Why Do Tech Strategic Partnerships Take So Long To Close, And How Can They Be Accelerated?
By Andy Miller and Dino Di Palma, Managing Partners at True North Advisory
At True North, we work with many early stage companies who are trying to complete the ecosystem of direct and indirect channels. One of the holy grails in this ecosystem is the Strategic Partner.
Whether it is Amazon, Microsoft, Cisco, Salesforce or others, early stage companies put resources and dollars pursuing these partnerships. Clearly, if executed and closed, these partnerships can add tremendous value both in terms of investor sentiment and the ecosystem of the Strategic Parter's channel base, a huge multiplying effect for a smaller early stage company.
But many early stage companies misunderstand both the dollars, resources and time these partners take. There is a crawl/walk/run enablement cycle that the Strategic will require the companies to work through, and typically takes 6- 18 months to complete and begin to see the fruits of their labor via pipeline.
There are some key points that we at True North walk our clients through prior to jumping all into trying to achieve both certification and a GTM license to co-sell:
The fastest way to achieve success is to have several clients both closed as references, but more importantly a pipeline of deals that can be brought to a Strategic to show market push/pull.
While a technical certification is one step, getting a Strategic’s sales team to engage is a more difficult issue. Areas like: Will they get paid? How challenging is the sale, is it worth the Strategic’s sales teams time? Is the marketing, packaging, positioning and packaging such that it is attractive and aligns to the sales teams needs? Is the sale something that can be bundled with a Strategic’s product to create a greater value proposition?
Is there an executive sponsor at the CXO level that will stand behind the process, or even accelerate the process?
The above are all points that can if properly thought through can make a material difference in a companies GTM and time to success with Strategic partnerships.
At True North, we pride ourselves on our CXO relationships with Strategic Partners and how we can engage them with our emerging portfolio clients. That engagement, as well as our Channel Enablement Framework focus, can make the difference between a company's success or failure, both with potential investors and the ability to grow ARR.
In today’s competitive market, it’s all about leverage of the Channel Ecosystem, and the approach with Strategic Partners is key.
