex, is the Program and Community Manager.

Gregor Gimmy coins the phrase “Venture Client Unit” as a key attribute of the BMW Start Up Garage. This approach allows a start-up firm to have BMW as an actual client. In most start- up models, large organizations act as an investor in the start-up. By becoming a client, BMW is able to become an early adaptor of a new technology. Most of the offerings from a start up are not yet mature, but the relationship is mutually beneficial.

One particular benefit to this Venture Client Unit approach for a start-up, is the procurement process. Once a technology provider is approved by BMW Start Up Garage, they can qualify to become recognized as a vendor with BMW Procurement. This is often an obstacle for many start-ups aiming to do business with large firms.

Once a start up is approved, they begin working with BMW engineering and R&D headquarters in Munich. The start up company is not required to move their offices. In the BMW Startup Garage project the start-ups conduct a Proof of Concept (POC) project together with our engineers. BMW Start Up Garage conducts one proof of concept and if this is successful a transfer into the “normal” BMW innovation process takes place.

During the pilot project, there is a feedback loop from BMW engineering about the gaps and areas of improvement. According to Gregor Gimmy, the key areas of feedback are around:

Specification: Does the innovation work as advertised?
Costing: Is the pricing model in line with BMW’s approach to marketplace?
Scalability: Can the innovation scale to meet the needs to BMW’s product line?
Business Model: How could the relationship between BMW and start-up look like in the future?

These four points could be applied to any technology company regardless of their specialization. Being the Co-Founder Gimmy Gregor has experience in Silicon Valley. He says start-ups looking to work with BMW can be assured that they are dealing with an automotive company that understands their technology.

When asked what technology innovations BMW is looking for, Gregor replied, “BMW Start Up Garage wants Start-Ups to come to us with innovations. Provide us with solutions that can help BMW solve problems.” This again is a good reminder for all technology firms to be bold and clearly illustrate a business case. BMW Start up Garage is looking at various innovations that are common across the entire automotive sector such as Clean Energy, Driver Assistance and others. The ground-breaking BMW i8 is proof the company is not afraid to innovate. Also, the new BMW 7 and 5 series models now include new technologies that many start-ups should analyze.

Less than 2% of applicants are approved to participate in the BMW Start up Garage. The criteria for success is simple; attract the best starts up, ensure innovations can deliver and eventual integration of these innovations into BMW models. Firms from around the world have participated in the program, including one in the Greater Toronto Area.

If your organization would like to engage the BMW Start up Garage visit: www.bmwstartupgarage.com and follow them on Twitter @BMWStartups. As well, engage your Sales and Marketing Leadership to find automotive conferences and trade shows demonstrating your innovations.