So many reasons for partnering exist. The ones above are examples from a short brainstorming session I had over email with a colleague who runs an Incubator in San Francisco. His customers are all skeptical that Business Development and Partnerships are worth the time, energy, resources their fledgeling companies will have to pour into them, not just at the start of their company’s life, but at ANY TIME during their company’s life. They all have experiences, first hand, second hand, internet rumor and innuendo, about partnerships that weren’t worth the paper the press release was printed on.
And I agree. 100%.
Most partnerships aren’t interesting, they aren’t effective, and they are resource drains at a time when a startup needs those resources most (frankly, that issue never goes away no matter how large the company gets). Why? I think it starts at the design phase of the partnership lifecycle.
Take a look at the above list of “reasons to partner” — let me count the ways. Most of these seem viable. Ok, the one about Golf was thrown in there to see if you were paying attention. But the rest, yes indeed. “My investors sent me this great company to work with”, “I want lots of blog posts”, “My competitors are doing it…I need to stay with them.” But hidden in this chart are the five reasons that more often than not are the REAL drivers of successful partnerships. Can you find them? I’ll wait.
For those of you who read ahead without guessing, “for shame!” For the rest of you, the five primary reasons to partner are:
Credibility, Awareness, Revenue, Defensibility, Utility
I’ll go into each of these in depth in future blog posts, but it’s important to understand that ultimately there are only 5 things that BD Organizations actually do and they boil down to:
- Create an Aura of Credibility for a company – This could be for a new product, a new company, a new initiative. It is often done by partnering with a larger, more credible company who, simply through the act of partnering, indicates to the market that they think your company is important to the space.
- Build Awareness for your offering – This is also an early stage of building a Ubiquity Play in that those who are aware of your offering are more likely to try/use your offering. Awareness building allows you to potentially significantly expand the reach to new markets and more existing customers in existing markets.
- Create Revenue opportunities – Whether the BD team is doing the selling, the Channel is doing the selling through BD programs, or you are simply generating leads for your own Sales organization.
- Build a Defensible position in the market and with your partners – At New Relic we call this “blocking the socket”. There is always a favored partner in any space and regardless of how many like-partners there are, only one will get the lion’s share of the resources, thinking, and commitment from any given partner. Building the best relationship puts you in a defensible position.
- Enhance the Utility of your solution – At various stages, your own engineering organization may be “maxed” in their ability to support all the platforms, all the components, all the things that make up the world in which your solution lives. In these situations, turning to partners to provide that utility, extending your solution through integration with others, is a viable option.
Too often, BD teams focus on the tactics and the opportunistic partnerships that present themselves. There is nothing wrong with that effort in and of itself. Partnering with someone willing to partner with you is certainly highly valuable. But most BD organizations never truly align themselves with the needs of the company.
If your BD org can step back and think through the 5 areas that BD can significantly influence (above) and get the entire executive suite to agree on which single area is the priority, you will set your team up for success because they will be driving the top priority of the business.