Accenture’s Outlook Journal has a somewhat older article (vintage 1999-2000) describing the benefits of "fast ventures", a strategy to bring a new eCommerce company to market fast using new company and new equity structures.
I have been involved with a number of internal venture and new business
initiatives within large corporations (not generally eCommerce though) and resonate with some of the pressures cited in this article that
must be compensated for or actively managed (I cannot speak factually on
the comparative findings on incubation and return timeframes). The passage that caught my interest from the article is as follows:
One research review by Patricia G. Greene and Candida G. Brush, "The
Corporate Venture Champion: A Resource-Based Approach to the Role and Process"
(Entrepreneurship Theory and Practice, Spring 1999), suggests
that compared with entrepreneurial startups, corporate ventures require a much
longer incubation period before commercialization and take twice as long to
reap a profit.
It’s unclear why this is the case, but experience
suggests five answers.
First, corporate executives tend to have a much smaller
universe of ideas to choose from than does the typical venture capitalist.
Second, they may have less objectivity about which ideas should succeed; this
may be due to internal politics or hardened views about their particular
industry. Third, internal initiatives are limited by the company’s own
capabilities, which may fall far short of best- of-breed.
Fourth, getting the green light for an internal venture
typically requires layers of approval that sacrifice swiftness for a certainty
that is rarely attainable in today’s fast-moving markets. Staffing allocation,
annual budgeting and political power struggles all conspire to limit a
company’s ability to innovate.
Fifth, and perhaps most important, corporate initiatives
suffer because managers are seldom personally on the line. To paraphrase Samuel
Johnson, nothing so concentrates a manager’s mind as the prospect of an IPO in
just three months.
In a corporate environment, a fast venture can minimize or
eliminate these impediments. New-venture teams tend to make decisions motivated
less by career advancement or company politics than by the opportunity for
personal and financial gain, creating powerful incentives for success.