What’s the best way to do effective business development?

David Jackson (Founder, Seeking Alpha)
How to make bus dev meetings with large companies successful and avoid time-wasters | A Founder’s Notebook

In my experience, the biggest risk of meeting with large companies is that their goal isn’t a partnership, but reconnaissance — to learn about what’s cutting edge in their market. An indicator of this is when a relatively large number of senior execs turn up for the meeting. How can you avoid this? Maybe by asking to meet with the key decision maker alone for the first meeting, and only progressing to a larger group when there’s clear evidence th… (read more)

Hunter Walk (Founder & Partner at Homebrew)
Let’s Meet: How to Prevent Big Companies from Wasting Your Startup’s Time | Hunter Walk

1. Don’t take the meeting unless you know what you want to get out of it. You don’t actually have to meet with BigCo, especially if they won’t tell you what the goal/agenda is, who will be in the room, etc. 2. Make sure the right people are in the room. You want an informed decision maker in the room. If you get stonewalled on this request, ask what data/information can you provide in advance to make it worth this person’s time to attend. 3. Unle… (read more)

Holger Luedorf (SVP Business @ Postmates)
Guest Post: Startup Business Development 101 – AVC

Create clear BD targets – This goes without saying, but it is worth repeating. Without clear targets, a BD team will aimlessly chase deals and in the worst case have a distracting effect on the rest of the organization by creating deals that are not core to the company but take up valuable executive, product, and engineering resources. Ideally, BD targets are a subset of the overall company goals (e.g. grow the user base, expand internationally… (read more)

Holger Luedorf (SVP Business @ Postmates)
Guest Post: Startup Business Development 101 – AVC

This includes market sizing, market and competitive analysis, and a clear timeline. If you are new to the industry you better start researching yesterday. There is nothing worse than being pitched by someone who did not make the effort to understand your business and the challenges you are facing. Secondly, you need to put a lot of work into figuring out how to approach these partners. Finally, you have to make sure you have all the necessary … (read more)

Holger Luedorf (SVP Business @ Postmates)
Guest Post: Startup Business Development 101 – AVC

Solve problems, help partners reach their goals – This is one of the most critical business development tasks. Partnerships never work when the benefits are one-sided. In addition to helping you reach your own targets, you really have to figure out how your proposal helps the potential partner reach their goals. Again, you would think this is a total no-brainer, but this does not seem to be the case judging by the large amounts of proposals th… (read more)

Holger Luedorf (SVP Business @ Postmates)
Guest Post: Startup Business Development 101 – AVC

Be prepared, research the companies you want to partner with – In addition to a well thought out, mutually beneficial proposal, it is important to research your target partners. To me this is like prepping for an interview. Nothing worse than realizing that the person you are interviewing knows nothing about your company or the issues you are facing but at the same time tells you how “passionate” s/he is about your business.

Holger Luedorf (SVP Business @ Postmates)
Guest Post: Startup Business Development 101 – AVC

Who are the decision-makers, which teams or managers are heavily weighing in, who is responsible for the long-term execution of the partnership etc. This organizational understanding will help you address the right people in the partner organization and help you identify additional contacts you might want to connect or back-channel with.

Holger Luedorf (SVP Business @ Postmates)
Guest Post: Startup Business Development 101 – AVC

For high-value partnerships, I always try to build a relationship on multiple levels, e.g. between the two day-to-day partnership managers, between the two VP-level managers responsible for those partnership, and ideally also between two or more C-level execs. Having these multi-level relationships gives you more flexibility in dealing with your partners. In certain scenarios bottoms-up approaches might work better and you want to convince the … (read more)

Holger Luedorf (SVP Business @ Postmates)
Guest Post: Startup Business Development 101 – AVC

Always be responsive – A pet peeve of mine. I think it is disrespectful not to respond to companies or people reaching out for various reasons. The only things I usually do not respond to are blatantly obvious sales pitches.

Holger Luedorf (SVP Business @ Postmates)
Guest Post: Startup Business Development 101 – AVC

Don’t rush, don’t annoy – Always remember that you are working in a dynamic start-up while some of the bigger organizations you are trying to partner with have heaps of processes and check-points that decisions have to go through. I remember from my time at two of those large organizations, in my case Deutsche Telekom and Yahoo!, that people in those organizations could get frustrated with impatient partners banging on their doors all the time.

Holger Luedorf (SVP Business @ Postmates)
Guest Post: Startup Business Development 101 – AVC

Can’t close? Regroup, analyze, and adapt if possible – Don’t beat a dead horse. If a deal cannot get done, and there might be many good reasons, regroup and think why the partnership did not make sense for the potential partner.

Holger Luedorf (SVP Business @ Postmates)
Guest Post: Startup Business Development 101 – AVC

Own your partners, not just deals – There is a fundamental difference between Business Development and Partner Management. In many large organizations you have a dedicated BD team that flies in to negotiate and close a deal and then moves on to the next deal with another partner

Holger Luedorf (SVP Business @ Postmates)
Guest Post: Startup Business Development 101 – AVC

Don’t over-commit, internally or externally – With many partnership opportunities, you only have a few potentially only one shot at getting it right, so it is critical that what you commit to towards the partner is actually something that your company can deliver.

Holger Luedorf (SVP Business @ Postmates)
Guest Post: Startup Business Development 101 – AVC

Relay partner feedback back into your own organization – The BD team is usually one of the most outward facing teams in a start-up and as such you will be able to collect a ton of valuable feedback for company.

Heidi Roizen (Operations Partner at Draper Fisher Jurvetson (DFJ))
Operating Partner, DFJ

I learned that negotiation is “the process of finding the maximal intersection of mutual need. ” It sometimes takes extra work and lots of iterative communications to find out what the other person truly wants, but the process creates better, more sustainable deals.