This document discusses key partners and how to leverage partnerships effectively. It notes that partners can help with faster time to market, broader product offerings, more efficient use of capital, unique customer knowledge or expertise, and access to new markets. There are two types of partner ecosystems: coordinated partnerships focused on efficiency and transactional relationships, and collaborative partnerships focused on expertise, innovation and market development through relationship-building. The document provides examples like Boeing, mobile apps, and Groupon and their partnership models. It outlines risks of partnering like misaligned goals and notes the best partners are customers, suppliers, and channels that have incentives aligned with your success. It recommends starting partnerships slowly, being a good partner, focusing on ownership, flexibility, and

1. Engineering 245The Lean Launch PadSession 7: ChannelsSteve Blank, Ann Miura-Ko, Jon Feiberhttp://e245.stanford.edu

2. KEY PARTNERSwhich partners and suppliers leverage your model? who do you need to rely on?

3. Test Hypotheses: Key Partners2

4. Why have partners?Faster time to marketBroader product offeringMore efficient use of capitalUnique customer knowledge or expertiseAccess to new markets3üüüüü

5. What defines a “Partner?”Shared economicsMutual success / failureCo-development/inventionCommon customer4

6. “Whole Product”5ComplementaryServicesComplementaryProducts© TCG Advisors LLC

7. Whole Product Partners and Allies6Us??UsUSUs??UsAssemble for a one-time projectRecruit for a repeatable whole productInclude to minimize sales frictionEliminate to retain marginOnly engage partners when they can supply a part of the whole product that you either cannot or do not want to provide© TCG Advisors LLC

8. Two different types of partner ecosystems7CoordinatedCollaborativeHigh volumeTransaction orientedOutgrowth of value chainsOrganize around a concentratorFocus: efficiency, speed, and market scalabilityHigh complexityRelationship orientedOutgrowth of project teamsOrganize around an orchestratorFocus: expertise, innovation, and market developmentCisco, Boeing, Android, Goldman SachsFacebook, Google,Nike, Charles SchwabGroupon© TCG Advisors LLC

9. Example: Boeing8Collaborative

10. Example: Mobile Location Based Applications9Collaborative

11. Example: Groupon10Coordinated

12. Managing partners is difficult and has risksImpendence mismatch – “ants mating with elephants”Longest element of partners schedule becomes your longest itemNo clear ownership of customerProducts lack vision – shared product designDifferent underlying objectives in relationshipChurn in partners strategy or personnelIP issues Difficult to unwind or end11

13. Who makes the “best” partners?(all of the same entities that we have been talking about in this class!)Customers: Get them invested in your success beyond separating them from moneySuppliers: Unique products for you, financing terms, time to marketThe Channel: Do they really win when you do? Are you accelerating their growth? Can they help you define the best product?Rethink these relationships – get as many other people and organizations invested in your success and you in theirs!12

14. Strategies for Successful partneringStart slowly – gain expertise and ability to evaluate partnersBe a good partner (very few companies are!)Focus on ownership – who owns success in your organization?Be flexible – when you get to “contract enforcement” it is the beginning of the endConstantly re-evaluate – declare failure and move on before it is too late13