We've seen a lot of corporate-startup partnerships through the years - the good, the bad, and the ugly.
Here are some of the best practices we have picked up along the way.
1. Understand Your Champions and Bottlenecks
Every company has something that slows down the process, and it’s important to know what yours is.
Who are the people who need to be onboard for a project to become a reality? These people are not always the most obvious, but they can have a huge impact on any potential partnership.
Some companies have a more arduous legal process than others. Others have executives that need to be involved and end up becoming severe bottlenecks.
Figure out who your champions are and where the bottlenecks are, and use this knowledge to devise a roadmap for piloting a partnership. Understand your dependencies and figure out some repeatable mitigation strategies.
2. Define Your Goals
It sounds obvious, but you’d be surprised how many corporate teams try to partner with startups without first establishing what they’re really trying to do.
We see this all the time. A company asks us to introduce them to a startup without context on how they might really work together. They meet the startup, everyone gets excited, and nothing happens.
The output of a partnership can only be as good as the thought put into it. Before you contact a startup, figure out what potential gap it could fill.
Does the startup’s technology fill a gap in one of your existing products? Or do they play in an area that is completely outside your current business model? Or, are they a great solution to a huge internal problem?
3. Find the Right Partner
Anybody can go into Crunchbase and get a list of startups in their vertical, but it’s critical to consider whether a particular technology can be adapted to fit your company’s needs.
To do this, you need to determine your needs and motivations, figure out which criteria matter most to you and carefully evaluate each potential partner against that set.
For example, earlier stage startups are ideal when you need to adapt the startup’s core tech in some way since they have more flexibility in their roadmaps.
On the other hand, if you just need a piece of technology to fill the gaps in something you are already building, a startup that has already put some effort into creating APIs or other ways of integrating their tech with other solutions will be a better fit.
4. Articulate Your Value Proposition
While many startups are thrilled to get a call from a big corporation, others can be wary.
The best startups are often inundated with requests and have to sift the valuable opportunities from meetings that will lead nowhere.
From a startup’s perspective, a corporate partnership can also slow them down from their core objective, or worse, the large company could decide to build their own version of the startup’s technology.
Startups have no time for distractions, and if you want to work with them, it’s imperative that you articulate what you bring to the table rather than resting on your brand name.
5. Be Upfront About Resources
Once you have narrowed down your potential partners, have an honest discussion about resources.
What can your startup partner reasonably expect to accomplish as part of a pilot? If the pilot is successful, will their existing resources be enough to deploy the solution as part of a full-scale partnership? If they aren't, this could be an opportunity for you to leverage your own resources.
Either way, having this conversation up front is vital to keeping the project moving past the pilot stage.
6. Overshare, Always
An unclear timeline or roadmap is one of the biggest deal-killers we see in these situations.
For a startup, every day matters and they can’t wait around for a month while a corporate partner works out its internal processes.
Once you understand your typical turnaround, be completely upfront with a potential partner about how long you expect each step of the process to take, and if it takes longer, keep them in the know about what’s going on.
7. Don’t Smother the Startup
Big corporations like meetings. Lots of them.
It’s tough to fight the temptation to meet with a startup partner once - No, twice! No, three times! - per week. Both parties have to agree to a roadmap early on, and figure out a way to communicate without meeting each other to death.
Remember the reason you are partnering with a startup in the first place: they are fast and focused. If you take away that focus with too many meetings, you sacrifice the core value of the partnership.
The team running the pilot or full partnership should act as a barrier between the startup and the rest of the organization. Shield the startup from the meeting overload that often follows exciting new projects, and act as the startup’s guide to your org, providing resources and support where needed.
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