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The Partner Channel Podcast

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: Page 1
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.

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