How can Startups Benefit from Strategic Alliances?
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Fremont: "Companies should expand beyond their existing resources through licensing agreements, strategic alliances, and supplier relationships." This phrase emphasizes on the importance of alliances for any company. A relationship between two or more independent organizations to pursue a set of agreed upon goals or to meet a critical business need. The organizations are rarely competitors for each other, but have similar products or services that are directed towards the same target audience. Alliances are favored more by the small businesses as it helps them to grow quickly and in an inexpensive manner. According to studies, businesses that participate in alliance have more advantages over those who abstain, in terms of faster growth, increase in productivity, and higher revenues. Strategic alliances can offer resources, advice, skills, and customers. Here are the types of strategic alliances that an entrepreneur can choose from: Joint Venture
Strategic Alliances for Startups
Two companies with similar goals marry and give rise to offspring which owned by both, with an objective to develop new products or services. They involve detailed legal documentation to spell out the objectives of the venture and the contributions made by each party. Also covered are the management rights, sharing of profits and or losses, rules and regulations, the mechanisms used in case of disputes, and the exit strategies. The most impactful and successful joint ventures of late have been eBay and Amazon.com, Wikipedia, and YouTube. In the Indian scenario, the well known joint ventures are Hindustan Unilever-Unilever, Suzuki-Maruti Motors, and Bharti Airtel-Singapore Telecom. For a startup, it might be an achievement to get into an alliance with a well-renowned company, which helps in its fast growth, and gives it lots of opportunities to learn from the best.

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