I’ve written before about the power of partnerships and Peloton’s recent deal with United Healthcare (UHC) is another example of why this can be extremely powerful. Beginning in September, UHC customers on employer sponsored plans will get complimentary access to Peloton’s digital subscription for one year. Afterwards, customers can continue and pay Peloton directly or simply let the subscription lapse. We’ve seen trial deals on entertainment subscription products now for a few years (think Netflix and TMobile, Verizon and Disney+, Hulu & Spotify, etc), with more likely in the pipeline. All of these services struggle with high customer acquisition costs and partnerships are an extremely effective way to grow.
A VC once told me that 50% of some of their portfolio companies’ growth is coming through partnerships. I wasn’t surprised, but I found this quite interesting, because successful structure and execution seems to be the achilles heel of many organizations.
Through the marketing lens, there’s no shortage of content and advice on how to grow your startup. The thing is, most startups look at marketing as a cost center (which it usually is) but there is white space here that is more efficient than marketing and that is through partnerships. Now, I know “partnerships” is a broad term, but let’s try and narrow it down by focusing purely on revenue generating initiatives. In my previous roles roles at Casper and Newell Brands, I oversaw numerous innovative partnerships and here are some lessons I learned as well as some thoughts on why this space continues to be undervalued.