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Two case protagonists (e.g., Dropbox, Cake) pointed out the challenge of doing business development deals with big corporations. Can we generalize about when this challenge is greatest? Do lean startups face special difficulties on this front? by Krizia Li “No significant tech company has been built solely through distribution deals without having a strong brand of its own.” – Drew Houston, Co-Founder and CEO of Dropbox After surviving two stages of evolution in Dropbox’s lifecycle, Drew Houston pinpoints “brand” as one of the critical junctures where lean tech start-ups begin to tip the balance of power as they strike business development deals with large corporations. This key differentiator is public identity; the stronger your perceived brand equity, the more robust your bargaining leverage and protection vis-à-vis partners. During early development stages for a lean startup, the desire to acquire user growth and operational scale via distribution deals using market-share dominant...

by Private Our class discussion around Foursquare highlighted a strange paradox that I’ve been trying to articulate for a while now. We all agreed that Foursquare follows and is one of the best instances of a lean startup method we’ve seen. They launched with a buggy product, initially did not have too many features, collected consumer feedback on the product and constantly improved. However, the discussion broke down when we turned to their monetization strategy. Yes, Foursquare does have data about location and users that can be broken down in several ways to add value to advertisers, but then all the methods that we discussed involved high touch activities. At first sight there also seems to be a lack of metrics around how the success of advertising campaigns can be made measurable to add value to advertisers.  The discussion highlighted that the lean methodology may not be consistent with all divisions at a startup. Some startups have done a great job implementing the lean me...

by Alvaro Febrel More often than not, startups are ignored by big companies when seeking help. To make things worse, sometimes a startup’s business model relies on established players to succeed. “Data Aggregators” are a good example of this, as they use other companies’ data to provide new services for customers (Tripadvisor, Kayak, Cake Financial and Chegg are examples of companies that in one way or another aggregate data from different sources). The issue is, what can a data aggregator do if its sources of information don’t collaborate?  The answer: scrape! The term “Screen Scraping” is used to describe software that reads and extracts information from data that was intended for display to an end-user, as opposed to reading and extracting the same information from “non-manipulated/machine-oriented” data. Screen scraping is usually considered an inefficient way to get information, as it depends on how the end-user output is displayed. For instance, if you want to know today’s oi...

by Sreejita Deb Partnerships with a large organization can offer a start-up access to a large base of users, validate the business model in the eyes of an investor and unlock revenue potential- the real question is how do you make it work? Deal making is much like recruiting the right team for your start-up. Most of all you want to make sure you’re watching for “fit”- right attitude, right skills and at the right time. Let's start with attitude. Chances are limited that you'll find a large organization where processes are lean. In the absence of that, look for an organization where the culture is similar to a startup- organizations that are more entrepreneurial and most importantly that have a real sense of urgency about getting things done and not one which is slow and lets hierarchy overwhelm critical decisions. “ Critical decisions” is a good segue to the next point-  the organization you want to partner with has to have a natural sense of urgency and you need to heighten it...