Explore a Career in Business Development in Tech - Discussion with Business Development Managers at Stripe and Hulu
In the case of Business Development in Tech, we have had not one, but two guests on the show, who have worked in BD at some well known companies in Tech including Stripe, Dropbox, Hulu, Intuit and Pulse.
Discussion with Cristina Cordova, Business Development @Stripe, Pulse
Cristina Cordova, first Business Development hire at Stripe and former Head of Business Development at Pulse (acquired by LinkedIn), talks at length about a career in Business Development in Tech.
As part of Stripe, Cristina has led complex deals to rapidly expand Stripe’s business through partnerships with companies including Apple, Facebook, Freshbooks, GoDaddy, Intuit, OpenTable, Pinterest, Twitter, Volusion and Xero.
At Pulse, Cristina sourced and closed partnerships with hundreds of media organizations, including The Wall Street Journal, USA Today, Los Angeles Times, Fox News, Reuters, Bloomberg & BBC News.
Cristina has a Bachelors in Political Science from Stanford University.
Some of the areas that Cristina touches upon in this episode include:
1. What is business development and how is it different from Sales
2. Examples of projects she has worked on, such as getting Pulse app pre-loaded on Kindle Fire
3. How BD deals can vary from product partnerships to simple cross-marketing/distribution deals
4. Stages in a typical project
5. How outreach to potential partners can happen through investors' networks, company's network and your own network.
6. How a small startup or a company looking for very specific deals, might look for a hire who is already very well networked
7. Why good BD people tend to be generalists
8. Interesting and challenging aspects of the job
9. How this can be a high-stakes job, with high highs and low lows
10. How this is a very external facing role, and so you need to be comfortable with working with people with a variety of different working styles
11. How a candidate's resume should ideally indicate whether they have worked with product or engineering in the past, prior deal experience and impact of those deals
12. Recommended resources
13. How you should join a company that has a negotiating style similar to yours and where you can learn from the people around you
Discussion with Sanjana Tandon, Business Development @Dropbox, Hulu and Intuit
Sanjana Tandon, Director of Business Development at Hulu and previously in Business Development at Dropbox and Intuit, talks about what working in Business Development is like. Sanjana has worked on a number of strategic partnerships during her tenure, including driving a deal with American Express while at Intuit.
Sanjana has BA in Economics from Stanford University.
Some of the areas that Sanjana touches upon in this episode include:
1. What is Business Development
2. How having a strong network can be a big benefit in BD, especially if you work at a smaller company
3. How this role tends to vary depending on the size of the company
4. How to assess whether Business Development is important at a company or not
5. Skills and qualities found in successful BD professionals
6. Typical project in BD
7. How BD professionals need to be great negotiators
8. Interesting and challenging aspects of the job
9. Recommended resources
Detailed show notes with timestamps:
Sanjana describes how she entered business development. (02:53)
Capabilities that are sought in BD are discussed. (03:55)
Idea of business development is introduced (05:00)
Discussion about inorganic ways to grow the business (05: 40)
Sanjana goes into the scope of BD and how it varies with companies (06:40)
Sanjana talks about the different kinds of partnerships in BD (10:20)
The different stages of BD are explained. (11:16)
“In a weird way, it’s like The Bachelor where you’re kind of dating a bunch of people but you have a sense of who’s the winner gonna be since the start but you keep everyone else involved.”- Sanjana (13: 35)
The length and duration of the process are discussed. (13:45)
Sanjana explains the importance of networking and building connections. (14:54)
“I think in business development it’s a lot about what your relationship with certain people is and how you are described in the business development community.”- Sanjana (18:10)
BD teams tend to be small even in large companies. (18:52)
Priority of BD as a function in the company. (23:22)
Sanjana shares an example of a stressful negotiation. (25:47)
Description of the negotiation process (27:00)
People involved helping out the BD process. (28:33)
The five things that show up in any contract. (29:40)
Lyft and Delta example of a partnership is discussed. (29:48).
Preparation for a negotiation meeting. (34:16)
“Figuring out how to deal with people and people with different styles, being good at reading people and what they are actually trying to do, that is an important part of this job.”- Sanjana (35:33)
Daily aspects of the job is discussed. (36:30)
Performance measurement of business development professionals. (39:40)
Interesting aspects of the job. (42:03)
Aspects that she does not like about the job. (44:03)
Importance of process in the job (45:03)
Challenging aspects of the job. (46:15)
Common mistakes people make in BD. (47:20)
Progression in business development. (49:13)
Example of a stressful situation Sanjana has been in. (50:51)
Top 4-5 qualities or skills Sanjana has seen in BD professionals. (52:20)
How to assess whether this is something you might enjoy or not? (56:08)
Typical background or a kind of background that would help in BD. (59:36)
Process of applying in BD (1:00:30)
“Do what you can to get in front of people is my advice.”- Sanjana (1:02:19)
How can candidates stand out in their application for BD roles? (1:02:30)
“Some of the BD people you’ll meet they have got some of the most interesting varied backgrounds and you can see how it helps them because they are able to adapt in a lot of different situations.”- Sanjana (1:03:46)
If you have any questions for Cristina or Sanjana or for us, you can email us at firstname.lastname@example.org or tweet at us @led_curator or like us on Facebook at facebook.com/learneducatediscover
Here is a transcript of the discussion with Sanjana:
SM: Sanjana hello! Welcome to the show.
ST: Thanks Sonali for having me.
SM: Absolutely, it’s great to have someone from business development finally on the podcast cause we have covered quite a few roles from tech on the podcast so far but this was one important role that has been missing for a while so I am happy that we are finally doing something on it.
ST: Yeah, excited to share.
SM: Maybe you can tell us about yourself and your career path so far.
ST: So I grew up in Virginia and moved to the Bay Area for college in 2005 and graduated from Stanford with a degree in economics and initially I thought I would go into International Development work. So I would be with the State Department or World Bank and in fact, I took a year off to move to India and do some service work. But that aside I have been into tech since I first started my career with Intuit which was my first job after college and there I started with the International Developmental program.
SM: I was looking at your profile and I did see that you were in India for a while. But for the most part you have spent your career in tech and specifically in Business Development. So when you first entered this field, what attracted you to it?
ST: I actually got into it completely accidentally, fortuitous accident I guess. My first rotation in Intuit was in product marketing but I happened to be working on a white labeled product. So basically that’s a product that someone else built for us, we put our brand name on it and we resold it. And we were in the middle of renegotiating our contract with that company and I started working with our head of business development in that process.
Long story short, he told me he thought I might be good in business development and I should consider doing a rotation in it and that’s kind of what I did. I convinced our rotational program manager to help let me do that because technically in our first year, we weren’t supposed to do a business development rotation but I kind of talked her into it. And I was very happy that I did.
SM: This just goes to show how these opportunities come up. You just meet someone and they see something in you. Do you know what the business development person saw in you that he thought you would be good in it?
ST: It’s probably more that he let me kind of run it instead of seeing something in me. He had enough faith in me to let me run the process. So he let me negotiate with the company, he let me talk to the product managers for what we should be negotiating for. I was a couple months into working and you usually don’t get that kind of opportunity to lead a project start to finish so early in your career. He let me do it and along the way and the thing that stuck out was that you have to be a confident negotiator and storyteller and I didn’t know I had those capabilities. But since he let me run with it, I did what I had to do.
SM: You were out of undergrad that time, you got a great opportunity so early in your career and looks like you really enjoyed it since you have spent most of your time after that in business development. So then what is business development?
ST: It’s one of those functions that can mean a lot of different things depending on the size of the company and the industry that you’re in. At its core though, business development is basically looking for ways to grow your business outside of your company selling to its customer base. So that may involve acquiring or merging with another company, it might be doing a partnership with another company that involves selling to their customer base, it might involve both of you bringing up a product together and going after customers that are new to both companies. So we call that inorganic ways to grow the business.
SM: In my mind I have always pictured business development as partnerships, like it is partnering with a company to do something. I think what you’re describing is maybe a bit broader in scope, would you say that?
ST: Partnership is the most common thread between all the things that BD can mean, but depending on the company you might be doing mergers and acquisitions as part of business development. You might be doing a lot of strategy work as part of business development. So it can flex in a number of ways but you’re right that partnership is the most common theme in business development.
SM: This variation tends to happen depending on the size of the company. So what varies?
ST: The easiest way to think about it is when you’re a very small company, let’s say you’re a startup and business development at a very small startup feels a little sales-y because the companies that you’re partnering with or want to partner with don’t even know who you are. So you’re cold calling a lot, you’re trying to network a lot because you want your name out there. You want these bigger companies to partner with you and to open up their customer base to you.
So a lot of times people think of business development as being of a sales-y role and it can be if you’re in a very small company because you’re trying to increase your brand name and get people to understand what your company does. At a bigger company, you’re often on the other side where you’re getting so many inbound opportunities that you have to have a much more robust pipeline management and a much more clearer strategy on what you’re going to do with a partner otherwise you’re going to be bombarded with opportunities because you are a big company. So that is it can vary and the skills required vary with the size and type of company you’re working for.
SM: That’s a great point. Business Development tends to sit in sales a lot of times, not always but people say “I am hiring for a sales/business development person”. But what you’re saying is that in a smaller company that might be going on hand in hand, you might be selling directly to your customers but there’s also reaching out to potential partners for sales who don’t know who you are.
ST: Business development tends to be associated with sales in those really small start-ups. As you mature as a company, generally business development becomes its own function. Sometimes it’s under marketing for a product but very rarely. It’s usually its own separate function.
SM: You also said that partnerships are the big chunk in business development. Can you describe the kind of partnerships that someone in BD might think about?
ST: Why don’t I give some concrete examples coz it’s hard to understand when you’re talking in generalities. So a couple newsworthy partnerships that you may have heard about. One of them is every time you ride a Lyft now, you can earn Delta miles, that’s a partnership that Lyft and Delta worked on. Every time you use Shazam and you Shazam a song, you can automatically add it to your Spotify playlist. That’s partnership that Shazam and Spotify worked on. I don’t know if you have noticed but if you take a Virgin America flight, on their entertainment system, you can find a Lynda.com class to take for free while you’re in flight. That’s a partnership that Virgin America and Linda worked on. Another good example is when you take a Samsung device out of the box and you find Google Drive preloaded on it, that’s a partnership that Google and Samsung worked on.
So these are all different flavors. In some, one company is reaching another company’s customer base. In another, its product innovation that makes your product work better together but in essence, any time you’re getting a benefit from a company while you’re using a different company’s service, that’s a partnership that was worked out between those companies.
SM: A lot of us even when we are moving around or using something online or on the streets, we can see examples of these partnerships. And if you start seeing those partnerships lens, you can see that a lot of interesting things are going around you. It would be really interesting to understand how someone in business development would evaluate, whether the partnership is worth doing, what is the return on investment, how much does one party gain against the other. So maybe you can give us an example of a project that you worked on or not, and then walk us through the stages of the things that you think about and work on as you go through the project.
ST: So let’s say your company needs to grow its subscribers by X by the end of the year and you don’t think you’re gonna get there through your company’s marketing efforts and growth efforts. So you start thinking of companies that you can partner with that can distribute your product. You want access to that company’s customer base as a potential customer for your own product.
So you make a list of companies and you start reaching out to them. This is usually done through a combination of leveraging your own network, your coworker’s networks and often your executive’s networks. If your CEO knows the CEO of the company you’re trying to partner with, sometimes you can introduced at that level. So once you get in touch with the right people which tend to be the business development people at the other company, you pitch your idea. You know you worked pretty long and hard to come up to this pitch desk where you elaborate on how your idea helps both companies. Because while your goal is to grow your own customer base, the company’s not gonna partner with you if it’s not in their benefit to do so also. And this will involve a lot of collaboration with other teams in your company. So you’re talking to finance about how you can structure the monetary agreement, you’re talking to product cause if you’re offering any sort of product in the negotiation you are gonna need a product engineer to help you build it out. So this can be a long process while you’re figuring out what is the exact partnership idea that I’m pitching to this company and you’re working with a lot of people across your company to get there.
And then once you’re in the door and you’re talking to the company and you start negotiating the terms, things like exchange of money, how long will the partnership last, who’s brand name will go where and usually if you can, you’re engaging with multiple companies at the same time because you’re trying to keep them all warm but you tend to progress with one faster.
In a weird way, it’s like The Bachelor where you’re kind of dating a bunch of people but you have a sense of who’s the winner gonna be since the start but you keep everyone else involved.
SM: How long does this entire process generally take?
ST: For big partnerships, it can take anywhere from 6 months to a year. From inception of the idea to pitching the idea, getting in touch with the actual company and then the longest period tends to be the development of product innovation or if you’re coming up with a new product together, actually building that out, along with the contract negotiation. Contract negotiation can sometimes take months.
SM: I can understand. The bigger the company is involved, even the number of people involved tends to be bigger, there is more alignment. I would love to dig deeper into the stages you described. So the first stage you said was, for example your goal was to increase the number of users on your product and so you try and get distribution through another company so you’ll identify a list of companies to reach out to through your network. So would you go so far to say that someone in business development should have strong network already or should be good at networking?
ST: It’s hard to say that a person should have network already, I most certainly didn’t have network when I first started the job. When you’re junior, you’re more relying on your boss’s network, the other people in the function’s network but you most certainly should be good at networking. Since you should be building up your networks and contacts as you are growing in the role.
SM: Let’s take your example. As you said you didn’t have a network from the get go, what are some of the things you did to build your network?
ST: The most obvious one is remaining in touch with people you worked with in the past on deals. One of the deals I’ve worked with is between Intuit and Verizon. So you work with these people on the other side of the table for months, keep in touch with them, get their personal contact information, make sure you’re connected on LinkedIn. I think now it’s a lot easier to have network since you have all these social networks to remain connected on but make it a point if you are visiting the city where the company you’re working with is located in, then you say hello and try to grab a cup of coffee. It’s just how you build any other network, your professional network generally. It’s just in this job you’ll probably rely on it more than you do on a day-to-day basis on any other function.
SM: When you’re reaching out to these companies, yes you’re reaching out to them as “hey I’m Sanjana and I do business development for Dropbox or Intuit or whatever your company is” but it is important you’re reaching out as Sanjana also. So you’re leveraging your personal relationship almost.
ST: It’s actually pretty when you’re on the side of the bigger business development team and your team’s goal is to have a partnership with x company, you will have conversations in company about who knows anyone personally in that company. Did anyone go to college with someone who worked there who could introduce us to the right people because it is not about getting introduced to the business development team? You want a good business development person to work with and what is that person’s reputation. And vice versa. When you’re reaching out, people are not just like you’re doing business development but what is your reputation in the community to what kind of a business development person you are.
People make note of what your style is, your negotiating style is, are you tough to work with, are you easy to work with, are you looking out for the best interest of both the companies. So your reputation most certainly follows you. I think in business development it’s a lot about what is your relation with certain people and how you are described in the business development community.
SM: I can imagine in a startup for sure, it doesn’t really have much of its own network so everyone is leveraging their own network but I wouldn’t have expected that at a large company. Because it sounds like the entire BD community is pretty tight, like different people from business development from different companies. Like they sort of know each other or sort of know someone who knows some other person and you have pulse on how do they negotiate, what kind of person they are to work with, etc.
ST: Even at a large company, business development teams tend to be pretty small. I guess the largest company I have worked with is Intuit and it was 8000 people and there were maybe 10 to 15 people across the company who did business development. 20 at max. So, it’s a fairly small team of people, even at a big company.
SM: the reason I’m stressing on this point a little bit is that it immediately tells you that if you do not like this kind of thing or if you’re not comfortable with putting yourself out there, actively reaching out to people and maintaining relationships, then business development might not be the role for you.
ST: I agree.
SM: So the next step is, once you have identified your companies and you have reached out to them and then some of them respond to you, they are interested in working with you or at least figuring out if there is a potential partnership over there. Then you’re sort of refining your idea and sort of figuring out what the partnership should be about and aligning the different people within your own company. What is that process like? Can you give us an example of the challenges you face when you do that?
ST: You have identified an idea that you want to work on with the other company and hypothetically, the other company agrees at a high level with the idea and the goals you want to achieve together. Now the hard part is getting your own company on board with that plan. Because what you’re pitching is something that the company didn’t plan for. So it’s not on the product roadmap, it’s not on the engineering roadmap, finance probably didn’t budget if you’re giving the company money or any new revenue share of any new customers that come through the door. So you’re essentially throwing a partnership in everyone’s hands and assuring that the outcome of this partnership is so good that it is worth the extra effort to fit this project in. You’re literally going from team to team and selling your idea to them. You are going to finance and product and engineering and marketing and saying “hey, isn’t this a cool idea? It could drive x many customers or x many sods and would you collaborate with us in actually making this happen. That’s the part of Business Development that people tend not to understand cause you think about it and you think about the externalities, talking to the companies and getting them on board the partnership but the hardest part is actually internal. Because it is easy to sell an idea, it is hard to execute it. Especially when you don’t control any of the resources.
SM: Also because you have to divert resources from things that have been permitted towards your idea. Since these ideas are not on the roadmap of any of the other teams so you have to convince them why this is good for them to invest in as opposed to something else.
ST: Exactly. And often, in rare cases are you able to divert the resources from existing plans. So it’s almost always like we are going to this and the partnership. Very rarely is it that we are going to the partnership instead of whatever the company had already planned so you are basically asking people to work a lot harder than what they had anticipated.
SM: That brings up an important point though. It also depends on the overall strategy of the company. I think one company might not prioritize partnerships over what they do whereas some company might rely more on partnerships for growth. Would you say that if you want to get into BD you should choose companies using the lens of how much do they prioritize business development as a function inside the company?
ST: Definitely. To my earlier point, business development can look very different based on what stage the company is in terms of growth and product. Some telltale signs of how important business development is to a company is to look at what they have done in the recent past, how big are they in sale, is that both CEO’s have released press releases about and made comments about, how the company is looking at business development- do they report directly to the CEO or do they report to the Chief Marketing Officer or Chief Sales Officer. You try to figure out the reporting structure because that can be a big insight into how important is this function in the company. And look at the volume of deals they are doing, how many press releases and news alerts are coming through of the company having done partnerships in the recent past. Because it gives a good indication of how important it is to the company at large.
SM: I am surprised to hear a BD person reporting to a Chief Marketing Officer but yes, business development is this function on the side which may or may not have a head depending on what they are pitching.
ST: Their deals might be all marketing related. They might be all doing offers through other companies like “hey partner company, send an offer to our customer base for a 10% off on my product. Those are fine and those tend to drive a significant amount of sod but in that case what it is telling you is that you’re not going to be doing any product innovation deals.
SM: So it is also about what you’re interested in. If that sounds interesting to you, then by all means, go ahead. And then the third stage you described, going back to your process for a typical project, was the structuring the agreement and negotiations for the partner company. I would be curious about how do these negotiations go? Maybe you can share an example of a stressful negotiation.
ST: In all honesty, all negotiations tend to stressful at some point or another. Usually once you structure the general agreement, what the idea is or what the basic terms are, you put together the project term sheet which is a really simple summary of the idea, what both teams have committed to doing, who’s going to get the other company money, or how much money, how the exchange of financials is gonna go and this is how long this deal will last. Every deal has a term which is how long it will last.
So that is the first stage, getting the term sheet signed and its more ceremonial than anything else because it is not legally binding but it is a good indication to the company that this is going to happen and we should start putting resources against it. Because in an ideal world, you wouldn’t put resources against something that is not a legally binding agreement but most of the time you are working towards a deadline or a launch date that you would never reach if you waited for the entire contract to be hashed out.
So the term is sheet is what you’re looking at when to put resources against this thing.
SM: What are the kinds of negotiation styles you have seen in these discussions especially because when people think about negotiations, they think of one country negotiating with another country. These sound more stretched out, there are multiple meetings, multiple stakeholders so how do these negotiations really go?
ST: So the next step after the term sheet is exchanging what we call is the long term agreement which depending on the company you are working for, can be anywhere from 50 to 80 pages long. For example if you are working with a bank or a financial institution, they have so many regulations so their long form agreements tend to be 40 pages plus.
SM: As the business development person, are you the person who’s supposed to be well versed in these contracts or you have someone from the legal side helping you out?
ST: So you will always have someone from the legal side helping you out and is responsible for the entire agreement but as the business development person you should have a very good understanding of what that contract means and you are leading the negotiation for most of the business term. Legal teams will hash out certain things like warranties or representations and indemnities which are very complex legal issues but as a business development person you should have an understanding of what those terms mean. You should be able and willing to negotiate all of the business terms. You should be able to tell the legal team of what you are going to do and how much are you willing to invest.
SM: Can you give us a few examples of what you think about when you talk about the business terms, generally the five things that show up in any contract.
ST: The five things that show up in any contract. What’s commonly an issue with big companies is exclusivity and in every agreement that you look at between different companies is that is this agreement exclusive or not. So let’s take the Lyft and Delta example. Lyft probably wants to probably partner with a lot of different airlines and build loyalty for its service by saying that you can get Delta miles, you can get United miles and Delta on the other side is saying, we want it to be just us. From the branding and marketing perspective, it gives us a lot of clout if Delta is the only airline partner or the preferred airline partner for Lyft. So this issue of whether this agreement is exclusive or not tends to come up in every negotiation and is reflected in every contract and can be one of the more contentious issues in any negotiation. The other thing that is common is the term. So how long is this contract going to last and under what circumstances can one company pull out. This is another area which can get very contentious. Generally one company wants to be in the partnership for longer than the other, what are the circumstances under which the company wants to end it, can end it. What constitutes a ‘breach of contract’ under which they can say that we are not legally bound to operate in this or there are other business matrix, which if not met, the other company can terminate this agreement.
So that can be a long and fairly complicated part of the contract.
SM: I can imagine this can go on forever. But how do these negotiations happen? Are these in person or commenting on each other’s documents or email?
ST: So the first negotiation is whose contract is to be used. Every legal tema is going to tell you to use their own contract because your company tends to have a standard contract, even if it is 80 pages long, it’s a standard contract that your company has worked out. After that is determined, and it is usually a combination of the BD and the legal people hashing it out, the first weeks of the negotiation is trading back the red lines as we call it. So the other company will receive the contract, mark it up in Microsoft Word using track changes and it will look like a bunch of red lines. So you’ll trade it back and forth, you’ll get on calls to discuss the issues and you’re generally looking at a once a week of trading (32:36) that paper and then you’re scrambling internally once you receive it to make sure you captured everyone’s comments and that you have everyone’s okay on the red line you’re gonna send back. So that tends to be how it progresses and then you’ll want to get together in person once if not twice, generally throughout that process. Say what you may about technology and the wonderful ways you we communicate today without meeting in person, but that actually is the fastest way to hash things out. Which is why you see BD teams meeting in person as we end the near of the contract negotiation, which is usually because you have to get the contract ready by x date in order to launch. So you’re working towards a deadline and it’s a lot easier to negotiate in a closed room with everyone in the BD and legal teams present.
SM: It certainly sounds like a more negotiation kind of job. Obviously there’s a lot more to it. You are negotiating for a pretty big company for example, as the BD person for Dropbox or Intuit, you are negotiating on behalf of them with another big company. You are taking some pretty important decisions in person. So I guess you guys have to prepare a lot before these meetings?
ST: You do have to prepare a ton before these meetings, because you should know what your negotiation tactic is going to be, what you’re going to tell the other company vs. where you are going to settle. Sometimes you are going to put up a fake fight over something you really don’t care about just so you can get something else in return. So it’s all pre planned to a certain extent and your whole team needs to be on the same page about what your story is going to be. To your earlier point, we are not negotiating peace treaties between different countries but these are deals that can cost millions and millions of dollars to both companies with both companies resourcing and brands are on the line, it can be pretty contentious.
SM: I guess we could have another discussion on negotiation itself since there is an entire art and science behind it but we won’t get into it. But I’m sure your own style has evolved over a period of time and you have run in to people with all sorts of different style so just figuring out how to deal with people and people with different styles, being good at reading people and what they are actually trying to do, that is an important part of this job.
ST: To me, that is one of the more interesting parts of the job. Watching other people and understanding what their style is and learning from everyone’s style. I think one of the fascinating parts of this job is that you get to see people on a day to day basis and then you get to see them in a negotiating setting can be very different.
SM: I think Sanjana, you gave us a very good overview of what business development is. What would be more helpful now is if we can go into some of the more day to day aspects and I would like to hear from you the overall thoughts on the job itself. So on a typical day, if I were to run into you, what are the typical things I would find you working on?
ST: I guess people have a hard time with this question regardless of their function but it is very difficult to describe a typical day because depending on where you are on a stage in any deal, I might be refining a pitch to another company, I might actually be doing that pitch in person in that company’s office, I might be at my desk modeling out the opportunity size of the partnership, working with finance to figure out how much money or how many customers could this actually drive or I might be negotiating the contract or working on it, running between different teams to get their consent. Sometimes when a partnership is live and you are managing that partnership, there are issues coming up- the product is broken, the reporting doesn’t match what the other company has sent. So there are a lot of issues that you’re probably firefighting on a daily basis. Depending on where you are in a lifecycle of a partnership, a day can look very different. Usually you are working on or managing multiple partnerships at one time, so you might be doing all of this in one day.
SM: Depending on how big the company is, there can be many partnerships but generally how many partnerships is one BD person typically handling?
ST: It really depends on the scope of the partnership because some are product heavy and deeply complicated. Sometimes you might be working on one or two. On the other hand if you’re doing a lot of offers to other companies, customer and doing some light weight cold marketing agreements, you might have anything between 8 to 10. So it really depends on the scope of the deal you are working on.
SM: In these kind of partnerships, you mentioned as a BD person you have to engage a lot of these other functions like finance, product and marketing to flesh out the partnership but within the BD team, is it just one person or are there different types of BD like someone is doing more of analysis and one is doing more negotiations?
ST: No. I would say as a successful business development professional, you should probably be good at all of it but you will have people who have a background in one area versus another. But generally BD people tend to be generalists. So you can work across verticals, you can work across different types of deals and the goal when you are a young BD professional should be to work in as many different types of deals as possible of different varieties so that you get that breadth of experience.
SM: So how are business development professionals measured in terms of performance? Are there certain metrics that you guys are evaluated on?
ST: It really depends on the company you are at but the easiest way is to look at the number and types of deals someone has done and that’s often what you’ll hear people talking about. In my personal opinion, I don’t think enough attention is paid to whether that deal was successful or not. It is a lot easier to say that I did xyz deals than it is to describe how you managed those deals or how that partnership performed on a long term basis but personally when I’m trying to measure a business development person for maybe hiring purposes or just generally figuring out what this person stands for, I try to dig into not what just the deals you did but describe to me how you managed to make that deal successful or drove value for the company. Because doing the deal in itself is just the start.
SM: Let’s say I worked on a number of really important deals but for some reason, the deals don’t get through. Is that going to negatively impact my performance?
ST: Not technically. In most companies, business development is not a commission role where you get a percentage of the value you drove or a fixed number based on the deals that you do so you won’t be directly impacted that way. Of course your job is to make sure that these deals happen. So to that extent, if you’re working on the deal for a long time, you want to make sure that the deals gets through and makes it through the finish line. That said, half of your job is completely unpredictable because you’re working with an unknown entity so deals do fall apart and most BD people have experiences of deals falling apart at the last minute. So it does happen and is not unheard of. It’s not looked at as a failure because so much of this is outside of your control. Of course as a BD person you want to see your deals through.
SM: In your opinion what do you think are the most interesting aspects of your job?
ST: So there are two things I genuinely love about this job and why I spent so much time in it. The first is that it is completely unpredictable. It’s really hard to predict what opportunities are going to come up, what ideas you’ll think of that you’ll drive to fruition, what issues are going to come up in a negotiation. With experience you learn to anticipate a lot of that, there is an element of surprise in every partnership and that to me, is very exciting and keeps you on your toes. The second thing I love about the job is that you have to understand every job function. Because when you go into the negotiating room, you are representing your product team, your finance team, your engineering team, every small team that has a stake in this deal, you are essentially their voice at the end of the day. So you have to be there and get their essence of what’s every teams desired outcome is going to be, you also have to dive really deep into every specific part and know what you’re driving towards.
The unpredictability combined with the breadth and depth of knowledge that you gain, is something that keeps me excited about the job and is really hard to replicate in other roles.
SM: A lot of other functions tends to be focused on one or two key things whether it is marketing or sales, this is touching all functions and you need to be pretty good at all of them in case you structure a good partnership and be able to negotiate it. Are there any aspects you do not like about this job?
ST: One thing that tends to be shared amongst BD people is not liking process. I definitely fall into that camp. Over time I have learned the value of process to better manage a business development team but it’s not something I have an actual inclination for and it’s a trait that is shared amongst a lot of BD people.
SM: So when you say you don’t like process, is process an important part of the job?
ST: It is definitely an important part of the job. I would say it is not first nature to a lot of BD people to try to put a process in place so process can mean anything from who are the partners this team is working on cause it tends to be a very individual role. Sometimes you are working with another BD person on a major contract but a lot of the job is you working individually with companies so the team is overall managed on a pipeline. Who’s working with whom, where are you on the stage because you owe it to your cross functional partners and to the executives of the company and to give them a sense of what you are working on, what resources might be needed, so that’s one process you have to think though. Another is in the actual deal negotiation at sales, think about how many different people you need input from. Right from you need input from accounting and finance and product and engineering and marketing and legal, there are a lot of different people to coordinate and to get in contract, so you need to have some sort of process to get all of those comments otherwise you’re gonna miss something.
SM: I guess there is some kind of project management that needs to happen. There is just one BD person to do it and you might not be particularly happy to do it. Are there aspects that you find challenging?
ST: Yeah, of course! I mean if it wasn’t challenging, I wouldn’t find it nearly as interesting. I think the hardest part for me and generally in the partnership is trying to look into the future, to predict what you’re pitching will still make sense in a year or two and working backwards, what can you negotiate into the contract such that if a situation arises where the partnership no longer makes sense, you can get out of it. So the hardest part of the job is knowing that what you’re trying to resolve today and knowing that the idea you have today is still going to be a good idea 3 years from now.
SM: I think one thing that struck me from this conversation of how things could be challenging is to get so many different teams on board in their own company. As you said sometimes you may have your partner company ready to go ahead with everything but you are not getting everyone aligned inside your own company. Do you find people in business development making any common mistakes that you have seen?
ST: I think I alluded to it earlier. The common mistake is thinking that getting the deal signed is the biggest feat. I mean it certainly is a ton of work and it should be celebrated or rewarded and often is where we derive most of our enjoyment from, that rush of getting something done and knowing that you have seen such a hard arduous process through is a lot which keeps us excited about the role generally but if you continue to grow your career just on signing deals and not on the working of the execution of them, I think over time you fall behind because you haven’t learned from your mistakes. And you won’t really find what mistakes you made until that contract turns into a real life product or project.
SM: I guess that tends to be more common early in your career. Once you’ve been around for a while, you realize it’s an important piece of your job.
ST: I definitely hope so. You’ll find people who are in very senior stages of their career and frankly haven’t managed a partnership. And it is surprising to me that you still find people like that, you’ll come across people who don’t understand the value of launching and executing on that partnership rather than just the negotiation and just getting the deal signed.
SM: I think it would also be helpful to understand what is the progression like in business development. Do you just keep the scope of the deals you work on that keeps on increasing? How do I see myself rising in the company if I’m in business development function?
ST: It is interesting because you don’t often seen people leave the function. In a lot other roles people are looking to switch into other functions. I have seen people if you’re talking about going outside of the company or to different functions inside the company. The thing about BD people is I have seen them going into product management, some BD people go into VC as part of career change but if you’re talking about the progression of the BD professional within that function, you’re managing more complicated deals, you’re doing them on your own, you no longer require supervision, you start managing a team. And because BD teams tend to be small, you may not be managing people for a while. It is not like other teams that grow very quickly. You are looking at a lean team. So your progression is what kind of deals you’re working on, how responsible are you on that execution and negotiation and then ultimately managing a team to work on that.
SM: So I guess you turn into a more people management kind of role, overseeing all of them. You mentioned that all negotiations tend to be stressful. Can you share a quick example of a stressful situation you’ve been in?
ST: It depends on your risk tolerance and how much you like uncertainty because the whole job function might be stressful for you. But for me the closed negotiations are an adrenaline rush because you are focused to deal with what you know at that time and to really think on your feet. The most stressful situations for me are when you have already executed the deal and its a few months into its life and it’s not performing the way you hoped. And to me that’s stressful because executives are asking what’s going on, the teams that invested their time and effort and resources are wondering what’s going on and you’re questioning if that deal itself was bad or there are things that could help the other teams that would change the course of that deal and fix it in a sense.
So to me that’s the most stressful situation, when you have worked on this thing for ages, it’s live and for some reason it’s not meeting the expectations of the company.
SM: I just have a few more questions, more from the point of view of someone who is potentially interested in exploring business development as a career path. So if you were to think about the really successful BD professionals, what are the top 4-5 qualities or skills you might see in them?
ST: Well we have talked about this a lot but they are very good negotiators and that doesn’t mean that they have the same style, everyone has a different negotiation style but in their own way, they can convince other people that what they are saying is right or at least defensible. Second, they all are really creative and I don’t mean creative in the traditional sense. I mean creative in playing one business term off another or seeing how different parts or concepts relate to each other that in your mind maybe unrelated. Because they think on their feet and come up with solutions to problems that are really impressive and pretty unpredictable. So I think another important theme is creativity and ability to think outside of the box. And lastly, one common theme I’ve seen that they play to get what they want. They don’t play to win. Because in these partnerships there isn’t a clear winner but often there is a side that is getting what it wanted. And people can have a hard time keeping those things apart like winning means vs. what you want means and the people who can separate those two things tend to have better outcomes. Because it stops being related to a personal need to win instead it is about what the company wants and how do I structure the deal in that way. It’s something bigger than them.
SM: I guess that it is a sort of negotiation. If I understand you correctly, it’s not so much about me winning and you not winning but more about maybe both of us getting what we want to the extent possible.
ST: It is more about making the other person feel like they got what they wanted. There are a lot of mind games that you get into.
SM: If you do not see yourself as a negotiator, or who wants to be good negotiator, then you probably would not enjoy this job?
ST: Yes with a caveat. When you think of a negotiation you think of like a movie, like a scene in a movie where you are yelling at each other and you are super aggressive, I would say before you make a call whether you like negotiation or not you should go talk to more people who do it on a daily basis. Because it’s not what you think it is. Like I did not think I would like negotiation if I see how it is depicted in TV shows and movies. It is a lot more intellectually stimulating than what people give it credit for. Yes, don’t do the job if you don’t like negotiation but don’t just judge it by what you see on TV shows.
SM: It’s a very good point. Let’s say I am someone on the outside and I like the outcome of business development. If I had a role to play, let’s say the Lyft and Delta deal, that would be pretty awesome but I don’t know if I would enjoy going through the motions. So what is a good way for me to assess whether this is something I might enjoy or not?
ST: It is hard to get an insight into the day to day if you don’t know BD people or you can’t shadow someone but one book that is helpful, it is called ‘Bargaining for Advantage’ by Richard Shell. I think that is a really good intro to negotiation and explains what the situations might look like. I think what the best resource outside of getting to know a business development person is trying to get your hands onto some of these contracts. If you’re at a company, asking people to read the contracts of the deals they worked on and if you can’t do that then go through the news and read of the partnerships that are being done and in your own way, try to figure out how that might be structured. Think about, in this case, who would be paying who, what products would be integrated together. Just from the news clipping you are reading, what are the things you can back into that would have been contentious, and see if you can play both sides. See if you can play Lyft on one side and Delta on the other and enjoy that exercise.
SM: You brought up a good point that if you can get your hands on a contract, that’s probably possible if you are on the inside of a company that has a business development function. I guess a lot of people might find that boring. Like if I have to read through an 80 pages long contract. Do you enjoy reading through contracts?
ST: I love it. Not something I generally say otherwise I would have gone into law. What I love about that is when you’re reading through a contract, sometimes just the way the language is phrased or how certain pieces of the contract comes together, you can kind of tell where the company has gone back and forth a lot. Sometimes things as glaring as grammar errors, but you’re going back and forth so many times on specific words that the sometimes the company do make mistakes in contracts, and I actually find it fascinating to read through them. Sometimes you can back into ‘oh company x gave into these terms and maybe 10 pages later you’ll find the reason why, they got something huge in return 10 pages later’. So it is a lot more fascinating to me than I ever thought it would but people in BD actually have legal backgrounds.
SM: This is good for someone to listen to. This is what a true BD person sounds like. It clearly sounds you enjoy what you do and been in this space for a long time. You have mentioned that law tends to be a background a lot of BD professionals share. Would you say there’s a typical background or a kind of background that would help you in BD?
ST: If you are going to look at it from a numbers perspective, a lot of people have a legal background or finance and consulting background cause they are similar skill sets in terms of engaging with other people or modeling out financial terms, but that’s not to say there aren’t people outside of those. And I think, to my earlier point, if you are a good story teller, if you can go deep on certain subjects and you can go broad on those as well. There isn’t a typical background but you do tend to see people from consulting, finance and legal.
SM: In terms of the actual application, do you apply in your standard resume and cover letter? Actually how do you apply? Do you apply on a referral, do you apply on the website, how do you go about it?
ST: Like is the case with most companies, you can get a referral internally that tends to be the best way to get into and that’s the same for BD as any other role. If not then, the website and submitting a cover letter and resume is always important. I think because BD is very personality driven, if you can get any informational coffee chat with someone who works in BD to pick their brain and also to get them to understand you and your personality, I think that would go a long way. If there are friends of friends who does BD, try to get in front of them cause its always important to see how you interact with people more so than what it says on your resume.
SM: I would almost imagine that, given that this is a lot about your network and tapping into it for these deals, even if you don’t know someone at the company from the get go, you should be the kind of person who somehow finds his or her way into forming a relationship with someone in BD and getting a coffee with them. Because that is the kind of thing that you would do on your job anyway.
ST: Definitely. It can make people slightly uncomfortable but don’t let that deter you from finding out more about the job. There are very few people who are day one comfortable with cold calling and pushing their way through to get things done. Do what you can to get in front of people is my advice.
SM: And when you receive these applications, do you think there is something that candidates can do to help them stand out?
ST: Diversifying the kind of work you do is helpful whether you have been in business development or you are looking to switch into it. Because you do have to play so many roles in a day, sometime you have your finance hat on, sometimes your product hat on, we like to see people who have done different things. And play that to your advantage if you are someone who has hopped around in different industries or different functions. Some people in other roles may say that this person doesn’t have 10 years of experience in marketing. You can actually play that to your advantage in business development in a way that you may not be able to in other functions. Just cause you can demonstrate that look that I have played all these roles and I can be successful at them, that makes a good indicator as a BD person you could think through everyone’s concerns.
SM: I think this is the first time I’m hearing that hopping around is actually a plus point. Because most of the times people are like this person doesn’t know what he or she wants to do but over here that’s an advantage. So that’s great.
ST: Some of the BD people you’ll meet they have got some of the most interesting varied backgrounds and you can see how it helps them because they are able to adapt in a lot of different situations.
SM: You mentioned this book that people should try and read by Richard Shell. Are there any other resources you would recommend?
ST: As I said earlier, if you’re at a company try to read the contracts and if you can’t get your hands on them, literally go through the news, find partnerships that are interesting and try and break it down for each company. Why they are doing it, what you think the biggest issues would have been, who you think is paying whom in this partnership can actually be more complicated than you think. Try this as an intellectual exercise to do that with a couple of different examples.
SM: Just testing whether you enjoy thinking about different partnerships and how that might have come about. It is a good indicator of whether you enjoy the job or not. Thank you so much Sanjana. This was so wonderful. I am in tech and I don’t think I have had any clue about business development so I learned a lot myself in this conversation. Is there any other piece of advice you would like to share with someone who’s considering entering BD?
ST: One of the biggest indicators of whether you’ll like the job and you’ll enjoy it is can you thrive on uncertainty or does it make you uncomfortable. This job can mean a lot of different things and can go in a lot of different directions and you very infrequently receive concrete guidance. You get in there and you have to figure it out to be a self-starter. So it’s an environment where all the things are not spelled out for you, there is not a lot of structure and there is always uncertainty whether the deal or the project you are working on is actually gonna happen. I would think about that pretty carefully to find whether it will be interesting or not.