Partnerships teams often find their biggest challenge is having too many partners to manage rather than not enough. It is therefore really important to have a method to prioritise who to spend time with, which can be done by creating a qualification table.
To create an effective table, you first need to work out your key business objective. As partnerships offer value in many different ways – including accessing new regions, brand credibility, lead generation and competitive defence strategy – it is vital to understand your most important company goal before deciding the aim of partnerships. Once you’re clear on what the overall business needs to achieve, you can then start thinking about the types of partners who will help you achieve that. Then by scoring partners according to key questions, such as whether they have a similar vision, Ideal Customer Profile (ICP) or speaking to the same job titles, you can make data-supported decisions on which partners to prioritise.
For start-ups scaling from series A to B (e.g. circa £2million – £20million ARR), focusing on the unit economics of the business becomes a key focus of the exec team, so we need to know how partnerships can impact these numbers to get the function delivering value as quickly as possible. For me, this usually boils down to three key metrics:
Cost of Acquisition per Customer (CAC) – CAC is what it costs to sign up a new customer and a low CAC means investment lasts longer and generates a bigger return. Partners can improve CAC by providing qualified leads to boost conversion rates and improve the productivity of a rep.
Lifetime Value (LTV) – The higher the LTV:CAC ratio, the more investable the business with 3:1 seen as good and 5:1 excellent. Partners can improve your LTV by upselling and promoting new products, while also using account mapping to target specific groups of ICP.
Net Retention Rate (NRR) – NRR looks at how many customers stay and how many grow, helping indicate a SaaS business’ long-term performance. Partners can positively influence NRR by identifying ICP prospects similar to the ones you’re growing and retaining, as well providing advice to your clients on who to use (or who not to use!).
A high-performing business is like a human body: all the systems’ functions are different by design but are aligned and operate in perfect harmony. In a similar way, alignment underpins successful partnerships.
In order to achieve excellent cross-functional alignment you need to map out the journey from acquiring a new partner > to onboarding the partner > to managing the partner. What are the stages and who else within your business will be involved at these stages?
The result? You’ll start to see where and when Customer Success, Product, Marketing and Sales impact the success of the partnership at different stages and, in turn, be able to think about what you can do to improve the effectiveness of the collaboration at each of those stages.
Once qualified, you need to spend time understanding the joint value proposition. In other words: how will your partnership deliver more value to each other’s respective client bases? This must be so compelling that the partner is excited to promote the message to everyone in their client base (or your ICP target prospects).
Once you’re clear on this unique joint value proposition, you then need to make sure the individual teams within the partner’s business are clear on how this partnership benefits them as well as their clients. This enablement piece is key. Understanding this value proposition from the start makes everything else, including the GTM approach, enablement and marketing plans, much easier.
One of the biggest differences between Partnerships and the Outbound Sales function is that you partner with companies for long-term growth vs selling to companies once and moving on. In order to achieve long-term growth, you need a really clear objective and a set of deliverables that both sides are committed to achieving otherwise you can easily lose sight of your most important goals, which wastes both time and money.
In order to execute successfully on these deliverables, it requires Partner Managers to have a dual mindset where they are constantly referring back to the balance of ‘are we both delivering on each other’s objectives’?
So you’ve spent time understanding your ecosystem, you’ve created a qualification table based on your business’ most important objectives and you now have a shortlist of the top 10 partner companies you’d love to partner with. However, there’s one last and really important ingredient for a successful partnership: is the partner interested?
Successful partnerships require time, effort, motivation and change within both organisations. You are aligning two different businesses and giving them new objectives. If the partner company doesn’t have the same willingness, the same passion or the same business objectives which the partnership will deliver from the outset, then you’re wasting your time as you’re unlikely to get the success you are looking for.
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