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Why your partnership deal is a Russian nesting doll
Five partnership principles for managing the deals-within-a-deal
A complex deal is more than just a partnership between two organizations. Transformative deals are Russian nesting dolls that hold a collection of smaller agreements within them. The story below of a (hypothetical) deal between Airbnb and Instacart outlines this partnership-as-nesting-doll framework.
After the short story of this deal you'll find five partnership principles to remember:
Internal before external
Building trust before is better than during
Simultaneous not sequential
Tops down and bottoms up
Individuals and teams
Level 1: one-to-one - external
Jaclyn works for Instacart. Eric works for Airbnb. She leads partnerships. He is a lead product manager. They meet during a group dinner at an industry conference in Chicago. As they sip cocktails, Jaclyn and Eric realize they share a love for ‘90s hip-hop and a distaste for public restrooms. When the conversation turns to work, Eric describes the typical Airbnb traveler. Suddenly, Jaclyn realizes an Instacart / Airbnb partnership opportunity. Airbnb guests arrive at their rental with a few key needs: wifi, experiences … and food. Instacart’s bread and butter is grocery delivery (pun intended). Why don’t Airbnb and Instacart make it easy for Airbnb guests to have groceries delivered to their rental?
By the time dessert is served, Eric and Jaclyn are sketching out ideas on a napkin. They agree to explore this potential Airbnb / Instacart partnership with others in their respective organizations. They need buy-in from others to make this deal happen.
Level 2: one-to-one - internal
After the conference, Eric meets with leads from Airbnb’s Engineering, Partnerships, Marketing and Legal teams. Over the last few years he has invested in building trusted relationships with each of them. As he walks through the Airbnb/Instacart partnership opportunity he can tell who is enthusiastic and who is not. Marco (Partnerships), Daria (Legal), Yvonne (Marketing) are onboard. But Betsy (Engineering) is not sold yet. Airbnb has never before integrated with another app in this way. Her engineering team is understaffed at the moment and slammed working towards upcoming deadlines. Betsy will need Eric’s help getting buy-in from above and below her before she can commit to supporting this initiative.
These one-to-one relationships are foundational to closing any complex, non-standardized partnership.
Level 3: one-to-many - internal
Next, Eric sits down with Airbnb’s COO. He needs her to understand the value to Airbnb users of a partnership with Instacart. Eric knows that having support from leadership will give aircover to Engineering to prioritize an integration with Instacart. Airbnb’s COO agrees to raise this potential deal during an upcoming leadership planning meeting to ensure it gets the due diligence it deserves from Airbnb's executive team.
Then he joins Betsy’s weekly Engineering team leadership meeting to outline the opportunity with Instacart. He outlined how the technical requirements of this deal align with several projects already on their roadmap. These Engineering leads need to be able to explain to their teams - the company's frontline developers - why this partnership justifies adjusting timelines on other projects.
One-to-many partnerships are about influencing an individual who can, in turn, influence a team or entire business unit. These partnerships are as important internally as they are externally.
Level 4: one-to-many - external
A few days later Eric gets a call from Jaclyn at Instacart. The team at Instacart is intrigued by the potential to partner with Airbnb. But Instacart’s Product team is skeptical that Airbnb will feature this partnership prominently within the Airbnb app. And without prominently displaying this feature, Instacart is not willing to invest the effort this partnership will require. Eric agrees to present Airbnb’s support and outline their commitments towards this partnership.
He goes back to his Legal, Engineering, Marketing and Partnerships leads to enlist their help with his presentation to Instacart. "I need you each to help make this presentation accurately reflect what your teams can commit to," he tells them. Here he must rely on the strength of his internal relationships in order to persuade the team at Instacart.
Level 5: company-to-company
Weeks after the partnership agreement is signed, Airbnb announces ‘At Your Door,’ a delivery program powered by its partnership with Instacart. Both CEOs post a short video on Twitter showcasing how the new feature works. The response from Airbnb users is overwhelmingly positive. And Instacart sees a strong uplift in new customers thanks to the program.
This mutually beneficial partnership originated with a one-to-one partnership between Jaclyn and Eric. But it would not have come together if each of them had not ‘closed’ several micro-partnerships within, across and up/down their organizations.
Five partnership principles to remember
Internal before external - when I worked in sales 80% of my time was focused externally. When I moved into Partnerships I learned that 80% of the job is focused on getting internal alignment (and 30% is external). First build relationships internally because those relationships and insights will shape where you focus and what to deliver externally.
Building trust is better before than during - trust and credibility is best earned before you need something from someone.
Simultaneous not sequential - the micro-partnerships needed to close a big deal do not typically occur in sequential order. They (generally) must be pursued in parallel simultaneously. Building great products is complex … and so is managing relationships within and across organizations. Hire great people to figure it out.
Tops down and bottoms up - true alignment within an organization requires getting leadership onboard as well as the frontline worker bees. They are both essential. If you over-index on one the other will (likely) bite you.
Individuals and teams - think in terms of both individuals and teams. Even if you have a strong relationship with a team leader, does that team leader have a strong relationship with their team? Will that person’s team follow the direction of the leader? How can you mitigate that risk? Who are the key members of the team that hold sway on implementation?
If you don’t have a firm grasp of the deals-within-your-deal, then the partnership you’re pursuing is not on track.
PS - as you can see, I’ve long believed in an Airbnb / Instacart partnership …