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28 Steps to a Strategic Alliance

Find advisers to poke holes in the concept. After her husband, the first person who heard about Owades's idea was Barry Traub, a lawyer and businessman. Another informal adviser was Stanford Business School lecturer Irv Grousbeck, a cofounder of Continental Cablevision, whom she'd met when he was teaching a case study about the start-up of Gardener's Eden.

With them, Owades would speculate about why the company might not work. "It's such an advantage if you can get people to tell you where the problems might be. Being surprised is the worst thing for an entrepreneur."

Decide which kind of partner to talk to first. Owades now felt she'd zeroed in on her concept and was ready to begin considering potential partners. "I approached growers first, before shippers and financiers," she says. "I felt I needed to know there was at least one grower who was willing to do this."

Check out particular partner prospects. "I went down to the flower market and asked for references and found out who the important growers of specific flowers were. I was reading trade journals, too, and certain names started coming up more frequently," she says. Owades cold-called people to talk not about going into business together but about the industry, how they sold flowers now, and the feasibility of mail-order flowers.

Determine the criteria for a partner. "It wasn't just finding someone willing to work with me. The growers had to meet certain criteria: quality, specialization in a particular flower variety, and commitment to service. And then it was, who will work with me?"

Spill the beans to a potential partner. Owades actually had one advantage: several years before, she had dealt with one grower who had supplied flowers briefly to Gardener's Eden. She talked to the grower, Peter Barr, on the phone about her idea, then drove out to Watsonville, Calif., to meet with him at his business, Sunbay Growers. After reading her business plan, he was intrigued enough to do some testing with her.

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"We have an industry that's oversupplied with flowers," says Barr, "and I'm always looking for different ways to sell them." In February 1988 Owades and Barr dived into figuring out how to preserve flowers during shipping. They experimented with different sizes of boxes, various ways of securing the flowers, and an assortment of padding. They did test shipments to a dozen sites (family and friends) across the country. Barr wasn't charging for his time, although Owades was picking up the cost of materials. After a couple of weeks the basic concept of shipping bundles of flowers seemed feasible.

"My reaction to the idea, candidly, was that I was glad it was her money," says Barr. "The mailing lists, the computer systems -- I knew catalogs were expensive, but the size of the venture just to start and the amount of money she had to raise made it risky. I agreed with the concept from the beginning, but I was more leery when I saw the numbers she had to generate." Still, Barr agreed to be a partner if the company took shape.

With one grower in her pocket, Owades was ready for the next step: finding a shipper to work with her.

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Evaluate other potential partners. "Instinctively, because of the reputation and stature it would give our business, I felt my shipper had to be Federal Express," says Owades, who had researched carriers the way she had investigated growers -- by reading articles at the library and annual reports. With help from Fran Wilson, who had begun working informally on the venture, Owades went through the motions of talking to other candidates. "Airborne, Emery, and a variety of others at the time were very eager to have the business and were very competitive on price but could not promise the lift capacity, the airplane space out of specific locations -- growers often are located out in farm country -- and a guarantee on a day-in, day-out basis to move product. We were guessing that some growers might eventually need to ship 5,000 boxes on a given day, and the other carriers just couldn't commit to it.

"Thinking about Federal Express was tough because it's so big," she continues. "Who was I? I was nothing. I didn't have a business, I had an idea." (She didn't even have a name: the company wouldn't be dubbed Calyx & Corolla until right before the catalogs were printed.) And she was asking for more than just an account number: she needed her partner to offer competitive prices, install a computerized package-tracking system at her office, and agree to such things as leaving flowers at a customer's door without a signature.