The 4 Key Tenets of Every Successful Partnership Your business's partnerships can unlock more doors than ever before -- if you approach them the right way.
By Joshua Goines Edited by Amanda Breen
Opinions expressed by Entrepreneur contributors are their own.
The saying "your network is everything" has never rang truer than over the past year and a half. Building relationships and partnerships has been the key to many businesses' survival during the pandemic, and even outside of the everyday challenges faced in this current economic climate, partnerships are hard work.
Healthy business partnerships are a lot like marriages. From my more than two decades at the intersection of fintech and software industries, leading global business development and strategic partnerships, I've learned that there are four essential ingredients to creating the perfect union.
1. Transparency
Radical candor seems to be the new language companies are speaking these days. Although you may be comfortable being direct with your colleagues or teammates, should you be with partners? Absolutely.
It pays to speak the truth, honestly and without varnish. An example of this in action was when my team at Bill.com negotiated a brand new deal with a major Fortune 100 financial partner. Our original agreement was to build a solution that they would put on their platform — giving us access to a large market and providing them with a tool to better serve their clients. The plan was put into action, but a few weeks into the initial design phase, we realized that what we were building was not the right fit for the partner's customers. So, we went back and proposed building something even bigger and better — and yes, a bit costlier.
I had the tough task of talking to our client, and I said, "I know what you bought. I know what you want to implement. But I don't believe that's the right product for your customers. We have a whole new idea. Are you willing to go down a path where we design a brand-new purpose-built product for your customers?"
As you can imagine, it was a difficult conversation, and the partner was understandably upset. They first suspected us of pulling a bait-and-switch — of hooking them with one project and then selling them something else. We explained to them that the process of going down one road had helped us understand what their customers really needed versus what they thought they wanted. This gave us the additional credibility to move forward with the redesigned product, which was not only successful, but put them at a significant competitive advantage.
Related: 3 Ways to Increase Client Retention Through Transparency
2. Trust
Trust is the cornerstone of every enduring partnership and the currency in which you trade goods and services. "Do what you say, say what you do" is easy in theory but harder to execute.
An example of this comes from my time at PayPal when we were building a close relationship with one of our significant network partners. Our businesses were highly complementary, and our goals were aligned in the sense that each other's network could open up new, financially rewarding opportunities for us. When we came together to enact our first big deal, it was tremendously complex and entailed not only building authentication and trust with our partner, but also with their downstream partners.
Our partner trusted us to treat their partners with the same respect, reverence and standards to which we held our own relationship. This trust was not only earned, but also kept throughout the course of the relationship and led us to working together to land multiple more product deals, resulting in one of the most beneficial partnerships for the company.
Your reputation and references help get you in the door, but it's trust that creates a long-lasting relationship.
Related: 7 Trust-Building Tips to Use in Your Business
3. Mutual benefit
"Is the partner happy?" This question from the CEO of PayPal in response to me providing an update on results with one of our key partners changed the way that I do business today. Ultimately, reframing your perspective to ensure that you are looking at every business partnership through the lens of "If your partner isn't successful, you aren't successful" will pay dividends in the future.
Setting mutually beneficial goals and a clear roadmap to what success looks like for you both will help establish a strong foundation, but it's regular check-ins and, if necessary, recalibrations that will test the strength of the partnership foundation over time.
Asking certain questions will help level set these conversations. What is the vision of this partnership? Does the original foundation still hold true? Why are we working together? What are we trying to accomplish? Do we see the world the same? Do we have the same empathy for similar types of customers?
I've never forgotten my prior CEO's question. So now, when I report to my fellow Bill.com C-suite executives and to our board of directors on how our partnership ecosystem is doing, I ensure that mutually beneficial goals are threaded throughout every single update.
Related: This Is How You Can Build Mutually Beneficial Business Partnerships
4. Shared vision
Over the course of my career, I've found that many companies and executives use the term "partnership" loosely. I've learned that the true definition of partnership lies at the North Star shared vision for the market, customer segmentation, problem you're solving for and the technologies or solutions to address it.
When Bill.com began conversations with a leading financial institution around a new partnership, we first started at the white board looking at ways we could collectively solve for SMBs' current and future liquidity needs. Then, we moved onto how our collective teams (product, risk, compliance, go-to-market and more) could support this much-deserving customer segment to better manage their cash flows. In creating a shared vision for the future, we've created a solid bedrock for a partnership that will ultimately enable SMBs to focus more time on growing their businesses and less time on back-office financial operations.
Partnerships don't sustain themselves. They are a living, breathing entity, which is why it is imperative to continually invest in the growth and, ultimately, the profitability for each side. These four partnership tenets have served as a directional roadmap to successful partnerships over the course of my 20-year career, and I hope they will serve as a guiding light for yours as well.
