Randy Weber

Let’s cut to the chase - No, it is not bad for small guys to partner with big guys.

Bronte Media references a post from Albert Wenger about small companies partnering with big Internet companies - Avoid David and Goliath Partnerships. The rationale:

Partnering with the biggest of the big on the other hand tends to be problematic because they are unlikely to be sufficiently responsive. […] So whenever possible, as a startup you should rely on mid size well established companies when it comes to strategic partnerships.

OK, I have lots of experience with this on both sides of the equation. All I can say is that there is some truth to this, but in general this is bad advice. At Verizon we worked with a few small companies and ended up essentially building their businesses and keeping them from dying during the dot.com bust. But I’ve also seen Verizon treat small partners poorly and likewise for other big companies that I’ve worked for. The key for the small player is to have a good contract that lays out how the relationship is to work and has sufficient penalties for not playing nice. Having an extremely responsive account management team also makes a huge difference.

Of course getting a solid contract is easier said than done. I didn’t like giving other companies much power over us when I was at Verizon. Likewise, the guys that were bigger than us didn’t like giving us much power. But if you can focus on win-win and genuinely add value to the bigger player, you can get to a place that works for both parties.

It’s worth noting that big companies in general don’t like doing deals with smaller players because of the risk that they won’t be around to fulfill their obligations. I was the guy that had the unfortunate task of delivering the bad news to hundreds of small guys that we wouldn’t do business with them and often the reason was that they weren’t established enough. Big guys tend to want to go with established players.

The thing that I think is most overlooked is that if the small guy can work a good deal with the big guy, it can make their business. It makes them a legitimate player and opens things up for additional deals with other large players and additional funding. This far outweighs the risk of the partnership not working out.

37signals wrote “Big business learning that smaller teams can rekindle the creative spark.”

The message: Keep teams small, give employees freedom and a sense of ownership, don’t focus too much on the competition, create a culture of experimentation, and use technology to enable remote teams.

They quoted the NY Times as saying:

By breaking huge business units into smaller, nimbler teams, companies stand a chance of rekindling the creative spark that got them rolling in the first place. After all, “small is the new big,” as Seth Godin, a prolific blogger and author, puts it in his 2006 book of that name.

I couldn’t agree more. When I was working at start-ups one product manager and one engineer could get more done in a day than an entire scrum team at one of my larger employers could do in a week. This came with the added benefit of nothing being lost in the translation and the ability to rapidly make changes until you got to where you wanted to be. I miss those days. It was very invigorating and both myself and the engineer walked away with a great sense of accomplishment and ownership.

Now go and spread the word.

A former co-worker at Verizon who was new to the group once asked me what it takes to learn how to be in Partnership Development. At the time I didn’t really have an answer. It had seemingly just happened for me. But after much reflection, it didn’t just happen for me. In addition to some basic skills, I had a lot of help along the way. Here’s what I think it takes to be effective at Partnership Development (and Product Management):

1. Vision – ability to see the future and visualize possibilities
2. Persuasion – ability to sell this vision to your management and your potential partner
3. Negotiation/Contracts – patience and attention to detail necessary to grind out an agreement, the requirements/specifications necessary to implement it, and the perseverance to manage the partnership (product) once launched
4. Leadership – ability to inspire members of cross-functional teams and get them to share your vision in order to develop and launch the partnership (product)
5. Communication and Organization – ability to keep everyone on the same page and up to date

All of this starts with a mentor to help you master these skills.

Vision and Persuasion
My former boss Shane taught me how to see the big picture and to sell that vision as we cranked out a multi-stage e-commerce strategy for a wholesale distribution company taking the company from a crude web site, to a polished online catalog, along with e-commerce and customer support applications that were back-office enabled. He was a great mentor and a friend.

Negotiation/Contracts
My former boss Patricia mentored me on the intricacies of negotiations, term sheets, and the contract process leading to a handful of multi-million dollar deals and dozens of smaller deals. It takes patience, perseverance, and creativity. She too was a great mentor and a great friend. She created the Partnership Development executive in me.

The attorneys I worked with (Allison, Cody, and Mark) were very gentle with me and helped me through the contract process. I still consider them friends today.

Together, all of these kind people helped me to understand the value of and how to get to a win-win-win partnership (both companies win, along with the customer).

Leadership
My former boss Kendall taught me how to survive in a matrixed organization with the result being the successful launch of over a dozen new features in a 3-month window for an online trade show startup. She was very good to me. A great mentor and a friend. She’s the one that pushed me into a larger organization to beef up my Product Management skills.

My former boss Karl taught me how to lead large cross-functional teams. He was a great mentor and a great friend. He created the Product Manager in me and helped me develop the confidence to try new things resulting in multiple successful product trials and the launch of millions of dollars worth of new products.

The Communication and Organization skills seem to come from practice. Lots and lots of practice.

If there is a theme in this story it’s that you need people to help you on your way towards developing the skills of your profession. I was very lucky to have had some great bosses/mentors/friends along the way to help me grow into my Partnership Development and Product Management roles. Thank you.

I look forward to passing these skills on as I advance in my career.

Back in December 2006 I wrote about TiVo not keeping up in the quest to be the provider of the “sofa web.”

Om Malik at GigaOM discusses the new game consoles and the contribution they might make to Internet browsing. He refers to it as the “sofa web.”

It was announced that TiVo and Amazon Team Up - NYTimes.com. This is a positive step towards TiVo becoming part of the sofa web. I can’t wait to see more deals.