When I started working in tech, business development (BD) always seemed like a typical sales role… except you get to take interesting people out to lunch and “talk strategy”. So when I started working at CloudApp helping manage BD and Partnerships, I was keen to dive right in and start building.
I learned fairly quick that BD and Sales are two different things and require different approaches. So, if you’re interested in learning more about business development best practices in the startup world, then keep reading. One approach isn’t better than the other and not all startups are best suited to dive into building up a BD strategy. I’m hoping that my journey through the process helps provide some useful insights and tips on how to be successful in business development.
Now, let's talk about when BD might not make sense. The main thing to determine is whether or not you have the luxury of playing the long game as you create relationships and build out your network. Growing a new sales channel might not be a good fit if you need fast results. Building out and developing a channel takes time and a little patience, but once it’s starts going… whoa nelly!
One funny thing I noticed is that no one really knows what you do in the beginning. They know you’re in sales, but that’s pretty much about it...
Making sure your whole team (not just sales) understands what you do and has bought into the idea of building out a channel sales strategy. People used to the outbound sales process expect faster results and the control that comes with directly dealing with customers. In BD, you’re typically not working with customers and require a different mindset as a result. You’ll need to work with different teams and potentially take resources away to help close a deal. Make sure people understand the value of what you’re building and the intended outcome.
So at this point, you might realized that you want to try building out a channel strategy for your startup. I’m excited for you! There are many different channels to try, but I’ll focus on how to scale a distribution network.
- Outline Your List of Measurable Goals
You need to identify what you are hoping to get out of these partnerships. New users, expand into a new industry, increase MRR? What metrics are important? You simply can’t google this. Chat with your team and figure out how they’re expecting you to contribute to the pie. If you don’t do this, you’ll risk focusing on metric that isn’t of value or looking at vanity metrics that mean nothing. What’s your North Star and how will BD initiatives help you reach it?
- Figure Out What Resources You’ll Need and What is Available to You
If you’re starting from scratch, you’ll need to be comfortable creating new collateral for your partners or you might need to go to a conference to make the right connections. What’s in the pot and who can you go to if you need help? Without this clearly outlined, you risk focusing on opportunities that you don’t have the resources or bandwidth to chase. Nothing is more frustrating, than spending time and energy on a new deal and realizing that you can’t follow through.
- Create a Hypothesis and Some Experiments You can Test
How are you hoping to tap into a distribution network and what do you think you’ll need to do to get there? The most important thing is not put all your eggs in one basket. Do small tests and see if you’re getting the desired outcome. For example, if you’re wanting to find new resellers, don’t just send out a mass email to resellers you want to partner with. It’s not a numbers game. Cut down the batch to 10-20 companies that you’ve researched, know would understand your value proposition, and targets your specific market. Make sure to track who responds and their specific responses (good and bad). Adjust your messaging and see if that increases the number of positive responses. Make sure that you know how each test campaign performs and why you’re getting the responses you’re getting. Outreach is a great tool for this! Here’s one of our test templates that had a good response rate:
- Know When to Move On
You’ll deal with some false starts and sometimes people just lose interest. Know when to pivot, understand why it didn’t work, tweak it, and move on. You don’t want to spend more than a several weeks testing something if you aren’t seeing any progress. How do you figure out if it isn’t working? Usually when communication drops off. Priorities change and people sometimes will put things on the back-burner. Sometime it helps to just go for the no and simply ask them if it still makes sense to continue discussions or should you put this on hold. You’ll either hear nothing or get a response. Either way, you’ll have an answer. Whatever you do, always ask “is this moving me closer to my goal or just creating distractions”. If nothing is moving forward, move on. As the old adage goes, time is money.
- Identify your Ideal Partner
As you conduct your test and gather feedback from potential partners, you’ll start to identify what an ideal partner looks like for you. This is most important thing! If you can’t figure this out during your campaigns and meetings, you’ll be chasing the wrong partners. As you send out more campaigns and chat with your potential partners, you’ll start to see trends. What type of companies are more responsive, what incentives are they looking for, and what did all the failed opportunities have in common. Nail this down!
- Create a BD Blueprint
At this point, you should have a good outreach strategy and know what your ideal distribution partner looks like. Now you’ll need to outline what steps and successes got you here. You’ll use this to create a scalable process.
- Have at it!
You’ve tested, built out a process, and your pipeline is starting to grow using your new BD blueprint. Keep going and watch your network multiply!