How to Choose a Strategic Partner to Bootstrap Your Businessby@antonvasilenkotg
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How to Choose a Strategic Partner to Bootstrap Your Business

by Anton VasilenkoNovember 7th, 2023
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You will find detailed instructions on how to choose the right business partner and how to build an effective working relationship with them. Using examples of failed and successful cases, I'll also discuss the key factors for an ideal business partnership.

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Strategic partners play a crucial role in the growth of a business, offering vital resources, experience and support. These partnerships bring together organizations with similar goals and complementary strengths, resulting in a powerful synergy. Recent statistics show that 94% of tech industry executives consider innovation partnerships a necessary strategy. Such collaborations increase the likelihood of closing deals by 53% as well as accelerate the process by an impressive 46%.

This article will explore the world of strategic partnerships and their significance in today's business landscape. I will also provide practical insights into creating and maintaining successful partnerships. Additionally, I will discuss the challenges that may arise, as around 60-65% of strategic partnerships fail due to a variety of factors.

Instruction: How to Find a Reliable Partner?

When searching for a reliable partner for your project, consider the following criteria to ensure a successful and productive partnership:

  • Alignment in Strategy: Look for a partner whose strategic view (goals and objectives,  especially in areas related to your project) aligns with your vision.. For example, if your company focuses on event organization and announcements, partnering with a company that prioritizes these activities would be beneficial.

  • Tone of Voice: Find a partner whose tone of voice matches your brand. Investigate how each  company communicates and interacts with its audience to ensure compatibility. A similar approach and messaging style will ensure consistency and coherence in the partnership.

  • Company Scale: Consider partnering with a company of a similar size or one that is more prominent, as they are most likely to be compatible in terms of resources, capabilities and operational capacity. A partner of a similar scale will better understand your challenges and be better equipped to support your project.

From Theory to Practice: How It Works?

While it is easy to state the critical elements for a successful partnership, life is a roller coaster. Therefore, I will share cases of successful partnerships, some failures, and the lessons you can learn from them. So, let's break down strategic partnerships.

Failed Partnership: Lack of Engagement in the Product

One significant issue with this partnership is that it focuses only on the owners and their companies. In other words, there is a superficial attitude when explaining the intricate details of how a complex product works, often resulting in a response like, "Yes, we will do everything." This attitude suggests a lack of understanding of the technical aspects and engagement in necessary discussions such as briefings and meetings. This lack of understanding and engagement simply means the person is incapable of comprehending the complexity of the problem at hand which will result in continuously adjusted timelines and hand-holding. To prevent similar situations in the future, I establish realistic deadlines, provide thorough briefings, and foster a deeper understanding of the product. The engagement and alignment between partners can be enhanced by conducting meetings and improving the partners' technical comprehension.

The most frequently used KPI in partner revenue assessment is partner source revenue, while partner influence revenue continues to be a prevalent KPI, with approximately 54% of partner professionals incorporating it in their measurements. Source: State of the Partner Ecosystem Report

Failed Partnership: Distinction in Business Processes

In another case, I encountered a problematic approach from the web design contractors I hired to develop a website. Despite clearly communicating the timeline and the three to four months deadline for completing the complex website, they engaged in prolonged workshops for two weeks, which eventually stretched to two months. This led to analyzing the website's design, resulting in additional costs of hundreds of thousands of dollars.

This contractor, who primarily worked with big corporations and tenders, failed to understand the unique business processes of our startup. They wanted to excessively deliberate over the website, potentially extending the project’s timeline to a year or longer. This approach greatly concerned me, as it did not align with the fast-paced nature of our product development. This was the second red flag I noticed in our strategic partnerships.

As a result of this experience, I now prioritize negotiating partnership details in advance. Finding companies with similar scalability and business approaches is crucial to avoid such future complications.

Failed Partnership: Unequal Participation

A well-known global e-commerce company planned to hold a gaming tournament in Dubai and approached True Gamers, an international network of eSports centers, for a partnership. They thought their popularity would cover everything, including the resources and needed support, so they offered nothing in return; instead they chose to focus solely on enhancing their own brand image.

I found closing our space without compensation  e for several days unprofitable therefore this offer was not beneficial to our side and it was never realized. This example highlights a failed partnership where one side prioritized its image without considering the importance of equal participation and mutual benefits. It serves as a reminder that partnerships should be built on shared goals and tangible contributions from all parties involved.

Successful Partnership: Clear Expectations

At True Gamers, we had the opportunity to collaborate with a soft drink manufacturer in a partnership. The arrangement was simple yet effective: we would purchase their refreshing beverages, and in return, they would graciously provide us with exclusive invitations to their highly-anticipated tournaments.

Participating in these tournaments from the comfort of our homes gave True Gamers members a chance to secure one of the two coveted slots available through our club. It was a fantastic opportunity for our community to showcase their gaming skills and compete against other passionate gamers.

The secret behind the phenomenal success of this partnership lies in the crystal-clear understanding between both parties. We knew exactly what was expected, and we delivered on those expectations.

Successful Partnership: Companies from Various Industries

One notable example is the partnership between Aramco, a Saudi Arabian energy and chemicals company, and Gamers8 in cybersports. Aramco, known for its belief in the power of youth and its aim to inspire and engage them, sought strategic global partnerships to achieve this. One of their collaborations was with the Aston Martin F1 team.

This collaboration had a unique objective: to discover promising young drivers through community sim tournaments. The selected individuals were allowed to train and gain real-world race team experiences globally. This partnership showcased Aramco's commitment to supporting young talent and demonstrated how companies from different fields can come together to create meaningful opportunities.

The Aramco Sim Racing Arena was at the heart of this collaboration, which served as a hub for e-racing and simulators within the Gamers8 Riyadh Boulevard. This venue attracted nearly 100k fans during the festival, making it the most popular venue. The festival's extensive reach and platform, including live streams, teams, and attending fans, enabled Aramco to maximize its brand exposure, a key objective for any sponsorship.

Strategic partnerships are a powerful tool for businesses to leverage vital resources, experience, and support. These collaborations foster innovation, accelerate growth, and create opportunities for mutual success. Finding the right partner and maintaining clear communications and expectations are crucial to building and maintaining successful strategic partnerships in today's dynamic business environment.