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In each episode of the Partner Channel Podcast we will focus on a channel leader’s experience, wins, and challenges. We'll also dive into their vision on the future of the channel ecosystem.
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Now displaying: April, 2017
Apr 24, 2017

Anjali Menon, Head of Growth Operations at Magic, joins me, Jen Spencer to discuss integrations with complementary technologies, listening to data, being honest with your community of partners and more on this episode of The Allbound Podcast.

Jen: Hi everybody. Welcome to The Allbound Podcast. I'm Jen Spencer, Vice President of Sales and Marketing here at Allbound. And today, I am joined by Anjali Menon, Head of Growth Operations for Magic. Welcome.

 

Anjali: Thank you so much. Happy to be here.

 

Jen: I'm really happy to have you. And I'm excited to talk about your career but, before we get into that, I want to talk a little bit about Magic. Because for all the times I've ever thought, "Man, I wish I just had this like personal assistant." You guys are kind of helping solve that problem for me, right? What's the scoop? Tell me a little bit more about the company.

 

Anjali: Absolutely. So thank you for having me, first and foremost. And I’m really excited to be here. Magic is a text-based platform that allows you to, just as you said, get personal assistants on demand. So the scope of what you can ask is really sort of infinite. You could ask for things as simple as somebody getting you lunch, to perhaps helping with your office needs and things that are much more grandiose in scale, planning a significant other's birthday party or something like that. But the idea is that you get manpower on-demand to increase your productivity. We launched in 2015, February of 2015. Actually, when it launched, it just went viral. I mean, we had a massive waiting list and it was really validation that people want personal assistants. They want more time in their day.

 

Jen: Yeah, I'm telling you, it's like as soon as I learned about it, I'm like, "Okay, what should I ask?" Like, "What should I ask for help with?" right? So, it's just such a cool concept. And you're Head of Growth Operations there. What does that entail? I'm starting to see Directors of Growth. I think this I the first time I've seen Growth Operations. What does that mean? What's your role like?

 

Anjali: Yeah, definitely. It's a really interesting one because we are a growth team, first and foremost. But because we interface with operations so closely, just by nature of the work that we do, we're constantly having to fulfill the requests that our clients put in. That's ultimately how we end up with Growth Operations.

 

So under this umbrella branch of what we call Growth Operations, there's a few sort of subcategories. We've got a sales team, which has historically been focused on sort of inbound leads as a main source of acquisition. Then we've got an activation team that interfaces with our operations team quite frequently to ensure that sort of consistent quality of service. And this team is critical because Magic's end product is ultimately defined by the user. You tell us what you want and we deliver it. So the activation has to be really customized. And that's in part where a lot of the operations work comes in with growth. And then the third piece which is pretty nascent in its start, but we now have a B2B and partnerships team as well, so those are kind of the three.

 

Jen: So let's let's dig into that a little bit, you're just getting started with it, but when you think about the plans, this go-to-market strategy for Magic, how important do you believe those strategic partnerships are going to be in your success? What kind of plans do you have in the works?

 

Anjali: This is such an interesting question because partners can add so much value to our type of business. But it's really a matter of finding the right fit because Magic has so many complexities. You can ask for anything as simple as lunch to something as complex as carrying out a whole sale cycle for a business using Magic. So because it runs the gamut of things that you can do, we really have to evaluate what partners make sense for us. But for Magic, like many other businesses, I think success for our customers comes in the form of efficiency gains, obviously, cost savings, and value-add. And partners can add all of these things.

 

Some examples of partners that we're exploring right now are things like verticalized partnerships. So, if we can sit on top of other services that already have domain expertise, it's a win-win for us, i.e., if I already can use a cleaning service that I know is good and I can just recommend that to my clients, then I'm saving them and us time by doing so.

 

Other sorts of partners that are interesting for us are ones that sort of epitomize our values. We have two really interesting values at Magic. Yet, their concepts that are sort of known in the startup community but I'm not sure how widely they're known beyond that. And the two concepts are called yagni and plow.

 

Yagni is a term that means “you ain't gonna need it.” It's one of those things that in the startup community, people will say it all the time. But it's a term that really signifies when we work with you, we want a partnership that understands that we're working under constraints, and you understand that, and I understand that. And we don't go build things that we don't really need at the moment. We'll build them when it's absolutely necessary. So that's something that we might look for as a value in terms of partnerships. And then this other concept is plow, which you'll hear almost every day in our office. And that's a concept, particularly for a personal assistant kind of concierge company, it's the concept that you don't give up. You keep plowing to make sure that whatever the client wants, you try to get. And so we would hope that our partners sort of share those values as well, maybe on these sales or affiliate side for example.

 

So really, I think partnerships are key for us, but they need to align strategically both in what we're doing as well as what our clients needs, as well as, finally, what the partners themselves need. And the reason I emphasize this is because when we went viral two years ago, we had major, major brands coming to us, asking us to do partnerships with them. And we turned most of them down. And the reason is, we had to sort of be true to what our capabilities were, and you've got to be honest with what you can deliver and what the partner expects. And so at that point, we hadn't even really figured out who was our right customer profile and did this major brand make sense for what we were doing. Just because they're a major brand doesn't mean they're a good partner for you. So, I know that's a long-winded answer, but I think, in short, partners are very, very useful particularly for our business. But I think that the key is really making sure that there's alignment on both sides for what that partner can do.

 

Jen: It's very, very sage advice. And it can be very tempting for organizations to just bring on those partners that have me with those big brands. But, if there's not that alignment...and especially for a very quickly growing young company, you got to have that focus, right? So, I think what you're saying you guys are doing is you're definitely going down the right path. I absolutely love hearing it. And those strategic partnerships just make perfect sense.

 

How about integrations? Are you looking at other complementary technologies as a way that they might play a role in your growth goals? One of the things I'm thinking about, just kind of off the top of my head is like different apps I might be in on a regular basis like Postmates for delivering food or supplies or what have you. I mean, are you thinking about technology, and in that respect, for partnership?

 

Anjali: Totally. So, this is such a great question for two reasons. One is because we actually just launched a Magic version for Slack. So this Magic-Slack integration allows teams and businesses to more easily and more transparently use Magic as kind of like an office manager. So Slack has been really useful for us as the first step to growing our business in sort of a different category. And so, I think when we think about these partnerships, for example, I sort of alluded to value being very similar. Slack is one whose whole value prop is to increase productivity with teams, and we have a very similar value prop, it's a Productivity Tool. So there's synergy here. And if we can reach more of our target audience through a medium that allows teams to interact more collaboratively like Slack, that's exactly the kind of thing that's good for our business but even better for our clients. So Slack is the major one that we've been focused on.

 

You kind of alluded to Postmates. And that's a whole other category of sort of partnerships that we'd also be thinking about. Basically these other sorts of niche services that we can kind of sit on top of or that they can kind of sit on top of us, either way. And we can just kind of use them as our clients come in and say, "Hey, I need a burrito." well, the fastest way to do that is through DoorDash or Postmates or something like that. So those are the other kinds of partnerships that we would look at as well. And so, absolutely. That's definitely something that increases productivity and efficiency for us.

 

Jen: I know I can speak on behalf of the Allbound #AllStars, we try to make Slack do everything. So we try to run our whole business through Slack. Things that are important and all of the shenanigans as well.

 

Anjali: That's awesome. Well, what's interesting is with the Slack integration, we're finding different use cases for Magic just by virtue of being on a different platform other than text. Because when you're suddenly on a platform that allows for different teams to interact with one Magic as if they were an office manager suddenly Magic becomes the office manager, and it's booking appointments for people, it's bringing vaccines on campus, it's booking team outings, and suddenly the use cases are becoming very different in the way that they interact with Magic is different too, just by virtue of the platform. So it's actually a key growth initiative for us to be thinking about these other kinds of platforms, because they increase the ways in which folks use Magic, increasing their own productivity. But it's also, of course, then expanding the reach of who can use us as well, which is really good for both sides.

 

Jen: I want to ask you a little bit about some of your past experience. Before you were at Magic, I know you were at Twitter. Before that, you led marketplace operations at TaskRabbit. And marketplaces and partnerships and communities of engagement, there's a lot of similarities there. And you helped launch the TaskRabbit Elite Program. So, let me know how did that concept for that program come about originally? And I’d love any feedback on how it helped really grow the company since its inception.

 

Anjali: Definitely. So, I am proud to say that the TaskRabbit Elite Program still exist today. So when you go to TaskRabbit, despite the business model having changed from one that was traditionally like a bidding system to one that's now more automated with algorithms, the TaskRabbit Elite Program's still maintained. And the reason is because it actually does really impact the business goals and growth.

 

The reason it came about was mostly for two sides. And it's two sides in parts because TaskRabbit is a two-sided marketplace. So, on the client side, when we were back in the bidding system, clients would put in a request for something like, "Hey, I need a cleaner." And it was possible that hundreds of taskers could bid on those requests. And clients would sort of face this paradox of choice kind of paralysis because they wouldn't know who to choose.

 

And so, the concept of the TaskRabbit Elite for clients specifically was, can we give them a sort of value set that allows clients to choose who is the right TaskRabbit for me for this particular job set? And then, on the Tasker side, on the community side, which was the side that I was most closely involved with, we had never created a systematic, defined program that really supported workers in the sharing economy. It was not something we had done formally. And so this was our first attempt to say, "Hey, there are a lot of people hustling on this platform to make it a great one. We should reward them in some way." And so for folks who delivered, who had great ratings, who consistently performed, we thought this is a great way to reward them and get their earnings up by showcasing their work more to the right kinds of people.

 

Similarly, it also helped new Taskers sort of ingratiate themselves on the platform because now new Taskers had a sort of defined path towards something that they could work to. And so, it was possible that within a month of becoming a new Tasker, you could actually become an Elite TaskRabbit when I launched this thing. And so, it motivated a lot of newer TaskRabbits to do a lot of work and get promoted and get more work. So ultimately, it was kind of a win-win for both sides. On the tasking community, it supported them by giving them more visibility and giving them more work. And on the client side, it helped them narrow their choice to the right Tasker for their job.

 

And ultimately, we switched the whole model to actually emphasize that specific point, finding the right Tasker for your job. So now, if you go to TaskRabbit, nobody's bidding anymore. You're just sort of shown the right TaskRabbits for you and you just pick the one that's good for you. It's a much easier process now but that concept really sort of originated with that Tasker Elite program. And the reason it exists today, again, is because both of those sides of the community are still served in the same purpose.

 

So it's been something that was strategic for the company. It ended up ultimately making Taskers more money, which is why we kept going with the program because it was giving them more money and was giving them more incentives to get more work on the platform. And so, yeah, it's something that I'm really proud of because it allowed us to build a community in a way that was very positive for both sides.

 

Jen: To take sort of a page out of Tiffany Bova's book, she talks about making your customer the true north, like the center of your universe, right? And in every decision that you make in your business, like thinking about it from the perspective of that customer. What's going to be best for that customer? Because people ask, "Should I sell directly? Should I sell online? Should I sell through channel partners? Should I do X, Y or Z?" And the answer should be, well how does your customer want to...right? How do they want to buy? How do they want to be served? What's going to be best for them? And ultimately, if you do what's going to be best for them, that will end up being best for the business and for all the business partners that are part of that ecosystem.

 

Anjali: Exactly.

 

Jen: So, it’s great to hear.

 

Anjali: A quick side note on that. We actually spotted the problem of clients not getting what they wanted and not identifying the North Star through data. Because I think folks don't know this, but the reason TaskRabbit changed their model is because a lot of tasks were being put into the system, that is to say, clients were asking for things to be done, but then they weren't always choosing TaskRabbit to get them done. And the reason was in part because of bids. It was because a lot of TaskRabbits could put in bids and then people would get so overwhelmed that we would see this long-tailed distribution of tasks that got bids, but then the client didn't do anything with them. So this effort was to give them exactly what you said, that North Star.

 

Jen: We talked to a lot of people, and they're building partner programs, whether they're reseller programs, referral partners, affiliates. But they're not just trying to build a program just to get leads or just for top of funnel. They're really looking, "How can I build a true community for my partner ecosystem?" Maybe it's to get partners collaborating with each other, or to get partners and customers collaborating to get shared visibility and really a shared experience. And I'm just wondering, over the course of your career, whether you want to speak to something from being at Twitter or TaskRabbit or even at Magic now, do you have any advice for people who are setting out to attempt to create a community?

 

Anjali: Yeah, definitely. That's such a cool question because I look at building communities or partner communities or whatever form of community you're building, like a two-sided marketplace because that's the background I come from. So the relationship needs to benefit not only your clients but the partners themselves. So for a business like Magic, that's so dynamic where the scope of what we offer is pretty much sky's the limit, we in particular need partners who understand this and can be flexible enough to work within the constraints of that model. So I would really say for folks who are interested in building this kind of community, define and qualify the ideal folks in the community and how do they fit into what you're building?

 

Because if you can't define that, then you're not in a good position to set up the community and your partners for success. And I think, and again this is what I alluded to earlier, but when we had major brands coming to us, we didn't even know who was a good partner for us and who were our right customers. But now we're in so much of a better position to do that, so we can start thinking about that. So definitely being able to understand who those right partners are for your community is key. The other thing I would say is honesty is everything, be honest with your community of partners. Because then, the expectations are set correctly. Don't over play your capabilities because you think that's what your partners want to hear. You are the partner in the partnership, and for it to work, I think really, really being able to transparently lay out the scope of what you can do, why you're doing it, and why it's important as it relates to your values are all very key. So that would be sort of my best advice.

 

Jen: I think that’s some really great advice and such a great way to wrap this up. But before I let you go, I always ask some more personal questions just so folks can get to know you a little bit better. You shared so much awesome stuff with us today, but I'm going to dig in a little bit more if you're up for it.

 

Anjali: I am, of course.

 

Jen: Okay. So easy questions. First one is what is your favorite city?

 

Anjali: Oh, okay, Cape Town, South Africa.

 

Jen: Oh, I have not heard that one yet. So why is that your favorite city? Tell me.

 

Anjali: So, I'm somebody who loves to travel. And I think that when you travel, you can often find places that you can call home, that are often not your true home. And you just know it when you're there. And so when I went to South Africa, I immediately felt this sense of home. Because South Africa is a lot like San Francisco, where I’m from, in the sense of scenery is very beautiful, there's a lot of nature, Table Mountain, a lot of ocean. People love surfing over there, but then the culture was also just very, very friendly and people were very welcoming. And I also love animals and wildlife. So being surrounded by all of that with a very sort of gracious culture, it felt like home. So that's my favorite city.

 

Jen: Well, you kind of hinted at my next question. Are you an animal lover?

 

Anjali: Yeah, I am.

 

Jen: Do you have any pets?

 

Anjali: I grew up with two dogs, Larry and Lucky. One was a German Shepherd and one was a tiny little Pomeranian. And they were best friends. But no, I do love animals. So South Africa made sense.

 

Jen: Great. Next question, Mac or PC?

 

Anjali: Mac.

 

Jen: And my last question, if I was able to offer you an all-expenses-paid trip, where would it be to?

 

Anjali: Well, the next place that I want to go to is Iceland. Because I'm a nature lover. I love exploring. And tickets are cheap right now so it wouldn't cost you too much probably.

 

Jen: Remember, this is a magic land where I have all the money in the world and I can send you anywhere you want to go. But I appreciate you thinking about me.

 

Anjali: Well, in that case, I probably just need the money, still in Iceland, but I'd probably go on some kind of luxury retreat, looking at the Northern Lights or something like that. But yeah, I think if we had all the money in the world, the place would be Iceland.

 

Jen: All right. Awesome. I love the practical fantasy, it's fantastic. Well, I just want to thank you again. Thank you for sharing some of your time with me and our listeners today. If anyone would like to reach out to you personally, what's the best way for them to connect with you?

 

Anjali: Sure. So they can connect with me via email and it's just 0-7, my first name and my last name. So that's Anjali Menon @gmail.com. I can spell that out as well, would that be helpful?

 

Jen: Sure, sure.

 

Anjali: Okay. So it's 0-7-A-N as in "Nancy" J-A-L-I as an "igloo" M-E-N as in "Nancy" O-N as in "Nancy" at gmail.com. So that's 07anjalimenon@gmail.com.

 

Jen: Perfect. Well, it's been great getting a chance to learn a little bit more about you and talking about partnerships and communities. So, thank you so much.

 

Anjali: Thank you for having me.

 

Jen: Yeah. Absolutely, absolutely. And thanks, everyone else for tuning in and we'll be back next week with an all-new episode.

 

Male Announcer: Thanks for tuning into The Allbound Podcast. For past episodes and additional resources, visit the resource center at allbound.com. And remember, never sell alone.

Apr 17, 2017

Joe Schramm, Vice President of Strategic Alliances at BeyondTrust, joins me, Jen Spencer to discuss refining your focus on specific partners, channel growing pains, understanding the win for your partner and more on this episode of The Allbound Podcast.

Jen: Hi, everybody, welcome to The Allbound Podcast. I’m Jen Spencer, Vice President of Sales and Marketing here at Allbound. And today, I’m joined by Joe Schramm who is Vice President of Strategic Alliances at BeyondTrust. Welcome, Joe.

 

Joe: Thanks, Jen. Good to be here.

 

Jen: I'm glad to have you. I think the best way for us to get started first of all is maybe if you can tell us a little bit about BeyondTrust and your organization.

 

Joe: Sure, sure. So BeyondTrust is in a segment of cyber security focused on privilege access management. We're also in another segment called vulnerability management. Both segments are pretty well defined in the cyber security landscape, but I would say that privilege access management is probably growing at a higher rate, and that's where we're seeing, a lot of our new product growth, net new logo acquisitions, and so forth. So we're very much focused in the cyber security domain, and it's a very hot market. It's something that we're doing really well in and are very happy to be participating in.

 

Jen: You have a history of working in business development, strategic alliance roles at very high-tech companies in security. And, I don't know if you have a byte of information or a hard and fast rule, something that you've really taken with you as you've gone from one organization to another to really help grow your channel program at BeyondTrust. How do you help it really run smoothly?

 

Joe: Yeah, that's a great question. So I think probably my favorite hard rule that I like to live by I learned some time ago now...this goes back several years and a few different organizations ago. But really, my favorite thing to think about and to focus on is what I call “partner profiling”. So a lot of organizations, when they start to build their partner program, they tend to gravitate towards easy wins, meaning if a partner came to you and said, "Hey, I'm interested in working with you," you'd rush to sign them up without really stepping back and understanding, "Are they the right partner for us, right, based on the type of company we are and the products we sell and how we sell them?"

 

So partner profiling, for me, is one of those almost religious experiences where I sit down and set out to really define the top three or so attributes and partners that we want to proactively engage and recruit and bring into our partner program. And it's easy to get this wrong, right? A lot of organizations, like I said, will gravitate towards easy picking, sign up lots of partners without stepping back and understanding, "Are those partners really aligned to your market? Are they in business for a sustained period of time?" To me, that's an important attribute is length in the market.

 

If an organization has been around 10, 20, 30 years, it's a very good leading indicator that they've got a big customer base and that they've had to reinvent themselves along the way a couple of times, and pivot as technology changes and continue to sustain and grow their business. That's an important attribute. And then certainly, things like a good go-to market capability, so having sales people, having pre-sales people, having perhaps delivery capability or at least very good technical competence within your domain.

 

So profiling and identifying what those key criteria are is really, really important. And then making sure that as you engage and as you seek out partners that the ones you're engaging with proactively, even the ones that you're reacting to based on inbound interest, you're qualifying them against those criteria pretty firmly to ensure that your chances of success, once they're up and running, is going to be a lot higher.

 

Jen: I think that's such great advice, and it should really resonate with a lot of folks who are focused on this account-based movement right now that's happening on the direct part of business because that's what we do, right? That's what we do with an account-based strategy is we identify who's a good target for us looking at those profiles. And, I know it can be challenging when you're building a partner program and you've got that inbound interest in joining your program. It almost like reminds me of if you've got someone volunteering their services, right, they are volunteering to sell for you or sell on your behalf, and you've got to say no to them sometimes. So it could be really hard to do, for sure.

 

Joe: Yeah. It takes some practice, for sure.

 

Jen: Yeah. Now, you have launched several key initiatives really to grow the channel at BeyondTrust. Can you share a little bit about the areas that you focused on so far in the organization?

 

Joe: Sure. I'll touch on maybe a top three that I would want to share here in the context of this discussion. So the first one is that we decided to embark on a global distribution strategy for our company. If you look at the way we were organized from a distribution perspective, it was very localized, so specific countries. For example, in the U.S., we had a distributor. In Canada, we had a different distributor. Throughout Europe, we had many different distributors, throughout Asia Pacific, many different distributors. And what we found was that there was a lot of inefficiencies, a lot of inconsistencies with that model.

 

Furthermore, we found that not all those distributors were doing much more for us than facilitating transactions, which is important, right? You need to have an ability to transact business. You need access to different kinds of resellers that distributors oftentimes have access to. And you obviously need access to certain kinds of procurement vehicles, which again, distributors often have access to either directly or through their network of resellers, so state and local contracts, for example, GSAs, too, and the federal site to name a couple.

 

So it's really important that you have some measure of a strategy there. But what we did was we set about to consolidate our distribution strategy and align ourselves to a distributor that we felt was very focused on the security domain, which is what we participate in, and also one that we felt could help us scale the business and generate net new opportunities through their network of resellers.

 

And so we decided to join a program that Westcon-Comstor offers called Accelerate. And it's a very selective program. We're one of like, I think, five or six different vendors that belong in that program, and that's really the extent of it. This gives us a lot of focus with Wescon, gives us an ability to wide up each region in a sequence. So we're very active with them in AsiaPac. We are now writing up North America and Latin America. In Europe, we'll be coming online later this year, in fact in Q2.

 

So it's provided us with a nice way to rationalize, streamline, drive more efficiency, drive more consistency with our distribution business, have one, well, not one entirely because we do have a couple of distributors that we're maintaining, but it helped us rationalize and reduce the number of distributors that we've had on a global basis. That's one initiative that we embarked on.

 

Another one that we embarked on last year was our Technology Alliance Program. So we wanted to have an opportunity to provide our technologies, provide our open APIs to potential technology partners as well as potential consulting partners who would want to or need to develop custom integration in their product or on behalf of our customers. We launched the Technology Alliance Program last year, and that's been great. We signed a couple of very strategic technology relationships through that technology program, SalePoint, McAfee being a couple in particular.

 

But we also have some others now coming to us and saying, "Hey, we want to build an integration to this product, to that product." We can do that very easily now. We can provision not-for-resale software. We can provide them with the APIs. We can provide them with some simple instructions on how to leverage them. And we're finding that some of these partners that are coming to us are now able to build these integrations very quickly.

 

And the third area that I would highlight is that one of the things that I thought was missing for the company when I joined really late 2015 or early 2016 timeframe, was that we didn't have a partner strategy centered around consulting partners and system integrators. We had been talking to a few and have been having some conversations with some. But I saw that as really a missed opportunity to align ourselves to some very well positioned, very focused consulting organizations that are really centered on the identity access and privilege access domains in particular, and for us to align ourselves with them to create new opportunities for us and for our salespeople, as well as scale our delivery service capability.

 

So as we're growing, one of our constraints or one of our challenges has been keeping up with demand for consulting services to implement our technologies. And so we aggressively recruited and onboarded about a half dozen or so boutique consultancies last year, and that's paying off for us really well. They're getting certified and getting consultants out there in the market who can implement our products and create bench strength and scale for us on the delivery side. And just as importantly, they are also identifying net new opportunities for our technologies with their clients that we didn't know about previously. So that's creating some net new business for us through that effort as well. Those are the three things that I'd call out.

 

Jen: You've been busy. That's quite an undertaking in a fairly short period of time, which is really commendable. I want to dig into some of the results that you've been able to see. You shared with me previously kind of what happened in one year. Your channel business is up 100% year over year. Business through the channel has grown from 15% of the business to between 25% and 30%. I mean, is this the result of those initiatives? And also, is there anything else, any other great results that you've seen because of work that you've done in 2016?

 

Joe: Yeah, I think there's a couple of forces in play here, right? One is that we're in a high growth market, right? Our market segment's growing at over 30% per year. And so there’s always going to be organic growth with what you've been doing. So that's definitely attributable to some of the growth. But I think moreover and more importantly is that we've really aligned ourselves to not only the right partners that can help us, but we've also really narrowed our focus down.

 

So when I joined the company, we literally had hundreds of resellers in our system, and I couldn't get my head wrapped around how we had so many. And then of course, you look back at the history of our company, and for a long time, we were a growth-by-acquisition company and we came together as BeyondTrust four or five years ago through the acquisition of four or five different companies. And with each acquisition, it brings a different partner base with it, right? And we never really rationalized that partner base.

 

So this year, actually, last year, we started this process and we're going to continue to do it this year, but we've really started to refine our focus on the partners that we really want to proactively manage. That's not to say that we won't work on an opportunistic basis with any partner, but what we're doing with those other partners, what I call the tier-two partners, is we're rolling them underneath Westcon to help us manage and grow those partners so that we can take my direct team, right, the alliances people that we have on the team and have them spending the bulk of their time really building business with the core set of partners that we want to focus on.

 

So I think those are a couple of contributing factors that have really played a role in our success and the growth that we've achieved. We expect this year to again significantly grow the channel business. So we're excited about the prospects, excited about the opportunities. I think we've got many of the key things in place to enable that growth, and it's really just going to be a question of our ability to execute.

 

Jen: That's awesome. Anytime an organization grows, and especially when you're in channel and you grow so exponentially, it's exciting and it's amazing, it's great from a revenue perspective. It can also be a little bit painful. Just there's challenges anytime that you do grow. I'm wondering, could you share maybe some of the challenges that you faced or maybe some challenges that you're anticipating and how you're going to mitigate those?

 

Joe: Yeah. So there's always challenges as you highlighted when you are growing, and these challenges that are good problems to have. And I like what our CEO says. He says, "We don't run away from problems or challenges, we run towards them," right? And so that's the attitude of our company, which I love and I embrace that philosophy. Every time he says that, I kind of smile because that's kind of how I operate. I want to attack things and get after it, right?

 

But that being said, yeah, there's certainly growth pains. Now, there's a couple things that we did early last year in anticipation of the growth that we were expecting and wanting to drive, right? One was we needed to launch a partner portal. We had a large number of partners, some of whom were very active with us, some of whom were occasionally active with us. But we did not have a good vehicle for disseminating content, and for addressing the educational needs and the content needs of both our sales folks that work for the partners, as well as the technical folks that work for the partners.

 

And so we stood up our partner portal last year, which has been very widely adopted, and I would say it allowed us to centralize a number of the processes, chief among them, our deal registration process. So that's been fantastic. And that's a key metric that we want to measure as you get your registration volume year over year, and even at a granular level by partner or region or what have you. We can measure how that's building. It's an important leading indicator as to what's going to come out the back end of the funnel, one, or two, or three, four quarters later, right? So that's been great.

 

And I think that the usability of the portal and the intuitive nature of the portal has been great. We see very sticky behavior, very good evidence that a lot of our partners referenced the portal. They referenced it frequently and not just to do deal registration. We obviously can report and track on what artifacts they're accessing, how frequently those pieces of content are being accessed. We can look at that and kind of analyze, what's valuable, what's sticky, what's being consumed the most. And so all that's really, really important for us. And so that's been great.

 

Another challenge that we've had to deal with has been training this new class of partners that I spoke of, right, the consultants and the systems integrators. Having training in education capabilities, certification capabilities was a really important driver to help us scale. And we launched our BeyondTrust University early last year as well. And that, too, has been extremely well received. We probably have over 500 partner individuals across the globe that are engaged in BeyondTrust University either from a sales enablement, pre-sales enablement, or technical consulting enablement perspective. And we're now starting to turn out certified consultants who can actually help scale on the delivery side.

 

So those are a couple of highlights and things that we've had to overcome. And we're not done yet. We're never, I think, fully satisfied. We can always do more. But, those were a couple of really important foundational components that we needed to get in place to help scale.

 

Jen: Well, with all of those individual partner users, you were talking about those partner entities, you weren't talking about the companies, right? You're talking about actual individual people who are engaging with that content or who are phase two, your end customer. You've got all those folks. You've got over 4,000 organizations as customers. You’ve got half of the Fortune 100. I mean, I'm just baffled. Like how are you able to dedicate time to your individual partner entities? I know tiering's got to be a big part of that, not just the segmentation of types of partners but also tiering within. Is that something that you guys are doing as well?

 

Joe: Yeah, yeah. We did that last year for North America. We just completed our first pass of it for Europe, and we're in the process of doing it now for Latin America. And I think AsiaPac is a little different for us. We've kind of been working through a two-tier distribution model in AsiaPac from earlier points in our history and so there is less rationalization needed there, I believe.

 

But certainly, if I take North America for an example, we looked at the entire pool of literally over 300 reseller accounts that we had in our CRM system and we started winnowing that down and looking at it different ways. We said, "Okay, over the last two years, how much new business has been booked by each of those partners," right? And obviously, you typically see a 80/20 kind of formation there, where 80% of the revenue comes from the top 20% of the resellers. And we quickly realized that we've got literally hundreds in our system who haven't done any business with us over the last two or three years.

 

We also looked at how much renewal business is being handled by that pool of resellers, and we found that there is some that do a large number of renewals for us but there's an awful lot of onesie-twosies out there, right? Literally, we have a reseller that handles a couple of renewals for us a year, and that's the extent of it. So we value that. We don't want to just throw that out the window, but we look at the volume of it and we look at the alignment to the partner profile that I spoke of at the top and say, "All right, who are the top 12 that we want to focus on, or the top 15," and really zero in on those resellers and say, "Okay, how do we sit down and build a business plan that's meaningful for both companies?"

 

And for us, we're kind of looking for anywhere from half a million in net new product license bookings or more from those kinds of partners, and whether they've done that historically or not may not necessarily be the critical decision factor. Maybe a partner has only done 250,000 with us but they've only been working with us for six months and we believe that they've got the right DNA, the right profile to really take that up to the right level.

 

So that's kind of how we've done some tiering here in North America. And I'd say that we're really focused on probably the top 10 or so resellers, and then there's a cadre of consulting partners maybe 15 or 20 in total that we’re either on board with or working with in some capacity to try to figure out whether they belong in that bucket or not. But taking it from literally 300 down to 15, 20 is a much more manageable number, and we believe that by providing that focus that we're going to see more benefits coming out of those relationships.

 

Jen: Thanks for sharing that. I think it's really, really helpful to a lot of people who are in a similar situation that you're in. And on that note, the last question I really want to ask you is if you have any sort of concise piece of advice that you can give fellow business development professionals who might be in a situation similar to the one that you embarked upon when you joined BeyondTrust, any words of wisdom that you can share?

 

Joe: Yeah, I'd piggyback on the first point about the partner profiling, and say that it's really important that you understand what your targets looks like. And then the second thing, which is really important, once you start getting into discussions and conversations with potential partners, you really need to understand what the win is for the partner. And it kind of amazes me that a lot of times, people don't step back and ask that question or even understand that and they may assume that, "Oh, these guys are VAR, therefore, they're only interested in margin on the sale of products."

 

Well, the landscape is changing out there, right? I don't really believe that organizations that may have historically survived and thrived on just being product-resale companies are going to survive, right? We're seeing a lot of evidence that traditional resellers are morphing into what I call a solution provider, and they're trying to solve problems for clients that includes products, that includes services, and it may include managed services.

 

So the landscape is shifting a little bit, but the point being is that it's really important for you to understand what the win is based on the partner you're talking to. And, one partner may say, "Hey, I'm only interested in selling product." Fine. Another partner may say, "Well, we do some product resale but we're really in the consulting business." Or it might be obvious from the onset that they're in the consulting business but, they like referral margins on the back end of deals, too, right? So trying to be flexible, trying to frame and understand the win for the partner is equally as important as understanding what the win is for you. So that's my piece of advice.

 

Jen: I think that's great advice. We can always be better listeners. Really listen to what our partners need and what's going to make them successful. That's fantastic. You know, Joe, before I let you go, before we totally sign off here, I always put people through a little bit of like a fun personal speed round, so ask some questions that kind of dig in a little bit, get to know you as a person a little bit more. Are you up for it?

 

Joe: Yeah, sure, why not. Sounds like fun.

 

Jen: All right, all right. So easy questions. First one is what is your favorite city?

 

Joe: My favorite city, oh, that's a good one because I've been to so many great cities. Honestly, my heart belongs to New York.

 

Jen: Good. What do you love most about New York?

 

Joe: I grew up in the New York area and I've always loved it. It's a city that, honestly, you can pretty much do anything within the bounds of law, of course.

 

Jen: Right, right.

 

Joe: Do anything, see anything, experience, any kind of entertainment, any kind of cuisine. It's just an amazing city to me. I've always loved it. But I’ve got to tell you, I do love London and I love Tokyo. I got to Tokyo last year and I am absolutely amazed by Tokyo and I'm dying to go back. I was only there for two days, and if I can figure out how to go back for 10 days, I think that'd be like my first choice. And I may come back with a different opinion about what my absolute favorite city is after some real time in Tokyo I think.

 

Jen: That's a really long way to travel for two days. Wow, wow. You need to go back.

 

Joe: It was a total of a 10-day trip in Asia but we only had 2 days in Tokyo.

 

Jen: Yeah, okay. That makes more sense. Okay, second question, are you an animal lover?

 

Joe: Oh, yeah, definitely.

 

Jen: Yeah. Do you have any pets?

 

Joe: We've had some pets from time to time, cats, hamsters, fish those sorts of things. I'm an absolute dog lover. But here's the thing, I travel so much and my kids are getting older and heading off to college. And, it's always been one of those things that we’d love to do, but at the same time, we've always felt that owning a dog would be unfair to the dog because you need to be around to spend the right time with them and treat them like any other family member quite frankly.

 

Jen: Yeah, I hear you. I hear you. Okay, next question, Mac or PC?

 

Joe: Oh, gosh. If I ever had the choice of having a Mac for a work tool, I would say Mac. But I never seem to get that choice so I have to go with PC. I'm using a Microsoft Surface and I actually love it. It's great, very lightweight, very reliable. And you can use it as a tablet as well, so it's got some nice flexibility.

 

Jen: Yeah, everyone who I meet who has one absolutely loves it, so that's great. My last question for you is let's say I was able to offer you an all-expenses-paid trip, where would it be to?

 

Joe: It would probably be Italy, and I'd have to say Tuscany in particular. For me, Tuscany is kind of the perfect balance between my need to see things and do things, but you can kind of find the peace and tranquility to relax when it's time to do that, too. It also has that phenomenal food and wine aspect to it that I love. So Tuscany, I'd take it any day.

 

Jen: Wonderful. Sounds lovely. I was picturing myself being there as you were talking about it with a glass of wine, of course. So thank you. Thanks so much for sharing your time with me, with us today, Joe. If any of our listeners would like to reach out to you personally, what's the best way for them to connect with you?

 

Joe: Find me on LinkedIn. It's Joseph Schramm, S-C-H-R-A-M-M. Easiest way to find me. There's not too many of me out there that I'm aware of at BeyondTrust. So yeah, I would welcome the opportunity to chat with anybody or kick any of this stuff around. It's good fun. I'm passionate about it. I enjoy it and would welcome the opportunity to talk to people.

 

Jen: Wonderful. Well, again, thank you so much. I hope you enjoy the rest of your day. And thanks everyone else for tuning in, and join us next week for an all-new episode.

 

Announcer: Thanks for tuning in to The Allbound Podcast. For past episodes and additional resources, visit the resource center at allbound.com. And remember, never sell alone.

Apr 10, 2017

Jeff Ernst, co-founder and CEO at SlapFive, joins me, Jen Spencer to discuss to discuss customer success and the channel, opposing the customer testimonial, and more on this episode of The Allbound Podcast.



There are a lot of folks in the SaaS industry specifically talking about customer success and see that as a result of higher customer engagement. Can you share with us where you think customer success can really meet that channel and generate a sort of kind of partner proof?

 

Most of my clients are SaaS spenders and as you know in the world of SaaS, it's all about renewals and what your renewal rate is because if you're churning customers faster than you can win new ones, you're just treading water or losing money. One of my SaaS customers does more than 70% of their business through the channel. Another one about 50%. And some of the issues that these companies face is one, the vendor gets so removed from the end customer because the channel partner, the reseller has the relationship with the customer. So, the vendor is getting less feedback from the customer, they're having less impact themselves on the customer success, and they just don't have as much opportunity for engaging the end customer directly.

 

And then on the flip side, you get the resellers that are competing on their value-added service, sometimes competing with other resellers for the same vendor, but they're always competing with other software vendors and their resellers. So, they've got a double challenge of proving why the vendor solution is better than others as well as why their own value-added service is better. And, let's face it, sometimes there's not much difference between the two.

 

I think that's where customer engagement and customer voice comes in. I'd like to say that it's probably the only thing that your last bastion of competitive differentiation is your customer engagement and customer voice because competitors can copy your messaging. They can copy your product, they can even try to steal your channel partners. But what they can't do is steal your customer success and the voice of what your customers have to say.

I'd love to hear some more of your perspective on what is really going to help a company thrive when it comes to customer engagement when you're thinking about that entire sales ecosystem. One of our customers has an actual person in the organization whose job is to be the voice of the customer. He is in every meeting that has to do with a product or any services, so they constantly remember the customer's in the room. What other advice do you have?

 

I commend that company that has the voice of the customer role because that's just so important and not enough companies actually do that. And if it doesn't come out of the customer's mouth, it's just an educated guess, right? In too many companies they're just making educated guesses as to what's really on the customer's mind. The more you can have your customers sharing their experiences and speaking up for you, the better you're going to be able to persuade people to buy. But one of the biggest questions I get is well, my customers don't want to participate, or they're not allowed to. It takes way too long for them to get PR approval. And so, that's a real challenge.

 

When it comes to capturing stories, one of the biggest pieces of advice that I have is to don't ask for your clients for endorsements recommendations or testimonials. And this might sound counterintuitive because this is what we as marketers have always done. We get all giddy when we get a quote from a customer that says, "A.B.C. Company rocks. I recommend them to everybody looking for a UFO widget,” right? I've gotten all giddy when I've gotten quotes like that and I've said "Let's put this on our website, let's up this in our sales presentations." And CEOs love it too. But those types of quotes don't really help buyers. I say don't ask for endorsements, recommendations or testimonials because for many reasons. One is generally there's not much in it for customers to give you an endorsement and oftentimes their hands are tied, they're not allowed to give endorsements. And if they do, sometimes they have to go through rounds of PR approval before you can use them. Whereas instead, I say ask your customers to share their experiences, advice, and knowledge.

 

This is very different. This is what I did at Forrester in my customer voice program. I would ask customers to share “What advice do you have for other marketers?” because they were selling to CMOs who are looking to get the most value out of working with a research firm. Or “Tell me about some of the major initiatives that you've done better with the help of the Forrester analysts.” Questions like that, people love. Your customers love to talk. They want to be heard, they love to give advice, they want to look smart, and they want to show how much knowledge they have.

 

You want their experiences and advice because in the end, that's what's really going to help a buyer. If a buyer is worried about whether they're going to get executive-level support for their initiative, they're going to care more about the advice that other customers of yours have about how they got executive-level support.

 

Just some advice for people working with the channel. You know, there's a lot of benefit in companies that have a channel to think about how you can generate customer proof that your channel can use as well as how you can enable your channel partners to develop their proof as well. And do it in a way that they can bring together both short customer stories that pertain to the vendor and their product and reliability and service and things like that. As well as some stories and customer feedback and advice that pertains to the reseller's value add, and then the service that they provide and the ongoing training or the implementation support because you've got to remember that to the buyer, they're buying a single solution.

 

The fact that the service and implementation and training might be coming from afar and the technology and maintenance might be coming from the vendor, they don't really care. To them it's all one solution. They want that one experience to be unified, and so they want to hear proof that relates to the whole solution.

Apr 3, 2017

Jay McBain, Global Advisor at Channel Mechanics, joins me, Jen Spencer to discuss shadow channels and the shift from IT buying power, verticalization (or hyperfocused vectorization), the future of the channel and more on this episode of The Allbound Podcast.

Jen: Welcome to The Allbound Podcast, I am Jen Spencer, Vice President of Sales and Marketing here at Allbound. And today, I'm joined by Jay McBain who co-founded the company ChannelEyes, currently serves as Chairman Emeritus of the CompTIA Vendor Advisory Council and Managed Services Community. He is a Board member of the Channel Vanguard Council, the Ziff Davis Leadership Council, and CRN Channel Intelligence Council. In short, this man knows channel. Welcome, Jay.

Jay: Thanks, Jen, really appreciate it. Glad to be here.

Jen: Absolutely. Well, it's good to have you. And especially, really wanting to get caught up with you and what's going on in your world and I'm sure our listeners are also really interested about five months ago, you took on a free agent status. You said, "Okay, I'm leaving ChannelEyes," which was the channel tech startup that you helped co-found. So catch us up, what's had your attention the last year or so?

Jay: Yeah, absolutely. I had spent the last while at ChannelEyes as CEO and they're working on some really interesting stuff around predictive analytics and artificial intelligence. And I think in the next three to five years, most of us in the channel will be using computers to help us do our daily tasks...help us with our daily tasks and get us to the finish line faster. And I think now that the company transitions to a CEO that can better position the company with some of the leading CRM players in the market like Salesforce and Microsoft. And who knows, further down the road, to really make something happen.

Jen: Great, great. So what are you focused on right now as a channel professional in your world?

Jay: That's a great question and I was at CompTIA last week and probably answered the question at least 100 times so...

Jen: I'm sure. I'm sure.

Jay: One of the answers is I spent almost 20 years working at IBM and Lenovo in different channel roles including channel chief roles. And they were always Americas based, either North America or full Americas, and I never really got a lot of exposure to Europe and Australia and Asia-Pacific. And what I've decided to do in the last five months is work closely. I've been to Australia and going back again working with a very large telco there, I’m working with this great company in Ireland which is where I'm sitting right now in Ireland. The company is called Channel Mechanics and they've really looked at the channel management space and they've done some really innovative things. So looking internationally but also looking obviously to work with some very interesting challenges, which I'm sure we'll touch on on this podcast.

Jen: Great. So let's, dig in to some of that. I’ve followed a lot of what you've been writing about specifically around channel, something that you previously called out, is that a large number of channel programs that tend to get stuck in the exact same place. And you wield it down to two key conclusions. So one, that some vendors will simply win because their product wins. And then two, that other vendors will win because they know how to influence the channel. So I'd like to know, what do you mean by that?

Jay: Yeah, this is one of my kind of personal passions and I think it started when I read the book "Tipping Point" by Malcolm Gladwell. He's got this great chapter early on in the book. I think it's chapter 2, about Paul Revere. What a great connector Paul Revere was in 1776 and why that won the day more so than riding a horse through all these towns, and why the other person who left on horseback that night wasn't successful. And this idea of influencers or connectors and super connectors, when I moved to the United States from Canada in 2009, I looked at the market and looked at the millions of people that participate in the channel and I didn't have 15 years to catch up to the relationships that I had in Canada at the time. So I kind of boiled it down and said, "What is this influence and how would you measure it?" And in 2009, I generated a list of the top 100 most influential people in the global channel and I did it again, actually, about 4 months ago on my blog. And seven or eight years had passed and it's interesting to see people have changed positions and everything else. But it's a very analytical numeric way of assigning scores for people's influence.

And just to give a quick synopsis is back in 2009, I figured out that there are 16 magazines that channel people read. There's 150 trade shows globally that channel people go to. There's thousands of vendors. There's dozens of distributors. There's bloggers, thought-leaders, associations, analysts. When you look around this web of influencing sites, what people read, where they go, and who they follow, it's across different mediums but they're all available. So I took and read every magazine. I wrote down every name of everyone in the magazines. I went to most of the trade shows in my first year and took note of who the keynote speakers, and the advisory council, and the board members, and all the key people at these events. I did the same for peer groups. I did the same for the associations and analysts. And as I came around, I came to about 1,000 names. But what was more important to me is how visible they were across multiple different communities.

In our channel, it's so wide and diverse. But more importantly, it's decentralized. Channel partners don't have the time to go and read 12 magazines. So they tend to focus on one community and at most, maybe two to get their information to reinforce their expertise and to really peer network. And we look at these organizations, there's about 30 of them in North America that they're a part of. And I was really looking at how many people influenced in more of these 30 communities. And really, for me, reach was more important than maybe... that's all I could find out on Google. I couldn't find out how important they were in each community but I could definitely measure their reach.

And so, I just added this really simple spreadsheet, and I just started adding check marks beside each name every time I saw them more than once. And after 1,000 names and thousands and thousands of check marks, I just sorted by whoever had the most check marks. And interestingly enough, in 2009, Larry Walsh, who was long time CRN editor, kind of patriarch of the channel, but he ranked number one and I didn't know who Larry Walsh was but I knew I had to go meet him.

And then, all the way down the list I wanted to meet. And as I met probably 20 to 30 of the top 100 people, the other 70 came rushing to me. Not because I was important but because they sensed that I was doing this and talking to these important people and maybe I was important. But to a connector, they don't want to be left in the dark. So it's really important to them to know what's going on and to be able to kind of stay on the inside of things. So it was kind of really fascinating and over the last seven or eight years, I've written a lot and I've studied the level of influence that people have in the channel and there's a direct correlation between people having a high influence and carrying their company to great new heights.

Jen: I think that holds true, regardless of what sort of industry or what segment of the market you're in, especially from that leadership perspective. I think it's also interesting, we talk to a lot of folks who are not your traditional type of channel organization, not your traditional enterprise IT company. Maybe they're a small or more mid-market size organization, software company, ready to kind of build a channel. A lot of folks are looking at an agency-based program. Upcoming on a future podcast episode, I'm going to be interviewing Pete Caputa from HubSpot who's now at Databox and has assured us that he's building the agency partner program to end all partner programs.

And so when I think about influence, I think about an individual like that. So would you say that this concept of influencing the channel is just as strong in the evolution of where channel is going? Is it even more important than ever? I mean, what is your take on it because looking at 2017 compared to 2008, not that much time has gone by but there's been a lot of change in that time period?

Jay: Well, there absolutely has, and some of the things I wrote about later last year, I call them shadow channels. But I've got this personal belief that your average vendor, their channel program is going to grow by at least 5X in the next three or four years. And the reason really goes back to the customer buy-in journey. And people at HubSpot know this very, very well but over the last 10 years, 90% of all IT decisions 10 years ago were made in the IT department. Makes sense, CIO. And today, it's flipped completely where 72% of all decisions are made outside of the IT department. It's now the VP of sales and marketing, operations, and finance, and HR, and all the way down the line that are making big technology decisions that are business decisions. And what's happening to traditional vendors is sometimes they're not in the room. Well, most cases, they're not in the room. When a VP of marketing like yourself is making a technology decision, a lot of times you don't have the person who's fixing your printer in the room.

Jen: Wait, wait, hold on. Jay, I'm the person who fixes the printer here, so should it be someone else fixing...

Jay: Oh.

Jen: Just...

Jay: That's right. Startup life, you know.

Jen: Startup life. Yeah, I know, I’m sorry, I had to insert that. I had to insert that. But no, no, I agree with you 100% what you're saying, right? So I buy technology all the time and we do have someone here who's responsible for overseeing all technology and he has a zero influence on what I choose to buy to run our sales and marketing team.

Jay: Right. And so, in the sense of if you put yourself under traditional vendor's space and you're trying to install traditional hardware, like you're selling software or other services, and now you need to get in front of Jen Spencer and, you know, who are you using to influence you. You might have somebody from HubSpot or Marketo in the room. You probably have somebody from your industry in the room that's a tech expert on your industry. In some cases, this could be accountants. They could be legal firms. They could be digital agencies. In your case, it might be a digital agency in the room. You could also have other ISVs in the room that play in ecosystems like a Marketo or HubSpot or Pardot or whichever one you play in. They're going to be in there because they know how to drive more leads for a company specifically like yours. You may have a startup in the room that's built with piece of technology and you're going to be one of their early customers so they want to make sure it succeeds.

But you look at the five people in the room and it's not the printer person. It's not the person that installed your phones. So in other words, it's not the IT department. And so, if you're a traditional vendor spending all your time trying to recruit MSPs and solution providers and VARs from days gone by, guess what? You just missed out of a technology decision because your influence isn't in the room when it was made.

Jen: Right.

Jay: Now put yourself in the shoes of...let's talk VP of marketing and let's talk ambulatory care...healthcare clinic, midsized, 50 doctors, in the Northeast U.S. And in the room with that VP of marketing, again, it's probably that person from Marketo, HubSpot, Pardot, whatever it is, Eloqua, probably somebody that is an expert in healthcare driving leads for midsized clinics who's had success in the past, with five other clinics of the same size and scope. But these five people are different five people than what the IT department would have in the room. And so, you're not talking about routers and PCs, and you're not talking about, traditional licensing and everything else. You're talking about driving more leads or you're talking about a marketing problem.

And to be relevant, vendors either a) need to train their current channels to be valuable to the VP of marketing in the clinic, which is less likely to happen. It's more likely that they then have to go and recruit and nurture these five other types of partners, and you call them alliances. You can call them whatever you want but the incentive is different, the way you manage them and measure them is different. The entire relationship is different. But the point is, there's so many more rooms that you have to be influencing now that your channel program is just invariably going to grow.

Jen: So, you call these “shadow channels”, and when I think about like shadow marketing, shadow IT, usually, it's a very negative connotation to it. There's work going on that's outside of your viewpoint, that is in most cases negatively-impacting whatever the core function is. But what you just described doesn't sound negative, right? So are these shadow channels, is this the future? Is this a good thing for these organizations?

Jay: Yeah, well, there’s good and bad. And depending on the audience that I talk to, is which one I'll start with. The good news is businesspeople are now making business decisions around technology. All companies are becoming technology companies and all other professional organizations and industry, association, everything else, are becoming technology-based just because that's the way world works. All 27 industries now are pretty much 27 tech industries depending on agriculture, fisheries, or whatever they do. You know, that's become such a big role. So, the world has changed.

And the reason it was called shadow IT or rogue IT is back in the day, where 10%, and then it became 20%, and then 30% of decisions are made by these people who have no idea what's going on with technology and they don't understand security and they don't understand backups and disaster recovery and they're not of the adult in the room which, you know, the CIO or IT department would claim to be. And so they were rogue, they need to be stumped.

Well, the fact of the matter...and these are Gardener numbers, by the way, 72% of all the decisions today are now made outside of IT, so it's no longer rogue or shadow. It is literally the new normal. And the prediction by 2020 is that 90% of all decisions will be made outside of IT. So in 10 years, there's been pretty much a 180-degree turn in terms of where the decisions are made. And this isn't changing. And businesspeople are making business technology decisions and that's the way the world should work. It's been a big boom for SaaS companies. And it's been pretty hard for technology companies and hardware companies, specifically, because they're trying to still find their place in these conversations when these decisions are being made outside of their normal feasibility.

Jen: It makes perfect sense and it's a good opportunity for consultants, for people like yourself to let you go in and really help some of those organizations along this evolution of the way that channel and selling today, tech buyers today has definitely changed.

I want to ask you now about another topic that you've written about, that you spoke about. You talked about channel vectors or vectorization. And you said that verticalization is being replaced by hyperfocused vectorization. So I'm hoping perhaps you can clarify what you mean by that. And then, I want to explore, what today's executive needs to consider as he or she is scooping out plans to grow through channel over the next 5 years, because there are a lot of these organizations that maybe they've hit $10 million in annual recurring revenue and they're looking at, "How do we get to $100?" And they're looking at channel as a way to do that. So what do they need to know from this new vectorization perspective?

Jay: Yeah, it's another example of me making up a word and then all of a sudden...

Jen: I love it.

Jay: It's really good for Google SEO if you actually make up your own word. It's actually pretty cheap, first of all. But all kidding aside, let's go back to the healthcare VP marketing in a midsized clinic. And you're looking at the 5 people in the room and 10 years ago, for an IT provider, it was okay to say, "Hey, I got to move from being a generalist to a specialist." "Well, what are you going to do?" "Hey, well, I'm going to specialize in healthcare." "Well, that's fantastic." So what they do is they go out and read HIPAA and HITECH, and, they get a couple people certified, and they can talk their way out of a paper bag when it comes to patient records and compliancy and even some legal. But again, the world in this journey has changed things for them.

So if you're that VP of marketing at a midsized clinic and you have somebody in your office that says, "Hey, I know a lot about healthcare." You're like, "Well, that's great. That's one of the vectors. What would be even better is if you knew not only healthcare but midsized clinics, so the sub-industry. The fact that you put in a solution for a 500-doctor firm probably doesn't have a ton of relevance to me because I don't have those resources.


So that's another thing. The fact that you installed in Colorado may not be as relevant as it is in New York because of the different statewide bureaucracy and everything else. I mean, there's just that 50 different systems in 50 different states.

So if you start asking these questions, there's actually five vectors. And as a VP of marketing in a midsized clinic, you're not going to ever get that perfect person who has all five. "Listen, I've just done the last five clinics exactly your size, just down the street. I've just done your competitors. They're the guinea pigs. I know exactly what to do. Here's my price. I can get started right away." That would be perfect. That doesn't work.

So all you only end up doing is, "If somebody knows healthcare that's better than not knowing healthcare." I put that in quotes, air quotes. But that's one vector. So, flipping it aside, "I want somebody who knows my business. I want somebody who's been successful in my sub-industry. I want to know somebody who's been successful in marketing. I don't care if you put in an accounting app, or I don't care if you put in an IT solution. I need the drive leads. I need you to be focused on my line of business. I need you to be focused on my sub-industry. I need you to focus on my region." So these are the types of things that you push back on. And if you can get two or three out of five, it's much better than just getting that generalist in the room who might have one out of five, or none out of five.

Jen: I think that's such a good kind of point to make and maybe even to end on here, because we've talked about how the channel is no longer just a channel. It's no longer just kind of a one-way street or even a two-way street. I mean it is a complete ecosystem. The story you just spun about healthcare IT, about being able to plug in to Salesforce to really put that on steroids to make it work for somebody to do their business, I mean that is absolutely our present and our future of the way that sales ecosystems are growing. And organizations that embrace it, organizations like Salesforce, organizations like Microsoft, that embrace that type of channel environment are reaping the rewards of it, the benefits of that in addition to their partners as well. So I love it. I'm glad you invented the word vectorization. I'll have to start using it.

Jay: Great to participate. I've actually wanted to do this since you started. But one of the key things is you asked me to look forward five years.

Jen: Yeah, absolutely.

Jay: Vendors need to look at the toolset that they're using. And many of the tools that they're currently managing the current triangle of gold and silver and bronze partners they have the same program they built 20 years ago, they need to refresh their tools. If they're going to grow their channel by 5X, they need to seriously look at a tool like GoalBot, take collaboration to a completely different level. They need to look at a tool like Channel Mechanics. They need to look at new, fresh thinking around how to do this because if you try to force-fit your old ecosystem, your old infrastructure into this new world, it's going to be very, very difficult. And many vendors are now realizing that and looking for those right SaaS companies and others to plug together, to kind of manage these new channels, measure these new channels and set these new channels. And in the end grow with these new channels.

Jen: Absolutely. I mean, it's that old saying that, "What got you to where you are today may not be what's going to get you to where you want to go tomorrow." And so, I agree wholeheartedly with that assessment. Thank you so much. I'm not going to let you go just yet, though, Jay. So since you said you listened to the podcast, you've been excited about being on it, then I'm going to ask you some other questions. So you already know this is coming.

Jay: I know it.

Jen: Okay. All right. So, yeah. Well, I'd like to ask some more personal questions just so we can kind of shake things up and get to know a little bit more about you as a person. So first question I want to start with is what's your favorite city?

Jay: Oh, that's a good one. I have traveled to 27 countries now. All of that spent on vacation, one of the blogs I write is "Rollerblades and Red Bull," the idea is to get to every country in the world. Right now, it would be tough to say the absolute but I would say Prague.

Jen: Prague, awesome. I haven't been there but I've heard amazing things about it. So I heard it's a really beautiful city.

Jay: Very, very difficult to rollerblade in, by the way.

Jen: Okay, I won't try that, at least not the first time I go. Okay. Question number two, are you an animal lover? Yes or no?

Jay: Yes, we have...we just actually...we had two dogs and one cat. And they were all 13 or 14 years old and we lost them all within 6 months. But, we're kind of in that mode now. We've got two young daughters as well I've got two daughters in college. But we're thinking about the family pets now and looking at different breeds so very excited to rescue some new pets.

Jen: Oh, good. Well, you have to keep us posted. We love pets at Allbound. Our pets have an Instagram account called "Allbound Critters." So when you do have a new pet join your family, you have to let me know so I can give you guys a shout-out there.

Jay: Will do.

Jen: Okay, next question for you, Mac or PC?

Jay: Well, being a 20-year IBM and Lenovo guy, the answer's going to shock you, I'm 95% Apple. So from iPhones to Watch to the laptop I'm on right now, everything, except for real work, is on an Apple. When I talked about analyzing the thousands of people that run this industry and running all these AI and macros and heavy, heavy lifting, I have one super-powered, liquid-cooled, top-end gaming machine at home that I do serious work on. But everything else is Apple.

Jen: Everything else is Apple. All right. All right. There you go. And last question. Let's say I was able to offer you an all-expenses paid trip, where would it be to?

Jay: That's a good question. So back to visiting every country in the world, the next, probably Middle Africa.

Jen: Oh, what interests you about Middle Africa?

Jay: A) that I haven't been there.

Jen: Okay, yeah.

Jay: I've been to most regions... You know, when I see the weather report that has 50 or 60 cities, most of them...well, almost of them I've been to. So now, I'm in the mode of, "I've got to go to dangerous places now." You can't go to the Middle East. A lot of Africa is off-limits. But it gets much harder to travel once you've knocked off the easy ones. Now you've got to start knocking off ones that have government warnings, or can add a little bit of risk. So that's what entices me about going to Middle Africa and maybe at Uganda, or Kenya, and help build schools or do something good for the world.

Jen: Sounds wonderful. Well, thank you so much. Thanks for joining me, for sharing some of your time with us, especially calling in from Ireland where I know it's late at night. If any of our listeners would like to reach out to you personally, what's the best way for them to connect with you? If folks want to talk about going to Kenya with you, or they want to talk about fixing their channel, how should they reach you?

Jay: Absolutely. My website, my blog that most of what we've talked about today, is jaymcbain.com. It's jaymcbain.com. There is at least 50 ways on there that you can contact me through every social and my cellphone and everything else. If you just want to hit me with a quick tweet. It's the letter "J" mcbain, M-C-B-A-I-N, so jmcbain. Hit me there and we can go from there.

Jen: Perfect. Well, thanks again, Jay. Thanks, everyone else, for tuning in, and catch us next week for an all-new episode of The Allbound Podcast.

Announcer: Thanks for tuning in to The Allbound Podcast. For past episodes and additional resources, visit the Resource Center at allbound.com. And remember, never sell alone

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