As you dive deeper and deeper into building your startup, you will inevitably begin to think about how you can partner with other companies to grow your business. It’s very easy to get caught up in opportunities that come your way, but maybe aren’t necessarily best for your company. Before you enter into a partnership of any kind, ask yourself these five questions.
What are my Business Development (BD) goals? Whether your goal is to acquire more users, increase revenue, or amplify brand awareness, understand what you want to achieve when reaching out to partners. Strategic partnerships are an incredible way to achieve massive growth, but you first need to identify what kind of growth you’re striving for at a certain moment in time.
Is this the right partner? A big mistake a lot of startups make is entering into partnerships for the sake of partnerships. They get attracted by a bright, shiny big name and think they should immediately jump on it. Don’t fall into this trap. One of the pillars of being an excellent BD person is knowing when to say yes to the right deal, and even more difficult, knowing when to say no to the wrong one. When deciding whether to pursue a partnership, always look back to your goals and ask yourself how big the opportunity is.
What problem would this partnership solve? If there is no clear vision for why your company and another are partnering, you will waste lots of time and effort. Business Development is incredibly strategic, and their needs to be a clear vision of what this partnership will achieve down the road. It’s not transactional like sales where one company is fulfilling the specific needs of another. Most of the time it won’t have even crossed a partner’s mind that a) they had a problem, and b) you can solve it together. Know exactly the problem you’re solving.
How will I help my partner’s business? Partnerships should not just be about solving your problems. You should always ask yourself how your business can solve the problems of your partner’s business as well as help them expand their reach. Partnerships are all about mutual interests and support. If you help your partner become a bigger player in their space, you will be rewarded as well.
Does my team understand the partnership? As an early startup founder, you will most likely be executing the deals early on until you hire a full time BD person. BD deals take a lot of time and effort on both sides of the table. One thing you shouldn’t neglect is making sure your team knows exactly why you’re entering into a partnership and making sure they are excited about it. One of the last things you want is your team wondering why they are working on partnership deliverables without first understanding why you chose to enter into this partnership in the first place. Make sure to convey the value of the partnership.