Picking a good alliance partner is a lot like finding the right tennis partner — find the right one you win; pick the wrong one you lose.
Strategic alliances can deliver significant benefits to startups including reducing your time to market, providing to strategic markets and increasing your company valuation to name a few.
But how do you determine who you should partner with? How do you evaluate potential candidates? I recommend an eight-step process for effective alliance partner recruitment.
Step One: Clearly Define and Validate Your Market
The first order of business of any startup.The goal of market validation is to identify your target market — the customers experiencing the most significant pain and who need your solution the most. Through this process you identify the gap between what constitutes a total solution and what minimal functionality you can realistically deliver. That gap represents your partnering roadmap — where you need to partner to deliver the total solution.
This is why market validation is the first order of business for any startup and the first order of business in any strategic alliance strategy. One of the biggest mistakes startups make is trying to build the perfect solution or killer app. You will never have enough capital or resources to ever be able to do this, so focusing on your core competencies is the best approach. Fill the gaps with partners.
This is a great post by Donna, and I'm a big believer in Market Validation. I recently wrote a book cover the whole process called "If You Build It Will They Come? Three Steps to Test and Validate Any Market Opportunity" (Wiley 2010). Details and more info on the subject are at www.drrobadams.com.
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