How To Leverage Partnerships For Startup Success

As a founder, building a startup is tough—especially when you try to do everything on your own.?

Partnerships are a game-changer, allowing you to scale faster and achieve the exponential growth required to become venture backed.

In this month’s Founder newsletter, we explore the importance of partnerships in startup success and how to use them effectively, with examples from Connectd and other successful tech startups of the last decade.

1. Why Partnerships Are Key to Startup Growth

A common theme among many successful startups is their ability to leverage partnerships to reach new markets, expand their offerings, and build trust.

With that in mind, I knew partnerships would play a crucial role in helping us grow and now we sit at $7m ARR in just under four years!

From day 0 we hit the ground running, securing our first partnerships with technology partner ExLabs and the world’s biggest fintech startup Stripe to ensure two things: a seamless, high quality user experience for our customers and to build up our financial infrastructure.

Aligning with partners within our ecosystem with strong expertise and a household name meant we could reach a broader audience and build trust, especially with early adopters and investors.

Unsurprisingly, McKinsey predicts that ecosystem business models (where multiple companies work together to deliver value) will account for 30% of the global economy by 2025 McKinsey: Ecosystem Business Models.

2. Filling the Gaps with Partners

As a founder, because of our delusion we think we can do everything and often end up being highly stressed or worse, burning out!?

You need to know what you can deliver.?

At Connectd, one of the smartest moves we made was partnering with experts in key areas where we needed additional firepower. For instance, when scaling operations, we partnered with Wilson Wright, a trusted accounting firm, which allowed us to focus on product development while they handled the financial side. This partnership helped us scale faster without the need to build everything internally

Another great case study is Notion, who initially struggled with development speed and feature rollouts. They partnered with over 100 companies to accelerate their feature set, integrating third-party tools that boosted their value proposition.?

This helped position themselves as the go-to productivity tool, without having to build everything in-house.

3. Leveraging Partnerships for Reputation and Trust

Early on, your startup might not have the brand power, testimonials, or case studies needed to win over big clients. By partnering with established brands, you can "borrow" their credibility to boost your own.

In our early days, we weren’t known nor did we have any testimonials or case studies, so getting the approval from a huge name like Goldman Sachs allowed us to demonstrate to our target audience, potential investors and stakeholders the value of what we’re building.

Interesting fact: Stripe actually partnered with major companies like Shopify and Lyft to build trust with its user base, helping them onboard new customers and expand their market share.?

The success of these partnerships was picked up by other businesses, leading to a partnership with Amazon!

4. Accelerating Your Roadmap?

When deciding whether to build or buy a solution, partnerships can often be the faster route. Rather than spending months developing in-house capabilities, partnering with an established player can accelerate your roadmap.

At Connectd, we partnered with Contractbook to accelerate the development of our legal and compliance capabilities, and also to help startups on our platform.?

This saved us months of work and allowed us to offer a fully integrated solution to our customers faster than if we had tried to build it ourselves

Plaid, a financial services startup founded in 2013, partnered with major financial institutions to streamline their product development and integrations. This allowed them to quickly expand their offering and provide users with access to thousands of banks and financial institutions, a feat that would have been near impossible to achieve on their own.

5. Knowing When to Cut a Partnership

Not every partnership will work out, and that’s completely fine.?

However, like any other part of your business, they require constant evaluation. If it’s not driving value, don’t be afraid to move on quickly.

We partnered with a tech vendor in the early days at Connectd which didn’t go to plan. My rule of thumb is, if it’s not helping you achieve the successful outcome you want at that stage (product-market fit for us), end it ASAP.

Casper did the same after initially partnering with Target to scale their distribution. While the partnership helped Casper’s reach, they eventually realised the collaboration wasn’t driving as much growth as expected and later pulled out and re-evaluated its distribution strategy to focus on direct-to-consumer sales.

I’ll go as far to say sometimes a failed partnership is needed to help you realise what needs to be changed within your strategy.

Whether it’s gaining trust, expanding your market, or filling gaps in your capabilities, partnerships can fast-track your growth.?

Just remember—partnerships should always be strategic. Know when to build, when to buy, and when to walk away.

If you’re building a startup, ask yourself: Are you leveraging partnerships to their full potential?