At FuelUp, we aim to connect startups and corporations, two groups who can benefit a lot from each other, but who have a number of differences between them as well as a list of negative stereotypes and associations. There are those who see corporations as the perennial villain, cloaked in ulterior motives and agendas. While to others, startups represent the overeager adventurer, taking leaps before taking a look at the intended surface and aimlessly falling before completing the journey. When looking at these parties from a superficial level, these images can ring true, but really, only when fully understanding and appreciating each other’s position can a mutually beneficial partnership be born. To illustrate some key points to keep in mind when approaching such partnerships, we’re looking to a classic (Disney) tale to draw out important lessons for startups and corporations alike.
The Little Startup
Startups encounter a number of obstacles, especially when growing their business. For startups who flourish in their native environment (say, for example, Europe), the next step in scaling up may be to expand their global footprint.
Partnering with a global corporation can be a direction to consider—the association can bring wide exposure and a large opportunity for investment and client interest. But, startups must understand what they’re looking to achieve and what elements of their offering they’re willing to compromise—and, especially, who they’re partnering with.
Most corporations have the same basic intentions of any business—to remain viable and to yield the same/higher returns from the year prior. But some corporations may feel pressure to diversify and innovate and as a result of that pressure, old-fashioned company culture, or inexperience with new methods, may approach partnerships in a one sided way. For startups who haven’t fully validated their product/service or who themselves feel an overwhelming pressure to scale or raise funds, this kind of intimidation may give way to the sacrifice of core elements of their company.
But all is not lost when a startup lands in such a position.
In fact, sometimes a startup can find that these kinds of experiences introduce new opportunities and help develop a facet of their product that wasn’t obvious before.
And in the case of the corporation, strong-arming a small company into working solely for the purposes of their gain and success can have a lot of consequences.
After all, startups now accelerate at a speed that isn’t comparable with company growth from 20 years ago. And what initially seemed like a budding company can become a corporation’s biggest competitor and threat.
Lessons for startups:
- Know definitively what your product is before you go down the road of a partnership
- Know what you want to achieve from a partnership
- Make sure you understand the terms of the partnership and what is expected
Lessons for corporations:
- Nurture and mentor smaller companies to the best of your ability to yield as many positive results as possible
- Deliver a proposition that has long-term value for your partner
- Be patient and manage expectations