Hardware Business Models
Selling to Consumers and Businesses
Selling to Local Governments
Working with Regulators
Your Extended Team
Urban Us Investment Memos
– Bowery Farming
– One Wheel (Future Motion)
Many startup founders have wasted considerable time and energy trying to work with large corporate partners, so there are some very good arguments in favor of avoiding these conversations early on. But there are two advantages that a well-aligned corporate partner might bring to the table: infrastructure and distribution.
Early-stage corporate VC has grown, meaning there are more people who understand early-stage startup needs as well as large operating groups within corporates. More companies now have programs that are explicitly designed to make it easier to work with large firms, much like APIs have made it easier to quickly leverage an array of services. Corporate VC objectives generally include access to solutions, technology partnerships, and acquisitions. They are also increasingly prioritizing returns.
It’s important to understand the motivation of the corporate partners with whom you are engaging. It’s very rare that they are motivated by a desire to hijack your intellectual property, as some startups fear, but conflicts may arise and should be discussed early. There are many risks in working with a much larger partner, but the biggest risk is wasting time and money. Make sure you understand how much risk you are exposed to, and that you aren’t risking the death of your company.