3 NON-EQUITY-BASED CORPORATE PARTNERING

For most startups and scaleups, growth depends on the close interaction and collaboration with corporates. Likewise, corporates can derive many benefits from an active engagement with startups and scaleups.

Corporate partnering is not limited to equity-based partnering transactions only, but also includes various types of non-equity-based partnering models. The closer the level of interaction between a startup and corporate, the more complex such collaborations become.

The figure set forth below shows a number of non-equity-based partnering models, from relatively straightforward licensing transactions to complex co-creation arrangements.

As the variety of partnering models is exceedingly large, the scope of this book is limited to a high-level analysis of the most important design and structuring elements.

Any collaboration between startup and corporate should be structured in a fair and balanced manner to ensure a lasting, mutually beneficial relationship.

It is absolutely fundamental to aim for a win-win outcome in corporate partnering transactions which involve strategic, business, operational and cultural elements, and are interlinked and change over time.

Relationships evolve over time and significant imbalances are likely to cause significant issues during the course of the relationship as the dissatisfied party is unlikely to be cooperative.