Written By: Loralyn Mears, PhD
On the surface, this headline on its own doesn’t seem extraordinary. Global enterprises are routinely investing in innovative new technologies and the emerging companies that are creating them. Plus, corporate responsibility dollars are increasingly being directed to organizations and causes with a social impact. But LG NOVA is doing something different. Two million dollars is clearly a lot of money — but that’s only what you see above the surface — what they’re doing to spark innovation runs a whole lot deeper.
On June 20, 2022, at Collision Conference in Toronto, LG Nova articulated its vision for the future of LG, the parent company, and announced their investment in 20 startups. Broadly speaking, three areas of focus were considered: Connected Health, Metaverse, and Energizing Mobility. Each winner received $100,000 for a total investment of $2 million. But there’s no simple cash hand-off here and that’s what makes the Mission for the Future Global Challenge program exceptional.
Having previously interviewed Dr. Henry Chesbrough, who coined the term “open innovation,” I was curious to learn more. With my past experience studying models of open innovation at Wharton and putting them into practice at a Fortune 10 and Fortune 100, it was likely that LG Nova’s global challenge had some wood behind the arrow. So, I met with Dr. Sokwoo Rhee, LG Electronics senior vice president for innovation and head of LG NOVA, to get the full story. Knowing that Dr. Rhee reports directly into LG’s CEO, William Cho, who was formerly the company’s Chief Strategy Officer and recently moved into his new executive position, there had to be a long-term vision at play.
Revelation #1: the Life’s Good company is committed at its core to improving the quality of life. This is the impetus behind all that they do from electronics design to philanthropy. Dr. Rhee was intentional, “As a company, we make $65 billion in revenues, but we can’t sit on that. We recognized that we needed to make a quantum leap.” Executive support from the very top is often lacking in open innovation programs and a critical point of failure for most.
Revelation #2: LG doesn’t have an internal R&D department. Hence, they have a need to outsource innovation which is what inspired the Mission for the Future Global Challenge. Their communications team posted a call for applications on various media channels worldwide about ten months ago. Nearly 1,400 startup founders applied: about half were from North America and the other half from the rest of the world. The down-selection process was highly structured and rigorous with an objective team-based approach so as to offset any unconscious personal bias.
Revelation #3: the global challenge was not deliberate about diversity. Submissions were not limited to specific founder demographics. Instead, they pushed innovation wide open and invited it from anywhere and everywhere. The results are a DE&I officer’s dreams come true. Ethnicities, genders, age ranges, and neurocognitive differences are all well represented in the Selected 20.
Revelation #4: they designed their open innovation model for long-term success. Dr. Rhee visited numerous accelerators, investors, and innovation programs before they rolled out their Mission for the Future. As an engineer and entrepreneur, he has the fundamental knowledge about a founder’s greatest need: revenues. For the past two decades, all the open innovation programs that I’ve personally been part of or been aware of, fail when it comes to commercial support. LG Nova has a dedicated commercial team, a corporate development team focused on M&A plus Joint Venture initiatives, along with a partnership team of success managers and engineers tasked with working alongside the founders’ teams. Dr. Rhee confirmed that it was “an ecosystem play” and said, “We’re building a new engineering and business development team around these external technologies.” In essence, LG has created new business units in the vertical markets of health, sustainable energy, and the metaverse.
Revelation #5: even the “losers” are winners with this program. “Our team met and individually vetted every applicant,” said Dr. Rhee, “In some cases, we immediately discovered that they were not a fit.” He went on to explain that in a few cases, LG Nova was interested in the technology, but the founder was not supportive of the plans to go-to-market or simply not ready to do so. Every founder received feedback. When does that ever happen? And the 30 finalists, who were part of the First 50 but not selected as the 20 companies who will advance, are still engaged with the commercial team. These “next 30” founders are receiving access to investment, business development support, invitations to conferences, and a place within LG’s ecosystem to explore how a future partnership may evolve.
Revelation #6: the nascent LG Nova innovation team is growing rapidly. Within less than a year, they already have 35 FTEs, and they plan to hire about 20 more full-time employees over the next few months.
This open innovation program has been designed “fit for purpose” and is already showing some early signs of success. Dr. Rhee indicated that the program would continue 2022–2023 with internal discussions ongoing now to expand the categories of interest. But it’s not over yet. In August, the Top 10 will be chosen as the companies poised to transform markets and industries. That elite circle of winners will be mentored, backed by NOVA Capital Alliance, and have the opportunity to build their businesses together with LG on what has been labeled as an “accelerated path to success.”
Congratulations to the Selected 20 startups who were named as the winners for LG Nova’s inaugural Mission for the Future Global Challenge. In no particular order, they are as follows:
CONNECTED HEALTH — where the emphasis is on patient-centric care
· MayaMD, Inc. offers conversational AI to mimic a human health assistant
· LifeNome leverages genomics and AI to enable personalized medicine
· Mindset Medical uses camera sensors in mobile devices to take health and biological readings
· XRHealth operates as a virtual treatment room with VR/AR rehabilitation and analytics
· TRIPP, Inc. is straddling alternate realities with an immersive health and wellness platform
· NeuroTrainer employs VR applied to brain training to improve focus and performance
· medZERO enables employees with on-demand access to funds to pay for their employer-sponsored healthcare expenses without any interest penalties or other fees
METAVERSE — where the focus is on driving broader adoption of immersive, interactive technologies
· iQ3Connect is a no-code platform enabling distributed teams to collaborate or train in AR/VR
· Snickerdoodle Labs enables people to own their data via a privacy-first data-sharing layer
· YBVR brings live events to fans via an immersive streaming and viewing experience
ENERGIZING MOBILITY — focuses on the EV charging infrastructure ecosystem for sustainability
· SparkCharge ensures drivers of EVs can juice their cars when they lack access to a charging station
· Driivz EV charging-as-a-service for hospitality providers
· I-EMS Group, Ltd. enables power optimization across smart cities and homes via AI & blockchain
· Kardome improves speech recognition accuracy in challenging audio environments
· Faction has a unique approach to driverless technology and light electric vehicles that introduces a more efficient way to move goods and people.
SMART LIFETSTYLES and INNOVATION for IMPACT — reflect people’s changing priorities on living better
· Digbi is exploring the health connections between the gut and genetic microbiome
· a*kin is a smart home application supporting caregivers and families
· Chefling is a smart kitchen assistant that suggests recipes based on your grocery receipts
This is a novel approach for a company to take regarding an open innovation program. For founders, it’s a novel alternative (a non-VC and non-traditional) path to fundraising *with* actual commercialization support. Be sure to watch for the announcements for the 2022–23 program!