I didn’t invent this quote (can’t remember where I heard it) but what a great one to help remember that with most business-related transactions, price is definitely not the only factor. Three such transaction types relate to the things I commonly write about on this site:
- Fundraising (valuation)
- Technology licensing (royalty or license fee)
- Acquisition (price tag)
In this article I provide insights into possible terms for each type of transaction that could dramatically change the value equation.
Continue reading “Tell Me Your Price and I’ll Tell You My Terms”
Some startups build core technology with the sole purpose of making money by licensing it to others while other startups later discover they have something that could be licensed as a revenue enhancement opportunity. In either case, licensing your intellectual property (IP) is a fairly involved venture with significant downside risks, if done wrong. But if done correctly and with the right partners, magic can happen. This article explains the risks and opportunities with technology licensing deals from a business development and deal structuring perspective (rather than a purely legal perspective).
Continue reading “Licensing Your Technology”
It usually takes a huge effort to get the attention of a big strategic partner and impress them enough to get a formal partnership. In fact, might have you read my articles titled “A Secret to Securing a Strategic Partnership with a Major Player” and “Get the Strategic Alliance Partner to Come After You” and they worked. Either way, congrats. Unfortunately, at that point you’re still only half way to fully exploiting the relationship. You might get some interesting press attention right after the announcement and your employees will certainly be proud of the accomplishment. But that doesn’t mean your revenue production will suddenly shift into a new gear. In this article I’ll explain how to significantly increase your leverage by embedding with your new strategic partner.
Continue reading “The Hidden Value of Embedding With Your Strategic Partner”
Most startups desperately crave a partnership with a big, strategic player that could offer them significant leverage and credibility. Just think about the giants in your particular industry. That’s who I’m talking about. But they are huge and you are tiny, so how do you secure a real partnership in which they actually utilize their size and influence to help you? Too many startups only think about the benefits they will get from such a partnership when the only way to get the partner to even lift a finger is to provide real value to THEM.
In a previous article I described a way to get a prospective strategic partner’s attention (see “Get the Strategic Alliance Partner to Come After You”). In this article I’ll describe how to leverage that initial momentum into a real partnership that produces real results. I’ve secured several such partnerships throughout my professional career and have identified three primary categories of the needed value creation I described. Let’s dive into each of them further to see what your secret ingredient(s) could be.
Continue reading “A Secret to Securing a Strategic Partnership with a Major Player”
The courtship almost always starts with the small company approaching the HQ of the big company they desire as a strategic partner. Usually, the big company is too distracted or the joint value from a partnership isn’t perceived as significant. If very lucky, a successful pitch is followed by numerous conference calls, lab trials, partner program paperwork and accompany payment. Eventually, the new partnership is revealed to the big company’s sales team and the pitching starts all over again. After all, if this sales team doesn’t take interest in the offering then all the work leading up to that point was wasted. So why not reverse the sequence of events?
Continue reading “Get the Strategic Alliance Partner to Come After You”
It finally happened. You’ve been trying to get the attention of a huge strategic partner and finally they gave you a chance to explain the value you can bring them. In fact, maybe you were fortunate enough to have them come after you (see related article titled “Get the Strategic Alliance Partner to Come After You“). Not only do they get the value you can offer but after a couple of subsequent meetings they utter the “exclusivity” word. You’ve heard from your advisors and read in books to avoid exclusive relationships if at all possible. But you don’t want to bring the positive momentum to a grinding halt by immediately saying “no”. Where do you go from here?
Continue reading “Exclusivity – Run Away or Embrace?”
You have a product that is ideally suited for a channel-based distribution strategy. But every time you approach a prospective channel partner, they expect you to already have landed some customers and already have an opportunity pipeline of deals to hand them. In other words, they are looking for traction and they probably also perceive risk with your value proposition, possibly because you’re at such an early stage or maybe because you’ve never done business in their country. So now you’re sort of stuck and don’t know where to go next to start building out your channel. I have an idea to try.
Continue reading “Build Out a Channel By Swimming Upstream From Your Deals”