There’s a fine line between innovation and disruption, especially for successful, well-established companies.

For the past five years, Dave Kruis and his team at FairVentures Lab (FVLab) have nurtured innovation among individual companies within the portfolio of Toronto-based Fairfax Financial Holdings Limited (Fairfax).

“The advice we were giving, and a lot of other people in this corporate innovation space were giving, was: ‘This isn’t about disrupting yourself – it’s about disrupting the market,’” says Kruis, FVLab’s Director.

As FVLab wraps up a five-year run in Communitech’s corporate innovation space, we asked Kruis to reflect on his experience.

A seasoned tech leader with years of experience in Waterloo Region, Kruis worked for BlackBerry, started and sold a startup, and worked for D2L before being tapped to launch FVLab in fall 2015. 

Fairfax, a publicly traded holding company led by founder and CEO Prem Watsa, has a diverse portfolio of subsidiaries that includes property and casualty insurance and reinsurance, restaurants and retail.

FVLab launched in February 2016 with a mandate to “research, develop, partner and invest in innovation solutions to support the Fairfax family of companies.”

Kruis says it’s important for companies – especially successful companies in established industries – to be constantly thinking ahead and preparing for change. The trick, he says, is doing it in ways that don’t harm the company’s daily operations or disrupt processes that have proved successful over the years.

“Our approach was really about doing these experiments in parallel and showing, in small, meaningful and measurable ways, that you can start to apply a combination of multiple things – new technologies, new business models and new value propositions,” he says.

To really understand a company’s needs and create useful solutions, Kruis says it’s essential to collaborate with the company and invite key staff to co-develop innovations.

“Everything we did was co-development,” he says. “It might have been a small team within a Fairfax company, but it was very much us doing it together, because we knew if we did these things in isolation and just sort of threw them (innovation ideas) over the fence, they weren’t going to get adopted.”

For innovators, there’s a lot you can learn by engaging directly with the people who have hands-on knowledge of the industry you’re trying to help.

“That was probably one of the keys to our success over the years. We always pushed a collaborative, not a consultative, approach, and this collaborative approach forced them to work with us on these ideas, experiments and tests.”

It’s also important to engage both the leadership and the frontline staff.

“With corporate innovation, there's this sort of top-down and bottom-up approach. You need to have the senior leadership open to innovation, but also engage the day-to-day folks who are on the floors. You need to get them engaged in doing experimentation and thinking about how they could better serve their customers, whether it’s an internal customer or whether it’s an external customer, by using innovative approaches.”

Kruis says one of FVLab’s biggest successes was helping individual Fairfax subsidiaries understand the value of making innovation and experimentation a regular part of their operations.

“Mature companies have a hard time with spending money and time on experimentation without an immediate return on that investment,” he says. “And that’s been probably our biggest success. We’ve really been able to successfully introduce this idea and have them embrace the idea of being able to do experiments even though the return on that investment might not be an immediate business financial return.”

In addition to research, Kruis and his team developed connections and partnerships with tech companies whose work might help a Fairfax subsidiary. 

“I think we’ve facilitated hundreds if not thousands of startup introductions over the years, and a number of them – probably 20 to 30 – have resulted in actual commercial partnerships,” says Kruis.

Introductions are a win-win approach that provides exposure to startups while making established companies aware of the rich source of innovation that exists in a tech ecosystem like Waterloo Region. 

Another element of FVLab’s mandate was to look for potential investment opportunities. Examples include Encircle, which creates documentation and productivity tools for the insurance and restoration industry, and Dozr, a tech platform for heavy-equipment rentals.

“Our approach was always partner first and then invest,” says Kruis, explaining that a partner relationship helps Fairfax evaluate the investment potential.

So, why is Fairfax wrapping up the FVLab?

“I don’t want to say ‘mission accomplished’ because it’s a bit of a cheesy term,” Kruis says. “But the key objectives that we set out to achieve in the fall of 2015 have been achieved.”

Those objectives include planting the seeds of innovation among Fairfax subsidiaries and providing them with the experience to carry on within their own companies.

“We’ve made a difference for many companies across the Fairfax family and it's time for them to continue on their journey around innovation on their own.”

As Kruis wraps up his time as director of FVLab, he has high praise for Communitech and its corporate innovation model.

“I couldn’t imagine trying to do what we did outside of Communitech,” he says.

He points to Communitech’s role as a central hub within the Waterloo Region tech ecosystem, and the many connections the organization has with startups, established companies, investors and government.

He also notes the value of working in the same space as directors and staff from other corporate innovation labs.

“We would get together every month to talk about how we set up our labs, the types of work that we’re doing, how we hire and how we work internally with our companies,” he says. “Having a group of peers who you can share your journey with is immensely valuable. I couldn’t imagine being a lab director all alone by myself somewhere and not having that peer group to work with.”

So, when FVLab winds down at the end of April, what’s next for Kruis?

“I don’t know the answer to that yet,” he says with a laugh. “I’m probably going to end up in a startup or near a startup. I love the early days and there’s a big part of me that loves that part of the journey.”