For many startup leaders, SaaS partnerships can feel like a black box. They’re not as cut and dry as marketing (drive demand) or sales (sell a product or service).
To make matters more confusing, partnerships can come in many different flavors depending on your company, industry, and goals.
At High Alpha, we often use the phrase “standing on the shoulders of giants” when referring to partnerships. This concept can be traced back to the 12th century, when people leveraged the knowledge of previous prominent thinkers to make further intellectual progress.
Today and in this context, we’re referring to startups partnering with a larger company to move faster as a strategic and significant growth lever.
Why should you prioritize partnerships early?
There is a direct correlation between the number of integration partners and high-growth SaaS companies. For example, the median number of integrations across the 15 largest SaaS companies is 347.
Early-stage startups should think of partnerships with big companies as the key to unlock and accelerate customer growth. Over time (often many years), these partnerships and companies will likely be the same list of your potential acquirers.
High Alpha Managing Partner, Scott Dorsey, recently did a podcast where he talked about the ExactTarget partnership with Salesforce which was 10 years in the making and eventually led to an acquisition. I recommend you check it out here to learn more.
How to choose your partners wisely.
If you chose to spend time and money on the wrong partner, there is no guarantee you won’t end up at a dead end.
There are many factors to consider when thinking about whom you want to hitch to your wagon, especially as a startup with limited resources. Below are a few ways to prioritize:
Do you share the same Ideal Customer Profile? Alignment around who you are selling to should be top of mind.
Ignore the big players when possible
Don’t be tempted to go after the largest, most obvious partner unless it’s critical to your customers’ workflow.
Many early-stage CEOs wonder how they might go about partnering with Salesforce or Hubspot. My answer is to “get in line with hundreds of other companies wondering the same thing.”
Both Salesforce and Hubspot (along with all the other big SaaS companies) have structured partner processes and a ladder that needs to be climbed, starting with integration.
Even after you’ve built an integration and have a handful of shared successful customers, you are still just a blip on their radar.
Instead, consider the fast-growing alternative to these companies. Look for someone that does not yet have an established marketplace and potentially has more motivation to work closely with you.
The value equation
Calendly and Gmail. Gong and any CRM. What do these combos have in common? As standalone solutions, they are powerful, but together there is clear incremental value.
While I was at Hubspot, we often said, “1+1 = 3”. This phrase refers to creating solutions and making decisions that deliver that extra value. You should apply that same line of thinking to evaluate a partnership.
Your solution plus your target partner should deliver an obvious incremental value to the end customer. If it doesn’t, don’t knock down walls to integrate and develop a deep partnership.
Here’s how to stand out in the crowd of other partners.
Recently, I held a session with our studio CEOs about the power of partnerships. Our guests included Billy Robins, Head of Partnerships at ProductBoard, and Conner Burt, President of Lessonly.
During the session, they agreed that one of the best ways to stand out in a crowd of integration partners is to show commitment. Below are a few ways you can show your commitment to potential partners:
Create a dedicated team for product integration
There is no better way to show your integration partner that you are committed than by building a dedicated team or focusing an individual on product enhancements tied to the desired integration.
Become a sponsor (at any size)
You don’t have to be a platinum sponsor per se, but there is an upside to paying for an event sponsorship by putting your money where your mouth is while also meeting customers.
Relationships are everything
The extra effort to jump on a plane for onsite discussions will likely pay dividends down the road. Be the partner that always says “yes” whenever possible.
When in doubt, ask how to be successful
Not sure what they’re looking for in partners? It never hurts to ask, “What have other companies like us done to be successful in this ecosystem?”
Invest in your brand and build mindshare
It’s powerful when your partner’s team starts to hear about your company from customers and prospects. So continue to invest in building the community that will get you there.
According to Andrew Black, Senior Director of Alliances at Pendo.io, a Partner ecosystem is like a biological ecosystem, and these environments can only support a certain number of organisms. Therefore, there should be an ongoing, active effort on your end to keep the relationship healthy.
It’s up to you (the startup) to initiate and nurture the partnership over time.