Channel Partnerships · Channel sales

How do you put together a proposal with large partner when you're a startup?

Helen Adeosun

December 4th, 2014

We are in talks with a company to do a revenue share for making our classes part of their offerings at the Point of Sale when a parent is hiring a nanny and buying a membership. The founders of this company have a pretty even knowledge of the size and breadth of my startup (short staffed). They have taken a fine eye to the product and like our content offering a lot! Now I have no idea how to structure a deal like this and leave room for learning/mistakes if we propose a relationship. How do I begin to write this up and see the most favorable terms? Anyone have an example of how they aligned themselves with a larger company and made a successful proposal especially for a revenue share?


Clynton Caines SharePoint Developer at Discover Technologies

December 5th, 2014

I'm no expert in this area, so I hope you receive some good advice from the FD community. Until then I thought I would share something that came to mind. It might be helpful to keep an open/skeptical view and do as much due diligence of your potential partner(s) as they are doing of you. You wouldn't want to share all your secrets/IP with an unscrupulous company that then leaves you in the dust...

That being said, recognise that if they are genuinely interested in you, then you should not shy away from being and acting like an equal partner. A lot of companies are larger in stature, but completely lack creativity - and so they stand in awe of smart, nimble startups. Now, put your thinking cap on, do what you do best and knock their socks off. They will gladly share the revenue as it sounds like they're up-selling your value-added product and thus increasing their profit margin, reducing their CAC and extending their CLV (Hey biz-people, am I doing it right? :)

Helen Adeosun

December 6th, 2014

I searched deep and far and wide for a great basis to start and funny enough found an awesome thread on LinkedIn that may help others trying to figure out how to create a channel distribution/content distribution deal:
https://www.linkedin.com/groups/What-is-typical-revenue-share-1246227.S.141557531

Enjoy!

Helen Adeosun

December 6th, 2014

Clynton this response is pretty great alone!

Thank you!
Helen Adeosun

Andria Younger, MA

January 26th, 2016

Hi Helen

I agree with Clynton. As someone who helps people monetize their expertise,don't under value yourself and what you bring to the table. It's about Playing Big. Its critical to take appropriate steps to protect your IP from being lifted by the large company. Have an IP attorney structure how the content can be used by the other company, as well as how you are compensated.

I had this issue with a large media client. Without permission, they filmed my client speaking at one of their company wide events and then developed a company wide training course without his permission. We only found out because when he showed up to do a segment for a show the make-up artist said..."hey your that guy from the training video".

Its worth the investment to work with a good attorney who knows how to structure these types of deals and protect your IP.

Good luck! Andria