There are far too many businesses for a start up to track, assess and compete with. More often than not, a startup’s features or business model overlaps with others in the same and/ or adjacent market. To enter this competitive field and as an early stage firm, scale becomes important and with the firm’s limited resources, it is essential to place multiple bets, none big enough to bring down the house.
One way to build such scale is via partnerships.
1. Why Partner?
Through partnerships, you can:
- test a hypothesis
- grow your brand
- increase conversion
- manage operations efficiently
- and the list goes on... And it’s not a fixed cost.
Think about a building or space, whose design made you feel great and alive. It could be a restaurant, home or resort. The creation of that space was a partnership of the client design brief, the concepts of a designer and the physical elements of a supplier (tiles, furniture, artwork, lighting, colors etc).
Have you ever wondered how many products and minds came together to make this one image? The blend of various elements had to come together to make it awesome- the same holds true for partnerships. When two firms or individuals bring complementary skills and quality, they can create magic.
Think about it - you are now able to request an Uber via your Slack chat window- bringing team communication together with on-demand transportation. Another example is Porch.com in the US, who partnered with Lowe’s. This partnership not only opened US wide marketing channels for Porch.com and customer loyalty for Lowe’s, but also resulted in Lowe’s investing in Porch.com.
The Louvre: A partnership of new and old materials that creates an awesome space
(photo credit: Rafael Miranda- www.unsplash.com)
2. Which are the prime areas for partnership?
While there are various partnership opportunities, for an early stage firm, the core is wherein you positively impact your customer. Partnership can be in consumer awareness, customer acquisition, technology, and operational expertise or in market testing.
Tying up with the right partner can provide the rocket fuel for the firm.
For instance, at , we are enabling partnerships between designers and retailers so that magic happens. And in that process, consumers benefit from the increased speed of project execution. So, we are identifying partnership opportunities to benefit our designers and retailers.
3. Do these partnerships apply to you?
Whether you know it or not, these partnerships are already in place.
Technology developers have applied the integration of skills and partnership to build tech products. They integrate UI/ UX, design, back end, tech architect and QA team. Your team doesn't have to be 100% in house: you can partner with different freelancers and outsource your talent. Different skillsets, coming together to make the product great!
Now, extend that model to your startup to identify complementary models.
- Are you a logistics company that can tie up with furniture stores to manage on-demand delivery for prospective or existing clients?
- Are you a health wearable company that can partner with an employee benefits provider or sensor based apparel and sporting manufacturer?
- Or, maybe you can partner with a fellow competitor to grow the market awareness for a new technology vs the incumbent?
Hot Tip: You can also use this brainstorming to perfect your brand and company messaging by figuring out what your customers' pain points are, then delivering a solution.
When forging these partnerships, ensure that as a team, you know what you bring and get from the partnerships. Not all partnerships are scalable, perpetual or carry network effects, but you will learn from these all the same.
Key note: As a team, establish these expected learnings ahead of time.
In conclusion, ask yourself whether the intended partnership would be one wherein you would invest in the other firm or vice versa (assuming resources are not a barrier).
If the answer is yes, the partnership has potential for a multiplier effect.
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