It is known that workshops are conducted to train a group of individuals. On the other hand, Hani Murad, the Commercial Director at Rainmaking Innovation MENA, recently conducted a workshop for a group of aspiring entrepreneurs in Jordan, part of the JOIN Fincubator which has launched a one-of-a-kind incubation program operated by Startupbootcamp and Rainmaking.
From this workshop, Hani gleaned an intriguing lesson: Fintech has no boundaries, and the entrepreneurs in Jordan have unbelievable potential.
This interactive workshop was aimed at creating a thought-provoking environment for entrepreneurs to better understand partnership building and management, especially within the Fintech ecosystem. Throughout the workshop, Hani shared insights on various critical topics, and here are some key takeaways.
Going back to basics:
In the industry, many tend to conflate partnerships with sales. While both are pivotal to business success, they are distinctly different. Despite their disparities, here's an overview of the main points:
Types of Partnerships Partnership deals generally fall into categories, often overlapping. The principal categories include:
Strategic partnerships: sharing resources, technology, or market access.
Channel partnerships: Distributing products or services to a customer base.
Technology partnerships: Enhancing products or services.
Deal partnerships: Sharing or accessing data with other companies.
These categories are broad, with each deal being unique. One of the interesting takeaways from the Join Fincubator cohort was the similarity in targeted partnerships in one specific category: Channel partnerships. It is interesting to see how the startups are looking towards the ecosystem in Jordan to create channel partnerships that will essentially allow for B2B2C sales. It is always a promising roadmap when startups and founders look to collaborate with the ecosystem to further enhance their offerings. This approach holds great promise, but it also comes with risks.
The risk Hani expressed to the founders was the heavy reliance on key partnerships that could make or break the startup. When Hani hears a startup or founder is looking to build a business case on a partnership with a government entity, there are a bunch of red flags. The reason is, that a startup just cannot base its business on a partnership, especially a government entity. Government entities are extremely supportive of the local ecosystem, but it is not a smart business case to base it on that. With that said, working with a government entity to build within a certain sandbox is quite a promising approach.
The Partnering Stages
Establishing a successful and sustainable partnership demands significant effort, particularly in the early stages. The journey begins with the exploration stage, where startups identify, evaluate, and initiate initial discussions with potential partners. Each stage involves multiple checkpoints to determine the viability of the partnership.
Next comes Negotiation. Usually, this is where startups will become victims to big corporations and their firepower. It is critical for startups to understand that in negotiating, it is not a matter of ego, but rather the impact of the value being delivered. In analyzing the terms, roles, and responsibilities, the startup and the targeted partner need to work out the value of each party to make sure no foul play is taking place.
It is all great "news" and impressive milestones when a startup has completed the negotiation stage and has signed with the partner. However, now begins the toughest part of the engagement process: Execution. The implementation, integration, and launch of the partnership are where all the energy should be going now that all paperwork has been completed. Without strong and effective execution, there will be no renewal, and in most cases, the partnership could backfire.
Even with effective execution, there has to be, which entails clear communication and continuous adjustments to deliver and maintain the partnership in a lean manner. These stages are what would make a partnership successful, but then again, it is a very high-level perspective.
Scaling Through Partnerships
It is the million-dollar question: To scale into a different country, does one build a team or set up a strategic partnership? There is no clear answer for this, as it is surely dependent on the startup and the many variables on the table.
However, in the case that a startup decides to go through the partnership model, below are a few value adds that could make the process for scaling much more effective and efficient:
Conclusion
By the end of the session, the startups seemed excited to begin testing a few models, but Hani clearly stated that timing is one of the most important factors when seeking a partnership. Embedding a potential partnership in the current strategy is definitely smart, but pursuing something before the right time for the business could be detrimental to the success of the partnership and, at times, to the startup.
All in all, it was great to see the enthusiasm within the Fintech ecosystem and especially within the incubation cohort that Startupbootcamp and Rainmaking are operating for JOIN Fincubator. JOIN Fincubator is truly leading the Fintech ecosystem in Jordan, and Hani is very glad to be collaborating with them.