When it comes to partnering we are so often focused on driving revenue that we forget about the importance of protecting revenue. You’ve made significant investments in acquiring and maintaining your existing customer base. You should be protective of that investment. Protecting that investment normally means providing great service and continued value to your clients, but you can also protect that investment through partnering.
With the rapid evolution of technology, you could have a formidable competitor bubble up that was nowhere on your radar. You probably know the key players in your competitive landscape, but with the rapid pace of technology and innovation, you could have a group of college graduates create a new or better mousetrap overnight.
The challenge many of these new ventures have is funding. They may have indeed developed a new or better mousetrap to solve a problem, but many of these efforts die on the shelf due to lack of funding. However, this is not always the case. Private equity firms are continually looking for investment opportunities in technology.
I had this very situation play out and I was able to overcome it through a partner strategy. I was working for a company that was recognized as a leader in their space, but I was continually monitoring the competitive landscape. I came across a company out in Silicon Valley that had solid financial backing through private equity, but more importantly had developed a technology that appeared to or had the potential to infringe on our core offering. As a result I reached out to the CEO of the company and requested a meeting. There was only about 15% overlap with their solution, so I focused on the 85% that I viewed as complimentary and value-add to our solution. We both agreed that the opportunity of working together far out weighed the 15% overlap I was initially concerned with. I knew that they could wake up one morning with a small pivot in their strategy and be a serious competitor. Instead, we found greater value in the 85% and worked on a partner and engagement strategy that would work for both of us. We crafted this as a win-win solution; whereas, we could have easily seen them as a formidable competitor had we turned the other way.
In the above example, we not only protected our revenue and existing client base, but also created new revenue opportunities through a partner and engagement strategy. The take away here is that you shouldn’t dismiss new entries into your market. You have to keep your finger on the pulse of your competitive landscape and look for opportunities to partner in the interest of protecting your current revenue and client base. This is a great strategy to turn a potential competitor into a terrific partner, but you have to approach these engagements with a win-win frame of mind and transparency .