Adrie's Blog

Partnership

Partnerships are notoriously hard to do well, to give you two key reasons:
a) they are people or organisations that you have little say over and
b) often there is a very unilateral interest - one of the two parties wants to other to be their partner.
At E.Factor we see the latter more and more now - as we grow - more people and companies want to do business with us, which was very different to when we were of a more modest size. No-one came to us, we had to go out and look for new partnerships ourselves and met with only mild interest in most cases.

Often you look for partners to cover another area or country and represent your company there. But it often proves very difficult to find the right partner, someone that truly understands the market but also the product. These days, internet obviously is a great help in gathering information about people and companies, but it doesn't tell you of course how strong the partnership will turn out to be. For partnerships where there is a paid element - you need to get that payment just right. If you pay too little, you can't be surprised if your partner will represent other companies besides your own and may not spend too much time on your company and product. On the other hand, paying too much you run the risk that they'll just take the money for granted and do little for it, this has happened to me a number of times (quite often also because people think that you have plenty of money to spend if you can spare that much for the partnership)..

If you start a partnership abroad, always do your due diligence into the company you want to do business with. Visit a number of prospective clients and listen to what they have to say about the competitive landscape in general and the company you want to partner with in particular.

Always define milestones, make sure you have an exit clause you can call on when the partner does not meet the agreed objectives. The biggest problem in these partnerships is always one-sided thinking - people expect you to pay whatever happens, but will have 100,000 excuses why they could not deliver.

Take note when you start working with another party:
* that the timing is right for both parties;
* is there chemistry between you - a click between people
* take references both from competitors and clients;
* check their expertise, don't just take their word for it.

Remember that such a relationship can last many years, so be cautious entering into it and don't be impressed by words or name dropping. Trust the facts and your gut feel - the risk to your name, business and finances is too big to be anything but careful at the start.

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