How to Prepare Your Startup for Corporate Partnerships

Creating partnerships is a powerful way for startups to unlock new business offerings and accelerate revenue, reputation, and market growth. If done correctly, you can access new technologies, execute a transformation, reach new customers, or collect information on a prospective market. Successful partnerships allow partners to amplify each other’s brand and, in essence, are an extension of each other. If you’re a startup, this means that with the right partners, you can grow and scale your company with a relatively small team.

I’ve experienced first hand the impact of partnerships with my current role at a startup and my time working for a large corporation. It can take months before the first sign of success and additional time before the success becomes consistent. Successful partnerships start with an alignment of vision early on by both partners, constant collaboration throughout, and a clear definition of short and long term objectives.

Finding product-market fit

We all understand the concept of product-market fit in the beginning. There’s no more significant litmus test to the likelihood of success out the gate than validating product-market fit as a startup.

Image courtesy of The Lean Product Playbook

With partnerships, it’s easy to get drawn to the concept that you can create a network of much larger companies to promote your brand and boost your reputation in the industry without spending a large amount of time or resources. The problem arises when startups make the mistake of going down the path too early before achieving product-market fit. If the ideal customer profile isn’t developed, then neither will the ideal partner profile.

Without knowing your ideal partner profile, you will not understand:

  1. The type of partner (service, technology, ISV, etc.) that fits your business,
  2. What the core problem is that needs to be solved from the partnership,
  3. What the value-added services are that the partner can build around your technology to change the trajectory of their business,
  4. If the partner will be aligned with your product roadmap as your product grows,
  5. The APIs that are needed to be exposed to make your partnership valuable to the customer.

Define your objectives

Short-term objective

Initially, your objective is to build credibility by optimizing internal business units and partners’ immediate priorities. These priorities can be revenue-generating opportunities, better exposure, or innovation initiatives for a particular product or service. Successful outcomes in early-stage partnerships can lead to validating the product-market fit for your product and revenue returns that accelerate the startup’s growth and build internal stakeholder equity that will lead to future organization buy-in to scale the partner program.

Long-term objective

If you’re starting to put together multiple successful partnerships, this would be ideal for thinking on a macro level and how you’d like your ecosystem to develop out past the first year. As you’re evaluating the current partnerships, look at your ecosystem’s strengths and where the gaps are. Consider the resources needed to get this point and determine what would be necessary to scale the partner program. What you want to do is invest in your overall industry thru the innovation from your partnerships and, at the same time, continue to iterate your partner program to adapt to the changing needs of the partners’ customers.

Set clear expectations and stay engaged

Set internal expectations with your team early on that processes will vary when working with other organizations, especially corporate partners. Different rules apply to both startups and corporate for legal, compliance, and accounting functions, which may slow down the progress that could lead to frustration as startups can move quickly, and corporations typically do not.

Once the partnership starts, it will be essential to rely on insights that data from sales, integrations, or support will determine how well the collaboration is going. You will need resources in place to provide data to make decisions quickly to respond to the market. In the beginning, you may only have a single person sourcing and managing partners, but eventually, it will not be enough. A single point of contact runs the risk of being spread across many partners and is a recipe for disaster. You will eventually need dedicated managers to govern and monitor the partnerships’ success and evaluate which partners have the most value in your ecosystem. Having dedicated partner managers to stay engaged with your partners will also keep your sales team focused on strictly growing the business.

In partnerships, your long-term goal should align with your business goals. Over time, partnerships will evolve, and as a result, you can unlock new product offerings, services, or enhancements that could significantly change the company in the future. Partnerships between startups and corporations are increasing as an option for both parties to grow and succeed. With the proper expectations and alignment, companies can thrive under these collaborations.

This post originally appeared on Partner Trends. To get this story and future articles straight to your inbox, subscribe here.

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