It’s no secret that the path of the tech startup is uniquely challenging, and at times can be a lonely journey for entrepreneurs. Lack of revenue generating opportunities, poor cash flow, hindered product development progress from bootstrapping or even your concept not gaining initial traction are just a few examples of the rocky waters that startup founders have to navigate on a constant basis. But fear not, because as many entrepreneurs have learned before, there is a way to bolster against these types of challenges and take full advantage of opportunities as they arise: find and secure strategic partnerships.
I know what you’re thinking – “well of course finding good partnerships will benefit my business”; to which I can only respond “well, why aren’t more startups making it a higher priority?” Yes, much like we all know that taking the stairs versus riding the elevator is for our benefit, yet so infrequently do it, the same is true for entrepreneurs and how little focus they can (at times) put into to cultivating value-added partnerships. So why exactly are such a large number of entrepreneurs not applying the same zeal to developing partnerships as they commit to product iteration, branding and sales? Perhaps it’s because entrepreneurs are inherently more prone to “lone-wolfedness” in their approach to work; or maybe it appears too daunting of a task to find and leverage partnerships. My bet is simply that a number of entrepreneurs lose focus on the benefits of partnerships in the middle of the fog-of-war that is running a startup.
Being that it’s the New Year, and so many of us are pursuing our 2013 Startup Resolutions, I thought I’d take a swipe at some of the hot ones on your mind and offer examples on how strategic partnerships can help hit these new goals in the new year.
1) Startup Resolution #1: Get market validation for a product
Most entrepreneurs contend with getting lost in the white noise of previous market movers or address a bevy of skeptics nay-saying their product’s potential. Partners can impact your product validation goals in a number of ways. The simplest solution of course being that by virtue of them publically using your product they will lend credence to your cause. Additionally though (and oftentimes overlooked), is the fact is that partners make great laboratory assistants with gathering, testing and applying feedback to your product roadmap. Some of the best iterations, advancements or new perspectives on your product can come from partners who have a vested interest in your success and are willing to forgo typical politeness for the sake of helping you take your product to a more evolved stage.
2) Startup Resolution #2: Explore new market expansion and sales opportunities
There are two painfully prominent truths that entrepreneurs contend with daily – first, you have a finite amount of resources to use in reaching your goals (especially when it comes to marketing) and secondly, your product is likely in its infancy or young adulthood at best. These two facts can make expanding into new markets seem like the biggest dragon of all to slay for entrepreneurs. Rather than ignoring expansion opportunities both in terms of markets and new sales, why not take that first step into the unknown with a trusted partner? Securing channel partnerships (especially with groups that already have a long-standing presence in their respective market) can significantly lower the hurdles that entrepreneurs will have to traverse as they expand; additionally partners present the opportunity to co-mingle services and take on projects jointly that may not of otherwise been possible for either group on their own. Plus these opportunities commonly end with the added value of being an experience that garners worthwhile feedback on how to better improve your own internal processes.
3) Startup Resolution #3: Solidify financing plans
Perhaps this resolution is the most widely targeted, and for the majority of entrepreneurs, can certainly be overwhelming. As the ebb and flow of the capital markets takes place, entrepreneurs can often be left in the lurch as far as how best to plan for capitalization. It comes as no surprise that a big part of finding success in the startup game hinges on financing. As your work with a partner goes on, you will see that overtime the success of each of your business models may begin evolving from complete independence to more inter-dependence; so much so that when it comes to fundraising (or even M&A activity) your partners will take a vested (and possibility invested) interest towards seeing your company’s financing secured. It’s not uncommon for these partners to be open to exploring an equity position, short-term loan or profit-sharing setup with some of their more prominent partnerships.
There is no doubt entrepreneur’s dance cards are already getting full for what their strategic initiatives are for 2013. Just remember that the outlook for those goals can be significantly improved with value-added partnerships. So plan accordingly, brainstorm new approaches and be sure to make securing and cultivating partnerships a high priority sooner rather than later. While certainly not a “fix-all solution”, finding the right partner can be a versatile tool for helping contend with challenges and reach new heights in the New Year.
Tags: Business, marketing, New Years Resolutions, product development, sales, Startup Founders, startups, strategic planning, strategy