3rd Party

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What is a 3rd party?


A 3rd party refers to an individual, group, or organization that is not directly involved in a transaction, agreement, or project but provides some form of external support, service, or product to the primary parties involved.


Imagine a school project where two students are working together to build a model. They are the primary parties involved. However, they need glue to put the pieces together, so they ask a third student, who is not part of their project, to lend them some glue. This third student acts as a 3rd party, providing a necessary resource without being directly involved in the project.

In other words

A 3rd party is an external entity that a company leverages for their services. These 3rd parties can be directly integrated into one's offering.

Why is a 3rd party important?

It's one thing to know what 3rd party is, but that is worthless if you don't know why you should know what a code repository is in the first place. Let's break down the importance of this tech term based on two high-level categories. We'll walk through an explanation as well as provide a score, 1-10, that shows you how much you should care about 3rd party.

Pre-Product: 1/10

If you do not have a product yet, the importance of 3rd parties may not be immediately apparent. However, as you develop your product, you will likely find yourself in need of services, tools, or expertise that you don't possess in-house. In these cases, 3rd parties can provide valuable support and resources to help you bring your product to market.

Live Product: 5/10

When you have a live product, the importance of 3rd parties increases. They can provide essential services such as payment processing, customer support, or marketing assistance. By leveraging the expertise and resources of 3rd parties, you can focus on improving your product and growing your business.

Examples of 3rd parties

So you know what 3rd party is, by definition. You know if you should care about it or not depending on your situation as a business/company/product. To dig in deeper, we will walk through some tools and processes so we can make sure you really have a solid grasp on 3rd party.

Payment Processing

Payment processors like Stripe, PayPal, and Square are examples of 3rd parties that handle transactions for businesses. They provide the necessary infrastructure and security to process payments, allowing businesses to focus on their core operations.

Marketing Services

Marketing agencies, social media management tools, and search engine optimization (SEO) services are all examples of 3rd parties that can help businesses promote their products and services. These providers have specialized expertise in their respective fields, allowing businesses to leverage their knowledge and resources for more effective marketing campaigns.

Customer Support

Customer support platforms like Zendesk and Freshdesk are 3rd party services that help businesses manage customer inquiries and provide support. These platforms can streamline customer interactions and provide valuable data to help businesses improve their products and services.

Key Takeaways:

  1. A 3rd party is an external entity that provides support, services, or products to the main parties involved in a project, transaction, or agreement.
  2. If you do not yet have a product, 3rd parties may become more important as you develop and launch your product.
  3. If you do have a product, 3rd parties can provide essential services like payment processing, marketing assistance, and customer support.
  4. Examples of 3rd party services include payment processors, marketing agencies, and customer support platforms.
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