Bottom line, a company is only as good as the people doing the work. People make the success. A company with smart people running it knows that it’s human relationships – partners – that can make scaling a goal that’s reachable.
Startups in particular need strategic partnerships to take them from baby steps to strides. But how are these special partners found, especially when startups often haven’t yet been around long enough to have connections? The best partners aren’t going to be random. They can’t be just anyone or any company. They must be carefully curated if they’re going to be effective at helping to bring a startup up the ladder of success.
Setting Goals
A strategic partner should have common goals with the startup. Aligned partnerships are powerful against any conceivable obstacle. Shared goals create a map with clear steps that lead to an outcome that both partners desire.
But those goals must be set by the startup first, then with those in hand, discussions with potential partners can be had to determine if there’s common ground.
Complementary Expertise
A good strategic partner brings something to the table that the startup doesn’t have currently. It could be something as simple as experience. It could be a set of assets, in which case asset investigation services would be called for to verify those assets. It could be other relationships, market access, a professional license, or similar. In turn, the startup would be expected to provide something the partner doesn’t have, to make the partnership unilateral and symbiotic.
Demonstrable Stability
No startup can afford to partner with a company or person that’s ultimately going to bring them down. The goal is an upward trajectory. So, any partner under serious consideration should have proven stability, with strong financial records and credibility in the industry.
Using Technology in the Search
Companies today are in a never-before-experienced situation where the use of technology can 10x the search for a strategic partner in business. Finding and vetting a great partner would have taken months or years before AI came along. Today, AI can be leveraged for a variety of services related to business success, such as:
- Executive screening, useful when making board choices
- Due diligence, for M&As
- Asset searches, for verification of funds
Of course, these AI-driven services are useful in hundreds of other ways; these are just a handful to show how powerful today’s technology is. A startup would be remiss to not leverage this technology in their hunt for suitable partnerships.
How Strategic Partnerships Help Startups
Startups must pass through so many stages to scale that it can be daunting to go it alone. It’s certainly slower to fly solo. Strategic partnerships make passing through each stage much easier and faster.
- First, there’s the funding and mentorship stage, where a startup seeks money and expertise to chase goals. Strategic partners help in this stage by giving startups traction to move forward from a stagnant starting point.
2. Next, startups start reaching for growth, wanting to grab more market share, and operate in more sales channels. Partners can help by driving distribution through building more industry relationships or promoting the startup through its own sales channels.
3. The level of sustained success isn’t one data point, but a stage where the startup has demonstrated control and leveraged the resources from the partnership to maximize profitability and reached stated goals. Joint ventures made possible through partnerships drive innovation and keep the startup relevant and growing.
Avoiding Impotent Partnerships
As much as a great partner can be like an upward escalator for startup growth, a bad partner can be a fast elevator ride down to the basement.
Red flags of risky partners include things like:
- Being targets of litigation, either pending or in motion
- Sanctioned executives
- Adverse reputation
- History of broken partnerships
- Lack of asset verification
- Conflicts of interest
- Legal entanglements
Ultimately, it’s important for startups to carefully vet any potential partners. A lot is riding on finding strategic partners that will prove to be assets to the startup. But as much as a good one can help, a poor choice can backfire in a big way.
Expansion of market reach, increased revenue, accelerated growth, and enhanced capabilities: It’s all possible with strategic partnerships for startups. By building strong, aligned partnerships, organizations that are just starting out can scale more efficiently and sustain long-term success that will benefit all the parties in the partnership.
