Strategic alliances are extremely common on the web and often the key to success. If you are going to pursue a project with another party, a strategic alliance agreement is a must. 

What is a strategic alliance? It is an agreement between two parties to pursue some common business effort. The parties usually do not compete directly with each other, but have products or services that might produce serious profits when combined. An example on the web is the relationship between Amazon.com and Toys R' Us wherein Amazon listed and sold toys from the company on its site. 

Alliances are fairly rare in the traditional brick and mortar world. While they do happen every so often, the companies pursuing them are almost always very large. A current example would be the alliance between Ford and Sirius to put satellite radio in the cars. While it is an excellent relationship, most offline companies are to suspicious of others to pursue alliances.

While rare in the "real" world, strategic alliances are extremely common on the web. While large companies pursue them, the real action is with smaller businesses. Let's assume you have a blog that covers gardening. You've developed a large following over the years and have a huge email list you send newsletters out to. I, in turn, sell an incredibly form of fertilizer that is the bee's knees. We are a perfect match. We can enter into an alliance wherein you promote my product on your newsletter in exchange for a cut of the revenue. You make money without having to develop a product and I make money without having to spend a bunch of money on marketing. 

While these relationships often make sense online, the parties need to protect themselves. This is done through a strategic alliance agreement. In it, the terms of the agreement are laid out and codified by the parties. Topics covered include revenue splits, how intellectual property such as copyrights and trademarks can be used, warranties, how disputes will be handled and, importantly, how the parties will separate if the project doesn't bring in the expected revenues. 

Forming alliances on the web is very common for the simple reason doing so is often a very good way to increase revenues for both parties. If you are considering it, protect yourself with a strategic alliance agreement. Contact me today at 619-637-6043 to learn more. Entering an alliance without such a document usually leads to major problems down the road because sooner or later all business relationships end.

Richard A. Chapo, Esq.