Starting a new venture can be a daunting prospect. But if you’ve made it to Base Camp – that is product built, funding in place, people on board etc, then you could be forgiven for thinking the hardest part was done.
Unfortunately in fintech startup-land, this is hardly ever the case. With little to no brand awareness, competitors with deep pockets, and few to no deposits in your prospective clients’ trust banks, the long, slow climb to success is in front of you, rather than behind.
In fact, you’d do much better to forgo the fireside chat and congratulatory cups of hot tea, keep your belay on and sharpen your ice pick. You still need to climb the sales mountain that is Everest. And Everest, as many of us know, is incredibly unforgiving.
Like climbing a mountain, going it alone on the sales journey can be tough. It’s the reason why many more businesses, fintech startups included, are choosing the partnership model as their go-to-market strategy. But do these models really make growth faster and sales easier? Or can having someone else involved in your sales process be a recipe for disaster?
Well, like most things, there’s no simple answer to that one. It all depends on what you mean by partnership and how you approach it. Get it right however, and the partnership model can be a powerful long term distribution strategy.
The key to success is to plan your approach before you start the climb. Below I share three things to consider when devising your partnership strategy.
Understand your leverage – no one size fits all
To make a partnership valuable to both parties, each needs to feel like it would be impossible, or at least harder to achieve success without the other. This means you have to be offering something the other partner doesn’t have but needs in order to grow faster than what they can alone.
And by the way, this isn’t always cash. While commission streams and referral payments can be attractive to some partners, for others the value of this relative to other ways they could gain a return on their time is negligible. Instead, can you help invest in their development/training expenses to integrate your product or offering more quickly with theirs? Can you contribute resources towards their general marketing efforts, with a caveat they reference you? Can you reduce their support and account management burden by taking on the client management tasks they find onerous? Can you raise their profile within the client community?
In other words, what’s your leverage? Once you understand this at a general level, and then at an individual partner level, you’re on the right path to a successful relationship.
Who can you learn from – Xero
Look beyond the obvious
Sometimes the best partners might not be the most obvious ones. Remember, if you’re trying to cuddle up with what seem to be the most logical partners, chances are all of your competitors are too. How will you cut through the noise? Look towards the periphery of your client ecosystem and work out who else holds an influential role in your target market. Could your product be adapted or tweaked to make them more successful? And then would this give you a greenfield opportunity and breathing space away from your competitors? What other startups could you pair up with and complement to supercharge your shared value story?
Who can you learn from – Trialpay
Don’t tie the knot too quickly
They say fools rush in where angels fear to tread. And this can be true when it comes to forming partnerships. Instead of worrying too much about agreements and contracts, where possible, start testing the working relationship as soon as you can. Remember, this isn’t just for your benefit but for your partner’s as well. Partnerships go south all the time. Better you both find out the good and the bad before you walk down the aisle, not after.
Who you can learn from – yourself. Get started, what are you waiting for!
Partnerships can help you achieve great things. Sir Edmund Hilary, the legendary New Zealander only conquered Everest by partnering up with local sherpa Tenzing Norgay. Regardless of whether you’re a sherpa or a mountaineer in the market, to achieve your goal you might just need to do the same.
Want to know more about how to growth hack B2B partnerships for success? If you’re in Sydney then come see me speak this coming Monday the 15th of February at Atlassian’s HQ. Details here.
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