John Guido | July 22, 2020
While at first pass “partnering agreements” don’t appear to be a hot topic, they are a vitally important aspect of ecosystems, P2P engagements, and collaboration within the IT channel right now. Up until now, there has been a consistent set of inefficiencies related to partner-to-partner engagements of which most solution providers are aware, and that P2P Global’s members wanted us to address specifically. These include:
- Customer Responsiveness
- Speed of Execution
- Expertise Discovery
- Cross Vendor Solutions
- Facilitate & Scale Partnerships
- Trust & Confidence
When designed correctly, a software platform can do many things efficiently, and we hope our platform is delivering above and beyond on these requirements. Building trust and confidence across a diverse set of solutions providers can be tricky, which is why we aim to provide our members a “trustworthy ecosystem.”
A trustworthy ecosystem begins with our members representing their firms’ capabilities accurately. Then, when members create and respond to opportunities to solve for project skill gaps, or to partner for business development, they need a simple and clear binding document to set the ground rules for their relationship: a partnering agreement.
P2P Global’s partnering agreement sets the stage for firms to confidently enter into a detailed discussion about a project knowing that confidentiality is a priority, that customer engagement needs to be mutually agreed to, and that they are protected from employee recruitment.
What Is a Partnering Agreement?
A partner-to-partner (P2P) relationship between two or more companies is a fruitful method of providing comprehensive solutions for clients where you can solicit skills from other companies in order to fill skill gaps needed to successfully complete a project. The benefits of P2P collaboration cannot be understated, however, arguably just as important for building a solid foundation for partnership is a key document: the partnering agreement.
At its most fundamental, a partnership agreement is a written legal document which states the base terms of operation before a partnership begins. The purpose of a partnership agreement is to set a basic legal framework, and perhaps most importantly, set expectations for each party and provide guidelines for the relationship and future engagements, such as confidentiality terms to help set the stage for further collaboration. They are beneficial in times of dispute and in times of harmony, as they formally designate the rights and responsibilities of each partner, but are also critical in ensuring both parties can engage with confidence in a trustworthy, credible relationship.
Why Is a Partnership Agreement Important?
Chief among questions from P2P Global pre-launch test groups was “How do I know this is safe?” Trustworthiness is a key component of any partnership, and for firms, trust goes beyond mitigating risk; you want to make sure your partnership will maximize positive business outcomes and ROI. A solid partnership agreement establishes that trust and creates a safe environment that allows you to enter the partnering conversation with confidence.
Evan Brown is an attorney at Much Shelist, P.C. who specializes in intellectual property and technology law, and he helped P2P Global craft our partnering agreement. We spoke with him about the value of partnering agreements and the benefits they offer:
“They provide an environment and a context in which an opportunity creator and responder can get to know one another and move forward with negotiations. Their primary purpose is to enable the parties to trust each other. By building this framework for negotiating, an added benefit becomes a higher success rate of projects.”
Not only will good partnering agreements establish trust and maximize project success rates and ROI, but they will also address questions like: How is success defined? Who is responsible for what deliverables? How long will the partnership last? How much notice does a party need to give if they wish to dissolve the partnership? These are all questions that can, and should, be answered within a partnership agreement, especially regarding topics such as termination of an agreement. It may seem very “doom-and-gloom” to think about worst-case scenarios right at the start of a blossoming professional partnership, but it is incredibly important to anticipate all possibilities.
Some of the other ways a partnering agreement can be beneficial include:
- Setting expectations between parties
- Creating a framework for a working relationship
- Establishing roles and responsibilities
- Protecting confidential and proprietary information
- Creating transparency
- Stating possible repercussions regarding legality and liability
- Preventing partner disputes
- Outlining guidelines for bringing in additional partners
Evan expounded on the importance of a partnering agreement and the key components of a good agreement. The key components are:
- Confidentiality: Ensures that the sensitive customer data that partnering firms share will not be shared to any other parties or misused in any way.
- Non Circumvention: Guarantees that the opportunity responder won’t bypass the relationship with the opportunity creator to work with the prospective customer directly.
- “Off Ramp”: Addresses the future of the partnership and establishes ground rules for how to move forward once the partnering agreement ends, providing a roadmap to determine respective rights and obligations to one another.
Watch his video to learn more about how these three factors solidify a framework of trust between parties, and allow them to move forward with negotiations and potentially further contracts confidently.
How Partnership Agreements Work at P2P Global
“The P2P Global partnering agreement was based on customer feedback, and was created with a level of fairness and clarity so that any partner could read and understand it. Because it is only a jumping off point for future agreements, you will not likely need a lawyer to decipher it,” said Evan.
Here at P2P Global, we do the legwork for you. Privacy and security are at the forefront of our partnership agreement, which is designed to protect both parties. We take all steps necessary to ensure that every single member on our platform is represented fairly and accurately.
We also place an emphasis on confidentiality. We won’t ask you to provide end user information, nor do we collect it in the background to share with third parties. In fact, until both members have entered into a partnering agreement on our platform, the opportunity creator’s identification isn’t even released to the opportunity responder. Only once this partnering agreement has been entered into by both parties will contact information be exchanged so that the partnership can begin.
We also offer firms the opportunity to conduct further screening of potential partners. When an opportunity creator is assessing a responding candidate company, their company profile information is available to view. When creating an opportunity, the opportunity creator can also include screening questions in order to make sure prospective candidates hold the required capabilities – these can be specific certifications held, proficiencies in certain skill sets, and more. Again, all of the firms’ information is authorized and vetted before this stage so you can be sure any matches are accurately depicting their skills.
Interviewing And Securing A Partnership
Once a firm has decided on who they wish to partner with, P2P Global has a partnering agreement so that the preliminary contracting can commence quickly and efficiently. Remember, by this stage, all parties will have agreed to terms and conditions, privacy and data protection. P2P’s partnering agreement covers the following key areas:
- Scope of Agreement
- Term and Termination
- Non Circumvention
- Non Solicitation
- General Liability
Our partnering agreement is just the first step to allow for the opportunity creator to engage with a selected curated opportunity responder. This first agreement allows for sharing of confidential information and for an open discussion about the opportunity, all with the intent to ensure the partnership makes sense for both parties. Clearly, as partnerships mature for specific projects, other agreements—for example subcontracting, service level, or nondisclosure—may be required.
Josh Walsh, CEO of The Refinery, a P2P Global member firm that specializes in web design, software development, and marketing stated, “Having a simple, easy to execute partnering agreement is a great first step to have in place before we discuss details about an opportunity, as a follow on to the partnering agreement, we realize that a commercial relationship may warrant additional agreements that include pricing terms and more detailed SOWs.”
Delving into a partnership ecosystem can be hugely beneficial to your business, but it can also be challenging and confusing to initiate and set up. A partnership agreement is the best (and in many cases, legally required) way to begin a new business relationship. Investing time and energy into getting the right agreement will pay massive dividends in the future; and using P2P Global’s platform makes it even easier.
It is also important to remember that a firm isn’t limited to partnering with just one other firm. As our friend Jay McBain, Principal Channels, Partnership, and Ecosystems Analyst at Forrester said,
“It’s not P2P anymore; it’s P2P2P2P2P…”
In a world where businesses need to focus on processes such as preventing security issues, gaining insights from data, and dealing with cloud hosting to name a few, creating a robust partner-to-partner ecosystem is vital to producing comprehensive end-to-end solutions for clients. This is why now, more than ever, setting up your partnership agreements from the start is so important.