Throughout my entire professional career, I have focused on creating strong, mutually beneficial, strategic partnerships. I’ve done hundreds of them. I have partnered with companies of all sizes, both public and private, for a variety of projects. Most partnerships were successful, though some were clearly not. Even in the cases where mistakes were made, I have learned from all of these experiences and I believe I have “partnering” down to a science. Partnering is part of my professional DNA and I’ve always looked to create a culture of partnerships, both external and internal, to help me accelerate growth, drive innovation and improve the customer experience.
Creating partnerships has always made perfect sense to me. Lately however, I seem to be bumping into people who don’t know how to partner with other companies or worse, people of the “I can do this myself” mindset. So, I thought I’d write about why and how to create a successful strategic partnership and include key components where I not only use, but rely on, LinkedIn.
There are plenty of great reasons to create a strategic partnership with another, complementary organization. A good strategic partnership will allow you to:
- Quickly create a larger following
- Grow your business and drive revenue
- Get access to new markets, new ideas, technology, innovation and resources
- Speed up the time-to-market timeline for your product or service
- Improve customer satisfaction
- Spread and enhance reputation
- Provide extra brainpower
- Reduce risk
- Reduce costs (through economies of scale)
- Obtain an alternative point of view
Think about it; you likely have a great idea to build, launch or promote something. Ideally, you want to do this as quickly, economically and as successfully as possible, all with the least amount of risk. What better way to accomplish this than with the help of a partner or multiple partners? Before you do however, there are some key points to consider.
UNDERSTANDING YOUR MARKET
Before you start pitching a partnership idea, you have to be sure you have a solid understanding of your market. I know, your first response is “Of course I do!” Well, let me be clear; this is one of the most important aspects of a good strategic partnership. If you’re a startup, you may very well have some initial research you included in your investor pitch deck. If you’re working for an established company, you may have some applicable (but possibly dated) information. Either way, while these are good starts, you’ll need even more information and more data. Make sure your research is up to date and as complete as possible. There’s nothing worse than a partnership proposal with dated or incomplete data. It kills the validity of your proposal.
FRAMING THE CONCEPT OF THE PARTNERSHIP
Picking the right partner is key. However, before you actually approach anyone about a strategic partnership, you have some work to do. You’ll first want to clearly define your goals and they shouldn’t be vague. Rather you’ll need to clearly articulate specific goals as this will make your partnership proposal more meaningful and more attractive. More importantly, they will also allow you to decide which potential partners to approach.
Then, you’ll need to identify your strengths. What are you good at? What is easy for you to do? What are the best parts about your IP. This is what you’ll be bringing to the partnership and what the potential partner will most be interested in. If you walk into a partnership proposal with nothing but a list of “wants and needs” but nothing to offer in return, you’re setting yourself up for failure. The goal here is to make the proposal win-win!
Next, you’ll have to be completely honest with yourself and identify your biggest weaknesses. They may be technological, financial or having to do with customer acquisition, etc. These weaknesses are your gaps and it is these gaps which will help you identify the best potential partner. In other words, you will be most successful if you find a partner who will fill as many of your gaps as possible. Remember, you’re looking for synergy here. Keep in mind you may have to partner with multiple companies to fill these gaps, even if it is for a single project. Note though, adding more than one partner at a time for any given project makes things a little more complicated.
After you’ve identified your gaps, start thinking about the type of company you would like as a partner. Is it a big, established company? Is it a smaller, more nimble one? Is it a company with a large social following? Would it have to be local or could you partner with a company in another state or even another country?
Taking all this information into context, you should now be able to brainstorm and make a list of the companies which fill your gaps and with which you would like to partner. Or, at the very least, you’ll have the criteria for potential partners.
INTERNAL FRAMING OF THE INITIAL, BASIC PITCH
For your initial outreach to potential partners, you’ll need basic bullet points for conversations and emails. You’ll want to concisely convey enough information about the potential partnership to get them interested, but not so much that someone else could take your idea and run with it. You also don’t want them to simply judge, from your first outreach, they’re not interested. Make sure you mention the basics of your idea, what you bring to the table, how you would like them to be involved, and how they (the company) would benefit. Remember, the goal here is to secure a time for a short, initial conversation so you can convey an exciting opportunity, over the phone or in person.
FINDING THE RIGHT PARTNERS
The first thing you’ll need to do once you have a preliminary list of potential partners (or at least the criteria for potential partners) is to start your research. Clearly, the best way to do this is on LinkedIn. If you don’t know which companies you would like to approach, start with a search of the criteria items, in both LinkedIn and Google. This will help you start a list. You should also reach out to contacts to see if they have ideas on who would make good partners.
If you have a target company in mind, visit the company LinkedIn page. On that page, read the “About” section, see when they were founded and pay close attention to the number of employees. This will give you an indication of the company’s size. Most importantly, see what they have listed as their company specialties. Read their LinkedIn posts. If they’re interesting to you, make sure you follow them on LinkedIn. If you have a LinkedIn Premium Account like I do (it’s well worth the investment), you’ll also see an “Insights” section. Here, you can see a lot of information about their employees, including the growth trajectory, distribution and tenure of their headcount. This will give you tell you if they’re in growth mode, staying the same or reducing their headcount.
Now, with all of this information, ask yourself if the company appears to align with yours and with your project goals. If so, or if you’re not sure, do more research by visiting their websites and read their press releases and social media posts. Do they have a large social media following? If they do have a significant following, where are they the strongest; Facebook, Instagram, etc.? You should also research how they treat their customers by reading reviews about them, their products and their services. The partners you target should be credible and respected. Then, if you confirm your belief they’d be a good partner and align with your brand, you will now have to find your way into the company. More importantly, you’ll have to find the right people at the company to approach.
Clearly, the best way into a company is through a referral versus a cold call. You greatly mitigate trust issues when someone refers you to the person you’re trying to reach. So again, head over to LinkedIn and go to the company page of your first target. On the company page, toward the top right, you’ll see, in blue, the words “See all # employees on LinkedIn.” Click that and you’ll get a list of all of the company’s employees on LinkedIn. The list will include their names, positions, location, what level connection they are to you and which connections you share with them. The first thing I do is look for the right position of the person I’m trying to reach depending on the type of project. I pay close attention to LinkedIn connections in common. Usually, the more connections you share, the easier the initial pitch will be. More shared connections generally means more trust will be afforded to you. The ultimate goal here is to get to the decision maker and if you can, get referred from a connection in common via email. I know you might be tempted to cold-call the person, but trust me, getting to them via a referral gives you a better chance of success. There’s one exception to this; if you work for a large, very well-known company, making a cold call is fine.
ASKING FOR A REFERRAL FROM A MUTUAL CONNECTION
If you have LinkedIn connections in common, display the list of the connections. Who on that this is most able to positively talk about you and your company? Have you successfully worked with any of the people listed? Next, send a LinkedIn InMail message to that connection (or you can also call them) to determine how close they actually are to the person at the company you’re trying reach. If they’re close with them, tell that person you’ll be sending them an email and that you’d very much appreciate them forwarding it to your target partner contact. Do not, under any circumstances, have them send an email on their own. The goal is to have them forward YOUR email, making sure they ‘cc’ you. By doing so, you’ll have your initial pitch conveyed the way YOU want and an easy way to follow up with your target.
IF YOU MUST MAKE A COLD CONTACT (CALLING VS. EMAIL)
If you don’t have connections in common, you may have to get a little more creative and you may have to make a cold call, send a cold email or send a LinkedIn InMail (though you need a Premium account to do so. More can be found here: https://www.linkedin.com/help/linkedin/answer/1584/inmail-overview?lang=en. Each has its pros and cons. Do whichever you feel more comfortable doing. It’s up to you.
I have found, in general, the people in business development, sales and marketing are more willing to entertain a partnership conversation as long as you show them the potential financial upside for them. After all, these are the people who are tasked with growing the company. So, even if your partnership is to be based on the sharing of technology, don’t shy away from the business folks. Remember, the purpose of a cold call (or e-mail) is to make an appointment for a longer conversation, be it over the phone or in person. This isn’t the time to lay out your whole plan. I suggest you use your previously created partnership bullet points and remember to point out how they will benefit. Again, make sure you’re contacting decision makers or people who can influence the decision makers.
Finally, if you are calling, be prepared to leave a short, concise voicemail, not more than twenty seconds long. Make sure you use the person’s name, mention your name, provide a sentence or two about why you want to speak with them and mention your phone number twice. Practice a few times before leaving a message.
MAKING THE INTIAL CONTACT
Once your referral has connected you via email to the right person at your target partner, you’ll need to be more specific about your partnership idea. Your return email to the person should be clear, succinct and compact. It should also mention that you’re going to send them a LinkedIn invite to connect, which you should do within a day or two.
Since your goal is to get a meeting, either on the phone or in person, your email should briefly explain what you do, your idea for a partnership, why you think they would be a good partner and how a partnership would benefit both organizations (but focusing on how they would benefit). Finally, mention how you’d appreciate ten minutes of their time, at their convenience, to talk about your idea. Done properly, you’ll pique their interest and get an appointment with this person, and it will likely be for more than ten minutes. You may get a rejection and that’s okay. It happens. If it does, respond politely saying if they change their mind you’d be happy to have a conversation. Mention again that you’d like to connect on LinkedIn (and send the invite). Then, move on to your next partner target until you get a meeting.
TEN MINUTES TO GET THEM EXCITED
If you get a ten-minute call on the books, you should send a one-page overview of your proposal to them a couple of days in advance. If you have their email, great. If not, send it through LinkedIn InMail. Either way, this gives them some time to review it and have put a little thought into it. Note though, it should be short and easy to read. It should briefly mention who you are, what you do, your idea about a synergistic partnership and what the goals are. Include only a few sentences on each section. You should also include a couple of data points as this will show you’re serious. Your goal here is to get a longer meeting scheduled, preferably in person. So, during your ten-minute call, go through your pitch overview. Make it short, sweet and exciting. Done properly, you’ll get a longer meeting.
CREATING THE PITCH DECK
I like to use PowerPoint decks with limited, bulleted talking points to go through an initial proposal in person. It is also good material should they ask you to send something in advance of your meeting. It shows you’re serious, that you have done your homework and it lays out your plans. However, it should be brief enough to require this meeting to go over the details. Don’t throw the kitchen sink into it.
The deck shouldn’t be too long or too verbose. It should be an overview of a win-win proposal that includes bullets and data points on:
- Your background highlights and I stress the word “highlights.”
- Your clear objectives. What is your end goal?
- What you bring to the partnership and why you are an ideal partner.
- Why they are ideal partners and why did you decided to approach them.
- What they bring to the partnership and how you would like them to participate.
- The potential for mutual wins of the partnership by joining forces.
- What the end state of the strategic partnership looks like.
- And, just a hint of what other things could you possibly do together in the future. This shows you’re a good investment of their time.
For the actual meeting (i.e. not for the deck), you should put a fair amount of thought into the economics of the partnership. You should know what you’re willing to spend (minimum and maximum) and what kind of return, financial and otherwise, you want from your investment.
Finally, make sure you allow time for and encourage questions and discussion. If you get a thirty-minute meeting, your presentation shouldn’t be more than fifteen minutes. The extra time should include conversation about what challenges they are facing, what their motivations are, what their overarching goals are and their reaction to your proposal. The more your partnership proposal helps them with their challenges and reach their goals, the more likely it will be you’ll get a deal. Remember, your goal is to come up with a shared vision of a mutually beneficial partnership.
Throughout this whole process though, it is important to remain realistic and keep it as simple as possible. Asking for too much is a mistake. You should also be cautious and protect yourself, your data, your customers and all of your IP. Speak freely, but don’t give away so much information that would be damaging to you if they reject your proposal.
Assuming you’ll be successful and that your target partner finds your proposal interesting, you’ll meet, discuss, iterate and hopefully move to the final step before implementation; the agreement.
THE AGREEMENT DETAILS
Once you get an approval to more forward, you need a written agreement. Don’t even think about skipping this step. I strongly suggest hiring an attorney to come up with your agreement template and you can use it as a starting point for other, future partnerships. Of course, you can also find agreement templates online. Personally, I would only suggest this if you’re adept at writing contracts. Otherwise, have an attorney write it.
The agreement needs to be complete and detailed and include non-disclosure statements. Your proposal should lay out your ideas, your goals, who does what, what each company will bring to the table, the related expectations of these items and how expenses will be shared. It should also list your measurement of success and what the KPI’s (key performance indicators) will be, what you’ll do if the KPIs aren’t being met, how often you’ll meet to discuss the KPIs and the project progress in general. It also needs to include everything related to IP and who owns what at the start and who will own what as a result of the strategic partnership. Of course, it should also include a section on the duration of the partnership and what will happen at the end of the partnership, with options for extension.
While all of these things pertain to a successful partnership, sometimes things don’t go the way you planned. So, you should also include a section on what happens if things go wrong. What happens if the partnership is a bust and it doesn’t work? What if one of the involved parties completely under-performs or worse, wants to back out? Who will own the products created during the partnership? Who will own the IP (intellectual property)? There’s a lot to cover in an agreement, which is why I always recommend hiring an attorney to write this for you. Noe last point, if you’re partnering with a big company, you are going to have to use one of their agreements, I assure you. It doesn’t mean you can’t ask for changes or additional clauses though, so be diligent. They may make the changes, they may not. That’s just the way big companies roll. If you are using a big company’s form, then I would definitely use an attorney to help you understand all the terms of the contract.
ONE FINAL PIECE OF ADVICE
The best strategic partnerships are those between two or more organizations that have the same values and share the same goals. A successful partnership requires a lot of work. It isn’t a “set it and forget it” type of project. Keep communications open, regular and honest. Most important, make sure there are multiple people involved. Create relationships with as many people as you can at your partner company. You don’t want the project(s) to fall apart if someone leaves the company.
As you can see, there is work involved, but a good strategic partnership can catapult your efforts. With the right partner, you should be able to do more, faster and cheaper than you would on your own. LinkedIn can be an important tool to help you create a successful strategic partnership.
If you’d like to see a PDF of this complete guide, you can find it here: Creating Strategic Partnerships_Final PDF