Strategic Alliances and Partnerships for Early Stage Companies

A strategic alliance or partnership properly negotiated can give credibility, access to markets and technology, complimentary skills and needed investment to the early stage company.


IEEE Boston Entrepreneurs’ Network, Waltham, Massachusetts , November 7, 2006

By Robert A. Adelson, Esq.

  • Merits of Strategic Alliances
  • Channel & marketing power
  • Credibility, Brand
  • Value added for customers
  • Complimentary skills
  • Access to technology
  • Scale up / time to market
  • Alternative capital source
  • Obstacles -Risks
  • Loss of independence
  • Divergence of partners
  • Partnership Planning
  • Purpose and Goals
  • Type of transactions
    • OEM, VAR, SI, Co-marketing
    • Target markets
      • Vertical, Horizontal,
      • Customers
      • Teaming /subcontracting
    • Separate shared entity
    • Equity investment
    • Operational Goals and Milestones
    • Decision Making

  • Partnership Implementation and Life Cycle Stages
  • Partner recruitment
  • Letter of intent
  • Due diligence
  • Definitive arguments
  • Nurturing the alliances
  • Dispute resolution
  • Termination
  • Research and Development Collaboration
  • Project Management & control
  • Development Milestones
  • Licensing existing IP
  • Treatment of new IP
  • Payment
  • Exclusivity
  • Restrictive covenants
  • Licensing for Marketing and Sales
  • Territory: Customers, market, geographic division
  • Exclusive or Non-Exclusive
  • Relationship/Statutory Requirements
  • Sales levels: Minimum, inventory, staffing, best efforts, loss of exclusivity
  • Pricing: Discounts, volume discounts
  • Credit terms
  • Product Availability and Allocation
  • Marketing and Promotional Arrangements
  • Order Entry
  • Sales Contract Terms
  • Termination: Return Buyer’s Property: information, trade secrets, tools, equipment, materials, no use of trademarks
  • Miscellaneous: Assignment, change orders, integration, arbitration, attorney fees, jurisdiction
  • Subcontracting / Teaming Arrangements
  • Services
  • Warranties/Indemnity
  • IP ownership
  • Confidentiality
  • Restrictive Covenants
  • Termination
  • Governing law enforcement and self-help protection
  • Alliances with Equity piece or
    Joint Venture Entity
  • Contribution & valuation
  • Minority protections
    • Anti-dilution
    • Liquidity / Information
    • Strategic Option rights
      • First offer for sale
      • Options over technology
      • Perception of captive company
    • Separate venture entity
      • LLC, LLP, Corporation
      • Liability, credibility
    • Management/ operation
      • Operating standards
      • Security procedures
      • Benchmarking
      • Management and control
      • Project team
      • Key personnel
  • Continuing the Alliance
  • Flexibility / Validation
  • Champions /Good will
  • Handling Deadlock
  • Dispute resolution
  • Disputes and Termination
  • Exit plan / Buy-sell
  • Termination procedures
  • Residual Agreement
  • Transition to successors

For more information contact:

Robert A. Adelson, Esq.

Engel & Schultz, LLP

265 Franklin Street, Suite 1801

Boston, MA 02110

617-951-9980 x 205

© 2006 By Robert A. Adelson

Author: radelson

Robert Adelson has been a corporate and tax attorney since 1977. He began as an associate at nationally prominent New York City “mega” law firms, first at the Wall Street firm Dewey Ballantine Bushby Palmer & Wood and later at the Park Avenue firm Weil Gotshal & Manges. In 1985, Adelson returned home, where he has since established himself as a respected Boston business attorney. He has attained partner at several small and midsize Boston law firms, most recently at Lawson & Weitzen LLP and then Zimble Brettler LLP, where he was a partner from 1994 to 2004 before becoming a partner at Engel & Schultz LLP.

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