Darin Lynch is the Owner and Chief Liberation Officer at Irish Titan, a Minneapolis-based E-commerce and development firm focused on user experience. Lynch’s “Business First. Online Second” mantra encourages his company to focus on creating long-lasting partnerships with clients, ranging from national retailers to start-ups. He offers nearly 20 years of leadership and technology experience and we are excited to have him with us to share his insight here on TheMail. If you would like to contact Darin, he can be reached at email@example.com
By: Darin Lynch, Founder and President, Irish Titan
Creating partnerships and not transactions is a core tenant of any successful business relationship. One of the most notable methods to this notion is offering unique and flexible payment methods for clients. Amongst these, one that most reinforces the combination of both values and skills is revenue share, and it can be a large portion of a long-term strategy.
We’ve successfully implemented this program with a select portion of our clients, including Ducks Unlimited, for whom we provide all E-commerce strategy and services. If we’re good at what we do, and we’re good at establishing partnerships, why wouldn’t we help align all parties’ goals, reduce some of the upfront costs, and share in the long-term success? By taking the idea of “Partnerships, Not Transactions” to the next level, we are able to practice what we preach more strongly as an organization.
But how does it really work? Obviously this isn’t a model that can work for every client. Businesses generate revenue in different ways. If a company is using their website strictly to legitimize themselves for THEIR prospects, then the website isn’t the direct cause of their successful fiscal year. Additionally, an upfront cost remains, although at a reduced amount. This helps to filter prospects who are simply looking for something for free from those who understand the business aspects of risk versus reward. Essentially, a company’s business model needs to be proven to a degree that we can ensure that a profit will be made that is commensurate with the cost of the work that is being performed. In some cases, this requires a higher level of financial transparency than some companies are comfortable sharing.
Perhaps the most important element in a successful revenue share arrangement, however, is shared values. Even if the numbers work out for both parties, you are creating a much more intimate business relationship than a typical web development firm/client interaction. You are essentially asking your client to open their business to you and let you have a bigger seat at the table. If the client is unprepared for this type of interaction, it can be easy for the relationship to sour. Both parties need to be completely open and honest with one another, as well as realistic about the potential for success.
In short, the revenue share arrangement is a unique arrangement, but can be highly profitable for both parties involved when implemented appropriately. It also allows companies to develop deeper relationships with their clients than would have been otherwise possible from normal interaction. Overall, we have found our revenue share arrangements to be opportunities for education and growth—two things that we love as an organization.