Pitching a new product to potential partners is a key part of getting a startup off the ground. It’s also a risk to be managed. How do you disclose enough to get them engaged and excited while still protecting your intellectual property? It’s a tricky proposition, particularly when your company is early stage and lacks the leverage to push for an NDA or, more importantly, to enforce it should you secure one. However, through a combination of well defined user stories, hard data and good storytelling, you can strike this balance.
I was prompted to write about this topic after a recent conversation with an entrepreneur facing just this challenge. He has an alpha-stage software product with a validated market and healthy revenue projections. Further, he’s identified a number of key partnerships that he needs to secure in order to get to market and grow the business. When we got together to discuss his situation, he had succeeded in lining up meetings with several potential partners and was sweating over how to show and tell without showing too much.
What we talked through were ways he could convey the capabilities, impact and value of his product without exposing too much detail — detail that would put his product at risk of being knocked off or show too many of the rough edges that it currently has. It’s worth acknowledging the argument that “ideas are worthless,” and if you lose to a competitor who simply copies your idea, you didn’t have a viable business in the first place. While I don’t subscribe to this argument in whole, I do appreciate it in principle. Even so, taking reasonable steps to manage this risk is worthwhile. Potential partners are often potential competitors. It can be a very fine line.
So, what can you do to protect what you pitch? First, you need a strong narrative; you need a good story. Features and benefits — “speeds and feeds” — won’t cut it, and they run counter to your objective of minimizing disclosure. Not only will you bore your audience, you’ll expose too much detail. A good story places the prospective partner in the mindset of your (and potentially their) customer. It helps them understand the impact your product makes and anchors it to what matters most: delivering value to customers.
In order to tell your story effectively, you’ll need well defined user stories that ground your product in real world customer scenarios. An experienced product manager will have developed user stories and use cases to support the development of the product. If you’re not quite there yet, this is an opportunity to build them. User stories should describe the most essential ways in which your product is or will be used by key customer or user types. For the purposes of your partner pitches, distil use cases down to their essentials: a description of the user, the problem they need to solve, and how they use your product to solve it.
The third component, in support of your story and use cases, is data. Specifically, I’m referring to inputs and outputs that enable you to show how your black box works without opening it to plain view. Depending on your product, this could take the form of your product’s effects on conversion rates, efficiency gains, or a Return on Analysis (ROI) calculator — whatever is most relevant to demonstrating the impact your product has on a customer’s business. The key is to present the numbers in the most credible light, preferably supported by actual customer results. If you’re too early to have actuals, be prepared to defend your projections with methodology and assumptions.
With a process for identifying the right target partners and a clear set of objectives, a compelling narrative, user stories and supporting data for your product puts you in a strong position to make the most of your next partner pitch. Go get ‘em.