Almost 60% of Gen Z and 51% of Millennials now prefer to shop with brands that provide ample digital interactions, recent Canadian Ipsos research reveals. This means that if you want to build a loyal customer base, digital transformation is clearly the way to go. Yet, this process typically isn’t easy for SMEs, usually due to budget constraints and limited in-house expertise; but the good news is, this is where partnering with a tech startup can help. Startups specialise in innovative solutions that can improve your operations, and will even implement these tools for you, so you have less to worry about. As long as you clearly define your needs and vet potential partners, you’ll be rewarded with a fruitful startup collaboration that has the potential to drive long-term growth.
Define your “why”
Before looking for a startup to partner with, you need to first get clear on exactly why you want this arrangement. What’s the specific technology or solution you’re after, and how will it help your business? For example, maybe you want an AI tool that automates customer service, so customers can quickly find the answers they need without waiting to talk to a human. This is important since 90% of customers now want immediate responses when they reach out to brands. From there, you can search Google or LinkedIn for relevant AI/tech startups. Beyond the general industry, you can further narrow your startup search by focusing on the specific problem you want to solve. For instance, if you want to streamline the employee onboarding process, use this term to search for startups that do just that.
Always request proof of concept
Once you’ve identified potential matches, you need to request a proof of concept (PoC) to verify the startup can actually do what it says it can. The recent AI surge has unfortunately resulted in an increase in fraudulent tech startups, so this is an issue to watch out for. Just recently, for example, the CEO of the Nate fintech app was arrested for defrauding investors out of over $40 million. The app claimed to use AI to help ecommerce customers complete transactions, but in reality, relied on human workers in the Philippines. A PoC request can help you steer clear of these scams as it allows you to test a product before committing to it. It’s meant to demonstrate how the solution in question performs in real-world conditions, within your actual business and current workflow. So, if a startup fails to follow through on this request, you’ll know not to take the relationship any further.
Go local for stronger relationships
Although you don’t have to limit yourself to startups in your local area, this may lead to stronger relationships and better results. A local startup will be better situated to get a good grasp of your needs and current tech setup, and can also pay you regular, in-person visits to help with the transition. This is important since digital change doesn’t happen overnight. It usually takes between 12-18 months to implement new technology, and that doesn’t even include the planning stage. A closer relationship with a local founder can also help you feel more confident about your decision. The company may seem impressive online, but you never really know how trustworthy they are until you meet in person. While Canada’s startup scene is mainly focused in the Toronto-Waterloo region, other cities like Alberta, Montreal, Calgary, and Vancouver are also popular with startups, so you have plenty of options.
Partnering with a startup can be a powerful way to help accelerate your SME’s digital transformation. As long as you take time to clarify your needs and vet potential partners, you’ll land a winning collaboration that paves the way for long-term business success.
