As managing director of strategic partnerships at Honda Innovations, the venture capital wing of the world’s seventh-largest automaker, Dennis Clark is a keystone in the bridge between the corporation and its growing stable of tech startups.
Before Honda Clark worked in Silicon Valley, forging deals between startups and multinationals. He began his career in business during an eight-year stay in Japan, during which he worked in sectors including finance and the civil service. Clark tells Red Herring how the synergy between multinationals and startups is tightening, how big firms can offer big data, and how safety should be the next AI frontier.
How much of your activity discovering new startups is centered in Silicon Valley?
About a year and a half ago, we went out and established a presence in Israel, we’ve been very active in Israel: I’d say it’s probably the second most active location for us outside of Silicon Valley. We also set up shop in Europe, in Berlin, and Frankfurt. We have someone in London now covering Europe as well. And in China and Shanghai, and finally in Tokyo, Japan.
We realized that Silicon Valley doesn’t have a lock on on the world’s top tech talent. And there’s a lot of interesting innovations both on the business side, as well as the technology side, that we’re seeing from across the world. And we wanted to engage with those ecosystems at an early stage.
How essential is it for multinationals to pair with startups?
This was an open question in our organization four or five years ago. And now without a doubt everyone in the organization understands the importance of–number one–the venture community: a lot of the innovations around electrification, autonomous mobility, connectivity and user experience. Some of them are still coming in-house from from large OEMs and Tier-1 suppliers, but a lot of innovation is being driven by the smaller companies that are that are more nimble, and have the freedom to create new things.
What can the startups do that Honda can’t?
First of all attracting talent, particularly that we haven’t traditionally seen in the automotive industry: software development, computer vision, these types of advanced, technology-driven skillsets, we’re seeing that startups have have a really strong ability to draw that type of talent and retain them. With a big company, obviously we try to be as lean as possible. But there are lots of steps that need to be gone through, to be able to make a product road-ready – even in the beta stage of testing.
Startups have the strength and the fact that they can create something literally in a few weeks, and get it out in the hands of customers and test it. And that’s a strength that we often lack.
How much of a draw for young companies is access to Honda’s huge datasets?
That’s a great example where we can bring something to the table of value, aside from just money and domain expertise to startups to help better their technology. We have extensive datasets around our products, or research that we’ve done over time, that we’ve offered a company and actually helped them validate it and show the power of their algorithms or what they’re building. So that is an area that we can contribute to.
We’re a global company. If you look at, for example, manufacturing, we were doing quite a bit of work with startups in the manufacturing domain. And we have lots of factories around the world generating data. Sometimes 24 hours a day. That’s an asset that we can provide to startups.
Where are you seeing the most increased AI and deep-tech activity right now?
We are seeing a higher quality of technology-focused, deep-tech startups from Europe. China is certainly moving very aggressively towards electrification. And there’s a lot of activity there. I think Japan has been overlooked for a long time. But there are very good research institutions there on the academic side. There are corporates that have put a lot of resources into R&D. And you have an increasingly younger entrepreneurial community.
What aspects of mobility technology could be improved the most?
A lot of emphasis has been put on level four, level five autonomous mobility. And I feel like there’s a lot of work to be done in safety in general. It’ll take a while for those technologies to trickle down to the typical mass market vehicle. I think there’s actually a lot of work to be done on creating inexpensive AI-enabled safety systems, that are that are less cost intense from the standpoint of having very expensive sensors and mapping, these type of things.