You’ve probably heard that a quality referral is critical when getting introduced to an investor, client, potential employee or strategic partner. This comes as no surprise, as word of mouth is powerful and trust is key.
The common problem, however, is determining what constitutes a great referral. Some people claim to know everyone, while others may boast vast networks on social media. But that doesn’t ensure that their emails will garner responses or that their calls will be answered.
I was recently reminded of what constitutes a great referral during a casual lunch meeting. I told a new acquaintance about our company. Upon hearing that a notable college football team wasn’t already a client, he immediately picked up his iPhone and called the head coach. Fifteen seconds later, I was chatting with the coach, and within 24 hours, his team had become a client.
After the call, my acquaintance said to me, “He and I have been friends for decades. And I’ve also helped him in the past. He runs a great organization, but your company sounds like it would be helpful to him and wouldn’t cost him a dime. So I’m happy to put you in two touch.”
A great referral can be game changing for your business, but not all introductions are of equal caliber. It’s your job to find the best ones. Here are three ways to evaluate them:
1. Relationship strength. Pay close attention to how well the introducer knows the person he or she is contacting on your behalf. Not surprisingly, the longer and more substantive, the better.
Look for foundational statements, such as “We’ve known each other for centuries;" "We were high school teammates and in each other’s weddings;" and "We’ve traveled around the world together and have all sorts of ‘dirt’ on each other.”
Related: 8 Ways to Optimize Your Network
2. Referral track record. Has the person being contacted enjoyed previous success based on this particular referrer? This is the perhaps the most critical part of a quality referral, but it frequently gets overlooked.
I’ve heard angel investors say, “Whenever that guy calls me, I not only answer but start pulling out my checkbook. I’ve always made money with the deals he has sourced.”
Whether its potential investments or hires, a truly great referrer has a pre-existing track record of helping the people he or she is contacting.
3. Depth of knowledge. A great referrer must clearly understand both your business and the business of the person being contacted, as it helps determine how you can compliment each other. For example, if someone has offered to introduce you to a venture capital firm, he or she should be well versed on your company and how it matches the firm’s specific investment criteria (for example, sector and stage). Not doing so can waste valuable time and even burn bridges.
So when you’re seeking or considering an important referral for your business, be sure to assess these areas to ensure maximum effectiveness.