Preemptive Predatory Partnerships

Note the plural. One is never enough - not in the crawl and scramble and crawl to that first personal billion ... which for two partners means?

This is the tale of IT and the litle ISV that could and would.

I wonder if the MBA schools are neglecting this topic?

Here's the short course.

Preemptive Predatory Partnerships 901.

Company X competes with Y and Z in a niche IT market as an ISV.  X fears that Y or Z may partner with ABC or JKL.  Try to partner with both ABC and JKL and let both know they are being considered. Partner with whichever first.  Drag feet. Fiddle with your API.  Send them your most useless 'architect' (just promote a senior developer who was warming a seat.) Start work on your own ABC-like or JKL-like product.
Now let the non-partner know you are already not to happy with your choice of partner, you made a mistake yah-da-yah-da.  You can see where this is going.

If you are good at it - really good - which you do by focussing on this 'strategy' rather than your core product - you can end up with a package better than that of ABC or JKL and the tax break and then the company that acquired floundering Y or Z now wants to acquire you - but not for that lagging 'core' product- but rather for your own little skunkworks alternative to the product of baffled ABC and/or JKL.

If you are really lucky ABC and JKL were located in Ireland and by the time you are acquired, they are defunct and they never understood the game.

It's like playing 'spades' with someone who thinks they know how to play whist because they once learned bridge.  You told them the object of the game but heck, it just looks and feels so much like whist ... and you make 500 ... or that first 100 million that is the first step to that first big B. That's an American 'B', 'natch.

Real advantage accrues to the partners at X, Y or Z who can sell the idea that their company "True-T-U" is their 'baby', their 'life' and is ever so definitely not for sale - which is why the partnering is so critical to our mutual success.  The successful entrepreneur with 3+ startups under his or her belt or bonnet by age 50 was first a ruthless salesperson by age 30.  Scramble, yes.  But don't neglect the all important crawl.

Partnerships.  Don't head to the banquet to feast with someone who is yet to display a good appetite.  It's rather like marriage before sex.  So partner, beware.

Motto: Just because you arrive at a square-dance with a partner doesn't mean that you won't be going home alone dressed in a sack and with nothing but old bags from Ralph's or Lund's on your feet.

If it's not for sale, it might as well fail.