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Why Most Partner Programs Fail, and the $850M Ecosystem Playbook That Works · Revenue Problem Solvers

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Your audience can really increase their revenue up to 50%
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of the revenue through the partner channel, which is
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probably the most misunderstood area.
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Welcome back everybody to the Revenue Problem Solvers podcast,
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where we look to crack the code on growing business by tackling
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challenges. They keep revenue leaders up.
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Tonight. I'm Carl Ironson at today's
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episode. Buckle up because we're going to
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dive into a topic that is so commonly misunderstood.
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That is the topic of partner programs now.
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Today's podcast is sponsored by the great team at Virtual
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The result? Fewer cold motions, more high
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My guest today is a long time B to B software executive, Robert
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Jorsky or AS we'll call him Bob today, Bob Drakowski.
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Bob has spent his career building and scaling revenue
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engines inside of some of the most interesting enterprise
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software companies in Silicon Valley.
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He's held senior leadership roles at companies like Oracle,
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ADP, and I2 Technologies, where he helped to grow revenue from
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just a few million to over 100 million in revenue in only a few
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years. But one of the chapters he's
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best known for is his is his time as CEO of Intact, a cloud
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financial software company. During his tenure, the company
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scaled its direct sales organizations.
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He built a massive partner ecosystem of hundreds of firms
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and grew to thousands of customers before ultimately
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being acquired by Sage for around, oh, you know, $850
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million. Since then, Bob has taken
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everything he's learned from building those companies and now
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works with founders and executives on something he's
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deeply passionate about. Engineering predictable capital
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efficient revenue growth. Instead of relying on hero sales
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reps or hoping the next quarter works out, Bob focuses on
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building systems, demand generation engines, partner
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ecosystems and sales processes that make growth repeatable.
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Bob, welcome to podcast and thank you for joining us.
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Thank you, Carl. It's great to be here today.
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So to kick us off, can you give us a little context about your
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world? What industries of verticals do
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you work with? What are your selling motions?
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What size companies do you work with?
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Yeah, it's a great question. So I have been working, I've,
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I've helped build 11 B2B companies at different stages as
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an operator, both as a chief revenue officer, as ACO and then
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as ACEO. Many of those companies were
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technology companies, B2B companies, professional services
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companies that I actually helped build.
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So as somebody who basically lives in the skin of that
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executive, I really learned along the way that the companies
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I built, one of them, for instance, Wright Works, we took
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from 0 to $100 million in two years in sales.
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Companies like Intact, of course, were different because
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we built the company, scaled the company, doubled the revenue
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every year. And one of the things that we're
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going to talk about today is how your audience can really
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increase their revenue up to 50% of the revenue through the
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partner channel, which is probably the most misunderstood
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area. But in many cases today, I'm
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working with typically 7 to 10 companies, B2B companies, they
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vary in size. I've worked with some start up
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companies. I work with mid stage companies
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that are looking to scale in the 10:50, a $100 million range.
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I've worked with large public companies where like SAP for
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instance, where they actually asked me to come in and look at
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their partner channel, why it wasn't working and figure out
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how to get it working. So you look at different
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companies of different sizes. All companies had this challenge
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with with the partner side of the house.
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It's probably the most misunderstood and missed
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utilized area in terms of revenue expansion and ecosystem
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adoption that companies are not applying today.
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That's why I'm excited to be with you today.
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Yeah, it's, it's a great topic because it's one that I know in
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my experience anyways, we'll dive into my experience is, is
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being part of it from actually I was early on with BlackBerry, we
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were, we had, I was, you know, Verizon was the carrier that I
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supported as an example. And so I was involved in that
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and also. With some other channel
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partnerships, but then leading the channel partnerships in the
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challenges. So I'm excited to talk about
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this one today. So anyways, here's how we got to
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today's topic is because like everybody, I asked Bob, hey,
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what's a successful revenue issue you've ever LED or an
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existing challenge you're solving?
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And he said, Carl, it's both a challenge and a success.
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It's using partner programs as a growth lever.
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So let's maybe start here if we can.
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Most companies want to establish a partner strategy or a partner
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program and they struggle to make it work.
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Now you've already talked a little bit about it, but you've
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scaled an impressive partner program at Intact.
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So maybe this is the first maybe the question we can start with,
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how come so many programs fail? That's a good question.
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Here's what I see a lot of programs today are, I'll call
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them opportunistic. In other words, they will you'll
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have a partner transaction or a partner deal happen maybe once a
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year or twice a year. So they're architected wrong
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from the start. When you, when you architect a
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program which is opportunistic, you're only going to get an
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occasional opportunity every now and then.
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The other thing is it's very easy for people to select the
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wrong partners. We're going to talk a little bit
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later about a partner scorecard and the importance of a partner
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scorecard. And we're going to talk about
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how to create one for for yourself.
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But the key is most partner programs are full of partners
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that are not going to deliver any revenue for you.
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And another reason why partner programs fail is they have a
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partner team or partner manager and they go through what I call
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the motions. They go through the motions of
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setting up partners on boarding partners, enabling partners and
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not getting the revenue out the back end.
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So a lot of times the reason why these partner programs either
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fail or underperform, which by the way is universal in terms of
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me looking at hundreds of different partner programs, is
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because they're architected wrong from the beginning.
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And #2 is they're not focused on achieving the throughput, which
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is revenue and and sale velocity that they need with the
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partners. So that's really a key.
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And the third thing is you got to start the right ones.
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So we'll talk about the selection process.
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And for money companies that are talking today, they can use the
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partner scorecard to look at the partners that they currently
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have and decide are these the right partners?
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But then this is the important part.
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Look at the ecosystem of people that are in every market you're
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selling into and say who are the partners I should be working
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with net ecosystem. When I was at Intact, we decided
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to go into a number of of verticals or industries very
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intentionally. But for instance, when I went
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into the property management space, there was already what I
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call a market maker. The market maker is coming
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called Real Page Theory in Dallas, TX.
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So Real Page was £800 gorilla in terms of providing solutions for
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commercial and and property management companies.
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And so they really had a suite. What they were missing though
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was what I do. What they were missing was
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financial applications. They had three choices if they
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wanted to provide that solution to their property management
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customers. One is go buy a company, 2 is
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build it which would take forever or three is go ahead and
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partner. And so I convinced them to
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partner with us. We put together strategic
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relationships. That relationship alone as they
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embedded our solution as part of their solution turned into about
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$2,000,000 of of net revenue licenses that we've received
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every year. So that's an example of a market
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maker. A market maker is somebody that
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offers mission critical services or solutions in each of these
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different markets and those are your primary allies.
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You'd like to figure out how do you work with as you go into
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each market? OK.
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Which I mean, there's there's so if there's lots of things right
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there that he just talked about. And if so, if you have a partner
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program, Bob has talked about the scorecard and, and some of
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these things. But if we can sort of jump back
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to the beginning, 'cause I think there's one of the things that
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we talked a little bit of is, is like the challenge.
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And so because partner programs are such a challenge, where did
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you start? Or maybe the question is, how do
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you advise some of these companies?
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To. Start building their programs.
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What are the things that they should be looking at to decide?
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Good fit, not a good fit. Well, there's two things.
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The first thing is what's your partner program strategy?
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It sounds like something we all have, but in many cases we
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don't. So for instance, for instance,
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are you building a partner program because you're trying to
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avoid cost? In other words, are you trying
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to offload organic sales cost of building an organization with a
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third party sales organization? That's, that's, that's what a
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lot of companies do. Another one is expanded
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coverage. Are you trying to reach
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different markets or segments of your market or geographies,
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let's say internationally that you can't reach today through
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your own sales rotation. So that's that's really an
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interesting thing. A 1/3 objective is market
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penetration. When you think about this, for
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instance, one of the companies I was at company I built a company
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called Orem Software. We've been acquired by by Bond.
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We we were covering a lot of a lot of B to B companies that we
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wanted to sell it to. So it made sense at the lower
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end of the market to, to work with the channel and the higher
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end of the market to work strategic.
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So in that case we needed to make the channel work and it was
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about market penetration at the lower end of the S&B marketplace
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through the channel. A fourth area that's important
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is strategic partnerships. Are you trying to build
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strategic partnerships? So for instance, another company
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that might help feed is a company called Silicon Energy.
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And what we did there is we put together strategic partnerships
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with the centre CGEY, major systems integrators to go after
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different industries around the world such as mining, such as
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financial services and so forth. These are industries we probably
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would have gotten to on our own. And then finally, this is the
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most interesting part about putting together well
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constructed partner programs. They could lead to acquisition.
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So one of the things that you were sharing was my background
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and one of things I've been very cognitive as I've built these
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different companies is to create and orchestrate 10 different
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mergers and acquisitions worth about $2,000,000 in value.
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So building the partner programs, getting leverage in
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the market was something I, I come I think about naturally in
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terms of it's just a natural part of your go to market
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motions as you build a company. However, the end effect may be
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that you, you find these partnerships, you make them
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work, you execute them. There's codependency here and it
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may lead to that partner thinking, wow, I can't get along
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without Carl's company because Carl's doing such a fantastic
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job in terms of partnering with me.
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And so I've had that happen many times.
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So those are different objectives that you should think
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about when the other partner program.
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This case. And so there's there's a number
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of things you just said there. There's other you're trying to
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reduce cost. You're either trying to break
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into a new market or you're either trying to, if, if I heard
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it correctly, you're either trying to penetrate a new,
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you're trying to further penetrate a market that you
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would like to, or you're creating a strategic
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partnership, or you're trying to put yourself prepare for an
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acquisition. All of these are different
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aspects and different components of where you are in a company.
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And so when you are looking at this, so if we, if we go back to
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like, if I'm, let's say an SMB and I'm just sort of, I'm
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starting to scale, I'm, am I looking for like do you advise,
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do you advise companies for strategic partnerships?
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Do you advise them, Hey, just look for you want to reduce
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costs? Like what's the very first one
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that they should think about? Yeah.
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I think the first one that they should be think about is
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expanded coverage for market penetration.
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Because what you're really looking at, if you're a small
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company, let's say an SMB, let's say you would have 5 sales
13:44
people as an example or or less. Some companies have to work
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with, it's the CEO that's a salesperson.
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So if you're, if you're in that situation, you're looking for
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leverage, right? You, you want to get as many
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opportunities as possible. You, you can't do that though
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under your own power. You've got to get leverage.
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And what's interesting, and this is kind of interesting way to
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look at this as I'll, I'll give you an example.
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One of the clients I worked with is a company called Gather
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Digital. Great husband and wife team
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focused on event management solutions that would be on your
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mobile phone. And what was interesting about
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them is they they wanted to see an exit in three to five years.
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They wanted to focus on which companies they should partner
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with. They had a strong small direct
14:37
sales team. So what we did is we said let's
14:40
go to partner Scorecard and let's figure out how to choose
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the right partners for you because it's always going to
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change for every company. Second thing we did is we said
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let's look at all the people that are in the event management
14:52
space that are either providing solutions or services into that
14:56
space. And we've came up with about 150
14:59
companies. We then scored all those 150
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companies in that space. And So what we did, we said for
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the people that scored though, those are people that probably
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would want to acquire you because they don't have a, a
15:12
mobile event management solution as part of their solution set.
15:18
For the people that scored high, which could be, let's say
15:22
conference organizers or solution providers that had
15:27
really the right, the right assets to go to market with
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them. Those would be sales
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distribution channel. So what we did is we figured
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out, let's go after the ones that scored high because those
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are going to help us expand into the marketplace.
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What was interesting though, is the first company I with the
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lowest score that I showed them is the company that ended up
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acquiring the company. And the reason was, is because
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that company needed what Gather Digital had created.
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So it, it can serve both purposes.
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But at the end of the day, a great way to think about this is
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you're in a market. Let's say that market is
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financial services. Let's say that market is
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healthcare. Let's say that market is
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something else, the SMB. And you're, you're saying, OK,
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I'm in the market now I need to look at who else in the market
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should I be thinking about in terms of liberation partnerships
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like we just talked about. And then how would I look at
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them through this, this lens of a scorecard to figure out
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whether they're right partner or not?
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And then how do I then matriculate this, this, this
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thought into execution to begin discussing A partnership with
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that company? And so this is really a great
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place to start. And partnerships, as you know,
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they take time to grow, but as you invest in them and as you
16:53
have success, it's amazing how they flourish, and that's a key.
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Which is, which is a great question, which is a great lead
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into the thing that I'm I'm thinking of and I wrote down
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here is like, what are the components of a great partner
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program that I should be thinking of?
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So some of the things that I think are really important of a
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great partner program is you've got to think about a couple
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things. One is executive sponsorship.
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So if you're going to put together a partnership with
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another company, you've got to make sure that you've got
17:25
executive sponsorship from their end as well as from yours to
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really see this partnership through the lens on what's it
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going to do strategically for both companies.
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If you just join a company, let's say I'll give you an
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example. One of the partner companies I
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worked with in the early days is Salesforce.
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So we, we, we created that intact, the front office, back
17:48
office integrated solution and we were one of the founders of
17:51
their app exchange. So in the early days we were
17:55
very important, very strategic to Salesforce.
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We were one of the founding companies on the app exchange
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and so forth. But after they added, you know,
18:04
3000 companies on App Exchange, you could say that we were just
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one of 3000 companies, right? Yeah.
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So, so without the sponsorship of Marc Benioff and some of his
18:16
management team, we would just be another, another plug in on
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Salesforce, right. So executive sponsor and
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sponsorship is really important. The second thing I think is
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really important to your question is architect the right
18:30
relationship. So when I talk about that,
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there's models for partnerships, there's referrals, there's
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resellers, there's embedded, there are services partners and
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there's affiliates. Now those are just five
18:49
different categories, but you have to look at what you're
18:52
trying to accomplish in terms of the partnership.
18:55
So referrals are are nice, they're opportunistic, they're
18:58
easy to do. Resellers are better because
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that organization now is taking your service or solution to
19:05
market and they're selling that. The cats Meow, as I call it, is
19:11
the embedded one. That's something I practiced at
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INTAC. That's where companies would
19:16
private label our solution and take it to market as part of
19:18
their solution. The reason why that was so
19:22
helpful was because we were embedded in every sale.
19:25
The reason why also that was so helpful is because they didn't
19:29
have to explain the relationship between INTAC and their company.
19:32
It was, it was already their solution, so they took it to
19:35
market. One of the companies that that
19:37
we work with, by the way, in my past where I did this is a
19:40
company called CGEY, right? Big company.
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They took not at Intact, but at Silk Energy.
19:47
They took our solution as a enterprise energy management
19:51
solution or platform to market as their own.
19:54
You can imagine once they had that CGEY stamp approval it it
19:59
became adopted everywhere. Because everybody trusted CGEY
20:04
as their strategic partner. So, so that's that's that's
20:10
another key. Another thing that happens when
20:13
you sign up a partnership. We talked about things that make
20:16
partnerships successful is prime to pump and then prime to pump.
20:22
Yeah, prime to pump, prime to pump.
20:24
So let's say, let's say you and I decided we were going to
20:27
partner together. And let's say Carl, you are the
20:31
CEO of the company and you've got a sales force of 10 people.
20:37
Even though we've signed this agreement, even without we've on
20:40
boarded you even we've we've helped you get up to speed.
20:44
So what we don't have opportunities sitting in front
20:47
of us, right? Prime to pump means we need to
20:50
create a mutual program of demand generation where we want
20:54
to put let's say 100 feeds in front of our sales organization
20:56
that you can work on. There's nothing that's going to
20:59
get the sales organization more excited about how to work
21:01
together then the prime, the pump give them opportunities to
21:05
work on in bed. I would embed my organization
21:09
and your organization to make sure that the DNA is transferred
21:13
and they can close it first, let's say 3 to 5 deals.
21:16
So a lot of you know that you hear this this term, failure to
21:22
launch, a lot of partnerships that get never got launched
21:25
beyond the paperwork. And the reason why they never
21:28
get launched is because you didn't prime the pump.
21:31
You have this chasm between you and the partner thinking about,
21:34
well, you're going to bring out a business to me and the
21:36
partner's thinking, well, how are you going to help me get
21:38
business in the door? And so that's really one of the
21:43
key. The the other thing, two other
21:46
things that are important in terms of I call it secrets to
21:49
success is what I call the VNA transfer.
21:53
If I have really a successful organization and we've been
21:57
successful selling direct to whatever market that we're
22:01
selling it to. And now I sign up a partnership,
22:04
what I want to do is do the DNA transfer to that partner so they
22:08
they fully understand how I've been successful.
22:11
So they can emulate that, right. A lot of times partners may not
22:16
have the same structure, sales process, maybe the same
22:19
discipline that you do in terms of success.
22:23
So part of our joint goal should be to help them with the DNA
22:29
transfer. What do they need to sell the
22:32
solution? How do they, how do you give
22:34
them the hunting guide? If I call it the hunting guide,
22:37
which is how do they hunt for opportunities?
22:41
How do you get their people up to speed in terms of being able
22:43
to present that solution or service, make sure that they're
22:46
competent? What are the steps in the sales
22:48
process that they should be thinking about going through?
22:52
How do you assist them when they're challenged?
22:55
So there is a that's part of the DNA transfer.
22:58
And then I guess the other thing I would say is start right and
23:02
scale up. So we didn't.
23:05
Write and scale up. That's right.
23:07
In other words, we didn't get to 300 sell through partners at
23:11
Intact overnight. We, we started out when I, when
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I first became CEO there, we started out working with the CPA
23:19
accounting firms and they were our initial partners to resell
23:24
our our solution. And it was only through this
23:28
process of me thinking through market makers, thinking through
23:32
mapping ecosystems where I started really to think about
23:36
unleashing the full potential of a partner model in each of these
23:40
different markets that we went into.
23:42
So when you think about this from think from a sales
23:45
perspective, if you decide you want to go into, let's say
23:50
selling the healthcare, that's a market you want to sell on to.
23:55
You're going to build this great team sales organization, the
23:59
right discipline, the right plate sales playbook, the right
24:02
go to market motions. In parallel to that, if you look
24:07
at healthcare, there's a lot of people already selling the
24:10
healthcare and successful working with your target
24:13
audience. You want to also have a playbook
24:17
with them in terms of how you're going to go partner with that
24:21
those organizations and get leverage into the healthcare
24:23
market. So you want to do both from a go
24:27
to market motion perspective, you want to sell direct, you
24:30
also want to sell indirect to partners and you want to scale
24:33
both of them to be successful. OK, so there's a there's a bunch
24:39
of things you just said that I'd like to try to ask you a little
24:42
bit more about and I'll I'll come back to it is sorry.
24:46
I'll come back to maybe a little bit of my experience.
24:47
So I've been been able to be on as a seller inside of a big
24:52
program, right? Like I worked at BlackBerry, we
24:54
were working with Verizon, we had the hardware, they had the
24:56
services and it was a good collaboration.
24:59
Then I've been part of ones where.
25:02
We had a product. And I think and we had global
25:06
distribution and we had partners like CDW, you know, etcetera.
25:13
So companies like that and they would sell the product on our
25:16
behalf. And then all of a sudden it
25:17
would, you would see a close. But then I've also been part of
25:19
where. And so I was leading, I was, I
25:22
was, I had the opportunity to lead some of that strategy and,
25:25
and, and work with them. But then I've also been part of
25:27
like establishing partnerships from the ground up.
25:31
So one of the challenges that I've gone through personally is
25:35
when you're creating, like you said, the prime to pump, which
25:38
is a is a good example. When you start to create the
25:42
relationship. I've used the analogy of use a
25:44
partner program as a bank and on an ATMI.
25:46
Don't know if that's a good example or not, right?
25:48
A bank is I give, I put money in, I take money out, right?
25:52
So the part like it's a gift to get, but there are some
25:55
companies that I've seen that use a partner program like an
25:59
ATM, Hey, I'm just going to take, I'm just going to take
26:02
money out. So there are some inherent
26:03
challenges in my opinion of getting it set up.
26:06
There's things like, you know, what's our cost going to be?
26:08
So if it's a relationship where forsake of round numbers, I sell
26:13
my stuff for 10,000 bucks, but you know, I give it to the
26:16
partner and the partner can sell it for anywhere between 8:00 and
26:19
$10,000 based on the relationship.
26:22
And I have to get minimum of $8000.
26:24
And then you have a, you start to look at your cost
26:26
acquisition. So there's, there's an example
26:28
of like one thing, the other, the other side of it is like,
26:31
hey, I really want to be a partner because I want to sell
26:33
your stuff on your behalf. Now give me a bunch of accounts
26:36
or leads to go do it or you're just going to send me leads and
26:39
I'm going to close them for you. So there's different structures
26:42
of that. If you're advising companies
26:45
early on of like just starting their first program, do you
26:48
advise them on prime the pump and just give them accounts to
26:51
run and leave and close on your behalf?
26:53
Do you do it more of a, hey, you should be looking at it from a
26:57
perspective of your acquisition cost or is it dependent on where
27:02
they are in the stage of the they're at?
27:04
That's good questions. So if you're thinking about
27:07
starting up a program today, when I talk about prime the
27:11
pump, usually I'm talking about doing some joint demand
27:15
generation with a partner. So in other words, create a
27:20
great example as a webinar. Let's do a joint webinar.
27:24
Let's talk about something that's really important to this
27:26
audience. Let's each contribute to what
27:30
the webinar is. And what we're going to do is
27:33
you're going to have a leads after this webinar to go run
27:35
with. So it's, it's a, it's a great
27:38
way to do something around helping them because if you
27:43
think about a new partner, you're bringing something new,
27:46
some new, new solution or service to them.
27:49
They may not fully understand it, but you can be in that
27:52
webinar, the thought leader to actually help the audience
27:55
understand the solution. They can be the company that is
27:59
going to be the execution owner to actually help the companies
28:02
realize the value of of that thought leadership.
28:05
And it's a great way to work with them.
28:07
So that would be a good one going going to conferences and,
28:12
and and Co-op and working together or speaking at
28:15
conferences or in person events would be another one.
28:18
We're doing some micro events with executives would be a great
28:22
way to do that. There are a lot of ways that you
28:25
can prime the pump, if you will, with the partner.
28:29
But one of the most important things I've, I've found is you
28:32
just got to create a joint partner plan on how to get them
28:36
off the ground. A lot of people have contracts,
28:42
they have built sales tools, they have a partner portal for
28:47
registration and those are all good things that you need.
28:51
But those are not going to make the program successful.
28:55
What's going to make the program successful is some of the things
28:58
we talked about is those are some of the keys, but making
29:02
sure that you're creating with them, priming the pump with a
29:07
lot of demand because all of us learn exponentially, right?
29:12
If you are working on opportunities, you get to learn
29:15
how you're going to sell a position and, and, and close and
29:18
service a client with that partner solution.
29:21
Until that happens, it's not exponential.
29:23
It's all in theory. So the best thing we can do is
29:27
convert and execute and make sure that that theory is
29:32
translated into real practice. So if I can, I, I've never done
29:38
this before, but can I take a bit of a contrarian view and ask
29:42
you a couple of things because I'm again, going back into
29:47
experience some of the things that I've that I've heard from
29:49
other senior leaders. So the first one is, is this
29:54
great? Bob, I'm, I hear you.
29:57
I'm just kind of, it's almost, I'm also kind of role-playing as
29:59
I'm asking a question. Hey, great.
30:01
Bob, I hear you. We're going to do a program,
30:03
whatever we're going to set, we're going to set up your
30:05
group. Awesome.
30:06
How do I know that you're actually going to be focused on
30:08
selling my stuff? That is something that comes up
30:12
and I've heard from others. So how do you, how would you
30:15
like say, how would you respond to that of like how do I know
30:19
what your focus is going to be so that I know that you're
30:21
actually going to do the work of the partner program as that bank
30:25
relationship as we sort of using that analogy well.
30:31
That's that's interesting part of that I talked about.
30:34
There's two things here that are important.
30:36
One is again, executive sponsorship, right?
30:39
You have to have somebody who says we're going to make this
30:41
program work, right? So that that has that's, that's
30:46
called commitment, right. The problem with two of these
30:50
partner models, the referral and reseller model is you can't get
30:54
dropped in the sales process, right?
30:57
So that's a situation where the sales team may be taking your
31:00
solution as a reseller to market and then they decide because
31:04
there's there's a bunch of constraints, they drop your
31:07
solution. The embedded model, which a lot
31:12
of companies can't start with, but they can always move toward,
31:15
prevents that. When you're embedded in
31:18
somebody's footprint, whether it be a service or a solution, that
31:22
means you're, you're getting sold in every, every transaction
31:25
that they close. That's where you want to be.
31:29
This is what we did at Intech. You would think, well, this is a
31:31
financial application. This is like giving a heart
31:34
transplant to the CFO, right? How do we do that?
31:39
You know, and people would say, people, it's amazing how
31:42
sometimes people they just don't, they don't believe.
31:46
And yeah, we did. We took that and we took that
31:50
that solution to market as a financial application.
31:54
And most people would graduate off of QuickBooks or they'd
31:56
graduate off some entry level system and they really needed a
31:59
full financial application that they could scale with going
32:02
forward. And so we basically made it easy
32:06
for people to get started with us, easy to onboard, easy to get
32:10
trained, easy to be successful. And when you start doing that
32:15
and you start doing that not only with your clients, but with
32:17
your partners, it's, it's, it's that five wheel that gets the
32:22
relationship going. So I, I think that a lot of
32:27
people are going to be skeptical about partner program because
32:31
they haven't had success. Yeah, I can.
32:33
I can tell you there is a formula for success.
32:37
OK, the second one that I'd like to ask you a little bit about is
32:41
it is again, I'm, I'm asking you some of the, the questions that
32:45
knowing that you've done all this things that I probably
32:48
would have liked to have asked myself in other examples.
32:51
So the other one that I've I've heard is who takes ownership?
32:58
So there's two different right. So sake of discussion, you're my
33:04
partner and you go and you, you sell something.
33:07
So you go and sell it to Steve's company.
33:12
And so Steve buys from Bob, but it's Carl's software.
33:16
Steve now has an issue. Is it Bob that handles the issue
33:21
or does Carl handle the issue? And how does that come together?
33:25
Because the the context of this and try to give you, I should
33:28
have probably lived with the context is having that
33:32
relationship of who has the who's the ownership of the the
33:37
final account? Is it Carl because it's a
33:39
software? Is it Bob because of the
33:41
relationship? And then how does that
33:43
acquisition cost actually blend to whether or not it was a good,
33:47
it was a good outcome or not a good outcome?
33:50
I don't know if I've kind of, I don't know if I've struck, I've
33:53
structured that question in a way that's helpful, but I'm the
33:57
question that the underlying question is who's responsible
34:00
for the end relationship in the case that something happens and
34:04
does that affect the end CAC or not?
34:07
Yeah. So let me let me share with you
34:10
in practice how this works, OK. If you are a referral partner
34:13
with me, Carl and I have let's say the the solution to
34:17
software, I would be responsible at the end of the day for the
34:22
customer, the customer success because you're just referring
34:25
them to me. Let's say you're a reseller and
34:30
you want to resell my solution into the marketplace.
34:34
Obviously you own the relationship with the customer,
34:37
right? And the next step is do you want
34:41
to implement or not this solution?
34:44
Some resellers do, some resellers don't.
34:49
The next step question is for that customer who's going to
34:53
provide support in the reseller situation.
34:56
I would suggest that I I provide the support for what I call
34:59
first line and second line support for the customer because
35:03
at the end of the day, they are using the platform, using the
35:07
solution, they want to have support from the source.
35:10
OK, now let's move to the next one, the private label or
35:14
embedded model. That's where you're taking my
35:17
solution set and you're taking it to market as your own.
35:20
Again, you obviously own the relationship, you own all the
35:23
sales and marketing around that solution.
35:27
And you probably also own the what I call first level customer
35:31
support, which means when there's an issue that arises,
35:36
your organization's going to provide the support.
35:39
You're not going to provide the second line support, which is if
35:42
there's a problem with the platform or something not
35:44
working or there's a technology click, since you didn't build
35:48
the application, you're not going to provide that.
35:50
You're going to defer that to us, right?
35:53
So in each of these models, you can see where the ownership of
35:58
what you own as a partner changes.
36:01
And so as you move up that the interesting thing about COGS
36:07
when you think about how you really are going to help in
36:11
terms of improve your cost of goods sold and your cost of
36:14
sales is you want to leverage your partner organization as
36:19
much as possible so that those costs are not here.
36:24
Where people get themselves in trouble, I think is when they
36:27
sign somebody up to be a reseller and their referral
36:32
partner and you end up doing all the work anyway, right?
36:36
Or they want to be a embedded partner where they want to embed
36:40
and sell you, but they don't want to take on the
36:43
responsibility for sales and marketing to take that half.
36:46
So you can't be a Rev share partner and give up let's say 40
36:50
or 50% of your transaction to a partner if they don't take on
36:56
that sales and marketing and first line support.
36:58
That's really important. So the reason why a lot of times
37:04
these these numbers don't work is because one of the most
37:07
important things when you architect these relationships is
37:11
it has to be very clear what does the partner do to get that
37:14
revenue? And what do you do if you sign
37:18
up a bunch of partners and they just turn out to be referral
37:21
partners, but they think they're resellers or embedded partners,
37:24
then all you're doing basically is increasing your cost of
37:27
sales, right? OK.
37:30
So that brings, I mean there's a really good nugget there that I
37:33
just took out of it is you you talked about different aspects
37:38
referral reseller embedded and so in that.
37:45
Going back to that relationship, say, hey, actually, Carl,
37:49
remember we set up this as a referral partnership, not as a
37:52
reseller or hey Carl, we set you up as a reseller, not a
37:56
referral. So this is where you need to do.
37:59
And so maybe that's where the language and creating that
38:02
structure and maybe that's the question, do you bring that and
38:04
say, look, I've got these partnerships, you pick the one
38:07
that you want and that's the one?
38:09
We're going to go. With it is you have to walk in
38:12
with a model, You have to walk in with a model that says, if
38:17
you're a reseller, these are the things you're going to do.
38:20
These are the things I'm going to do, right?
38:22
You have to spell it out. The problem a lot of times when
38:25
people build these, architect these relationships, they don't
38:28
do a good job talking about that.
38:30
They just say, well, Carl's going to be a reseller and I'm
38:33
going to provide everything Carla needs, right?
38:35
And it's going to be fantastic. What I didn't do there is I
38:39
didn't spell out what Carla has to do to earn 25% of the
38:42
transaction or 30%. The key there is to be very
38:47
explicit to say, Carl, you've got to own this.
38:50
You've got to own your own demand generation, you've got to
38:54
own your own sales. If you don't, then then I'm
38:59
giving up thirty basis points for nothing, right?
39:03
I really am. This is one of the bigger
39:06
biggest keys that we have in terms of making sure that the
39:09
partnerships are our thing. The other thing that we did, and
39:12
this is really interesting at Intact is we didn't start
39:16
everybody off to be an invented partner.
39:19
We started them off to be either a referral partner or reseller
39:22
first. And we said, let's get, let's
39:25
learn to walk before we run. Let's, let's go ahead and work
39:28
together, you as a Carl, as a reseller and let's get maybe 5-5
39:34
opportunities closed together. And as you get more comfortable
39:37
with this technology and the solution set, why don't we look
39:41
at how do we expand that relationship to where you could
39:43
take this into every opportunity that you have as an embedded
39:46
partnership. So a lot of times it's great to
39:50
crawl, walk around when you're talking about partnerships.
39:53
So even though let's say you may come to me and say, hey, I want
39:57
to take your solution embedded go to market, we'll say, well,
40:01
for the first five points, why don't we start off with
40:03
reseller? Let's make that work, Carl, and
40:05
then let's graduate to that. It's also a great way to set
40:10
proper expectations. Yeah.
40:14
And I think that I think that is the best thing right there that
40:18
we just talked about is like that setting of expectations
40:21
because it does it can become conflated.
40:23
And I've heard like, you know, like you said, my experience is
40:26
not nearly what your experience is, but the, the experience of
40:29
like, well, wait a second, we set this up and you were going
40:34
to give me a bunch of accounts and why don't you just do this?
40:37
So the conversation shifted. And I, like you said, is
40:39
establish that and be explicit with your expectations.
40:43
It's, it's really. And then the crawl, walk, run
40:45
phase, I like Bob, I realized we're at 40 minutes already and
40:48
we got to get you out of here. I said, we get you out of here
40:50
within the hour. So maybe let's I like to say
40:54
this, everybody likes new, nobody likes different.
40:58
And when you do both at the same time, it can either cause
41:00
friction or uncertainty. So for somebody thinking about
41:03
up levelling and thinking about building a partner.
41:06
Program, what are two or three actionable items that you would
41:09
tell them on Monday morning? Go do these two or three things
41:13
and that will put you in a great path for success with a partner
41:16
program #1 is if you think about your partner program, let's
41:23
think about strategically what do you want to do with the
41:25
program? What's, what's your goals,
41:27
right? Number 2 is let's build a
41:33
partner scorecard. Who?
41:36
How do you, how do you even know what a good partner looks like?
41:39
If you don't know what good or great looks like, how do you,
41:42
how do you even get started? Right?
41:44
Because it's like anything we'll do at that point.
41:47
And by the way, I'm happy to do this for free with anybody
41:50
that's listening to your podcast today to actually help them just
41:55
create a partner scorecard. And I have AI have a formula for
41:58
that. I've done that for many cases.
42:01
But what goes into the, the 10 components that goes into the
42:05
partner scorecard are different for every company.
42:09
And then the, the third thing I would look at is realistically
42:14
just thinking about scale, what, what are we trying to do in the,
42:20
let's say the first 12 months in terms of the partner program.
42:24
So I'm big in playbooks, right? You know, we talked about go to
42:27
market strategies, we talked about go to market motions.
42:32
One of the keys I look at is a playbook and just creating a
42:36
simple playbook that says in the first year, here's what we want
42:40
to execute and accomplish with our partner program and here's
42:43
how we do it. I love, well, I love strategy.
42:48
Strategy doesn't pay the bills. What does pay the bills is
42:52
execution of results. So those are the three things I
42:55
would say we start with today, Monday morning program, partner
42:59
program. What do we want to accomplish #2
43:02
is build your your partner scorecard and #3 is let's think
43:07
about a plan over the next 12 months that can be implemented
43:10
based upon the size and scope of your company.
43:15
If you're just a startup company that you're looking for
43:17
leverage, then it's got to be size appropriate.
43:21
If you're a big company like SAP and you have a partner program
43:25
that's not working for you, then we're going to do something
43:28
different. In that case, I interviewed
43:31
their Top 40 partners to figure out why it wasn't working and I
43:35
quickly came to to the the way we were going to reinvent their
43:39
program. Amazing.
43:43
There's a huge value add If you didn't hear what Bob just
43:46
dropped a little nugget right there of like if you need help
43:49
with a partner scorecard, he just said he'll help you do
43:52
that. So Bob, this has been a lot of
43:54
fun and I've a lot of learns where, where can people find
43:59
you? If they said, hey, you know
43:59
what, I'd just like to learn a little bit more from Bob, where
44:02
would they find you? A.
44:04
Couple ways you can visit my website,
44:06
whichisrevenuegrowthstrategy.com and go ahead and go there.
44:12
We have an area of blogs. We have a blog specifically on
44:15
this topic. So Carl and I covered just a a
44:19
fraction of what's in that block, but you're welcome to
44:22
read that. If you're looking for a more
44:23
granularity in terms of building your partner per echo, getting
44:26
it started, scaling it so it's positive and accretive to your
44:32
revenue growth, that's a good place to start.
44:35
Another thing I can OfferUp is go ahead and reach out to me on
44:41
LinkedIn. There's my LinkedIn address.
44:45
So go ahead and do that and just reach out to me and say, hey,
44:48
Bob, can we get together? Let's talk about my strategy.
44:51
Let's talk about my scorecard. Let's talk about maybe giving me
44:55
some advice. We're here to actually help you
44:59
get this, get this on the right track.
45:00
We're here to help you. If you haven't launched one,
45:02
let's get it launched. If you have launched one, we can
45:05
discuss ways that you can interrogate your current program
45:08
to make it even better, but make it more successful.
45:11
So those are great ways to do that.
45:13
If all else fails, you can call myself.
45:19
Yeah, this, and I mean, if you, if you haven't heard from this,
45:25
like, you know, I've, I haven't got to know Bob for very long.
45:28
And you know, we got introduced through, through somebody
45:31
through Natasha and, and, but I will say that like when he
45:35
offers these things up, he does, he is genuine.
45:37
Like he's done an incredible job of following up with me.
45:40
And you know, Bob, it's not often that I get a chance to
45:42
talk to somebody who's taken multiple companies public or
45:46
they've had multiple acquisitions or they've done
45:48
these things. So this has been really, really
45:51
great to get to know you a little bit over the last of a
45:54
while. And I appreciate everything that
45:56
you've you've shared with us today.
45:59
And also, you know, it's all of your lessons learned.
46:02
So thank you for doing all of this with me today and also for
46:05
for all the communications and and building of the relationship
46:08
so far. And Carl, thank you and, and
46:10
thank you for creating this podcast for every Problem
46:13
Solvers. I mean, what an excellent form
46:16
to bring insights, best practices, and knowledge to your
46:19
audience. So thank you for doing that.
46:21
You know, it's a, it's been a lot of fun.
46:24
I didn't think that I would enjoy doing a podcast nearly as
46:28
much as I have now. I will say it is a ton of work
46:31
and it may be something for that I tell other people in the
46:33
future, but it's a lot of work. But I've learned so much and I
46:37
get to ask questions that I hopefully people are like, oh,
46:40
this is really interesting now. And to all of you that have been
46:43
continued listeners, I appreciate you and you know.
46:46
And also, hopefully we're answering the questions, but
46:49
that's gonna wrap wrap up another episode of the Revenue
46:51
Problem Solvers podcast. I definitely wanna thank you,
46:53
Bob, for sharing these invaluable insights today.
46:56
You heard there's strategies you can put into action.
46:58
Remember, success leaves clues and every revenue problem has a
47:02
solution. Sometimes you just need the
47:04
right conversation to find it. Until next time, it's Carl with
47:06
the Revenue Problem Solvers helping you turn your obstacles
47:09
and the opportunities. Thank you for investing your
47:11
time with us today. We'll see you on the next
47:12
episode.