Prior to SinglePlatform, one of my biggest business development mistakes was failing to include a measure within my hitlist that allowed me to prioritize opportunities.
For those foreign to the concept, a hitlist (or pipeline) comprises of all of the companies that you could potentially partner with, sell to etc. It’s essentially a list of targets.
Inevitably there are going to be some target deals that move the needle for your company more than others. Doing a deal with Google, will probably make your company more valuable than doing a deal with a startup that may not be around in a year. Thus, as you build out your hitlist it’s important to be able to quantify how much value opportunities might drive so that you calibrate your time and effort appropriately. Let’s call this measure the SOP (size of opportunity) and be clear that every hitlist should include a SOP column or measure.
What your SOP measure comprises of depends on your strategic goals.
For an integration partnership (API), a SOP might be the amount of unique visitors prospective partners receive. This metric gauges the audiences you might reach by integrating.
For a cross-promotional partnership (i.e. email list swap), a SOP might be the amount of users a target has or the size of their email list – again, guaging the potential audience you might reach through a deal.
For an enterprise sale, the SOP might be a unit that quantifies a revenue opportuntiy. If I was selling a POS solution to a big box retailer, my SOP would be the number of brick & mortar locations that a retailer has assuming every one was elibilgle for my solution. If I was selling an enterprise HR solution (i.e. linkedin), my SOP might be the number of employees in their HR department.
Without having a clear picture of the SOP, we tend to spend more time on smaller, less meaningful opportunities because the deal cycle (and subsequent win) happens faster providing the dopamine hit that all sales or BD professionals love. I’m definitely guilty of this. In reality, if doing a deal with company X, is going to drive 10x the value of company Y, I can justify spending 9.9x more time on the deal with company X than Y. When you fail to include a SOP metric (or scale) to value opportunties, it can be challenging to maintain a disciplined, efficient methodology.
The SOP is also a guide for the sequence of your pipeline approach. When I’m first getting started, maybe I’m not ready for a meeting with a target that has the greatest SOP. I personally like to make sure I have my pitch air-tight and the optics provided by other partners/commitments before hunting the great white elephant…but when I do feel my shirt tail ruffle from the wind at my back, I’m swinging for the fences.
Using a “SOP” makes it easy for us to work smart instead of just hard…and the most successful people always make it easy to do the right thing.
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If you’re interested in BD, I recently read a post called A co-founder’s guide to Biz Dev written by Ian Hogarth from Songkick. It’s spot on and suggest you check it out.
