Strategic Alliances Partnering Examples

Beverage Start-up Gets A Big Boost From Anheuser-Busch:

Soho Natural Soda, a startup producer of natural carbonated beverages, was operating out of a Brooklyn kitchen. With no money to build, rent or operate any bottling facilities, it persuaded a regional beer company to use its excess capacity to bottle the beverages. Soho then got brewer Anheuser-Busch to distribute the product. In 11 years it grew from a kitchen table to $11 million in sales, with little overhead or cost.

Motorola And In-Focus Join To Route The Japanese:

Motorola and In-Focus Systems saw an opportunity to gain a share in the burgeoning worldwide market for high-performance video display panels. In-Focus developed a new technology that lets it make passive matrix displays that are almost as good as active matrix displays but cost much less.

Motorola purchased a 20% interest in In-Focus for $20 million. They then formed an equally owned joint venture to build display panels incorporating In-Focus's technology Motorola's integrated circuits.

In-Focus got the capital it needed, a key customer, and access to Motorola's international distribution manufacturing capabilities. Motorola locked in a strategic technology that it was unable to develop internally. The technology permits Motorola to leapfrog past rival Japanese competitors. It also created a captive customer for its integrated chips while getting an equity that could rocket in value.

NEC Rockets Past Its Competitors:

In the 1980s, NEC used more than 100 joint ventures to gain a leading position in three critical high-tech markets: computers, semiconductors, and telecommunications.

During a period of eight years NEC grew more than five-fold, from $4 billion in sales to more than $20 billion. It shot past its competitors and emerged as one of the leading international companies with in-depth competence in all three key markets. NEC did this while spending a far smaller portion of its revenue on R&D than its competitors.

Electronic Muffler Developer Gains A New Product, Credibility & Distribution:

Noise Cancellation Technologies, Inc. developed an electronic noise cancellation technology that could be used as a replacement for conventional automobile mufflers. The company teamed with muffler maker Walker Manufacturing to develop a revolutionary electronic muffler.

Noise Cancellation had the technology. Walker had automotive expertise, marketplace credibility and the manufacturing capability to deliver orders once they are placed. Together they used Walker's credibility to approach major customers and were able to get test installations on city buses in New York and Montreal.

Noise Cancellation got technical, marketing, and manufacturing resources. Walker got a leading edge technology to increase its profit margins in a price competitive industry.

AT&T Helps Launch A New Software Company:

A software company had developed a family of computer "compilers." Its technology permitted it to quickly move a full line of computer languages to a new computer with minimal effort. The compilers convert computer instructions written by programmers into the software that runs on computers.

AT&T was developing a new line of computers requiring compilers, but was a new entrant to the computer industry. It didn't have its own family of compilers nor did it have an existing staff of experienced compiler writers. Compounding its problem, AT&T had a tight schedule and needed a full set of compilers right away.

What did AT&T do? It chose to fund the completion of the software company's line of compilers, then acquired a license to sell the compilers with its new line of computers. Compared to what it could have developed itself, the licensed compilers cost less, were ready sooner, and performed better.

The software company got funding to complete its line of compilers. Because it was not investor money, it never had to pay it back. It just had to provide a product.

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