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When it comes to innovation, PepsiCo has a secret weapon: startups

Posted by Grace Townsley

December 6, 2022    |     4-minute read (760 words)

For PepsiCo, there are only two options: Innovate, or get left behind. 

That’s why PepsiCo Labs — the research and development arm of the food and beverage giant, PepsiCo — is turning every stone in an effort to find the best forward-thinking companies in the world. Today, those companies happen to be startups. 

PepsiCo Labs’ partnership pilot program seeks the best and brightest startups in the world

Why startups? Because PepsiCo understands that early-stage startups are at the forefront of innovation. These small companies often have little more than a big idea, fresh energy, and a passion to create, but that’s exactly what the mega-giant needs to remain competitive. 

While PepsiCo has high-value talent on board, its leadership team recognizes that outsourcing some R&D efforts gives them access to a whole new caliber of creative, innovative and high-tech solutions that otherwise may have taken decades to develop internally. 

How the partnership program works

At this time, PepsiCo Labs accepts applications from startups employed in a variety of industries, with experience in multiple areas of technology and development, including:

  • Business services.
  • Supply chain logistics.
  • Automation.
  • Emerging technology.
  • Sales training, organization and development.
  • Marketing technology.
  • Creative campaigns.
  • Data and analytics sourcing, organization and management.

All interested startups need to do in order to be considered for the pilot program is fill out a simple application. The essay-style application asks questions about the startup’s size, revenue and history, as well as its technology solution and the industry this solution addresses.

If selected, the narrow pool of chosen startups will have the opportunity to test their technology, alongside PepsiCo Labs’ team of experts, to determine if the idea can scale globally. This scaling process can take as little as a few weeks, or a year or more, as the PepsiCo team works alongside the startup to fund and develop the custom solutions needed. 

Successful ideas are then implemented across PepsiCo’s global endeavors, giving the startups behind these big ideas huge access, momentum and credibility. 

This unique arrangement is a win-win for both sides

Early stage startups often struggle to gain the expertise, client roster and real-world experience they need to become major players. But by partnering with corporate giants like PepsiCo, these small companies have the opportunity to scale quickly. 

If chosen, the promising startups gain instant access to some of the most talented tech leaders at PepsiCo Labs: brilliant thinkers who have the insights needed to take these ideas across the finish line. Startup teams benefit from the brainpower, and PepsiCo’s leaders benefit from a constant stream of fresh ideas. 

PepsiCo also benefits from the expanded access to R&D that would be cost prohibitive to conduct on its own. Research in the fields of machine learning, AI and thermoplastics, for example, can require billions of dollars, exceptionally brilliant minds and multiple years of trial and error. But with this pilot program in place, PepsiCo cuts straight to the final stages of R&D while supporting the startups that put in the foundational work. 

To date, PepsiCo Labs has leveraged over 30 startups in 200 countries around the world

One of those successful startups is Zappi, an ad-testing platform that allows clients to test, analyze and deploy ads quickly. 

By partnering with Zappi, PepsiCo was able to improve its time from ideation to implementation by 60%. Zappi even trained over 400 of PepsiCo’s internal team members on how to leverage this technology to do more, faster. 

Another successful partnership involves UBQ Materials — an Israeli startup that figured out how to recycle a variety of plastics and organic waste into bio-based thermoplastics. This exciting process significantly reduces greenhouse gas emissions and material usage for PepsiCo. 

For PepsiCo, outsourcing is the future of innovation

PepsiCo acknowledges that the company has incredible internal talent. But not every great idea has to be generated internally. Instead, by using its vast resources to tap into the best startups around the world, the company can maximize its time and money, free its internal team to focus on other innovations, and access a level of ideas and intelligence it otherwise may not have been able to cultivate on its own. 

This unique arrangement positions the company for both short-term and long-term growth. In the short term, PepsiCo’s product lines remain at the forefront of the industry, and the company can focus its internal resources on other initiatives. And in the long run, PepsiCo has real staying power as these innovative ideas continue expanding and improving the company’s market and processes. 


Grace Townsley
Grace Townsley

As a professional copywriter in the finance and B2B space, Grace Townsley offers small business leaders big insights—one precisely chosen word at a time. Let's connect!

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