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Beverage
Startup Gets A Big Boost From Anheuser-Busch:
Soho Natural
Soda, a startup producer of natural carbonated beverages, was
operating out of a Brooklyn kitchen. With no money to build,
rent or operate any bottling facilities, it persuaded a regional
beer company to use its excess capacity to bottle the beverages.
Soho then got brewer Anheuser-Busch to distribute the product.
In 11 years it grew from a kitchen table to $11 million in sales,
with little overhead or cost.
Motorola
And In-Focus Join To Route The Japanese:
Motorola
and In-Focus Systems saw an opportunity to gain a share in the
burgeoning worldwide market for high-performance video display
panels. In-Focus developed a new technology that lets it make
passive matrix displays that are almost as good as active matrix
displays but cost much less.
Motorola
purchased a 20% interest in In-Focus for $20 million. They then
formed an equally owned joint venture to build display panels
incorporating In-Focus's technology Motorola's integrated circuits.
In-Focus
got the capital it needed, a key customer, and access to Motorola's
international distribution manufacturing capabilities. Motorola
locked in a strategic technology that it was unable to develop
internally. The technology permits Motorola to leapfrog past
rival Japanese competitors. It also created a captive customer
for its integrated chips while getting an equity that could
rocket in value.
NEC Rockets
Past Its Competitors:
In the 1980s,
NEC used more than 100 joint ventures to gain a leading position
in three critical high-tech markets: computers, semiconductors,
and telecommunications.
During
a period of eight years NEC grew more than fivefold, from $4
billion in sales to more than $20 billion. It shot past its
competitors and emerged as one of the leading international
companies with in-depth competence in all three key markets.
NEC did this while spending a far smaller portion of its revenue
on R&D than its competitors.
Electronic
Muffler Developer Gains A New Product, Credibility & Distribution:
Noise Cancellation
Technologies, Inc. developed an electronic noise cancellation
technology that could be used as a replacement for conventional
automobile mufflers. The company teamed with muffler maker Walker
Manufacturing to develop a revolutionary electronic muffler.
Noise
Cancellation had the technology. Walker had automotive expertise,
marketplace credibility and the manufacturing capability to
deliver orders once they are placed. Together they used Walker's
credibility to approach major customers and were able to get
test installations on city buses in New York and Montreal.
Noise
Cancellation got technical, marketing, and manufacturing resources.
Walker got a leading edge technology to increase its profit
margins in a price competitive industry.
AT&T
Helps Launch A New Software Company:
A software
company had developed a family of computer "compilers." Its
technology permitted it to quickly move a full line of computer
languages to a new computer with minimal effort. The compilers
convert computer instructions written by programmers into the
software that runs on computers.
AT&T
was developing a new line of computers requiring compilers,
but was a new entrant to the computer industry. It didn't have
its own family of compilers nor did it have an existing staff
of experienced compiler writers. Compounding its problem, AT&T
had a tight schedule and needed a full set of compilers right
away.
What
did AT&T do? It chose to fund the completion of the software
company's line of compilers, then acquired a license to sell
the compilers with its new line of computers. Compared to what
it could have developed itself, the licensed compilers cost
less, were ready sooner, and performed better.
The
software company got funding to complete its line of compilers.
Because it was not investor money, it never had to pay it back.
It just had to provide a product.
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