Sometimes the most powerful move in building a robust network is a strategic ‘no’.
Wise words from this episode’s special guest Tim Britt. With over 20 years in channels, the new Senior Director of Alliances and Channels of Freshworks sheds light on the unique dynamics of the cloud channel.
Tune in to learn about:
1️⃣ The things to consider when you're building a cloud-oriented channel
2️⃣ The “90-day rule”: A critical strategy for initiating transactions with partners
3️⃣ How to overcome the friction points when getting MSPs to market
4️⃣ The complexities of marketing and co-selling when you're in a suite of products, and your brand's not involved
5️⃣ How marketing can drive alliances
_________________________
Connect with the podcast hosts 👇
Connect with Channext 👇
https://bit.ly/channext-demo-request
Watch on YouTube ►
https://www.youtube.com/@channext
#partnerrelationshipmanagement #channelmarketing #partnerenablement #Throughchannelmarketingautomation
Sometimes the most powerful move in building a robust network is a strategic ‘no’.
Wise words from this episode’s special guest Tim Britt. With over 20 years in channels, the new Senior Director of Alliances and Channels of Freshworks sheds light on the unique dynamics of the cloud channel.
Tune in to learn about:
1️⃣ The things to consider when you're building a cloud-oriented channel
2️⃣ The “90-day rule”: A critical strategy for initiating transactions with partners
3️⃣ How to overcome the friction points when getting MSPs to market
4️⃣ The complexities of marketing and co-selling when you're in a suite of products, and your brand's not involved
5️⃣ How marketing can drive alliances
_________________________
Connect with the podcast hosts 👇
Connect with Channext 👇
https://bit.ly/channext-demo-request
Watch on YouTube ►
https://www.youtube.com/@channext
#partnerrelationshipmanagement #channelmarketing #partnerenablement #Throughchannelmarketingautomation
Welcome back to Partnerships Unraveled, the podcast where we unravel the mysteries about partnerships and channel on a weekly basis. My name is Alex Whitford and I'm the VP of Revenue at Channex, and I'm very excited this week to welcome our special guest, tim Britt. Tim, how are you doing? Hey, good morning, thank you for having me. Yeah, it's good to have you on. I'd love it if you could give us a little bit of background about who you are, where you've been and why we should be listening to you around. All things channel.
Speaker 2:Yeah, perfect. So 20 years, I think. Now in channels I'm trying to count it up. The other day, but, starting my career in IBM, did a big stint at Polycom, where probably a lot of the listeners will know me from. I jumped over into a company called Cyber Reason, which was a cybersecurity company at the Israel, and then six years with Dropbox Business building and developing their channel, and recently actually very recently in the last two weeks I've just joined Freshworks as their senior director for partnership and the mites for Europe.
Speaker 1:There's some really interesting brands in there. We're going to work our way through, I think, through most of them. So, as you just touched on, you were the director of channel sales at Dropbox for a mirror, and I think one of the things that a lot of our listeners understand is that the cloud channel works extremely differently, in certain ways, than the hardware channel. I'd love it if you could sort of wax lyrical around. What are the things you need to be careful of when you're building a cloud orientated channel?
Speaker 2:I think sometimes the cloud channel could be the hardest channel to build because you don't physically have to or something tangible. But I was talking to a team this week and I said the kind of number one rule which I've done throughout my career in channel is what I call the 90 day rule. So, and what I mean by that is if you recruit a partner, you have 90 days to make their first transaction. If you can do that in less, your propensity to satisfy it. But that also needs to be an evolving number. So if your partners aren't transacted in every 90 days, you're going to lose them because I don't physically own any stock, they're not building anything, it's a SaaS based solution. So having that top of mind is really key when you start thinking around. How are we going to put this channel together? And then there's a couple of leading indicators which I kind of think about. First is partner selection, and I've seen this work good and bad. Like you almost want to build a bit of a partner scoring system. So if you've got a hardware partner that all of a sudden says, hey, tim, I want to start selling your cloud based solution and we're going to go and sell it in public sector that we've never sold in before, but we like the idea of selling it to earn us. But their successes can be really low. So you've always got to learn to say no as well as yes to every partner and then think about what are they offering? What are the cloud offerings that they got? And we saw this a lot over the last few years where partners were trying to diversify away from Microsoft because it's a competitive market and typically can be margin low. So if a partner is looking at growth, saas is the easiest or cloud based technology is the easiest place to go. But from a vendor, what are the SaaS solutions that they sell in? How easy is it going to be to sell?
Speaker 2:So top of mind for me, that partner selection piece and then the kind of training and enablement. We have to have a very good enablement story and journey and the days of. Here's the partner portal. Go and click through it. Here's content that's out of date. It's out of date, I think. What I always try and think around with training, that is, look at your own sales methodology. So whether you're a mid-peak force management seller, whatever it might be and understand how the partner sells as well, because you've got to get a line done how you go to market and have the right sales process and understand the pain that you're trying to solve. And I think that's really key in that enablement piece are working your birds and they probably just, you know, to touch a little bit more on this I did the co-marketing and co-selling is really interesting.
Speaker 2:I hate it when people say to me you don't give me leads, the leads are weak. You know the Glen Calvi, glen Ross thing. But any partner that's coming into a relationship you're just expecting leads is probably not the way to go about this. Because from a dive, especially if you've got a direct sales organization, why should a direct sales organization give up their own margin as a pass through to a partner? That's adding zero value. So, thinking of that partner selection piece again, what value are you bringing to this over and above just the transactional piece? There will be times when that transactional piece is needed framework, peculiar, process, and that will be my thing, but to make partnership success when you've got them understand how the direct sales organization is.
Speaker 1:So I'll pause there as a couple of examples and see yeah, I wanna touch on a couple of those points in more detail. Your sort of 90 day principle. I think that's excellent. A lot on the podcast We've spoken around how you have to generate three opportunities within the first 90 days.
Speaker 1:Now that's typically for a longer sale cycle product, as you say, if it's software and it's a high velocity deal, you actually want to trans that. Those deals and I but I've seen it time and time again talking about keeping partners engaged Follow the revenue right there, follow where they think they can grow, and so if you're making that nice and easy by literally adding, adding money into their bank balance because you're closing deals, or you're working with the monocobe marketing strategy that helps them create deals and keeps them enticed, almost your enablement strategy can almost be weaker. If your revenue strategies brilliant because they you know they've got shed loads of opportunities, people are hammering the phone trying to speak to them. Then then actually a partner portal. How much we're well invested in a portal, partner portal sort of doesn't matter, right?
Speaker 2:I mean, I think the biggest challenge I always seen partnerships is the misalignment on property ability. So typically a partner is measured on property ability, a vendor is made on or Hi project, and it's this misalignment that read. You know, if you don't get that right, beginning your partnership fails. So understanding what drives the partners sales person versus your own, sales person versus the channel manager is key to understand the better.
Speaker 1:And one of the things that and I think this is true, whether it's hardware, software, everything in between you should be valuing that margin when we're talking about building a partner business plan around the full stack. So what are the services? What's the renewal, what's the attachment they can play into that Can you might actually have a very low margin. Microsoft's a great example. Lots of Microsoft products is incredibly low margin, but it's a facilitator. That seven to one revenue, seven to one ratio they always bang on about right.
Speaker 1:That's everything around it and I'm making a fortune, even if the license margin is poor.
Speaker 2:yeah, I really good example of this I probably won't name the partner, but when I'm a colleague contains the largest side. That ratio was one to a hundred and fifteen dollars. Every dollar on the ground, that partner generated a hundred fifteen dollars a services and that is where you get that expansion and that sea level buying to say, actually this is a profitable partnership for us and that's when you start to see the growth with those large partners. Do you know what that's so?
Speaker 1:good. If you can build a hundred one to one hundred, twenty five ratio, yeah, you're doing something right. What's so good about that is, to me, what I start to see when you start to see those impactful ratios bought in a senior level, as you say Starts to drive deal velocity, because now the name of the game is to get into as many customers as possible, because we can sweat that asset and really, really milk that customer to get that high ratio, and so it just becomes about an end user acquisition strategy and then, for a vendor's perspective, and user acquisitions the name of the game. Right, that's really what scale channel.
Speaker 2:I think this is what we saw only in a sample Dropbox. We we moved a large portion of our direct business to the channel so we actually looked at cost of sale for us and we identified that channel had a higher renewal rate, we had a lower discount, we had a better customer satisfaction, better customer implementation. So as a business we can start then monetizing and finding efficiencies within the channel by understanding how that channel is supporting us with those services Because, especially for expansion and for emerging markets, no vendors gonna put full time headcount into that market so you need to be a partner first strategy when you gotta look at it for me, financial standpoint and how this is driving that.
Speaker 1:Now to pivot slightly, and one of the real challenges I see when people are building cloud based channels is that there are actually two very different types of partner segments. Right, one is your reseller. Right, we're selling Licenses as part of an ecosystem of solutions that we sell. And then one of those is more of an MSP or an OEM partner which is taking that software and white labeling as part of an orchestrated package. Can you talk to me about some of the complexities about marketing, co selling, when you are in a suite of products and your brand's not even involved? Good, question.
Speaker 2:I think we gotta look at it. Let's just take a view of that partner type, because you write between a bar or a transactional partner versus an MSP Very, very different, and this is where Vendors don't get it right. So why we wanna go to the MSP route is what services or in tated approach, they tend to have longer term values, that customization and integration, so you build in value within that and what's important to an MSP is the up with the revenue and use that and scan it and growing that and then you then can start to rely in that co sell motion and it is well as well as so. So which one says when the same little bit for you is Typically cloud-based solutions or SaaS solutions have generally sometimes a young in career sales books right, okay, so that'll be politically clear.
Speaker 2:But generally you see that evolution from BDR to AE to AM and that's really growth. Indeed, the complexes of that is those salespeople only understand your solution and in that swim lane and you've got to start thinking around how does that technology integrate into the technology stack? That's where the MSP comes in and creates that connectivity and understands that integration or customization versus a transactional or VAR is just looking to solve that one problem by selling your software, and that's a bit that you've got to try and understand and do to get.
Speaker 1:Yeah, and I think one of the key challenges that I see. I speak to marketing leaders within the biggest channel organizations and the real challenge from a marketing perspective is how do you market with an MSP when it might be an entirely white label? If we take Dropbox as an example, we want to spend MDF to sell Dropbox, but it's not Dropbox. It's, you know, x as part of an ecosystem. How have you seen that? Play well, play badly? Where do you see it? How do you see it progressing?
Speaker 2:So a customer isn't buying Dropbox or Freshworks or whatever. They're buying the managed services Platinum, gold, silver, monthly, active Partner. They're buying their solution. So having the ability to co-grandure collateral and layer the partner or the MSP to kind of top and tail it. So one thing that we kind of look to do I think really good success is campaigns in the box. So we build a standard campaign that solves a problem but it's small enough for them to integrate into a wider solution. It's not the prominent thing but it helps.
Speaker 2:Then the MSP then, okay, you take one, this solution, this solution and this is the integrated approach, and then they're offering their service. And that's what the marketing people need to think about is like they're not just selling our solution, they've got to sell six or seven other solutions with it to get that one deal. And that's a bit of the education piece that you need to do Now. I think that is a better route to market in terms of quality of needs and I've seen a higher close rate than the entity models on that approach, because the customer is buying the solution, they're not buying the product. And when you start looking at the lifetime value of that customer, when you get into years, three and above. They're just buying a new.
Speaker 2:Someone joins, they add the gold package, they get these seven applications and it's all integrated and then for us it's really sticky because to switch that solution out is very difficult because you've got to change the MSP's, got changed that whole business model so that rip and replace becomes very challenging and I've seen really good success like a dropbox. We had a good call-execut with Abbey Compton and Kaye John's listening, but John was great at doing this where he'd take entry points of Microsoft dropbox for this collaboration, whatever it was, and create this gold layer and they would focus then on verticals around media and they had a very strong upwind go to market.
Speaker 1:Yeah, we like to call it on. This channel is the sort of salesful stickiness right. Because once you're embedded, you've got your claws into that customer.
Speaker 1:The more you are ingrained, the more products that are associated, the more time that's associated with unpicking it, which means you never turn right, and so this is why we see companies like Salesforce, hubspot have the highest LTV of basically anyone in the world, because the operational cost of turning that off is more than the contract right, and so then you're just sorted forever. I think one of the friction points in terms of that marketing element, when we talk about co-brandable assets, is surely one of the challenges that you come across is you've then got to be speaking to partners who've got the marketing resource. They're going to dedicate the time to helping you market. Where do you see the friction points in actually getting MSPs to market?
Speaker 2:I think you've got the training and support to drive that.
Speaker 2:So if an MSP is, then you know, go with your product and then the customer's like, hey, I really like this, but you've not enabled and trained, because typically an MSP is going to have consultants and they're going to have very strong technical skills and that consultative approach. The biggest fall is then, or the risk is when that partner consults and gets in a meeting and they're whiteboard in this whole solution and vision and then it comes to Freshworks or Dropbox or whatever it is and then they're like, oh, I don't know enough about this, but I know it's good and my boss has told me to stick it in. So you've got to get that layer enabled and write first To fill the confidence because of me seeing this with the competitive side over the years Partner sell what they know, but they don't want to propose a solution. That they concern, especially in cyber security, was one of the biggest. You know this is such a yeah, it's such a high risk product set. You are not gonna sell A cyber security product that isn't gonna stack up and help me.
Speaker 1:So yeah, yeah, one of the ways we was coach coach brands here is is to talk them through. There's two levels that you can pull. You can give a partner more margin. You can make it easier to sell. The one that's harder to do is to make to give them more margin. The one that's actually more valuable is to make it easier to sell right, and you do that by better sales enablement. You do that by a Improvement in marketing, whatever that process is. But the amount of sc is that me and you both know personally. Yeah, walk into a room and go, I don't care. This thing has all the bells and whistles, but I'm not a hundred percent comfortable. It's too hard for me to sell, so I'm selling the thing I know right.
Speaker 2:I'd be, so I can I do with the team? Is this? Two things on this. So First question I always ask whenever I need a new partner is the last time you onboarded a new technology? Tell me what was great about the moment, what works for you? Miss the partner and then we want to replicate that. It's no good coming in with hey, this is that, this is how we do it here and it's great. But actually listen as those questions and the other short for which I see a lot is we don't treat partner recruitment like a sales purposes right, we can't miss guys.
Speaker 2:Back to the ninety day rule we talked about your partner signs up, signed the reseller agreement and the ninety days later that not so good because we're not treated it like a customer. You would do discovery, you identify pain, you would do a. What's the critical event? Why is this part of the going to sell my solution? What gap are we feeling for their customer and ultimately, the clothes is when they make their first transaction. But if you treat it like a sales process, I really understand the pain and identity about the impact that we got. That's how you just get this past. Huge going part should go.
Speaker 1:Awesome. I think one of the things that I'm really sort of bullish about in terms of where channels are gonna develop. We see that there's technology alliances, and software in particular is really big on alliances, right. How do we integrate our tool with these other tools, and that's what I've done a senior, very technologically lead level and then somewhere down the waterfall channel gets involved. They're not particularly ironically for it being called alliances well aligned between those channels. Right is just, we throw stuff off the top and hopefully at some point down in the ecosystem it will come together and a partner will sell a cohesive message, they'll market a cohesive strategy, maybe a distributor place and value that. What do you see in terms of blending channel alliances, because I think the brands that do that well are going to be the ones that went.
Speaker 2:Yeah, I have to use on this. So why does the vendor use an alliance? Well, sometimes it's reference ability. It's a lovely, we work like soft and you know you do this with that. And then there's the people that do extreme, like you. If you're blending that channel alliances together, you maximize your reach and your effectiveness of that Is more likely to sell your alliance offering space on their expertise. Customer base, like what's the connective layer and this is why I think you see the shoes drive in is weakens in the moment as well.
Speaker 2:So Historically was always the big global brands and If you kind of look at that cost versus the ltb on that whole partnership, it's like like something to stick. But you get into the is the world and then you start then creating customization yeah, flexibility, never want to sport. And then what do we say? Understand the partners that meet in the middle. So how does the partner take both technologies and then start to build an optimizer business around it? And then the one thing that people always forget is the partner was part of the vendor for someone. So, prime example, that I'm a specialist in it's and I'm not gonna go and sell zoo, but my customer needs a communication tech stack that integrates with the workflow around my cx or whatever it might be. So actually start bringing the best of three skills from partners together with this overarching layer of what we take on the alliances. You get that right, I'd say you've been touch with.
Speaker 1:And we've spoken earlier on in this podcast around how marketing is critical in terms of opportunity creation, speed market for your partners, and I love that sort of philosophy of let's start the stopwatch the day the partner signs right, and so we've got to get them to value. I think the real area where to me it's just such a black hole at the moment is a take, oh you know, x brand announces marketing sign off with microsoft. Right, there's an alliance from a marketing perspective.
Speaker 1:But it's never filtered down into demand gen done by partners. Right, it's never actually creating opportunities to me. That's the real sweet spot that I look at now to say, hang on a second. The brands that get that done right at the local level, yeah, from the partners voice, they're the ones that are gonna really spearhead those alliances. Actually, you know, driving agility and creating revenue. What's your sort of vision in terms of how marketing drive alliances?
Speaker 2:We got. I think don't be selfish. Right, you're gonna go into this joint approach. Don't have your measurements on cell stage. Should put a pre-ed right because Not all leads are gonna go your way and it's very difficult to manage. Think about a more cahy see strategic approach. So you leverage Both partnership models to expand the reach and drive. That revenue road is key and understand what you're bringing to the table. So the reference ability, the customer use cases, how this seems to get the value, like, which to get the value to the customer when the guys much that sales approach again, what pain points we trying so and it's a hungry, was poly, calm or whenever.
Speaker 2:But I don't remember the better together campaigns years ago. I mean, are we better together? What are we better at, you know? So I was always. My question was I mean, you just saw this huge rose with all of these huge tech vendors and then when she left the hood and this is where MSP is a really good day they look at that and say what is it? That is like you have no integration, that's all really. You just saying that you can do something. So and that's why I like that is the alliance layer down, so someone who's building a Very specific solution around hr.
Speaker 2:An example from box days like you know, you got hr solution that the back end is the data store. So how do they control the legality and data protection, please? How do they control people see me? So the security, please. Like I got the cv, I can start to build this vision behind what you are. Then I can start to look at how we preach and things. So you protect cv because when you apply for a job, you give everybody everything your schools, your dates, your dress, phone number way, everything about you. So you got a hr solution. Then all of a sudden actually put something like dropbox on the back. That's a very different cells by verses than we just have an integration with the house. So how do I think?
Speaker 1:the really funny one is right. So if you just think about it hypothetically, tech alliances come Because one brand can't solve a particular problem. It comes up against a hurdle typically comes up against a hurdle in a massive customer where that customer typically sold direct, and that customer goes no, no, this, this doesn't work, fix it. And so then they get what. We gotta go and fix that. So they go and build an alliance at a technical level and then they don't market that use case through the market.
Speaker 1:It's absolutely bananas, right, because what I'm thinking is, hey, are ecosystem and see, this ecosystem starts here. We bring them together and then I want my entire channel and we know channels of hundreds of thousands of partners Divide this. Test them on. Why did these two brands form a partnership?
Speaker 2:no, idea, and to me it's how do we scale that message down?
Speaker 1:that why you're gonna pick up so much stuff, because it's not just an hsbc who's encountered this problem. Right, there's thousands of millions of engines is all over the world that have.
Speaker 2:Yeah, that goes back and hands that credibility, that that complimentary expertise. But it's the why and what are we actually provided here? And I've seen this and I'm working in large tech companies and we have the internal and a record and it's the drum beats and it's like, hey, we just got a partnership with this. And the channel is always the first ones to say, okay, what is it, what? What are we actually positioning here? And then the alliance team was like we got a lot of things.
Speaker 2:So I do and then the kind of just a phone on that. The one thing that we see is never happens what you do, that you know. If you do this markets and campaign really well, the alliance is really good. You never share success on each of those websites so we never actually put a case study on where us and the alliance and the partner Did, and that's very rare that you see that.
Speaker 1:Yeah, I mean this is why companies like reveal and crossbeam are doing so well to build those sort of end user account plans effectively, where we can do a white space analysis. Cross Companies because that's so important is like hang on, we've sold to these 150. We've sold to these hundred. There's a 75 crossover call. We know whether white spaces, let's go after it together. Yeah, problem is that's really hard to do via the channel right, and so instead my philosophy is you need to let marketing do that by drip feeding the information, drip feeding the winds down and letting the Market come at an end user pool love and say hey, yeah, we are also encountering that problem.
Speaker 2:I'd be like to see some of the larger partners actually approached the venue this and say we see value and we see opportunity here and we actually get there's a really strong business case to do this. So how do we do it? You build the integration and we'll go and sell it. You never get that reverse approach. Very I think that is something. Even if you offer exclusivity to that partner is another good way to manage and do that. And they've got something very niche in the market that they can then develop and grow.
Speaker 1:I think, the exclusivity piece, because I could imagine I'm just hearing loaded partners that we know too well going hang on a second, we're not doing all this work so that they can pump it out to my direct competitor. Yeah, I think if that exclusivity was available, we would see loads of deployment and innovative solutions. I think that's why MSPs and ISPs provide such huge, huge value to the market. Yeah, we had this at.
Speaker 2:Dropbox. So there was a partner in the US that built a dynamics integration with Dropbox and we weren't gonna build it ourselves if we just, you know, we couldn't afford cuts to effectively build it. So all of a sudden, we gave that partner exclusivity and then we resold that offering globally To that and that's that partner plus partner. So all of a sudden, they had an IP that actually was better than than we could ever create and every time we needed dynamic integration, just be introduced that partner. Awesome, awesome.
Speaker 1:Well, look, tim, we are a channel and a partnerships podcast, and so, as part of that, we're always looking for our guests to recommend the next great guest. Who did you have in mind that we should have onto the podcast? So someone I've been following very closely and I'm very interested to hear on this podcast is a guy called David Colstrom.
Speaker 2:Who is that nuns, who was just taking the lead on their Amir channels and, I think, anyone who's watching this market at the moment. Notion is one of the fastest growing solutions, so I'd love to hear from David. I do know personally as well, so I think it'd be a great guest for you on this puppy. Awesome, david, we're coming for coming for you, tim.
Speaker 1:It's been a real pleasure. Thank you so much for your time. It's been a real pleasure. Thank you so much for sharing your insights. David, thank you for having me. Cheers, and we'll see our listeners next week.