In finance, partnerships can often be hard to pin down, but understanding the ins-and-outs of partnerships can mean a world of difference for Fintechs everywhere.
Which is why this episode, as part of our Fintech Karaoke series, Cara Hayward interviews Kara Parkey, Director of Business Development at MX, to learn the secrets to successful partnerships.
They discuss:
- What defines a partner and the best way to choose them
- Buy-in and sales alignment
- The future of partnerships
Defining partnerships
In defining partnerships, you hear a lot of terms: referral partnerships, reseller partnerships, strategic alliances….
Often, you’ll even hear Fintechs selling capabilities to, say, large banks defined as a partnership, which really is more of a client relationship.
Without going into each type of partnership, you really just need to know that this is the big distinction: Are you selling them a service or are you pairing your products with theirs to benefit both companies?
If you are integrating products, then you are partners.
Defining partners
If you want to start a partner program, you need to remember one simple, but universal rule:
The key to a successful partnership is that it is beneficial to both parties.
That means you need to only pick partners where you can fill a need for them and they can for you. You want the partnership to equal more than the sum of its parts.
“You’re going to find the best partners when your solution makes theirs better, and vice versa.” — Kara Parkey
Defining expectations
Another huge component of ensuring a mutually beneficial partnership is education.
In order to have a successful partnership, you need to set expectations early on in the relationship, clearly defining what each party hopes to achieve by working together.
Buy-in and sales alignment
The education doesn’t stop there — it needs to permeate your whole organization in order for partnerships to work.
Everyone involved internally and externally needs to understand the exact goals and expectations of the partnership.
This means, of course, that it’s vital that leadership is on board.
“Education internally is huge and the organization needs to support it.” — Kara Parkey
An even tougher nut to crack is how to ensure that sales are properly aligned — both in your organization and your partner’s — to effectively sell your products.
This is another obstacle that can be overcome with proper education. But there’s a caveat: You need to partner wisely in the first place.
Some organizations will be too large to make your products any kind of sales priority, for example. This is something you should know before you go into a partnership — and something that, if you are transparent at the outset of the relationship and clearly defining your partnership, you will catch before it is too late.
The future for partners
Some speculate that M&As will mean the death of partnerships in the Fintech space as the more successful companies acquire others for their capabilities.
While mergers and acquisitions will have a noticeable impact on the sheer number of Fintechs operating in the space, it likely will not change the number of partnerships out there and definitely not the need for partnerships.
“You can’t be everything to everybody, so partnerships will always exist.” — Kara Parkey
As long as companies want to give their customers the best solutions they can, there will always be a need for partners.
No one is the best at everything, which means we will always be stronger together.
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Until next time!
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