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022 - Innovating Together: The Power of Tech Partnerships · Partnerships Unraveled

• 0:07
  Welcome back to Partnerships Unraveled, the podcast where we unravel the mysteries of partnerships and the channel on a weekly basis.
• 0:13
  I'm Alex, VP of Partnerships at Channext, and today we have a special guest, Jens, who's our CTO.
• 0:20
  Jens, how are you doing?
• 0:20
  Doing well.
• 0:21
  Thank you, Alex.
• 0:21
  Good to hear that.
• 0:23
  We brought you on today because we're discussing something that I think is really important in the space tech partnerships.
• 0:30
  Why don't you give us a rundown of what is a tech partner?
• 0:32
  All right, so to me, a tech partnership is when two or more vendors work together by integrating to get a better solution than they were as separate solutions.
• 0:42
  For example, two software vendors like Slack and Salesforce, or Logitech and zoom in a combination of hardware and software.
• 0:51
  That's what the tech partnerships and deals and what turns them into something better than they are alone, standalone solutions.
• 0:58
  And so typically the design of that is what?
• 1:01
  Two different sort of engineering company engineering departments coming together and ultimately trying to build a better product?
• 1:09
  Well, not per se like they try to build a standalone solution.
• 1:14
  Right.
• 1:14
  So sometimes you figure out that if you combine these solutions, in the end you get a solution that is better for the end-users.
• 1:23
  Perfect.
• 1:23
  However, that's obviously the technical integration.
• 1:26
  I imagine that is the first step of building the full go to market motion.
• 1:32
  I don't think it's the first step, to be fair.
• 1:34
  What's the first step?
• 1:35
  First step is actually figuring out if you have a joint failure proposition.
• 1:41
  Right.
• 1:41
  You need to figure out if you're actually better together before you start integrating.
• 1:45
  It's a waste of resources if you start integrating before you know if it's actually worthwhile or actually better for the end-users.
• 1:52
  So from your perspective, what will happen is two vendors will come together to have a conversation to see if they can solve a particular problem or develop a better solution by integrating the two technologies.
• 2:03
  Yes.
• 2:03
  They need to know if they are in the same market, if their solution actually fits together, if that solution then solves a need for the end-users as well.
• 2:16
  So, yeah, they need to have that conversation first and figure out a business case before they start actually spending time and money and resources on developing the integration.
• 2:26
  And from your perspective, that business case, it's usually as a design to deliver a better solution in whatever way between those two integration partners.
• 2:35
  Yeah, absolutely.
• 2:35
  Awesome.
• 2:36
  And so then it sounds like once they've built the business case, that will then flow through into the actual, I imagine, design, implementation and testing element.
• 2:44
  Can you give us some detail in terms of what that sort of tech partnership typically looks like from that phase?
• 2:50
  Well, it takes like multiple conversations to find out how are we going to do things?
• 2:57
  You need to talk with endusers that use both products, preferably to find out how would you use this integration and then design the actual solution and start going through the usual cycles you would normally do to build a product.
• 3:12
  Right?
• 3:12
  Sure.
• 3:13
  And so what's really interesting there is you've actually touched on you might end up beta testing it and developing it within an existing key end-user as a good example.
• 3:22
  Agree?
• 3:22
  Yeah.
• 3:23
  Perfect.
• 3:24
  So I think what's really interesting about that when we talk about channel design is very often we talk about you define your end-user, your ideal end-user or ICP.
• 3:34
  And what we've done there is design the technical integration within that end-user.
• 3:39
  But feasibly what that would mean from a sort of sales methodology is then if it works for Coca Cola, it probably works for Pepsi as the typical example.
• 3:48
  Perfect.
• 3:48
  So then in terms of the channel design you would then very much focus into why does tech partnerships and that improved solution work for the channel.
• 3:59
  And so what we're hearing is that there is an improved technology and an improved solution at the end-user level but does that actually benefit the channel?
• 4:06
  And so I'd love to spend a couple of minutes just taking our audience through how that mechanism works.
• 4:11
  So for example, if you've got a tech partner and one of the partners is a channel orientated business and the key one that obviously comes to mind is someone like a Microsoft.
• 4:21
  Lots of integration partners work very closely with Microsoft and then we can get into something called a co sell motion.
• 4:28
  And by that I mean the technical teams work together to build the integration, they build the improved technology.
• 4:34
  But then you can obviously leverage Microsoft's extensive channel team over 400,000 global partners and suddenly you can get into a real sales methodology to scale that network.
• 4:46
  Is that something that you see in the Channext a lot?
• 4:49
  Yeah, definitely it happens a lot.
• 4:51
  It's not only Microsoft like Salesforce as amazingly big app exchange HubSpots is growing at a rapid pace.
• 4:58
  So it's definitely very common.
• 5:00
  And I do feel that those tech partnerships are less collaborative though than for example, two ecosystem companies like Reveal and Genex would do an amazing integration that's more collaborative than Genex pushing something to the Salesforce app Exchange and then hoping that they get end-users.
• 5:22
  Because Salesforce is not necessarily going to help us with full time employees helping us go to market together because they're already this big brand and we are just a smaller company for them.
• 5:35
  I do think there's a difference between those types of companies and integrations versus like similar sized tech partnerships.
• 5:43
  Yeah, I think what's really interesting, the bit that you're calling there is more of actually like a marketplace.
• 5:48
  And what happens, especially with the Goliath, the Microsoft is yours, the Googles, the salesforce is the HubSpots.
• 5:54
  Those types of guys, they've got their captured base.
• 5:57
  And really the value add for those big brands is the improved service delivery or improved product delivery.
• 6:04
  That happens at the end-user level.
• 6:05
  So they have open APIs and development platforms that allow people to very organically build in marketplace improvements.
• 6:14
  We run loads of these improvements internally, which actually you end up managing as your role in as CTO.
• 6:21
  But that's fantastic because we use click up, integrates with Slack, integrates with HubSpot, integrates with Gmail, and suddenly you've got a really cohesive solution.
• 6:30
  And you can understand from a HubSpot's perspective, they want those integrations to work because it drives stickiness.
• 6:37
  It means if you've got all your apps integrated into one place, well, you're very unlikely to pick up that integration tool.
• 6:44
  Yeah, absolutely.
• 6:44
  I fully agree.
• 6:46
  Perfect.
• 6:46
  And what's really interesting then, I think, for the sort of sales and marketing people to get their teeth into is how can you leverage this go to market motion to drive sort of improvements in channel revenue and marketing performance?
• 6:58
  And the bit that I think is really interesting for the channels out there is how can you monetize those tech partnerships really, really well?
• 7:06
  So I think what's a fantastic opportunity is, if you sell Microsoft today, but you're not leveraging the improvement in some of those marketplace tools, you're actually missing one stickiness into the end-user, but two improved revenue opportunities.
• 7:21
  So if I'm a partner out there, I'd be talking to some of those key icps and going, right, we've sold you Microsoft Azure.
• 7:28
  What are the tools you're using?
• 7:30
  And using that as sort of my vendor priority list to then start selling those solutions.
• 7:35
  And so I pivot from being a product orientated partners into a solution orientated partner.
• 7:41
  And you can imagine that then you combine, pull all those cohesive technologies together and almost deliver them as a managed service provider would.
• 7:48
  Yeah, I agree.
• 7:50
  Can you talk us a little bit about your experience in terms of you managing our internal It infrastructure?
• 7:55
  What leads you to make a decision from one tech partnerships to another?
• 7:59
  Because obviously there's lots on offer.
• 8:00
  Yeah, there's absolutely lots on offer.
• 8:02
  And I think it starts with what problem are you trying to solve?
• 8:05
  Right?
• 8:05
  And then usually questions you think about is buy versus build.
• 8:11
  Sorry, but nowadays it's more like buy versus build versus integrate.
• 8:17
  Can you create a better solution with something that already exists and then integrate with that solution?
• 8:23
  For me, look at the problem that you're trying to solve.
• 8:27
  For example, we live in Slack at Genex, and I'm really happy that a lot of companies and software tools we use also have integrations with Slack.
• 8:35
  I get notified of errors on the server or logging, et cetera, based on Slack.
• 8:41
  And that's where I find most of my information.
• 8:43
  So it really helps me to get everything in one place, basically.
• 8:49
  And therefore, what you say it creates stickiness, it helps you because you start using that product more because it's showing you the data in the place where you already are.
• 8:59
  So you get a lot more interaction with those tools as well.
• 9:03
  What's really interesting then, if I put my partner hat on, some of the efficiencies are actually what partners should be selling.
• 9:10
  Right.
• 9:10
  So rather than just selling slack and just selling Gmail, it's like actually no.
• 9:15
  You need to be looking at network issues or security or the optimization in terms of usage or adoption of those technologies that fast becomes the partners.
• 9:26
  Sales focus especially into your profile of buyer, where it's not just how the technology works, it's how does it integrate into the daily life.
• 9:35
  Yeah.
• 9:35
  How does it integrate in our current ecosystem, I think, and especially in It, that's very necessary.
• 9:43
  There's so many different vendors, so many different tools you can use.
• 9:45
  You want something that already ties into what you have built so far in your internal network, and your software doesn't really matter where.
• 9:54
  It just needs to be a cohesive experience.
• 9:57
  And would you say that those levels of integration and app building are growing, or do you think it's tapering off?
• 10:04
  Can you talk to the changes that you've seen over the last few years in terms of how you're designing our internal resources and how we're scaling?
• 10:13
  I think it's growing, and it's growing at a rapid pace.
• 10:16
  You see more and more marketplace developers, people building on top of other tools and having better integrations.
• 10:23
  You even have a lot of companies that help you tie those tools together, like Saper and some other automation tools as well.
• 10:30
  It's just getting bigger and bigger because everyone's realized the power of combining solutions to get a better overall solution.
• 10:39
  Yeah.
• 10:40
  For some of the novices out there, I remember someone once explained it to me as the iPhone is a wonderful tool, but the reason it's so good is the App Store has lots of specialist products which very individual designers have built.
• 10:53
  So the reason Spotify, I think, rather ubiquitously is known as a better product than Apple Music is because that's all Spotify do.
• 11:01
  They build this one app.
• 11:02
  And so if you can design a solution which is loads of specialists woven together into a cohesive solution, that's obviously a far better experience for the user.
• 11:12
  Absolutely, yeah.
• 11:12
  And for me, building the Chenx platform, for example, you have to think about what are you going to specialize in, what are you going to focus on and do that really good with your.
• 11:23
  Sort of Chief Technology Officer hat on.
• 11:26
  In terms of when you're building the Chen X platform, obviously there's a few ways that you can go in terms of build, buy, or integrate.
• 11:33
  Can you talk to me through what your thought process is that drives you from one to another?
• 11:38
  Yeah, absolutely.
• 11:38
  So the strategy for me is like, build one thing really well, do that like extremely well, and that's your key differentiator, and then integrate with tools that do something else really well, that's adjacent to what you're already doing.
• 11:52
  And then there's buy.
• 11:54
  I think that's almost outdated for us, especially as a startup buying companies or buying software, like really expensive stuff.
• 12:03
  It's not an option that's obviously the landscape today for tech partnerships.
• 12:07
  Can you give me a bit of an indication around where you think the future of tech partnerships is headed?
• 12:12
  Well, obviously lots of people talking about AI now, especially with CHED GPT releases and everyone integrating with CHED GPT as well.
• 12:21
  So I think there's a massive opportunity for a lot of companies to start leveraging that power of AI and the Open APIs that are getting available more and more in the coming years.
• 12:32
  Yeah, absolutely.
• 12:32
  And do you think that AI is going to mean less integration because, like, businesses, obviously Microsoft spent, what was it, $10 billion investing in OpenAI.
• 12:42
  Do we think that's going to drive up the amount of integrations minimize because AI is able to do a lot more?
• 12:49
  That's a fair question.
• 12:49
  I haven't given that too much todd, but I wouldn't think that would change a lot in terms of the amount of integrations.
• 12:58
  Right.
• 12:58
  It's going to be helpful to create better integration or maybe even to create better software.
• 13:05
  And therefore the amount of integrations doesn't change.
• 13:08
  It's just going to be better solutions and then combine those better solutions to an even better solution.
• 13:13
  Yeah, I think what's really fascinating when we look at the world of tech is this is going to be an even greater change than the Internet was, right?
• 13:20
  And I think we're seeing such a shift up in the tools capabilities.
• 13:25
  I mean, I'm really excited to see what that can do for the technology industry as a whole, because I think it's going to be such a value driver over the next sort of five years.
• 13:34
  Yeah, absolutely.
• 13:35
  We're going to see massive gains every year, every quarter even, because after Daly two basically really soon followed by chat GPT than Facebook.
• 13:47
  Now with their Lama thing, it's going at a massive pace.
• 13:52
  All the big companies are trying to keep up with one another, so they're just going to drive up innovation more and more.
• 13:58
  And that's where we see nice and maybe even exciting and scary things at the same time coming up more and more.
• 14:05
  Yeah, I think what's really interesting is everyone's aware that there's a race, right?
• 14:09
  I think we heard the sort of red alert meeting that Google had.
• 14:12
  They hadn't had one for something like ten years because of the search engine replacement capability of a chat GPT.
• 14:20
  What makes me excited with my sort of business hat on is areas of huge change provide areas of huge opportunity.
• 14:27
  And I think for a long time we've thought businesses like Google and Meta and we're going to be around forever, and Microsoft were going to be around forever.
• 14:36
  But these massive changes in technology mean that there are always new winners and some of those big beasts end up dying.
• 14:43
  I think Meta stock price certainly is indicating that that may happen to some of even the biggest companies in the world.
• 14:49
  What I would be making sure that I'm doing from a tech partnership, but also a channel perspective is focus on the end-user.
• 14:56
  AI is obviously a seismic change for the way technology has been working and I think we're going to see continuous innovation quarter over quarter and year over year.
• 15:06
  From a business now perspective that just makes me really excited because that huge change to the way that business is done creates a significant amount of opportunity.
• 15:16
  But my advice to anyone in the channel is not to be fearful but really attack that opportunity.
• 15:21
  As long as you are very customer focused and you're providing an extreme amount of value and you're paying attention to which vendors are also focusing on maximally delivering that value, those are the ones to pick and ultimately they're going to be the ones that win big and you can win big with them.
• 15:40
  I think why tech partnerships are so so exciting because so often vendors have been very insular and focused on their own product.
• 15:49
  But what we're seeing is a pivot to this far more solution orientated prioritization and in a simple word it means we're just delivering the maximum value from a solution perspective.
• 16:00
  But the vendors that also treat their channel the same way and leverage the huge scale that they can deliver, they're going to be able to deliver huge value at the end-user level and huge value at the partner level.
• 16:12
  And that's going to be the macro forces that ultimately I think are going to see the big winners over the next five years.
• 16:18
  Blending tech partnerships and channel scale for the big win all round.
• 16:22
  Couldn't have said it better myself.
• 16:24
  So obviously we've discussed the opportunities for tech partnerships, how they provide an awesome solution to the end-user, how we can maximally deliver value at the end-user but also at the partner level to deliver hyper scale.
• 16:37
  But where are the challenges?
• 16:39
  What's the threats of tech partnerships?
• 16:42
  Yeah, there's several challenges I believe and I think the thing a lot of companies struggle with is that they sometimes tend to integrate just to integrate.
• 16:51
  And if you do something half baked it's just not going to turn out really well.
• 16:55
  You want something to seamlessly integrate to get a better experience together and just don't do that by doing half an integration.
• 17:03
  You need to find out if your integration is actually solving a need for the end-user, that's in the end what you want to provide a solution for, something they have an issue with or a need for.
• 17:13
  And if you don't find out that, or if you find out that there is no need for that solution that you are building, then stop integrating.
• 17:19
  Don't waste time doing something that no one's going to use.
• 17:22
  What's really funny about that is at the beginning of the conversation we talked about the need for the first thing to do when you're discussing a tech partnership is are we solving a problem?
• 17:32
  That's obviously one of the fundamental and most important steps because if you're going to build and heavily invest in building that tech partnership and it doesn't work properly, not only will the end-user be frustrated that that partnership and that integration is not working, but in fact it might even roll back to the actual core product.
• 17:52
  So a badly integrated product could end up causing churn of the entire brand.
• 17:57
  And so I think absolutely understanding both the need but there's obviously a requirement to develop incredibly well and ensure that integration works.
• 18:06
  Agree?
• 18:06
  Yeah, you need to find the need and then fix it really well.
• 18:11
  And if you somehow don't do either of those things really good, then it's bound to fail to be a bad integration and you're going to lose business and like you said, even take steps backward.
• 18:24
  So a well executed integration that solves a key problem, that's a must.
• 18:29
  But what are some of the weaknesses that we're seeing in tech partnerships today as well?
• 18:33
  Being too dependent on the integration and on the integration partner, for example, that creates like you need this trust in someone and if they break that trust, not only your integration is broken but the entire value chain gets a smack.
• 18:48
  That's a really funny example and Apple are the kings of this.
• 18:52
  They'll build the integration either with a hardware or a software product and then they will release their own competitive and guess what, better and more tightly integrated into their own unique ecosystem and suddenly no one else buys that product.
• 19:06
  The product that comes to mind is Tile.
• 19:08
  They integrated with Tile, it worked perfectly.
• 19:11
  Then they released Apple Air Tags and Tile.
• 19:13
  Stock prices just plummeted as a result.
• 19:16
  So it's really important when you're building your tech partnerships is it a two way relationship that's sort of equally balanced, which in some aspects you can if you're finding an equally sized company.
• 19:26
  But if you're integrating into salesforce, that's almost never going to happen.
• 19:29
  And so then what you need to make sure you're doing is managing risk by probably integrating into multiple areas so that if HubSpot decides to just do the clever widget themselves, then at least you've still got salesforce and other mechanisms to continue that revenue stream.
• 19:45
  Awesome.
• 19:45
  Jens, I think that's been really insightful for me.
• 19:48
  I've learned a lot about tech partnerships.
• 19:49
  I think what it's important to remember is when building a tech partnership, first start at the end-user and find a problem that your key integration will solve you.
• 19:59
  Then obviously you need to work with the design teams at both parties to ensure that you develop a really strong integration.
• 20:06
  You need to be able to manage that risk because obviously, if you're tying your entire revenue stream to that integration, you better make sure that that's going to last a long time and probably it's best to spread that risk.
• 20:18
  There's a lot of coming opportunity in terms of the world of AI and how that's going to influence the world of tech partnerships.
• 20:26
  But also remember from a channel and partnerships perspective, that's where true hyperscale comes from.
• 20:32
  The seismic shift in terms of AI and tech partnerships together is going to present a wealth of opportunity for the channel out there.
• 20:40
  Thanks so much, Ian.
• 20:40
  That was really fun and I learned a lot.
• 20:43
  No problem.
• 20:43
  Thanks, Alex, for having me.
• 20:44
  It was great fun to join the podcast for once and happy to join again in the future.
• 20:49
  Yeah, we'll have to have you back soon.
• 20:50
  This has been partnerships unraveled.
• 20:52
  Thank you so much for listening.
• 20:54
  Please like and share and we'll see you next week.