“Our partnership initiative is relatively new, so many are still in the works. We are still finalizing our plans with some of them, so I can’t reveal too much about our execution strategies. However, here are four that we are currently working with.”
When asked about a theme that resonated with you to address with your entrepreneurial peers, you chose ‘partnerships’. Why?
The tech ecosystem is chock-full of companies that are incredibly focused on solving one problem really well. That means there are tons of tech companies that likely share the exact same target market. Because of this, partnerships present huge opportunities for scaling and adding value.
What does a partnership mean to you, in this context?
My background is business-facing software/apps. I look at partnerships in a couple of ways: integration partners and strategic partners. In the tech space, an integration partner is the most obvious. Two products working together can add value for the end-user in number of ways. Here are three that come to mind:
•Provide convenience to customers, making them more productive with both products. Think SSO (single-sign-on), widgets and data syncing. Offers customers an all-in-one solution without the disgusting user experience that comes from monolithic software makers that offer a ‘complete solution.’
•Sometimes integration creates a totally new layer of value that’s never been considered before. For example, sharing data between two otherwise independent processes can offer brand new insights that help businesses make smarter decisions.
•As for strategic partnerships, one kind is creative cross promotion. If you and your partner are targeting the same market and both products add value for the end-user, it might make sense to establish a method of cross promotion. Be creative. Make sure the cross promotion is actually relevant to the end-user. Context is king in this case. Don’t spam your customers with ads or allow your partner to market directly to your customers. Your customers have chosen you because you offer something they find valuable. They trust you. Use your brand to introduce customers to your new partner in a non-intrusive, creative way. Tell them why you’ve partnered and why it’s relevant to them.
•Another kind of strategic partner is the revenue share partner. This is the partner that has HUGE reach in your target market. Perhaps they’ve been around for a long time and have a sales channel that, if tapped, could be like rocket fuel for your customer acquisition. For this to work and present an attractive ROI to your partner, your onboarding process for new customers must be incredibly simple and automated. The goal is to require only a modest amount of effort from the partner to convert the customer. Ultimately, it’s lead generation that your partner is doing, not selling.
As a startup CEO, how do you generally perceive the value of partnerships?
For a partnership to work, two things need to ring true: a truly mutual benefit for the two companies and it must offer honest, relevant value to the end-user from both products.
How do you approach the possibility of partnerships? How do you assess unique partnership situations, formally, or otherwise?
When I consider a potential partner, I learn as much as I can about their business model and ask a few questions:
•Who are their customers?
• Is there a significant overlap in our target market?
•Are we competitors? Is there an overlap in what we offer? If so, how much?
•Are the end-users that buy their product the same end-users that would buy mine? That’s important. Just because you share the same target market, doesn’t mean you share the same end-user that buys.
•How can this partnership benefit them?
•How can this partnership benefit me?
After thinking through the answers, I consider what the partnership could look like and some tactics on how it could be rolled out. This is where creativity is important.
What has been your biggest personal learning experience around partnerships? What advice would you have for other tech entrepreneurs?
If it’s an integration partner, think through your use-case. Make sure you understand your partner’s product and have a solid (but simple) use-case example prepared when you contact them. Make sure, whatever the use-case, it adds value to both of your customers.
If it’s a strategic partner, have a few creative ideas prepared before you make initial contact. Take the time to understand their business model and exactly what their product does and how their customers use it.
Overall, don’t focus on what you want, focus on what you can do for them.
Is there anything else you would like to add?
Curate your partnerships. Give each one some care and thought. Seek out partners that share your values and philosophies. Kindred spirits can go a long way in building a successful partnership that your customers will actually care about.