While Target Corp. may be cutting some internal innovation initiatives, it hasn’t lost its appetite for working with start-ups.
The Minneapolis-based retailer is launching a new program called “Target Takeoff” to help support health- and wellness-related start-ups through a sort of mini-accelerator. It’s one of a growing number of programs in the Twin Cities aimed at helping young companies develop and connect with the major retailers in town.
Target is accepting applications through the end of February. It will select 10 early-stage companies and will fly them in to Minneapolis for a week in May when Target leaders will teach them the ins and outs of retail.
The start-ups will have the option to work out of Target’s offices for the following weeks or to keep connected virtually. Then Target will bring them back in July for a “Demo Day” when they will pitch their products and services to an audience of investors and Target buyers. There’s no guarantee that Target will carry the products on its shelves, but that is one of the hopes for the program.
“We want to support the next generation of entrepreneurs creating accessible, affordable, inclusive and inspirational wellness products and services,” Target said on a website advertising the program.
The relationship between fast-moving start-ups and slower-moving corporations is often a difficult one to navigate.
But Target, like other retailers grappling with rapid digital disruption, has been trying to improve such capabilities as it looks to carry the newest products and to bring other innovative ideas and technology into the company.
Target made a major foray in this area last year when it launched a retail-focused accelerator in partnership with Techstars, which runs intensive boot camps for start-ups around the world. Ten companies took part in the first class last year. Target and Techstars are now recruiting for their second class for this summer.
One of the goals of Target’s involvement with Techstars was to learn how to run such a program on its own, said Target spokeswoman Meghan Roman.
“This is the first step in terms of doing that,” she said of Target Takeoff. “We are taking the learnings from year one [of Techstars] and are dipping our toes” with the mini-accelerator.
Target Takeoff is a joint effort between Target’s internal innovation team and its corporate social responsibility team.
The focus on wellness aligns with one of Target’s strategic goals, not only in terms of offering better-for-you products but also in terms of the focus of its charitable giving efforts.
Start-ups that have raised less than $3 million and have products or services in areas such as food, baby, beauty, household supplies and athletic wear are encouraged to apply.
The new program comes at a time when Target has been stepping back on some of its other innovation initiatives. The retailer has halted an experimental store of the future concept as well as a secretive internal start-up called Goldfish. The cutbacks came after a disappointing holiday season for Target.
“Innovation is still a priority for us,” Roman said. “We’re very much still committed to working with start-ups. That’s a muscle we’re trying to build.”
Last year, Target also launched a website — startups.target.com — to be a gateway for young companies looking to partner with Target on pilot programs.
Richfield-based Best Buy also recently started a new program called Ignite, similar to Amazon’s Launchpad, through which start-ups can more easily submit their products for consideration to be sold on the retailer’s website.