How To Make Partnerships Easier
Here are some basic truths about these kinds of partnerships, and how you can make them easier.
There are enough homilies, old sayings, and axioms out there that trumpet the virtue of teaming up with another person or team (like, say, a company) that the idea of a business partnership sounds awfully attractive. That’s especially true for startups, that are scrambling to get themselves recognized and on a solid footing.
But that eagerness and zeal so characteristic of startup founders may often times blind them to the realities of partnering with a bigger, better established company. Here are some basic truths about these kinds of partnerships, and how you can make them easier.
Established companies need to be convinced to partner with an untried startup. What’s in it for them?
Who Benefits From This? The article "Why Business Partnerships are so Difficult and What You Can Do About it" nails it when it says "In order for them to work out, there has to be benefits for both parties." The last time anyone checked, established companies don’t enter into partnerships with untried startups out of the goodness of their hearts.
In order for a partnership to be attractive to both parties, there needs to be clear benefits for all concerned. The benefits need not even be the same for all parties; but there has to be clear incentives for everyone to jump on board.
That’s why, when proposing a partnership with an established company, the benefits must be clearly spelled out for everyone. In a manner of speaking, this pitch is the startup’s commercial, selling itself to a most important customer!
The Startup Needs To Justify Its Existence A startup has to have a product or service that people actually want, including the potential of making it big. When an established company sees a startup that offers a viable product or service, they see evidence that the newbie can actually perform; they can put their money where their mouths are.
On a related note, it helps if there’s evidence of customer demand for the startup’s particular commodity. Companies don’t take risks on hare-brained schemes that MIGHT work.
Are The Partners Compatible? Think of a business partnership as you would a relationship. There has to be chemistry between the participants, common ground and the ability to mesh well together. If at one end you have this staid, proper, strictly professional company and at the other end this mellow, laid-back, "anti-corporate" startup, then you had better believe there will be problems.
Granted, there has to be some give and take, considering the very nature of startups and their informality and unorthodox business culture. But overall, the partnership has to be a good fit.
"You Better Werrrrrk!" The startup has more to prove than the established business does. After all, the latter doesn’t need the former; more like the other way around! Therefore, the startup staff had better get ready to do the lion’s share of the heavy lifting, at least at the start. Once the startup proves its value, the conditions may change.
There Needs To Be Enthusiasm Finally, the startup needs to show that they are in it to win it. While zeal alone won’t carry the day or win the battle, presenting a can-do, hungry attitude goes a long way towards showing a prospective partner that the startup founders are serious about this venture and are eager to make it work.
Partnerships should be approached not as a life-saver for startups, but rather a means of enhancing its value and reach. For more thoughts about startups and money, check out "Is Fundraising Becoming The New National Game Of Web Startups?"
Find out more on the future of Business at our DLUK - Trends Briefing on the 24th September 2015