Do you want to find the best technology partners for your business? First, you have to learn how to properly leverage a business partnership. Read on!
In the field of technology, collaboration is the key to success in the industry. Whatever type of product a company offers, it needs to have a versatile system that it can integrate with other technology partners. The more compatible your product is with other brands, the more your market will reach for it.
The partner program plays a crucial role in keeping your product relevant and sellable. One way to keep up with your competitors is to work with them. Looking at the big picture, the biggest names in the industry are intentionally designing their software with their competitors in mind.
Read on to learn more about how to find technology partners for your business.
What are technology partners?
A technology partnership is a collaboration between vendors to provide products and services to clients. Partnerships are crucial in the technology field because no IT vendor can do it all. Strategic alliances are created to reach maximum productivity.
The main goal of the partnership is to smoothly implement and integrate technical systems. On top of helping companies with their own IT system, partnerships also allow them to connect with the systems of other organizations. This makes for a seamless process of exchanging data.
Additionally, a partnership not only allows your business the opportunity to expand but can also give you an edge over other competitors.
Take for example how Walmart and Microsoft formed a partnership to secure their place in the industry against their mutual competitor Amazon. Walmart made a deal with Microsoft to boost its e-commerce performance through its advanced cloud services.
On the other hand, there are also some cases when competitors collaborate on a project. Although known competitors, Apple and Google announced their collaboration in creating the iCloud storage.
As you can see, there are plenty of collaborations in the IT startup communities. Clearly, we all need to set aside personal differences to grow. You gain more credibility when you successfully leverage a partnership with other companies. A good partner program builds up your startup network.
Acquiring technology partners
Before you strike a deal with a startup partner, run through these items first to make sure you’re doing business with the right people. Here are some things to consider about what a partnership entails.
Just like any other business deal, you need to do a thorough background check on who you’re teaming up with. Remember, you are building your startup network, which means you need to choose your partners wisely.
A partner company may be successful in conquering its market but it might not be as good at working with other parties. Look into their past collaborations and see if there are problematic areas that might arise.
It’s always a good idea to call up those who they’ve worked with in the past. You need to ensure that your partner will keep their end of the deal and to keep your company safe.
Contracts and Documents
Never sign anything without reviewing. Take extra precautions before finalizing any partnership contract. For legal documents, it’s safer to have a good attorney read through it point by point to weed out any possible issues.
In the hands of an expert, you can be assured that you’re surely getting the good end of a deal. An attorney can also revise the contract to something that would be fair and more beneficial to all parties involved.
If your partnership involves more than one person with an ownership interest in the business, make sure they also agree to the terms of your business partnership.
This usually applies if your business partner has a spouse who could take over their asset in the future. This is essential when it comes to the method of valuing the business when you plan to buy out in the future.
You and your partner should have a focused discussion on the potential issues that might arise (financial, logistics, supplies, sales performance, etc.). You both need to identify the kind of problems that might come up and how you can prepare for them.
Setting up a Business Partnership
If you’re ready to venture into a partnership, here’s how to get started.
The key to establishing a successful partnership agreement is to agree on the structure of the arrangement. Who gets to manage what?
Your collaboration is meant to maximize your potential for growth which means you need to play on each other’s strengths. Although each partnership is unique, these are some of the common items to consider:
The first order of business is to appoint someone authorized to manage certain aspects of it. You and your partner need to have a clear understanding as to what extent your officers are going to intervene on operations before you take over.
Duties and responsibilities
In the same way you designate responsibilities to your subordinates, you and your partner also have your own duties. It’s important to identify what to expect from each other in the partnership.
Have a clear understanding of what percentage of the capital and expenses you’re contributing to. This includes the initial contribution and the additional expenses that will inevitably pile up in the future.
Division of profits, compensation, and losses
Stipulate the financial division in your partnership contract. Be sure to discuss your rights to discretionary distributions, as well as the return of your contributions.
As stakeholders, you and your partner have to make a unanimous vote on certain events or decisions. You must decide on which procedures you will intervene in.
Prepare for the worst-case scenario. Your partnership agreement should also indicate what happens when the partnership will be dissolved. It’s important to have an exit strategy to smoothly transition all the closure or transfer of operations. This may include buying out one partner or selling the business as a whole.
Another possible factor that would affect your business is if something happens to one partner. For example, one of you may decide to sell ownership interest or voluntarily leaves the partnership.
Then this would mean buying out one’s share. You need to address, beforehand, the major changes that will happen to your set-up.
Grounds of expulsion
This works as a double-edged sword. On one hand, you get the security of protecting the business but on the other, this could cause tension and conflict. You can agree as to when a partner can be forced out of the agreement.
If one of you decides to leave the business, you are not allowed to open another business of the same nature or work for a competing company. Your contract can specify the time this restriction would last.
Make sure you discuss with your technology partners the best- and worst-case scenarios. Hire an honest and experienced business attorney to guide and secure your partnership. You and your partner can hire separate attorneys to review the partnership documents Watch out for your own, as well as your partner’s.
Partner with Full Scale
Full Scale is a partnership business founded by two veteran entrepreneurs, Matt DeCoursey and Matt Watson. They are the ultimate technology partners helping startups with their software development needs. It is their mission to partner with other business owners to grow their operations and services.
Full Scale is an offshore software development company that offers a wide range of IT services to help you scale up your business. We have top-tiered project managers, web and mobile developers, QA specialists, data analysts, and more!
If you want to gain more opportunities for business networking, contact us today!