N11-9: AI Partnership & Co-Development Models
When neither full build nor full buy is optimal — and how to structure co-development partnerships.
🎯 What You'll Learn
- ✓ Design partnership structures
- ✓ Negotiate IP ownership
- ✓ Manage co-development risks
- ✓ Measure partnership value
Lesson 1: Partnership Model Taxonomy
Beyond build and buy, there are 4 partnership models: (1) Co-Development — you and the vendor build together, sharing IP, (2) OEM — you embed the vendor's AI as a white-labeled component, (3) Revenue Share — the vendor provides AI, you provide distribution, revenue is split, (4) Strategic Investment — you invest in the AI vendor in exchange for preferential access and pricing.
Joint development with shared IP. Best when both parties bring unique capabilities.
Embed vendor AI as a component with your branding.
Split revenue generated from the AI integration.
Evaluate which partnership model fits your current AI needs. Map each option against your strategic priorities.
Lesson 2: Co-Development IP Negotiation
The #1 deal-breaker in AI partnerships is IP ownership. Three clean models: (1) Joint ownership with field-of-use restrictions (each party uses the AI in their domain), (2) Background IP stays with creator, foreground IP (new work) is jointly owned, (3) Licensed back — one party owns the IP, the other gets a perpetual license.
Each party owns rights to use the jointly developed AI in their specific market.
Pre-existing IP stays with creator. New IP created together is jointly owned.
One party owns all IP, grants perpetual license to the other.
Draft IP ownership terms for a hypothetical co-development partnership. Choose the model and justify why.
Lesson 3: Partnership Value Measurement
Measure partnership health quarterly: (1) Value delivered vs projected — is the partnership generating the expected ROI? (2) IP contribution balance — are both parties contributing equally? (3) Strategic alignment — are both parties still heading in the same direction? If any metric falls below threshold for 2 consecutive quarters, renegotiate or exit.
Actual revenue/savings vs projected at partnership inception.
Are both parties investing equivalent effort and resources?
Are the partners' product strategies still aligned?
Design a quarterly partnership health scorecard. Define the metrics, targets, and escalation triggers.
Continue Learning: Track 11 — Economics of Build vs Buy
2 more lessons with actionable playbooks, executive dashboards, and engineering architecture.
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Module Syllabus
Lesson 1: Lesson 1: Partnership Model Taxonomy
Beyond build and buy, there are 4 partnership models: (1) Co-Development — you and the vendor build together, sharing IP, (2) OEM — you embed the vendor's AI as a white-labeled component, (3) Revenue Share — the vendor provides AI, you provide distribution, revenue is split, (4) Strategic Investment — you invest in the AI vendor in exchange for preferential access and pricing.
Lesson 2: Lesson 2: Co-Development IP Negotiation
The #1 deal-breaker in AI partnerships is IP ownership. Three clean models: (1) Joint ownership with field-of-use restrictions (each party uses the AI in their domain), (2) Background IP stays with creator, foreground IP (new work) is jointly owned, (3) Licensed back — one party owns the IP, the other gets a perpetual license.
Lesson 3: Lesson 3: Partnership Value Measurement
Measure partnership health quarterly: (1) Value delivered vs projected — is the partnership generating the expected ROI? (2) IP contribution balance — are both parties contributing equally? (3) Strategic alignment — are both parties still heading in the same direction? If any metric falls below threshold for 2 consecutive quarters, renegotiate or exit.