What Does it Take to Build “Real” Strategic Partnerships and Collaborations?

Presented by

Jason Friedman, Principal

With Debra Carr, Director, ISED

AEO’s 2010 National Microenterprise Conference and Training Institute

Background

• It’s a given that effective partnerships and collaborations are critical when it comes to supporting aspiring entrepreneurs and existing small businesses.

• As nonprofits, we talk about “partnerships” and “collaborations” all the time. But what does that really mean?

Purpose of this Workshop

• Learn more about how to develop effective partnerships with these organizations and how together you can build an inclusive and sustainable community.

• Address the critical role that partnerships and collaborations play in running a successful MED Program.

• Provide a framework for developing collaborations.

Purpose

• In this highly interactive session, we will define these terms, reveal the elements of a true partnership, and discuss what it takes to manage and nurture them.

• We’ll provide a process and tool to investigate, develop and “vet” potential partners. We’ll discuss how to assess your “credentials” as a partner.

• And we’ll provide examples of what our peers are doing in the field to develop effective partnerships that provide real value and impact to their clients and organizations.

How do you define a partnership?

What it is…(and what it ain’t)

Definitions

1. A legal relation existing between two or more persons contractually associated as joint principals in a business.

2. A relationship resembling a legal partnership and usually involving close cooperation between parties having specified and joint rights and responsibilities.

http://www.merriam-webster.com/netdict/partnership

Share with us your successful partnerships! Why does it work?

What are examples of what our peers in the field are doing to develop effective partnerships that provide real value and impact to their clients and organizations?

Partnerships with Local Business Owners

Justine Peterson and the Black Hair Project

• The Black Hair Project is a non-profit organization whose mission is to increase the number of Black-owned beauty industry businesses in predominantly black communities.

• Developing a partnership with JP to offer free private counseling and workshops at barbershops and salons.

• Soft pull credit reports and offering credit builder loans.

Collaboration, not competition: Partnerships with Other Microlenders

Georgia Green Loans

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A new brand…

Georgia Green Loans provides capital to start or expand an

eco-friendly product or service or “green” an existing business

What is Georgia Green Loans?

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1,917 unique visitors since May 2009; ranked high in Google due to blog, Facebook and Videos

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Collaboration with other lenders

• Collaboration with two other lenders: SBAC (Small Business Assistance Corp out of Savannah) and ACT (Albany Community Together, Inc.)

• When a business goes to the website to apply for a loan, their county selection automatically routes them to the organization that handles that area

• Recent approval by SBA to split non-served middle Georgia counties

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Georgia Green Loans Advisory Council

• Guide the green loan program• Provide expertise in green business development• Bring connections to potential funders and individual

donors• Assist in guiding the establishment of Georgia Green

Loans in the state of Georgia• Leaders in the community and people with highly

respected skills in critical areas• At least two members will be current clients of GGL• 2 year term; meet quarterly• Examples: Georgia Organics, Southface Energy

Institute, foundations

Partnerships with Educational Institutions

ISED and Simpson College

• Professors of Business did a sabbatical with ISED for a semester and:– Helped revise the curriculum; – Upon completion of the sabbatical, Simpson Professor

connected ISED with the College President, City and County Officials as well as a community of retired professionals who are interested in giving back and helping to support and encourage entrepreneurship in a seven-county area.

• Southview Expanded Entrepreneur Development Program or SEED:– Simpson College students and faculty play key roles– County EDCs– Rotary Club

Microenterprise-SBDC Partnership - Del Mar College’s ‘Center for Economic Development’

• An adaptive, responsive Small Business Development Center, funded by the SBA and the State of Texas

• A Procurement Technical Assistance Center, PTAC, funded by the DLA

• An Accion branch office,with a partnership with our local EDC. This partnership funds an interest buy-down for Corpus Christi businesses that create a full-time position within two years from receiving the loan. The buy-down drops the interest rate down to 5-5.25%.

• An office for our ‘Westside Business Association’. This group supports businesses within a specific geographical area of the city.

• An office for our local Black Chamber of Commerce.

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SBDC-Microenterprise Partnership

• GV classes are supported by our local EDC. Attendees who complete the program have from January 1 through June 30 to create at least one full time position.

• After class they receive $5,000. If the companies retain their existing workforce and the new employee stays for a minimum of six month, the company receives a second $5,000. We had some micro-grants available for the first two FSFT classes, ($250 - $1,500)

• FSFT class was sponsored by a company who was laying off 200+ people. They contracted with us to provide four classes available for the first 50 people who signed up, offering a $10,000 grant for each individual who completed the program, drafted a viable feasibilityand started their business. Awarded $80,000 and most of these businesses have survived.

Opportunity Fund, San Jose, CA

• Haas Business School Team Examines Opportunity Fund's Metrics and Evaluation System: UC Berkeley’s Haas School of Business and McKinsey & Company teamed up to form Social Sector Solutions: a project where students, coached by McKinsey consultants, engage in a semester-long consulting project with Bay Area nonprofits. 

• In the spring of 2008, the Haas S-Cubed team tackled Opportunity Fund’s evaluation system across all three programs and established metrics and a plan to help them maintain our leadership in social impact evaluation.

Specialized TA - Sustainability Assessments Neighborhood Assets, Spokane, Washington

• Approved loan clients receive a thorough sustainability assessment conducted by Sustainable Local Investments Project (SLIP).

• Coalition of public and private organizations in the area, SLIP provides access to specialists in the community who can help businesses make cost effective investments in energy conservation, alternative energy sources, waste reduction, and other environmental improvements.

• Commit to implementing certain recommendations from the SCORE assessment, they are given a 2 point discount on their loan. Follow up to ensure that they follow through on those implementation steps.

Other Ideas for Partnerships

• Trade Schools

• EITC Campaigns

• Rapid Re-housing Programs – Small Dollar Furniture Loans

• Pro-bono legal services

Questions to Consider in Developing a Partnership

Is it Worthwhile?

• Does the potential partner have access to your target market or markets in which you want to expand?

• Will the partnership increase client participation? How many new people do you expect will be drawn into your organization through the partnership?

• Can they help to subsidize or provide part or all of certain specific services that are currently costly to your organization?

Is it Worthwhile?

• Will the partnership allow you to focus on offering the services that you are most cost-effective at providing?

• Will the partnership bring needed financial resources to your organization to help cut costs?

• Will your organization’s cost per person or cost per service decease as a result of the partnership?

• What are the long-term scale implications of the partnership? Is it sustainable?

Is it Worthwhile?

• How could a partnership with this entity increase “buy-in” from other partners, including funders like banks and financial institutions?

• Will you be able to leverage the partnership to achieve other goals, such as accessing government funding or increasing media coverage and public recognition for your program?

• What’s the “win-win?”

Developing a Framework to Establish and Grow Successful Collaborations

Developing Good Partners

• What is your internal strategy for developing collaborations?

• Identify the potential partners that would benefit your program. Think broad and wide?

• Develop criteria for selecting a partner and strategies for recruiting.

• Identify how the partner benefits – “win-win.”

• Jointly establish the structure/rules for the partnership.

Internal Strategy

• Who sells your organization and how well do they sell it? What is the message? Is it uniform and consistent?

• Are outreach and partnership initiatives built into the schedules of staff?

• Is staff equipped with adequate knowledge of your organization (talking points) to handle questions from interested parties and communicate effectively about the organization’s partnership goals?

• Does your organization emphasize the goal of increasing scale when approaching partners?

Criteria for Selecting a Collaboration

• Reputation

• Quality of service

• Flexibility

• Accessibility

• Accountability

• Client support

Establish Rules and Structure for the Collaboration

Develop “Rules of Engagement” for what the collaboration should do and shouldn’t do.

• Define roles and responsibilities• Develop an implementation plan• Implement a communications plan• Develop procedures for problem-solving

Roles and Responsibilities

• Resources: what staff, finances, and technology will each organization provide?

• Time: how many hours both will devote?

• Key people: who will be the point people from the collaboration team?

• Boundaries: clarity about the target market and geographical boundaries

• Note: Put it all in writing!!

Create an Memorandum of Agreement

The interests and preferences of each party must be clearly understood & a formal “MOA” prepared and signed by both parties to assure that the mutual expectations & agreements are clear.

Develop a Communications Plan

• Communication within your organization

• Communication between collaboration partners

• Collaboration team communication with a outside parties

Process for Problem-Solving

• Problems may arise between collaboration partners which will necessitate involving others to help resolve. What do you do?

• Have a plan that lays out the resolution process

• Gains more meaningful commitments from management of both organizations to work together & secures a commitment from both management teams to mediate disputes

The Collaboration Champion

You are the person with the vision & skills to move the collaboration forward.

Skills/Characteristics:

• Integrity

• Strategist

• Visionary

• Planner

• Communicator

• Collaborator

• Persistence

Partnership Assessment Tools

Thanks!

Jason Friedman, PrincipalFriedman Associates1 Knollwood LaneIowa City, IA 52245319-341-3556www.friedmanassociates.net jasonj@friedmanassociates.net