When looking to grow your business, the choices come down to build, buy or partner. I decided to focus first on partnering and asked like-minded entrepreneurs and advisors for the straight talk on how to approach partnerships and collaboration for maximum benefit. Here is what you need to know and need to do when approaching partnering in your business:
1. It's Really Simple
Make sure you find someone with complementary skills. If you are a programmer, find a business guy, and vice versa. Don't find just another "copy" of who you are.
2. Values Matter!
Start with a small project that has limited risk as a way to test your values alignment with your new/prospective partner. People underestimate the power and influence of our values on decision-making and how we approach and perform our work. When values are out of sync - disaster ensues!
3. Help Me, Help You.
Partnerships are great for entrepreneurs BUT make sure both sides help each other and get something out of it and it's not one sided. Everyone is looking to get ahead so when partnerships form don't be surprised if someone leaves you hanging. Make sure when you talk about partnering that each of you put on the table what you will do for each other. Partnerships can be a great thing but make sure you approach it as a "Help me, Help You," situation and you're golden.
4. Define Ground Rules Upfront
It's easy to say "oh yeah I know that", but most small business collaborations don't - make sure the ground rules of the partnership are firmly established upfront including financial terms. Make it clear the value each party is bringing, so if you are both delivering a solution to potential clients, you collectively can pour your collective energy into making the collaboration work for the benefit of the client and not second guessing the motivations of your partners.
5. Winning Partnerships
The best partner matches require the two people involved to have the same beliefs about money management. Much like a marriage, two people with differing values when it comes to how money is spent will destroy a relationship. So, make sure your prospective partner feels the same way about how to manage money.
6. Aim High!
Oprah Winfrey said, "Surround yourself only with those who lift you higher." That said, attend events to connect deeply with like-minded professionals with complimentary expertise. Explore win-win-win ways to work together. Action Plan Marketing Guru Robert Middleton organized an Info Guru Summit weekend in January of 2010. That event brought my "Bio Whisperer" expertise to a well targeted group that has introduced me to 1000's of new ezine subscribers, blog followers, and customers.
7. Best Must Do Business Strategy
Do business with someone you can drink with. I learned this from the Koreans. When you can drink with someone, the real person comes out. The face of business comes off. You get to know if those "trust me" requests (that usually go along with a pile of one sided legal contracts) are really valid. Unfair to those that don't drink? Nah. I'm on a 1 month hiatus and I'm still cutting deals. Sure some people don't drink, and I respect that, no rule is absolute.
8. Trust Is The Key
Trust is the key to all relationships. If you want to build profitable partnerships, work with people you trust. Effective collaborative relationships are built on trust. Go first, demonstrate your trust in the person with whom you are thinking about partnering. Be willing to share your thoughts and ideas. Gain the trust of others by trusting others.
9. Map Your Client Ecosystem
A great collaboration strategy is to find referral partners who hunt at the same watering hole, but who play at different stages in the value chain. For example, our target clients are technology startups. One of the first things they do is go to a lawyer to incorporate. Next, they want to launch and raise money, so we are brought in, and then we refer them on to recruiters as they grow. In short, understand the value chain of your market and partner with those sitting in front and behind you.
10. Partnering To Stay On Track
I consult with start-ups & launchers on their PR strategies & do a lot of business coaching, too. As a solopreneur, I have different clients pulling me in different directions - it's hard to stay on track. So I hooked up with an accountability partner. We work together at least once a week; this keeps us on track & focused on long & short-term projects.
So that is my "must do" strategy - find an accountability partner, meet regularly & see what a big difference it makes in your business!
11. Be Specific
When entering into in a partnership of any kind, it is important to be specific about each person's role. Whether you are partnering or collaborating - be sure you spell out each person's obligation to the other, what you will get, and what the benefits are for each party. If partnering in a corp, be sure you have a shareholder agreement that specifies duties and roles, and consider having shares vest over time for each party. If only collaborating, be specific as to what each person gets.
12. Swim With Bigger Fish
When considering partnering or collaborating, many business owners think they want somebody just like them.
Nice and safe, right? Maybe.
Considering that the point of collaboration is for growth then you would want to consider partnering with someone who challenges and encourages you to get out of your comfort zone. Staying in a place of comfort will keep you where you are. Working alongside someone who pushes you (in all the right ways) can bring growth.
13. Partnership Is Like Marriage
Partnership is like marriage. Like marriage, sometimes you give more than you get and sometimes you get more than you give. A partnership is something that you work on constantly.
14. Open The Communication Lines
Always keep the lines of communication open. This means to always ask questions and clarify with your business partner, making sure that both partners are on the same page. Lack of honest communication is the biggest downfall of partnerships. Example questions to ask your partner include; What can we do to help each other be more successful? What should we keep doing? What should we do more of, or less of?
15. What's In It For Me?
Businesses seeking partners are often clear on what they're looking for from that partner, for their own business. However, for a successful partnership that will go beyond the immediate deal, you need to think about the motivations for the partner. The ability to clearly articulate not only what's in it for you, but also what's in it for them, is key to success.
16. Partner Rather Than Compete!
A full 50% of our business comes to us through partners. Since we are 100% an internet business, the name of the game is search engine optimization (SEO). My partners are good at it, and as affiliate sites they get paid a commission only when a sale is made. It's like I'm piggybacking on their SEO. Sure I have to share their visibility with other merchants they select on their site, but the results prove out. I pay 15% of a sale which averages $10 per customer, very reasonable for us.
17. Give More Than You Take
Find a way to give rather than look for what to get in all of your dealings and interactions. It may seem like a paradox and somewhat of a cliché, but it does seem to be true that the more you give the more you receive. The only way to see if this is really true for yourself is to put it into practice consistently and with sincerity and see what happens. Don't wait until you are successful to start giving back. Giving is not an afterthought to success, it is the foundation.
18. Key To Successful Partnering
The key to a successful partnering relationship is to make sure that the goals and expectations of both parties are aligned. The worst scenario is where one partner is expecting leads to be passed to them, and the other partner is anticipating sales to the other partner's existing customer base.
19. Build Power Partners & Grow
Find your perfect power partners and create formal referral agreements. For example, a professional organizer will build a book of business more quickly if she aligns with a Realtor, moving company, junk hauler and cleaning company. Turn them in to Power Partners. Grow and rise together. All four companies can host workshops together, market together and become each other's sales force. Give each other 10% of the net sales or a flat fee for each referral that turns in to a paying client.
20. Keep Communication Flowing
If you want to grow and enhance your business with partners and collaborators, it is critical to keep the lines of communication open. Make sure they know what you do, and are updated about your company's developments. Don't assume they know all areas of your expertise -- instead "market" to them as you would to any prospect. Be sure you also communicate as you work together -- no partner has ever complained about over-communicating, but many have been frustrated by the lack of it!
21. Put It In Writing!
Establish an agreement in writing that clearly defines the roles, responsibilities, financial terms, schedule and anything else that is part of the partnership. If the arrangement is between friends or among family members it is still vital (maybe even more so) to put it in writing. Having a defined agreement is more efficient, insures a successful project and protects partnerships, friendships or family harmony.
22. Communicate To Collaborate
The one 'must-do' thing we do in successful collaborations is to have weekly meetings that can be canceled only if both sides agree. If either organization won't commit to a weekly management meeting, odds are that the collaboration won't be successful because there's no clear communication channel for the collaborators.
23. You're Getting Into Bed
Do your homework on a perspective partner upfront to determine if they are looking for a relationship that benefits both of you, or if they’re drowning, and flailing to grab onto anyone that will keep them from going under. Also, check in with your “gut reaction”. If they pass the tests, then trust completely.
24. Be An Idea Expert!
Always have specific ideas and suggestions ready BEFORE you meet with the person with whom you want to collaborate. You will find that the ideas that come from your area of expertise are the reason why they should want to collaborate with you too. Present those ideas as a starting point. At the very least, he/she should appreciate that you have taken time to consider the options. At best, your ideas will be used as is or they may be the beginning of a strong collaboration concept.
25. Strengths & Weaknesses
When you partner with someone combine your strengths and their weaknesses or your weaknesses and their strengths to create the best synergy possible.
26. Collaboration: Free & Fruitful
Small business owners usually have limited resources (time, people, and money). An often untapped / under-used resource is their own suppliers. Suppliers often have experts, designers, drafters, engineers, and creative-types on staff who would be pleased to provide assistance in product development, advertising campaigns, marketing concepts, etc. Often you receive these services free of charge. My suppliers understand that this is "the cost of entry" for doing business with companies I run.
27. Goals And Champions
Successful strategic partnerships require two key ingredients for success: (i) distinct, well-thought out goals, and (ii) internal champions. The goals should be the result of serious and honest discussions between the partners regarding expectations, and should be translated into something measurable. Track your progress as you proceed. Also, each partner should identify by name an internal champion that has the necessary power and influence to move the relationship along successfully.
28. Deep Industry Understanding
My one tip would be to find a partner who actually understands your business, not just on the surface but truly understands the business as much as you do. In essence you need somebody who can not only fill in the gap of specific market knowledge yet also understands what your company is capable of providing to each client.
29. To Collaborate Or Not?
When deciding if it makes sense to collaborate, you must answer in the affirmative to this question: Is it beneficial to ALL parties?
When you do decide to collaborate you must give more than what you expect.
Does this sound crazy? No, when you are busy tracking who gave what, you lose the essence of collaboration which is to develop relationships and provide service beyond measure. An unmatched benefit of success.
30. Honesty Is The Best Policy
Have complete transparency in term of operations, remuneration and most importantly objectives. A crack in the relationship at an early stage or the revelation of a lie at a later date will not only destroy the immediate efficacy of the partnership but also create negative reverberations and possibly bad word of mouth that will damage the credibility and reputation of your business.
31. High Trust = True Synergy
In a high-trust relationship, speed goes up and costs go down. Demonstrate a propensity to trust by extending trust abundantly to those who have earned your trust, and conditionally to those who are earning your trust. Learn how to appropriately extend trust to others based on the situation, risk, and credibility of the people involved, and most importantly, keep commitments at all costs. Say what you're going to do, then do what you promised.
32. Clarity When Collaborating
Be very clear about what you need from the collaboration and always be open to allowing the space to be filled with someone who we can help fulfill their dreams while jointly owning a space within your organization.
Move away from old business models of competition and comparisons and develop relationships that are structured around compensation being commensurate with contribution.
33. The Right Partners Add Value
Be complementary. Partners who offer services/products that truly complement yours--and your brand promise--are the ones that make the most sense. Ask yourself of each potential partnership: how would this company add value for my customers?
34. Throw Give/Take Out The Door!
It's not about you. It's not even about give/take. I'm a firm believer that it's give/give. Give until you can't give anymore. In the long run, the benefit is tenfold.
I have a relationship with a chocolate and coffee company. Last year, I traded services for her product, which became my holiday client gifts. Not only did she benefit from my services, but she also received exposure to potential clients. She benefited more initially but I consider the relationship a valuable one.
35. Partnering: It's Not About You
As companies, we partner because there is value in it for us. But remember that the partner has to feel the same way too.
If we are strategic in what we are trying to achieve, the relationship has to be meaningful and fulfilling for both partners. Your partner must want you as much as you need them.
As a small business I have often less resources to offer than other potential partners. I just remember that what makes me unique for a client also makes me valuable in a partnership.
36. Pretend To Be Worst Enemies
An attorney and an accountant once gave this advice to me: "Pretend you and your business partner are worst enemies for a day. It will be hard to do, because you like each other now. But you need to think through various scenarios—like death, disability and financial disputes—as if you were adversaries. What processes and agreements do you want to put in place to protect yourself and your business?" Write down your roles, financial agreements and decision-making/communication ground rules.
37. Give To Get
Be willing to give more than you are expected to give. I have learned that when you freely share your expertise and allow yourself to have the heart of a giver, you will receive more than your share of help in return. The law of reciprocity definitely applies to your relationships with those who can advance your business more than you can do alone.
38. A Simple Age Old Method
Just email the person you want to partner with and pitch your proposal that very clearly states the benefit you have to offer that person. If it's going to benefit him, he'll get back. Most high profile people who understand marketing and PR get back with either a yes or a no. Even best selling author Seth Godin has replied to my email. It's the old method but it's very simple, it works. Try it!
39. Must Do Tip
Communication. Solo entrepreneurs that partner and start a business with other entrepreneurs need to share and be transparent about all information. While solo entrepreneurs are used to running a business on their own, they aren't used to relaying their mind share with other decision makers. If people on the team are designated as account managers they'll have access to a lot of information and it's critical they have the ability to concisely take back and communicate that data to their team.
40. Partnership Prenuptial
Like any other partnership, situations change and can affect the relationship.
No matter how short-term or informal, terms and "what ifs" should be discussed upfront and documented. While you may feel you don't need a formal, written agreement, an informal e-mail, simply to confirm your understanding, can be invaluable.
Ideally, talk to an attorney about critical terms, make them "user-friendly", and create a template you can edit to use as a "confirming we're on the same page" e-mail.
41. Rules, Rules And More
My one "must do" tip when collaborating and/or partnering with others in business is to have a document that includes a firm set of rules and guidelines that are agreed upon and signed by all parties. This will set a clear path for an ongoing relationship. The document can also be updated when needed, but it is something that is imperative in order to protect all parties.
42. Character Counts
The one “must do” tip to collaborate or partner is to understand the motivation of the other partner, and the value system or code of ethics under which they operate. Even when your partner offers the best of abilities which complement yours, know what their motivation is, where they are headed, and how they will respond when the unexpected happens. Understanding these issues will create an atmosphere of trust, and allow room for working through the challenges which inevitably arise.
43. It Ain't What Or Who You Know
People say, "It's not WHAT you know that's important, it's WHO you know". The truth is, if you don't know how to persuade or motivate people, then I don't care if you know Bill Gates. Being able to persuade others without being a manipulative sleaze ball is the #1 difference-maker.
Mastering persuasion will improve your selling, negotiating, project management, marketing, and writing. Your job is to MASTER the science of persuasion. (Yes it is a science.)
44. Think Long Term
The single most important thing in building strong partnering and collaborating relationships with industry vendors is ensuring that the relationship benefits both parties. This requires trust, effort and an eye toward the future: building a long-term relationship. Try to see the relationship from their side and what you can do to make it work for them. Do that and they will make every effort to make it work for you, or they simply aren’t going to be a good partner.
45. Only A Few Matter
Most companies seem determined to engage in as many partnerships as possible. The reality is that only a small number matter. My tip is to figure out which partnerships provide the highest value and then focus only on them. In other words, identify what is most powerful and compelling about the combination of companies then give the partnership the best chance of success by 1) assigning joint executive sponsors, 2) naming dedicated teams, and 3) building a joint go-to-market program.
46. Explore Your Inner Publisher!
You'll attract more promising collaborative opportunities if you own locations where your unique content is published and updated daily. People like to collaborate with people who can spread the word about the collaboration. If all you have is a website and maybe a Facebook page, the value you add to a collaborative process is limited. If you own branded media outlets that you use to share ideas and showcase your expertise, you are a more attractive potential collaborative partner!
I think that this list presents a very good foundation for thinking about partnerships. Many thanks to everyone who contributed this valuable feedback!