

Ultimate Guide to Partnering®
Vince Menzione - Technology Industry Sales and Partner Executive
Empowering partners to thrive during this time of rapid transformation.
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Jul 16, 2025 • 0sec
268 – Cracking Microsoft SME&C: The Partner Playbook for Growth
Recorded Live at Ultimate Partner LIVE in Redmond, WA
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Welcome back to the Ultimate Guide to Partnering® Podcast.
Join Alistair Butler, Jennifer Weis, and Steve Hale in a deep dive into Microsoft’s Small, Medium, and Corporate (SME&C) business – aptly called the “Acre of Diamonds.” This session unveils how Microsoft’s intentional decision to establish SMEC as its fourth and fastest-growing region, now a $72 billion business, creates unparalleled opportunities for partners. Learn about the MCEM framework, a common methodology for solution selling, and how partners can strategically align their sales organizations, leverage Microsoft’s investments, and build a “win formula” to unlock immense customer value and profitability in this high-growth segment.
Key Takeaways:
Microsoft’s SME&C (Small, Medium Enterprise and Channel) business is now its fourth and fastest-growing region, representing a $72 billion opportunity for partners.
This dedicated SME&C region brings unprecedented consistency, dependability, and investment that did not previously exist across Microsoft’s geographies.
Partners must align their sales organizations with SME&C’s customer segmentation and internal structure (ATU, STU pods) to gain engagement from Microsoft sellers.
Leveraging Microsoft’s funding and investments, particularly for driving Azure consumption and specific customer workloads, is a critical strategy for partners.
The MCEM framework provides a consistent methodology and language for solution selling, enabling partners to fast-track their go-to-market and collaborate effectively with Microsoft sellers.
Success in SME&C requires partners to have executive buy-in, build a clear “win formula,” and focus on delivering end-to-end customer lifecycle services, as Microsoft relies heavily on partners for stages like “realize value” and “manage and optimize”.
If you’re ready to lead through change, elevate your business, and achieve extraordinary outcomes through the power of partnership—this is your community.
At Ultimate Partner® we want leaders like you to join us in the Ultimate Partner Experience – where transformation begins.
https://youtu.be/a8jwaqWFNAA
Key Tags:
Microsoft partners, Acre of Diamonds, SME&C, mid-market, channel business, MCEM, Microsoft investments, partner programs, solution selling, Azure consumption, customer value, win formula, executive buy-in, sales alignment, territory planning, ATU, STU, ecosystem multiplier, partner profitability, co-sell, services revenue.
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https://youtu.be/s33fltuizEo
Key Tags:
Microsoft, Lori Borg, Microsoft Partner, Go-to-Market, Technical Agility, Organizational Agility, AI, Agentic AI, Ecosystem, Partnerships, Growth Mindset, Digital Transformation, Business Strategy, Innovation, Technology, Microsoft Americas, Channel Partners, Sales, Marketing, Engineering, Customer Success, Microsoft Azure, Microsoft Cloud, Satya Nadella, Leadership, Entrepreneurship, Change Management, Business Growth, Co-selling, Solution Areas, Digital Marketing, Cloud Computing, Microsoft Programs, Partner Hub, Future of Work, Tech Trends.
Transcription:
Transcription:
[00:00:00] Jennifer Weis: My recommendation to a partner is if you wanna get serious in this space, go figure out what solution you’re gonna go sell. Build your wind formula, set how many goals you’re gonna do, and then build a territory plan.
[00:00:14] Vince Menzione: We believe this time is like no other. We believe we refer to these as the tectonic shifts,
[00:00:20] Intro: all the hyperscalers in the world, if you add them all together.
Managed services will be one and a half times larger because it is the customer buying behavior that has created the need for all of us to rethink our models. Until we have data quality, the effectiveness of AI cannot be realized and effectiveness of the partnerships cannot be realized. Can you figure out, first, what your purpose is and how Microsoft can support your purpose and how you can support Microsoft purpose?
Now we have a partnership. It’s the ultimate partnership.
[00:00:52] Vince Menzione: Welcome to The Ultimate Guide to Partnering. I’m Vince Menzi, own your host, and my mission is to help leaders like you achieve your greatest results through successful partnering. We just came off Ultimate Partner Live at Microsoft Redmond Campus.
Our most powerful event yet over two days. We gathered top leaders to tackle the real shifts shaping our industry. If you weren’t in the room, this episode featuring Alistair Butler and Jen Weiss of Microsoft and Steve Hale, a partner from suse, brings us to the conversation of the acre of diamonds and how to achieve your greatest results.
Working with Microsoft, it’ll bring us to the edge of what’s next. So let’s dive in now. So I’m excited to help lead this conversation with you all. And this is, has a very unique theme. It’s called Acre of Diamonds, and anybody who knows who about acre of Diamonds, it’s actually a fairly common term. It was a thesis.
Russell Conwell who created Temple University in Philadelphia, which has become an outstandingly successful university system, wrote this thesis about your acre of diamonds. And I’ve been talking about how Microsoft, especially its S-M-C-E-N-C business, its small, medium enterprise and channel business, that mid-market is really your acre of diamonds.
’cause so many partners tried to focus in on the very top at the tip, tip of the top. And we talked about that. Yesterday, Nicole and I had that conversation about like focusing in this area. So I’m thrilled to welcome on stage. Alistair, Jennifer and Steve, thank you for joining us. Come on out. Come on out.
Woohoo. We got some, a kickass team here. Jennifer, so great to see you. I heard
[00:02:36] Jennifer Weis: that introduction. I’m a little, I’m
[00:02:38] Vince Menzione: sorry. Whoops. I’m dropping things. I’m gonna grab it for you.
[00:02:41] Jennifer Weis: Where to go.
[00:02:41] Vince Menzione: Yeah. I didn’t want to get. You know, start attaching. Thanks. Good to see Alison. I don’t think I can live up to that side.
See my friend introduction. Oh, we know. We all kind of know that. So, um, we’ve got an incredible panel conversation today and I really wanted to spend some time with each of you. I thought we’d take a moment just from a context perspective, have you intro, because I did a little bit of an introduction, but I didn’t do it justice, to have each of you introduce yourselves.
Your roles in your organizations, and then we can talk about like, how do we take advantage of this business opportunity. So Steve,
[00:03:13] Steve Hale: we’ll start with you since great to see you, Vince. Great to see you, sir. Well, it’s a pleasure to be here. Thanks so much for the invitation. I appreciate it. Real. Uh, quick background.
I think I’ve worked in four different buildings around campus here, over my, my career. But, uh, you know, right now I run, uh, software, uh, partnerships at suse. So it’s a really a pleasure to be here with all of you. So great to have you in the room. Alistair.
[00:03:35] Alistair Butler: Thank you for the opportunity. Lovely to be here, Vince.
So good morning everybody. My name’s Alistair Butler. I run our, um, mid-market West business here in our SME and C
[00:03:47] Vince Menzione: business. Right. And you, and you’re even struggling with that we call SMC. I know, I know. We,
[00:03:52] Alistair Butler: we, we, on the day it happened, we are, we EC now, but uh, we’ve moved a little bit past that. There was intentionality for it.
Yeah, of course. Our mid-market customers, um, you know, we really wanted the enterprise piece in that small, medium enterprise and channels
[00:04:08] Vince Menzione: and just to find that. Mar the, the, the scope that you have. ’cause it’s a very significant, you talk about it very casually. Yes. Like you have a lot of customers in that market.
Yeah.
[00:04:17] Alistair Butler: So, um, I think many of you would understand, um, Microsoft’s regions and SME and C as its fourth Yep. Uh, region. That’s a $72 billion business in, of its own right. Um, you can do the math on roughly what that’s going to be in the us. Um, but for me, I have, um. Um, small, medium, uh, corporate customers or enterprises.
5,000 of those through the western part of the us
[00:04:41] Vince Menzione: Yes. That’s a very significant number. Absolutely. 5,000 just in the us in the western us.
[00:04:47] Alistair Butler: Yeah. And then I have a peer, uh, Noman Act who has a similar sized business on the east, and then we have a Canadian team in the Latin team and a team.
[00:04:54] Vince Menzione: Yeah. And after Jen, I’m gonna ask you a que another question about how your team is organized as well.
Sure. But Jen, kick ass, by the way, I do know I’ve known you for many years. Um, you have an excellent reputation from partners about the work that you do in helping organizations, and I got to see up on stage yesterday as well. So,
[00:05:13] Jennifer Weis: yeah. Well, thank you for having me. Here I am. My role today is I’m actually A PDM in our global SI organization, but I heard Vince mention some of my history and you talked to Lori this morning and you talked to Alyssa this morning and you’re asking the number of years, and I started counting back and I’m like, I’ve been in the Microsoft ecosystem for.
30 years, so, and we were just joking right? Outta school? Yeah, we were just joking behind back there. I said I was a Microsoft partner when I received a fax to put an internet email. For a company with Microsoft Mail, an exchange for, oh, beta was just coming out. So I’ve been, I’ve been in the Microsoft ecosystem since then and uh, I’ve worked for small sis, I’ve worked for medium size sis working on that.
SMC or back then, I don’t remember. It was. Called SMB, I think we know it’s something else. And then I heard you mention CDW as the director of software sales at CDW. And that’s where kind of the conversation today will come in from what I did at CDW to take it from a, you know, 200 million to a billion dollar, you know, Microsoft business there just a number of years.
And then went to an ISV. So I got the ISV part of it, a partner to partner part of it. Now I sitting here representing kind of the Microsoft PDM, but a lot of the stuff I do now is all the stuff that I did when I was a partner and how I learned to be agile and really evaluate every year what’s Microsoft doing and how am I gonna have to change the business and change it really quick to drive results.
[00:06:48] Vince Menzione: And the work is that you do is very in instructional to organizations like Steve’s. About how to align for success. So I think it’ll be a little bit of a cross conversation here. You bet. But Alistair, I want to spend a moment here a little bit more of a double click. So first of all, 5,000 organizations is fairly significant.
Yes. For any of you who don’t know, there’s probably about 11,000 enterprise organizations at the very, very top of the pyramid. Maybe even less than that today. ’cause it, you know, down. So you’ve got a number almost equal to that, just in the Western United States. Yes. And then you have sellers, you have leaders, you have, uh, managers or leaders underneath you as well.
Yes. Talk about how your organization is structured a little bit for the, for the partner. Yes.
[00:07:32] Alistair Butler: Very, very happy to. So one of the things that, uh, within Microsoft and end caps that the way we try to run the business, of course, is with consistency. So just like, um, leaders in the strategic parts of our business where they have an account team unit, an A TU, um, and then those are supported by our stews.
Our, um, uh, specialist technical units we’re exactly the same. We’re exactly the same. So we have an a TU layer, and then we have our stews in the Azure space and biz apps and in modern work and, uh, and security. So, you know, there’s a number of layers to that, to, to get to that, uh, amount of reach or so. But I think one of the things that I would stress as to, um, where we are at now as a company, it was a very intentional decision, um, by Satya and, and, and Amy to, um.
Create SME and C as it is now. Yes. This was a decision 18 months ago into Microsoft’s fourth. Region prior to and forever and a day, we were actually part of the geographic regions. That’s right. We would roll up to them, but, um, it’s now Microsoft’s largest region at $72 billion. It’s also, its fastest growing region at $72 billion.
So, um, for any of you who have been around us for a while or worked with big companies, when a decision like that is made, it’s. Big. Yeah. All of a sudden we are not sharing resources with strategics. We have our own teams, uh, with uh, GPS, with um, our SE and O teams marketing. And that will take time to mature and of itself.
But with the new leader that we have, um, we’re very much elevating, uh, the investment into, into, into the segment. And, uh, that should be opportunity for all of us.
[00:09:28] Vince Menzione: And I just wanna differentiate for those who are watching and, and paying attention today. ’cause I, you bring up some interesting points. If you’ve been around Microsoft long enough as I have it, we, it was sort of a, we didn’t pay enough attention.
We didn’t have the right rigor and we didn’t have consistency because every region, every geography, every industry, in fact, public sector being one of the industries would treat that part of the market differently. And we didn’t put the right level of investments depending on where the investments got laid across the business.
By creating that fourth region, you created a level of consistency, dependability about execution structure, organizational structure, investments that did not exist in Microsoft. And that’s why to me, it has become an acre of retirements,
[00:10:13] Alistair Butler: um, completely and. Um, to su to suggest that, you know, our success will, um, come with the partner community as part of that segment is a gross understatement.
Yes. Everything that we are, uh, building, um, in our programs, in our M stem phases, in our training and enablement, um, is now going very much through a part lens. And, you know, that’s why it’s so wonderful to be chatting to a few folks here today
[00:10:40] Vince Menzione: and. Just a few years ago. In fact, when it was first stood up, it wasn’t getting the same level of attention from the partners.
It’s one of the reasons why we have you here. Yes. Uh, and it also wasn’t, um, set up in a way, or the commitment wasn’t quite there. I remember it was about a few years ago, first conversations I had with then the leader of the organization who was Kevin Piker about doubling down. Like it was the first like foot in the ground saying, we are gonna double down now we’re gonna bring partners in.
Uh, you mentioned that having the scale of the organization, but you also have, I will say, I’ll suggest, uh. Your organization is structured so that you have maybe, uh, more accounts per rep Yes. Than when you get up to the very largest enterprises account. So I might have Coca-Cola and that’s my only account, but when I get into, which is very, a very significant organization’s, what you call small medium.
Enterprise. They’re still very big companies and most companies, they are enterprise big enterprises
[00:11:36] Alistair Butler: in other technology companies. Completely. It just speaks to Microsoft’s reach and brand and, you know, what’s over a $200 billion business today. But yeah, so look, the, at the higher strategics, you know, that’s a one to five type ratio in accounts.
Then we get into majors growth. Um, that might be anything from five to. To 20. And then it’s our, then it’s our segment that comes in. We top out at 50, 60 accounts per rep, but it’s in that a TU and stew model, which we actually run, um, in pretty thoughtfully designed pods. So small teams are really hunting in those pods with their partners, um, with their partners.
And, uh, um, the ability to reach the customers with that is with those partners.
[00:12:22] Vince Menzione: I wanna dive in a little bit and I’m going to ask the perspective from the partners in the room. Steve, you and then also get Jennifer’s perspective as a partner development manager. How do you engage, how do you find the engagement?
What, what, what is, what is the type of engagement you do? What, what are best practices you can share with our community here?
[00:12:40] Steve Hale: Yeah. It’s, it’s a great question. I think, um, if, if I’m sitting in the audience and I, I don’t, I don’t know. What your size and scale is. If you’re a smaller consulting partner or you, you’re a part of a, a larger, you know, technology company, an ISV or who, whomever, the way I look at it is sort of the so what factor, like what we know that we have a huge ecosystem to be able to tap into with Microsoft.
And so, you know, at the end of the day, how do we do it? How do we do that in a way that’s gonna help us drive solution selling? So, um, we were talking a little bit earlier. When, um, so I, when I did this at Microsoft, I just remember bomber would, would, he would pound his hand on the, on the conference room table, and he said, the field is always right unless proven wrong.
So the business units were already saying, Hey, we’re gonna build these solutions. We’re gonna have this stuff, we’re gonna go to market. Yeah. And he would come in and pound his fist and say, the, the field is always right unless proven wrong. And so what he meant by that, where we’re. You know, preparing for the midyear reviews, right, with the 90 slide deck.
And then the, you know, six point font was all about like, how are we gonna drive customer solution value? And that was the part that I loved about it. Right? That’s where. If you think about the history, you’re talking about a TU and the whole design of what happened back in Tailwind and all of that, um, what it was all about was making sure that we have a solution oriented selling mechanism that is integrated with partner solutions.
And that’s the part that that’s beautiful about it. Microsoft has always been true to that part of it. And if you think about. The strategy of it is very different than, let’s say, I mean, not to, um, you know, say one is better than the other, but like an Oracle model or whatever, where it was a very direct selling motion at Microsoft.
What, what bomber did was, which was cool, I. Was he peeled off a little bit of services margin out of the consulting business and fed it into the ecosystem part of it to help develop ISVs and and integrator partners. We were talking a little bit earlier about, you know, your, your history at Biby and, and you know.
That is what it’s all about, is like if you really are in the ecosystem selling business, which Microsoft is, that’s great. Okay. Prove it and then show us that you, you, you have an alignment to that model in terms of how you do investment and help the businesses grow, and that literally becomes the ecosystem multiplier.
So what
[00:15:12] Vince Menzione: instruction would you have for the partners in the room and those watching us on livestream? How, how to engage with
[00:15:18] Steve Hale: Alistair’s organization? Very self, selfishly, I would say figure out how to use their money.
[00:15:23] Vince Menzione: Okay.
[00:15:24] Steve Hale: Very cool. I mean, to, to be fair, right? Yeah. And, and the reason why I say that is because there, there, if you look at the consumption model that we, that.
We want to drive with Azure, right? You want to try and figure out, like, how do you tap into that part of it to be able to drive those? Um, look, at the end of the day, the way I think about it, when I talk to my sales teams, it’s all about the workloads. It’s about what is driving the customer investment?
Where is the money coming from? Where is the Vander Gold for, I don’t care if it’s a, a huge, you know, Coca-Cola or all the way down to a, a smaller, uh, a smaller company that’s trying to. Innovate. They want to innovate. They need partnerships that are gonna help ’em go drive this. This is stuff that I did with, um, after I left Microsoft.
I was with Bridge Partners here as a consulting firm that’s, that’s, uh, uh, very near and dear to my heart. But, you know, it’s going from a massive company down into, um, a, a consulting organization that’s always thinking about customer value and solutions. So that would be. You, you know, I mean, figure out how to tap into the wealth of Microsoft, but also at the same time be very, very focused on the workloads and the customer solution value.
I mean, how do you get
[00:16:39] Vince Menzione: relevant? Jen, I want to come to you because I know you spent a lot of time with organizations and, and their lack of relevancy, their lack of engagement models, and I know there’s some points you want to share on that as
[00:16:51] Jennifer Weis: well. It, well, it, it. Builds on what you both were saying and and using Microsoft’s money.
And to be blunt, so when you mentioned Biby, I was at BUR for years. Biby was acquired by CDW, then I was at CDW, then I went for startup ISV. But that was exactly it. We would sit down every year, first off being relevant as a partner. No offense, it’s not about the partner’s model and what the partner does.
If you wanna be relevant to Microsoft. You have to do it the Microsoft Way. Mm-hmm. So every year we knew changes were coming. Microsoft is not simple. It’s complicated, but at the end of the day, it’s not. If you just take that ego out of the way and you say, okay, Microsoft’s gonna come out in the June timeframe and they’re gonna come out with their incentives and investments, and that’s how their sales reps are compensated.
So every year I sit down with that plan. And I would go through it and I would say, okay, how am I going to make money? Yeah. Off this plan? And how am am I going to model our win formula to be able to go after you said the solution areas, how am I gonna do that? And I’ll put a plan together. And then I, I think it was Lori Alyssa said, then I go to the executive board and say, okay, I plan to bring in, you know, you gave me a quota of whatever million in profit, right?
This is how I’m gonna make a million in profit, but. I’m gonna need to make these three changes. Do I have your buy-in? And every year they’re like, go for it. And we did it, and I would deliver. And then the next year I’m like, okay, here we go again. But if you go into it with the attitude of it is what it is, yes, you can influence changes for future years, but you’re not gonna change it that year.
Yeah. So you just accept what it is. And then you build a strategy to maximize the heck out of it and earn, I mean, Microsoft, we, we, when we were at Burbank, they were our biggest customer because we used their funding, but we used it and delivered results and delivered results and delivered results. And so we even went to Microsoft many times and said, I think we can do it better, but we’re gonna need investment from you.
You
[00:19:02] Steve Hale: bet.
[00:19:02] Jennifer Weis: Right? And we wanna bring this program and they’d go. Okay. You did it last year, so go ahead, do it again. So that’s how we built a great strong Microsoft practice in consulting. Then we brought it over to CDW and then we brought it to the licensing piece of it, and we just build kind of a program sales, and there’s really three elements to that.
The first element is, uh, someone was mentioning it, the maniacal focus, right? Yeah. The first element is everybody on your team has to know what you’re actually doing. Our goal is to drive x. And this is how we’re gonna do it. We built a win formula. Well, you have to have this marketing funnel. Then from this marketing funnel, you then deliver this and train your sales reps on this.
And you just, you build that whole win formula from your account based marketing to your hero offer. And you go through those pieces of it, and then you just turn around and deliver. But you needed that. You needed the executive buy-in, so you had to have from top down if it’s just alliance driven. And it was mentioned this morning.
It, it doesn’t work.
[00:20:05] Vince Menzione: It doesn’t work.
[00:20:06] Jennifer Weis: And so you, that’s what we did is we, and we did it really quick and really agile and we just repeated that motion and created that flywheel.
[00:20:13] Vince Menzione: Yeah. And that’s what we did. You got the executive commitment within your organization, right? I got the executive
[00:20:17] Jennifer Weis: commitment within the organization.
So we’re doing that with partners now. We worked on a majors motion, 15 partners. We walked in, it’s like half the partners got it and they’re like, yep, we’re gonna adopt it. And they’re. Crushing it just in the last two, you know, two months. Some of the other partners are still trying to decide what solution, and so they’re a little bit farther behind.
So that’s my recommendation. Build a plan, get executive buy-in. Then build your win formula with all the roles aligned and then just go deliver. But you make it easy and you make it simple.
[00:20:51] Vince Menzione: Yeah. And you mentioned all the roles. This is with the Alyssa conversation earlier, right? Engineering go to market, co-selling, your alliance team, your executive team at the executive level to executive
[00:21:01] Steve Hale: level.
Yeah. What, what I, what I loved about what, um, Alyssa said earlier was, uh, you’ve gotta have the technology piece of it. Yeah. Like once you, if you have that, then you’re good to go. And then the co-selling motion, right? Yeah. Which is what. They’re really, that’s gonna be the next question. That’s where we’re gonna roll into.
But I, I loved her point of view on that. And I think it’s like, how do we, how do we connect with the, with the machinery that is happening at Microsoft, it is creates this scale. And how do we do that in a way that’s gonna be profitable for all of us and help our customers? So, Alistair,
[00:21:33] Vince Menzione: thousands of sellers, right?
Mm-hmm. Within the organization. How do I get their attention? Right? I, I’m one of 165,000 partners in the Americas. Lori Borg mentioned earlier. Yes. So how, I mean, that’s an incredible number of partners. Tapping on the door, on your door.
[00:21:48] Alistair Butler: It’s a quest. It’s a question I get a lot and, uh, we still okay on Mike?
You can, yeah. Yeah, we’re good. You’re good, you’re good. Um, so it’s a question I get a lot and, um, it’s easier to answer now that we are specifically a fourth region, if you’re serious about that. Customer segment, you really need to think, um, through firstly making sure your sales organization has some dedication to that customer segment.
Um, you know, just speaking very openly, if my, uh, sellers are engaged with a partner and you know, the first time they’re together and they have an open discussion, okay, so how do you look at us? And they’ve got seven strategic accounts and four. They turn off straight away. Yeah. Right. Because they’re trying to, my sellers are trying to engage really with anything from two to five partners to run their scale business.
Yeah. Okay. So a lot of that’s regionally based. A lot of that, of course, is still into its relationships and connectivity and rhythms that are running in the business. But if you’re serious about wanting to grow with us and SME and C business, really think about segmenting your own sales teams, um, for that.
That’s, that, that’s number one. Um. And I can give a very brief example of we had a, we had A-A-G-S-I, huge player. You would all know them. Um, came to, uh, myself, uh, last summer. Um, we’re making plans for six months away. Um, we’re actually going to double down, um, our Kevin Ster and, and create a, uh, a mid-market segment.
What’s your advice? I showed them my a TU structure, if you align to that. When you’re ready and you can demonstrate the right skill base and understanding of M Em. I’ll make all the introductions. Ah, M em. Yes. The executive team listened to that. They came back three months later and they showed us the plan and they were activated across my sales team within six weeks.
Yeah.
[00:23:51] Vince Menzione: Yeah.
[00:23:52] Alistair Butler: It can be done now. There’s an intention to that and I think maybe just the final piece, um, here, Vince, to your go have an opinion. There is in the segment enough white space for all of us have an opinion on what the solution areas that you have, skills and expertise in sustainable, um, and the industries where you have presence.
It’s a really difficult thing sometimes for a partner, and I’ve been around partners since the mid nineties to actually be declarative. But when you share that opinion and your value proposition. The connection into the sales team is so much faster. It happens at the first meeting versus folks finding out at the third or fourth, and I’ve just wasted, you know, two months of starting to, it’s much, much better to be cleaner and clearer.
Um, all of our growth, um, is in the middle part of our mail even. And, uh, we, Microsoft partner to help us go Microsoft account list, by the way. Absolutely. Now for
[00:24:52] Vince Menzione: those who don’t know it, yep. You mentioned M em, I’d like to double click on SEM a little bit. For those who don’t know M em, we’ve actually had speakers talk about M EM specifically on stage.
Great. It’s a great topic, but I think we should double click and I think with amongst the three of you, you probably have different perspective on here, but I think I’ll, I want to get all three of your perspectives on M EM and how to engage as a partner to drive msem.
[00:25:16] Steve Hale: So at the end of the day, it’s a framework, it’s a methodology to be able to help us be able to, I think, strategically and tactically sell better.
Right? So, I mean, we got all the acronyms in the world. Um, at the end of the day, I think it comes down to how do we have a connected fabric in terms of how we do solution selling together and how we deliver. Um, you know, that value and messaging, I, I was, um. It was funny, I was at a, uh, a dinner and a customer came over.
It was a partner dinner, and the customer came over and they said, and I’m not gonna say who the partners were, but um, the customer came over and said, Hey, are you guys actually working together? Like we were having a conversation with the technology company and, and, and the customer said to us. I love that about you guys.
I love that you’re actually sitting down and talking about technology working together to help us deliver value in my organization. You know, so m sem and, and you’re, you’re the expert on it. It, it’s a framework. It’s a methodology. That’s great. How does it help us? How does, how do we make it real? And how does it deliver customer solution value?
Yeah. In my, my opinion. Double click on me.
[00:26:31] Jennifer Weis: Yeah. Well, well, with M Sem, I was talking earlier about the wind formula.
[00:26:35] Vince Menzione: Yeah.
[00:26:36] Jennifer Weis: The, and, and you mentioned the, the funding programs and different things. Yeah. So within M Sem, there are the five stages. But within each stage there’s specific guidance given to the sellers on this is the ha halo conversation you have, this is the hero offer you pitch, and the hero offer usually comes with funding to deliver something.
So, and there’s even, I think
[00:26:58] Vince Menzione: we actually have a slide that might help us along here actually. So let’s go. There’s
[00:27:01] Jennifer Weis: even campaigns in a box.
[00:27:03] Vince Menzione: Yep.
[00:27:04] Jennifer Weis: Right? That you and marketing materials. I was shocked when I started to work with some of the partners, even some of my own, but the partners that weren’t mine, and I would ask, do you know what M SEM is to their sales teams?
And the sales teams are like. No. Yeah. And I’m like, okay. And then I would say, show me your strategy, you know, wind formula for how you’re going to land this. And they’re like, well, here’s our offer. Here’s the technical capabilities. And that’s not a strategy, that’s a, that’s a technical solution. So we would go through the wind formula that you see there.
We would go through and say, well, what are you doing at each stage? But there’s, there’s a link on this slide too. I said, Microsoft has this built already. You just need to go get the material and make it your own. Right. Go get the campaign in a box. Go get the, the, the halo conversations and material. Go get the hero offer.
Just make it your own. And so we help optimize that. They have a strategy and then it’s like, now we just go land this with your sellers. Yeah. And that’s you. You gotta build that formula to be able to land it. And if you follow the Microsoft methodology, then when you go in and talk to. You know your sellers, it’s really easy because you’re talking the same language.
You have the ability to collaborate and sit down at the table together ’cause you’re talking the same thing. And it, it gives the, the partners the ability to, to fast track going to market, but then make it their own. Yeah.
[00:28:28] Vince Menzione: And Alistair, this is very deliberate at Microsoft. When, when, when I was a Microsoft gm, we didn’t have this No.
Everybody followed their own methodology. You have a common language Yes. That you’re, when you, when you’re having reviews, funnel reviews, any business reviews in your business, you’re talking through this right.
[00:28:44] Alistair Butler: Absolutely. So M CAPS is a hundred thousand people organization that is wired to this.
[00:28:49] Vince Menzione: Yeah.
[00:28:50] Alistair Butler: And you know, it’s been around a few years, uh, a few years now, but the commitment to it, and I suspect the longevity will, will continue because it really has given so much more clarity and understanding of our own business. As to how competitive we are, um, uh, what the customer experience is. Dare I even say, what’s the profitability profile for our partners in that?
And yes, we live by this for any operational review. It is so important that your sales teams have an appreciation of this. Yes, they don’t need depth, but they need an appreciation. But you must have at least one person. Or at least a small team, really understanding the programs, how you leverage the dollars, the timings, the announcements to actually filter all of that into your sales team.
That is a, that is a critical point as to doing, doing business with us, really. But yes, for anything that we’re doing on our pipelines and looking at program activations and, and anything that you might imagine on a sales dashboard, um, uh, finds its way back, uh, back to this.
[00:30:00] Vince Menzione: Steve, when your sellers, you’re working with your organization and your sellers, how are you implementing em to help them be successful working with Microsoft?
[00:30:08] Steve Hale: You know, I think at the end of the day, what, when, when we talk about leveraging our, our partnership and our center of gravity with a partnership like Microsoft, at the end of the day, like what, you know, and I’m not trying to get into like product specific stuff, but. It. What we’re, what we want to do is make sure that our delivery of what we’re trying to focus on, we, we talked about this earlier, which is be be really clear about what we’re going to do, and also be clear about what we’re not gonna do.
Yeah, because otherwise we can just be random and we can, you know, say we’re gonna do all these things, but, but, and we’re trying to conquer the world. And that’s why Microsoft did the segmentation in the first place, right? That’s right. And that’s where, that’s right. Trying to get very focused. So if you think about, I mean the orig, the original a TU piece, they used to call it the atomic, uh, unit.
And so it became the account team unit, all of that stuff. And now it’s being implemented and they’re doing it for a reason. And, and, and ER’s point is like. Are we gonna focus on mid-market customers or, you know, be dedicated to that. Be clear about what you’re gonna do and be really clear about what you’re not gonna do and prioritize.
[00:31:19] Alistair Butler: There’s, um, there’s a, um, little piece here to add as well, particularly for the partner community, for the segment that I’m part of. Yes. Um, different to our strategics who have. Um, the CSUs in stages four and five. You’ll see ladies and gentlemen, realize value and manage and optimize. We have a lot of Microsoft people around, around those, those don’t exist in our, that’s right segment in SM, E and C, we are fully committed to that being partner.
A partner delivered. Uh, and lifecycle delivered with your services. Right. So where we coach our sales teams much more in recent years is the connectivity into the partner base such that we are getting actually an understanding of your services. I. And when we’re together in the customer, um, that’s a really positive thing.
Yeah. And, um, many, many changes have happened in a very short period of time, uh, that we’re really positive about lots of energy going into it. And, uh, even in our CSP program that plays very, uh, cloud solution partner program that plays very prevalently here. Um, good, uh, profitability and margin for our partners in that aspect.
[00:32:32] Vince Menzione: That comes back to the IDC study that we talked about yesterday. And was it $8.65 of services revenue for partners for every dollar of Microsoft. Yes. Commitment. And I think the point you’re making too is there’s, you don’t have this massive consulting services organization. You really need the partners in the room here to drive that.
[00:32:51] Alistair Butler: We do. And there was even an organizational announcement where. Um, folks in our global, um, solution partner teams even joined us. So we’re now one organization. Yes. Obviously that cements the, uh, commitment to
[00:33:03] Vince Menzione: that part of our strategy. That’s right. So Nicole’s organization absolutely is part of you, same organization that you sit in now.
So it’s really intertwined the partners into the business. Anything else we should add? Yeah,
[00:33:14] Jennifer Weis: well I was just gonna add, and I talked about it yesterday in the breakout session, if you attended, is the other thing that I’m doing with partners that is coaching them on how to do account planning. Yeah. And you, we were helping them to understand that Microsoft and the enterprise builds these four segments in their account plan, but in the SM.
E and C, it just doesn’t roll off the tongue.
[00:33:35] Vince Menzione: That’s why they’re using smack. That sounds
[00:33:38] Jennifer Weis: terrible. Uh, you build a territory plan and you mentioned another partner that came to you guys and said, we are, we’re gonna invest in this. So my recommendation to a partner is, if you wanna get serious in this space, go figure out what solution you’re gonna go sell.
Build your win formula set how many goals you’re gonna do. And then build a territory plan, you know, so that you can come to the teams and say, I’m going after this market or this industry. I have a target list of a hundred accounts. My goal is to close 20 deals. And this is how I am su structuring, accountability and ownership within me, my partner organization.
And we’ll align with you on the, the first, the blue stages on there. And then once we’re done with that, then we go deliver the. Purple stages because there’s no CSU. Yeah. So it’s, it’s not complicated. It’s complicated to learn how to put it together, but once you know how to put these things together, it’s
[00:34:34] Alistair Butler: not complicated.
And then my, my best sellers working with their three to five partners on their territory plans are doing exactly what, yeah, Steve was suggesting where there’s clear delineation on who’s on first, who’s on second. Within that, under a common. Under a common language, it’s, it is designed well. It is designed simply.
Um, and the partners where we do it the best with, we just fly. I love
[00:35:02] Steve Hale: it. I love it. Yeah. The, the, the, the cool thing about Microsoft is that they will get super, super complex about everything, but then they generally will boil it back up into something that’s executable. And that’s what I love about it. I mean, they wrote the book on co-sell.
They did. And so like Howie. You talk about M and all the acronyms and blah, blah, blah, blah, blah, all that kind of stuff. But at the end of the day, they really know what they’re doing. And if you tap into that method and go along with the acronyms and figure out how the machinery works, it’s a great ecosystem be to be a part of it really is.
[00:35:35] Vince Menzione: Well, we are up on time. We promised everybody a break. Um, hopefully you’ll all be around if for networking for a little while. I know Jen was leading a session yesterday. There’s a lot of great knowledge in the room here on how to engage with Microsoft. How be more successful driving your business. And if you haven’t, we haven’t.
We actually have a double click on M Sem. As a video that’s in our ultimate partner. If you got Ultimate Partner website on YouTube or even the ultimate partner.com and go through our sift through our search on sem, you’re gonna find some in great, some great instruction on what SEM is and how to engage with sem.
So, and I know we could, we could spend hours on SEM here and we have some great experts who can take you through this. So I want to thank each of you got great conversation today for our partners. This is, this is how you need to engage this. This is where the acre of diamonds is for each of you. So I want to thank you all for being part of this conversation.
Thank you. You, you. Thank you.
Thanks for tuning into this episode of Ultimate Guide to Partnering. We’re bringing these episodes to you to help you level up your strategy. If you haven’t yet, now’s the time to take action and think about joining our community. We created a unique place. UPX or ultimate partner experience where leaders come to learn from each other.
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Jul 13, 2025 • 36min
267 – The 1% Club: Elastic’s First Secrets to Partner of the Year Status
Recorded Live at Ultimate Partner LIVE in Redmond, WA
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Is your business ready for 2026?
Welcome back to the Ultimate Guide to Partnering® Podcast.
This was a fan favorite as I was joined by former Microsoft executive and current Elastic leader, Alyssa Fitzpatrick, as she reveals the strategies behind achieving pinnacle success as a Microsoft partner. Learn how Elastic consistently earns “Partner of the Year” awards by prioritizing technology innovation, fostering deep engineering alignment, and ensuring maniacal focus across all functional teams. Alyssa shares invaluable insights on gaining executive buy-in, establishing clear communication “swim lanes,” and leveraging data to drive impactful decisions. Discover the importance of consistent engagement, human relationships in partnering, and why adaptability is the new IQ in today’s rapidly changing market.
Key Takeaways:
Achieving “ultimate partner” status requires a deep understanding of how to congruently apply principles across all aspects of the business.
Executive commitment is paramount; the entire leadership team must be on board and actively driving the alliance strategy.
Aligning functional teams (build, go-to-market, sell) with their Microsoft counterparts through dedicated points of contact ensures effective feedback and execution.
Leading with technology and embedding innovation is the “secret sauce” for winning partnerships, going beyond traditional co-selling to integrate roadmaps and push for new functionalities.
Resource allocation must align with strategic focus; sometimes trade-offs are necessary to maintain intensity on critical hyperscaler relationships.
Data-driven decision-making and continuous analysis of performance are crucial for adaptability and predicting market shifts, allowing leaders to defend and explain their strategies to leadership.
If you’re ready to lead through change, elevate your business, and achieve extraordinary outcomes through the power of partnership, this is your community.
At Ultimate Partner®, we want leaders like you to join us in the Ultimate Partner Experience – where transformation begins.
https://youtu.be/DgzjeaUiYM8?si=fScjJ-a3QaZlMMh0
Key Tags:
.Microsoft partner, Elastic, ultimate partner, partner of the year, cloud go-to-market, alliance strategy, executive commitment, technology innovation, engineering alignment, co-selling, go-to-market, influence strategy, partner resources, adaptability, data-driven decisions, human relationships, BRS, QBR, EBC, channel leadership.
https://youtu.be/s33fltuizEo
Transcription:
[00:00:00] Alyssa Fitzpatrick: Adaptability is that has become really the most important thing that any leader needs to do in this, this world that we’re in. Um, it’s no longer one, two year roadmaps. It’s three months.
[00:00:16] Vince Menzione: We believe this time is like no other. We believe we refer to these as the tectonic shifts,
[00:00:22] Intro: all the hyperscalers in the world, if you add them all together.
Managed services will be one and a half times larger
[00:00:28] Vince Menzione: because it is the customer buying behavior that has created the need for all of us to rethink our models.
[00:00:34] Intro: Until we have data quality, the effectiveness of AI cannot be realized and effectiveness of the partnerships cannot be realized. Can you figure out, first, what your purpose is and how Microsoft can support your purpose and how you can support Microsoft purpose?
Now we have a partnership. It’s the ultimate partnership.
[00:00:54] Vince Menzione: Welcome to The Ultimate Guide to Partnering. I’m Vince Menzi, own your host, and my mission is to help leaders like you achieve your greatest results through successful partnering. We just came off Ultimate Partner Live at Microsoft Redmond Campus.
Our most powerful event yet. Over two days, we gathered top leaders to tackle the real shifts shaping our industry. If you weren’t in the room, this fireside chat with Eissa Fitzpatrick, the partner leader for Elastic, an award-winning partner, brings us right to the edge of what’s next. Let’s dive in. So we always talk about like the pinnacle of success, like how do you get to be the top Microsoft partner?
And that’s one that we aspire to is where we came up with the term ultimate partner. ’cause an ultimate partner is a partner that she’s their greatest results. They understand how to be part of that 0.001 point. Percent, you’re not in that 99, 9 per percent. And I saw that quite a bit when I was at Microsoft.
I got to see the one per the 1% that knew how to, how to operate in a, in a, in a congruent way. They knew, knew how to apply all these principles in order to be successful. So we wanted to have, as our next guest, an organization and a leader that’s been driving that. In fact, this is also somebody who’s former Microsoft who’s gonna be joining us and having a conversation about.
How do you get to be partner of the year? How do you get to the pinnacle of success as an organization? And so I’m thrilled to invite, and I think she’s in the back ready, uh, Alyssa Fitzpatrick, I don’t know if anyone knows Alyssa. Alyssa was at Microsoft for many years. She was in the global partner organization.
Uh, she’s now running Elastic, which if, if you, if you haven’t been keeping up, like who are the top partners, especially in the marketplace world, elastic is at the very pinnacle of success across the entire ecosystem. Of partners and cloud go to market. And so I’m so thrilled to have her spend some time with us talking about how do you get to that level?
How do you become the most successful partner out there? How do you become a pinnacle partner? And so Alyssa, so great to see you, my friend. That’s great to meet. Thank you. Great to see you. Thank you. Great to see you. We were comparing scars the other day. Yes. I had, um, we both had accidents within the last month or two, right?
Yes. Yes. Your, yours is much better. You look much better. Mine. Mine was a little bit easier
[00:03:13] Alyssa Fitzpatrick: than the getting hit by a car. I, uh, I did it all to myself. Um. When you have low blood pressure, there is a you swoon sometimes, and if you don’t get yourself to a place where you’re stable, you can fall over and the heaviest part of your body is your head.
So I broke my fall. Right there. So it was three weeks ago. I’m healing pretty well, but I had a couple of black eyes for two weeks, which was really wasn’t Turn the camera on, I’ll tell you that. But um, but yeah, I was,
[00:03:43] Vince Menzione: I wasn’t turning the camera on either, so. Well, it so great to see you. Thank you, dad. So great to have you.
Yeah, we’re in, we, we brought the event up to you.
[00:03:50] Alyssa Fitzpatrick: Yes, you did. We did. I love it. Yeah. Yep.
[00:03:53] Vince Menzione: And I wanna sit, I wanna sit down with you and have some conversation’s today. Let do, let’s do, uh, it’s so great to have you. I mentioned the fact that you spent many years at Microsoft. That’s how we first met you were at Microsoft.
[00:04:03] Alyssa Fitzpatrick: Yep.
[00:04:03] Vince Menzione: I knew. I knew even back in that day. You were in the sailing. You were a big sailor. Yeah,
[00:04:07] Alyssa Fitzpatrick: I did. But you didn’t grow up in
[00:04:08] Vince Menzione: the Pacific Northwest. No. Yeah. So tell us more about your background. I grew up in
[00:04:11] Alyssa Fitzpatrick: Colorado, actually in Boulder, Colorado. Nice. Beautiful town
[00:04:14] Vince Menzione: and, uh,
[00:04:16] Alyssa Fitzpatrick: kind of, it was a small town in the seventies.
Very, very small town, very different. Um, but I did come to University of Washington for school, but I quickly left because I was only up here for the school year, never spent a summer. Oh, and if any of you have ever experienced a summer in Seattle, that’s why, you know, we live here and I didn’t until 30 years later.
When I came back to work for Microsoft and I was like, how did I not know this? I got to work in all these other places. I lived in San Francisco, I lived in London, I lived in New York. Um, finally came back here and, uh, it, it’s outstanding.
[00:04:54] Vince Menzione: Summers are beautiful here. Yes, absolutely gorgeous.
[00:04:56] Alyssa Fitzpatrick: It is, it’s amazing.
And I, yes, I love boating and I’ve taken my passion for sailing, which I’ve been sailing for about 35 years, and I’ve transitioned that into cruisers. Um, there’s a lot that you can accomplish up here and up into Canada and just, it’s the most beautiful boating place in the world. So I love it.
[00:05:16] Vince Menzione: I love it.
And you know, we had Lori Borg gun just before you. Mm-hmm. Spent 26 years in the Microsoft ecosystem at a partner. You, I know you’ve had several. Points before you got to Microsoft, but you went from being a Microsoft executive. I want you to talk about what you did at Microsoft and then you went back, you went back out now and leading a top award-winning partner.
So take us through a little bit of that. Yeah,
[00:05:36] Alyssa Fitzpatrick: it’s, it’s actually been a lot of fun. Yeah. Um, and, and I will, you know, kind of caveat it, that you don’t have to come from Microsoft to have a successful partnership. Um, because it was already happening before I got there. It was, it was already in line. And so, um, I can’t take credit.
For the, the Partner of the Year awards because I joined Elastic a year ago. And, um, and that motion was already happening and, and what the, what I see is, um. A company that made commitments and followed through on them and was very, very focused in, uh, making the partnership itself work. And so it doesn’t mean that because I’ve got a background at Microsoft that that was the recipe.
Um, it really is understanding all of the programs and the opportunities that your partner provides, and then tapping into that, um, being on the Microsoft side, it, I got to see. Who are the partners that were tapping into our programs and how are they working for them? And taking the feedback of, well, this is gonna work if we do it this way.
We need to drop the threshold here, or we need to do that. And I learned a lot about how my partners. Worked, transacted, engaged, marketed cosal, and, and that really gave me a different perspective because when I came into Elastic, I, I understood the ecosystem in a way that I, I hadn’t before Microsoft. And so it.
Really made it clear how do we go to market as elastic together with our ecosystem because our technology powers, um, all the ISVs out there as well. So we’re, we’re all, we wanna partner with everybody. Um, and so when I look at what I learned at Microsoft and the power of the engines that they build, that we can tap into the partners that do.
Are the partners that win. And so that, that really is it. It’s as simple as that. It’s understanding what’s available and then tapping into it. And when it doesn’t work for you, feed it back. Give that feedback so that they can modify because. Coming from Microsoft, I knew I wanted programs that worked for my partners.
Interesting. And if it wasn’t, then I wanted the feedback so I could modify. And that’s really important to not just ride along and go, well, it doesn’t really work, so I’m not tapping into it. Mm-hmm. Figure out how to make something work for you or go and give that feedback so that you could say, Hey, what if we did it this way?
Yeah. Microsoft will listen. Our partners will listen. We all want to win together.
[00:08:10] Vince Menzione: How do you give the feedback in a way that’s both deliberate and diplomatic?
[00:08:15] Alyssa Fitzpatrick: So, um, I’ll take a page from what Lori just said, the. Go to market build with go to market, sell with. It’s, um, it’s probably been the mantra here for almost 10 years now.
Yeah. And, um, if that is not your mantra in the way that you’re running your partnerships, um, with Microsoft, I strongly recommend that you, you adopt that. Um, and it works for everybody else. And so that’s what’s the nice part about it is every partnership that we run at Elastic, we look at what is the build piece.
Where’s the innovation coming from? What’s the solution that we’re trying to build for our customers? The how do we market that? How do we tell the world about what we built together, what we have, and then the sell? How do we empower our sellers to understand how to work together? And so making sure you, you really have that spectrum and, and you’re working that, and then decide what works for you.
Yeah. And, and to bring that feedback in, you’re gonna have, you, you need to have points of contact for each one of those, um, those swim lanes and working with
[00:09:15] Vince Menzione: those functional, functional areas that I like to refer to as Yeah. You’re working with
[00:09:17] Alyssa Fitzpatrick: Microsoft. Yeah. And that’s where you give the feedback.
[00:09:19] Vince Menzione: Yep.
[00:09:20] Alyssa Fitzpatrick: If it’s a build, you give it to the build team. If it’s go to market, let’s take the marketing team and show them what we need to do. So it’s really important that you land the feedback in the right place so it can be, um, taken in and then addressed. Um, otherwise it, it tends to float around without, um,
[00:09:36] Vince Menzione: yeah.
You bring up a really great point, but, well, you brought up a couple, several good points I wanna make sure I want to highlight. First of all, you talked about executive commitment and that’s super critical to success. Like if your executive team is not on board and helping to drive the the alliance strategy all up.
You’re gonna lose. Um, but you talked about the, the swim lanes and making sure that you, you’re aligned by role. And one of the things we’ve encouraged organizations to do over the years is not just have one person who’s responsible for the alliance mm-hmm. But to embed leadership from your organization with leadership.
At the Microsoft partner leadership level. So your build team and their build team are aligned. Your go-to market and their go-to market are aligned, your co-selling, their co-sell are aligned, and any other areas, right? There are other functional areas that are gonna align with your business. Mm-hmm.
Mm-hmm. Is that how elastic Exactly? Yeah.
[00:10:26] Alyssa Fitzpatrick: And, and it’s very empowering for the teams because the marketing team, they, they, they work incredibly well together and the rest of us are like, oh, what are they doing over there? Alright, that’s great. And then I get in, you know, information from what’s happening on the build.
And you know, we, at every single Microsoft conference or, or any of our partner conferences, we try to release. Um, do press releases on new functionality and that’s coinciding exactly with roadmaps. And so we really wanna make sure that the build team, all they’re thinking about is how do we innovate together and make sure that everything that we’re doing from our roadmap and their roadmap are aligned.
Marketing, empower them to go and find those opportunities and drive it. And then the cell team as well, it having each team have a connection versus one person trying to work the, the entire, um, agenda. It really does empower the team and make it agile, quick and innovative at, at the very, um, source.
[00:11:24] Vince Menzione: And let’s dive in on executive commitment.
’cause all those things are, all those teams are reporting into a C-suite leader. Mm-hmm. Right. Generally the CEO of the organization or or other role, how do you drive that and how do you drive the communication from your level of role within the organization driving partnerships and strategy there? How are you then communicating with that leadership team and how are you sprinkling in the priorities that you need to drive into the business?
[00:11:48] Alyssa Fitzpatrick: You know, I think that’s probably the. Biggest challenge for, um, individuals in the, um, the global channel leader role is getting the buy-in from our executives and getting them to understand the opportunity to the magnitude that, that we see. And they’re very numbers oriented. Yeah. And so it’s a challenge.
It’s a, it’s tough to really go in and get the leadership to understand what the opportunity is, because a lot of times it is. Belief, you know, build it, they will come. Well, we do have proof for that. And there are partnerships out there that you can point to and say, look at somebody our size, our scale, and what they’ve done by doing X, Y, Z.
So I think the best way to sell your story is to look in the industry at peer group successes or even bring in and, and I know this sounds crazy, but bring an analyst in because. Your leadership, hearing it from you is one thing, but when they hear it from someone else, there is a different impact. And I’ve, I’ve recognized that as I’ve been trying within Elastic to, uh, modify and move our focus going to my senior executive team.
By myself is less effective than going to my senior executive team when I bring in outside data or even an outside consultant. Yeah. To really prove the story. And it doesn’t mean that there’s not credibility with me. It’s, there’s so many ways to do partnering. That is your way, the best way. And so trying to find that right recipe for your company, it is important to do the research.
Do your homework, make sure you’ve got a financially driven plan, that you have, a metric that your leadership can say, okay, I believe in that metric when it goes up or down. That’s what I’m gonna hold you to. That is really important. Otherwise, you’re asking your leadership to, um, you know, really believe in something that may or may not happen.
You’ve gotta prove the story.
[00:13:52] Vince Menzione: So what’s the secret sauce? What, I mean, you, you’ve given a lot of it, but Right. But partner, the year status, multiple years. Right? This is, uh, you’ve, you’ve just been awarded again, some of the other cloud, uh mm-hmm. Hyperscalers as well. What is the secret sauce within Alaska?
Elastic that helps you become partner of the year? Like what, what do you think it is?
[00:14:12] Alyssa Fitzpatrick: Well, I actually think, um. Lori nailed it with technical intensity and I do remember when, you know, when Satya said that is the most important thing for Microsoft and our partner ecosystem. What I’ve seen, the way that Elastic engages with our partners is technology first, and that is something that’s different.
I’ve been in. Partnering for 35 years, and the early days of partnering was all about co-selling, and it was all about how do we line up our sellers? How do we engage ’em, spiff ’em, do whatever we can do to have a meet in the market. Well, that doesn’t work anymore if you don’t have the technology.
Innovation. And so it really does come down to leading with your technology first and embedding your tech in, uh, Microsoft or vice versa, somehow making it hook in and understanding what are the release cycles, where, what is the next innovation and. Until you get deep in, you may not hear what those roadmaps are.
And so you’ve gotta build those relationships so that you can become part of the fabric that is doing the innovation. And then you’re actually. Driving Microsofting. So what I’m seeing now is the way that Elastic and Microsoft work is we have these innovation sessions regularly where we look at our technology and we, we compare roadmaps.
Yeah. And as we do that, we’re affecting each other’s maps. Um, we ask for functionality in, um, the marketplace. It took a few months, but we pushed and pushed and pushed, and it’s something that we really needed so that we could do multi-year transactions with our partners. Um, they responded and we worked together and, and we made it happen.
And so I think the secret is, I. Lead with your technology and make sure that it is something that can really work and hunt with the partnerships that you’re trying to build and then wrap the relationship around that, that’s where you start. Um, and I do think that that is the secret sauce that has made Elastic very successful, is we are fearless in going into the engineering organizations and, and really asking for more.
Um. I love it. I come from an open source background, um, at, at Elastic, and it is fearless. It’s like, Hey, let’s build here. Let’s do that. Let’s do this. And it is, um, so it’s a very, it’s fascinating, um, exciting time to watch this happen, but when you think about the partner world. It has changed so much, and yes, co-selling is very important, but if you don’t have the nucleus of technology and innovation together, it, it doesn’t matter what you’re selling out there.
[00:16:53] Vince Menzione: So I’m hearing tech intensity, I’m hearing engineering. I’m, I’m seeing, I’m visualizing your engineers in the room with the Microsoft engineers in the room, having very, very deep conversations about product alignment. Mm-hmm.
[00:17:05] Alyssa Fitzpatrick: And fit.
[00:17:06] Vince Menzione: Mm-hmm. And, and re-engineering the technologies on both sides.
[00:17:09] Alyssa Fitzpatrick: And I think that to get to that point, to be in the room is, it’s important to, to push, to have the conversations, but then do what you say you’re gonna do.
Deliver on time, deliver those features and that functionality that you both agree to. And that’s what really proofs it out.
[00:17:29] Vince Menzione: You’re speaking my language. I talk about this all the time. Like I would sit in those rooms with the PowerPoint slides. We’d have great meetings, we’d have great alignment. We’d, we’d set goals with one another.
We we’re all high fiving each other at the end of the meeting saying, we’re gonna achieve incredible success this year. And then crickets. Yes. We never hear back from them. And it comes back to that maniacal focus. People miss the maniacal focus part of this. Mm-hmm. Right? Mm-hmm. And it sounds like you’re doing all that, right?
Your engineering teams are maniacally focused, working with Microsoft. You’re driving the go-to market strategy. You’re driving the co-sell strategy across the organization. Yep.
[00:18:03] Alyssa Fitzpatrick: Yep. It.
[00:18:03] Vince Menzione: It’s quite a bit. What would you say from a, like a resourcing perspective, how do organizations need to think about their resourcing for a successful partnership like yours?
[00:18:12] Alyssa Fitzpatrick: You know, that’s a, that’s a really interesting question because that is probably the biggest challenge that we, we all face every day is, that’s right. Our, our teams are never big enough. Um. When I came into Elastic, I, I was astounded because the partner organization, um, is of size. Um, but for the size of company that we are, it’s, it’s, it’s pretty lean.
But the hyperscaler element of our partner organization is about 15% of the org all up. And so there was a clear decision made, and this is before I showed up, that the hyperscaler relationships were king. They were the top, top dogs. We’re going to make sure we get that right. And so that actually for three years, it was that maniacal focus, which did make other partnerships suffer, right?
Because we just didn’t have the resources. But that was a choice, and those are the choices that you have to make. Sometimes you can’t do it all. And right now I’m making trade-offs where I’m like, this year. I’m not gonna be able to do that because I’ve gotta get this right and this is going to stay healthy and this is gonna stay strong.
And so it is trade-offs. But I would say that if you want to go. Part of the hoop and you really wanna make Microsoft or a hyperscaler relationship work or any partnership, it is focus and intensity around that and putting the resources where your focus is. And that should align all the way up to the the board.
Because if they are, let’s make this work and you move your resources and say, look, another part of the partner organization may suffer as a result. That’s understood. Yes, as long as you communicate and you’re clear with that. But I would say that resourcing, um, making sure that you’ve got, you know, the right leadership that’s connecting at the leader level and running those BRS and QBR and making sure that you constantly have, um, you know, an EBC every six months that keeps the executives together and has that rhythm of the business.
That’s really important. So you’ve gotta have that executive leadership and that alignment. But then you’ve gotta have folks in the field that are helping your sellers really work the deals. Um, it’s not easy. I mean, it’s not just hit a button and get it done. And so we, we do have to help our sellers get it across the line and drive a marketplace first mentality.
In our company. And so it, it is, um, resourcing I think is, is critical to make sure you got the top and the field resources. We have a whole team on marketing and we wouldn’t, we wouldn’t be where we’re at right now without the, um, the incredible focus from marketing and engineering.
[00:20:53] Vince Menzione: And I think I heard you say getting your executives aligned at the top.
By the way, the upstairs of this building is the EBC, it’s the executive briefing center for Microsoft. I’m sure you use this quite a bit for some of those meetings. What do you find is like the secret sauce or the sweet spot getting the, your executives in, the Microsoft executives at that level aligned?
Is there some level of engagement? Executive sponsorship. How do you, how do you do some of those things? Well,
[00:21:18] Alyssa Fitzpatrick: so you do need to have executive sponsorship. That’s important. Um, and then you choose where that comes from. Does that come from the partner team? Does that come from engineering? Does that come from marketing?
’cause that sponsorship can come from different parts of the organization and, um, and that, that’s important ’cause that really does kind of give you that north star of what you’re doing. But then, um, in order to make those, those. Consistent meetings, those qbr, those brs successful, you do need commitment from your leadership.
And so when we have an EBC or even A QBR, my. My CEO will fly up. My CRO will fly up. We bring everyone here to show the commitment, and we do that twice a year. So Microsoft knows we’re gonna come in. Yeah, we spend an entire day together and, um, there is an entire, um, afternoon of engineering and then they say.
Been off and the engineers go in another room and I don’t even know what they talk about. But, um, but we do bring everyone together and it creates the relationship, it creates the consistency and the understanding. ’cause when your CRO hears directly from the top brass at Microsoft about what they’re doing Yeah.
He’s motivated. Yeah. And so it is important to not just have ’em dial in on Zoom or teams or whatever, get ’em here. Get them in the room. That’s when it really, the magic does happen. It is human relationships that we do that partnering. I, I’ve been 35 years in partnering and, and my kids ask me what I do and I say, I built human relationships.
Yeah. Um, where they weren’t before. And, and then we create business out of that. That’s what it is. But it starts with the human relationships first. And, and so get your leaders here. It makes a difference. It really does. And
[00:22:59] Vince Menzione: demonstrating that your leaders are willing to make the commitment to come here.
Mm-hmm. And engage with the other executives in the room is critical. Yep. It also takes a lot of the pressure off of you as a leader of the partnership organization to not have to have the, be the intermediary to the conversation about like, we’re not driving the right results on co-selling with our C-R-C-R-O.
To have the CRO kind of put in the hot seat in a way. Yep. Right. Yep. It’s okay. It’s okay to have that conversation with the other aligned executives on the other side of that. Mm-hmm. And I think that’s part of your secret sauce.
[00:23:31] Alyssa Fitzpatrick: Mm-hmm. Yeah. As as long as everyone’s in the know as well, when you hit those roadblocks, which you will hit, having your leadership understand what’s happening in the relationship not only helps you get over those roadblock, it helps.
You not get as much and you know, you don’t get on fire as much. Right. You’re not gonna get shot at because now you know, like your leader knows Okay, they can’t transact that way. We have to do it this way. Yeah. And so you’re not in the middle going, wait, wait, wait, let me explain all this stuff to you.
They’re in the know. And that’s so helpful to, you know, the, the velocity of the business.
[00:24:08] Vince Menzione: So we talk about embracing change. We talk about adaptability. We’ve used the term adaptability quotient, in fact. Mm-hmm. Like that’s, that’s the new iq. And EQ is the aq. Right. It’s, it’s something you really need to lean in on.
Right? Yeah. How are you leaning in now? You, you’re sitting here as a. And you work with the others as well, but you’re sitting here with Microsoft being a very significant part of your business, knowing that in a couple of months as things are gonna change, right? We’re at the end of 25. Moving into 26, what are you doing from an adaptability perspective within your own organization and how are you also, uh, how are you in tuned with Microsoft on some of this now so that you are able to get the feedback loop going in a way that you’re thinking about your planning and process.
Mm-hmm.
[00:24:51] Alyssa Fitzpatrick: Um. Adaptability is that has become really the most important thing that any leader needs to do in this, this world that we’re in. Um, it’s no longer one, two year roadmaps. It’s three months and the fourth month something could pop that you didn’t know about. And, and, and. It could derail your strategy.
So you, you, you’re constantly adapting. You’re constantly watching. You have to do your homework more than you’ve ever had to do your homework because your homework changes every day. And so, um, being adaptable to what’s happening in the market, but also looking at your performance, looking at how is your relationship actually working and starting to be your own data science scientist and figure out, well, when this happens.
And these two things come together, that’s a great opportunity. Or really start analyzing how does the business happen? Where is it good? Where is it suffering? Where can I actually close some of those gaps? And, and looking across the business. At a, a regular cycle. So you’re seeing, um, we used to, we, we called it a correction of error.
I don’t know if they still do at Microsoft, but whenever there was something that was kind of going off the rails, we would have a COE, a correction of error. And it was kind of like whack-a-mole. Like whenever something came up, we were like, oh, everyone would jump on it, fix that problem. Something else would pop up over here.
That’s the same thing that happens in our world, but we’ve got to be agile in looking at not only knowing those are coming, but predicting them and looking at our business and saying, okay, I’ve seen this, this play out before and I think we’re heading into this kind of, um, gully or whatever it is, moving the boat, getting back on track.
And so I do think it is really important as leaders of our organization to know our data, to know what’s happening and really. Wallow in it and, and watch, because the market is changing so quickly, our data is going to tell us a lot of the things that we may are pontificate about and try to give excuses or reasons.
Yeah. Focusing in the data is going to help you make Dr. Data driven decisions, but also give you the confidence and the credibility. As to why you did that. And so I really think agility does come from, um, being able to adapt to changes in the market, but doing it in a smart way, in a way that you can defend and explain to your leadership.
[00:27:24] Vince Menzione: So that’s your advice for the partners in the room is what I’m gathering, right? It’s that you really need to pay attention to your data. Your data will tell you where you need to go as an organization.
[00:27:33] Alyssa Fitzpatrick: I, I, you know, you can get data to tell any story, like everybody knows that. But reading your data and looking at trends and using what you know, you’re in these roles for a reason, using what you know to make those decisions and powering it with what you’re seeing in front of you and how the, the business is actually transacting and actually, um, you know, moving through the cycles.
[00:27:57] Vince Menzione: I wanna spend a moment on influence strategy though. Okay. We really, we’ve talked about a lot and I think we’ve covered a lot, and I hope people are getting a lot of great nuggets here today about aligning your business, getting your executive team involved, getting everybody in the right room. Mm-hmm.
Doing it on a regular basis. Mm-hmm. Mm-hmm. How do you think about your influence strategy, like as the leader coming into the organization? Like you said, all about a year enrolled. Mm-hmm. You can’t take all the credit, but you’ve been driving obviously more success on partner of the year award. Um, what is your influence strategy?
How do you think about your influence strategy with the. Both your leadership team as well as the Microsoft Leadership team.
[00:28:33] Alyssa Fitzpatrick: So, um, I, I do actually think about that quite a lot because, um, I came into role a year ago and we were, you know, it always feels like it’s in a state of emergency. Um, I came in, there were nine different organizations all rolling into different leaders that there had been no one in the channel, um, chief.
Uh, had had a channel, no one had been in this role for two and a half, three years. Wow. So it was a little bit, you know, wild out there. Yeah. Um, I had 42 different compensation plans across a team of under 142 comp.
[00:29:07] Vince Menzione: You sound like Microsoft with 42 compensation plans. And
[00:29:09] Alyssa Fitzpatrick: I’m like, what are these people doing?
What? Everyone’s doing something different. Right. So. I had to really bring things together so I had an influence story, so I had a place to start because I really wanted to go to my leadership and say. We’ve gotta bring this together. We’ve gotta be a cohesive team. We’ve gotta have a culture of our own and, and something that we’re striving for.
Everyone has a different goal. We need a North star for our organization. Yeah. And so my influence journey started with. I gotta get a number that matters. Yeah. Like what’s gonna matter to my leadership and what’s gonna matter today. That number that I landed on, which was, uh, you know, a specific revenue target, um, will change.
And it’s a specific revenue target. ’cause it’s not all of revenue. It’s a kind of revenue that I’m, I’m saying this is most important, this is what we’re gonna go after and I’m gonna fix this. Next year might be a different one, but right now I’m laser focused on showing. Progress and showing improvement and bringing the organization together and everyone rowing the same direction.
Um, I’m down to six compensation plans guys, so
[00:30:20] Vince Menzione: Very cool.
[00:30:21] Alyssa Fitzpatrick: Yes, I know. Thank you. That was a lot of, it took a year to get us kind of organized, but now the teams. Understand what they do, and they can cross pollinate, they can work across the regions and actually share best practices. And so my influence strategy started there, which is let’s create a unified structure and then I can start to prove what we’re capable of.
Yeah. The part that. Tends to get lost is you need an influence strategy across the entire organization. Because partnering is building a company inside of a company. It is, it truly is. When I love that, when I, when I talk to my CEOI say, we have sellers. And what we do with our own sellers is we compensate them to do the things we want them to do.
We give them marketing so they can get demand gen. We give them compliance, we give them, uh, Salesforce, we give them a portal to work in, um, you know, uh. All the things that they need. So we have to do the same thing for our partners, but we don’t get to pay them. To do what we want them to do. So we have to create an incredibly attractive partner program and value for our partners to wanna work with us, and it has to be compliant.
They need a portal. They need sales and marketing. They need demand gen. They need everything that we’re offering our entire internal organization. We need that for partner. And don’t let me forget engineering, right? We’ve gotta have engineering as well because our partners push us to do better. And so it is like building a company inside of a company.
So your influence strategy cannot stop with sales and it cannot stop with the CMO and the chief product officer. You’ve gotta get into the services team, you’ve gotta get into legal, you’ve gotta get into the IT department because if you don’t have it working for you, your stuff’s gonna be at the.
Bottom of the list, right? So your influence has to go all the way across the organization. I love this. I love this. It’s exhausting too.
[00:32:20] Vince Menzione: Well, and we could, I mean, I’d like, I’d love to, I know we’re short on time, but, uh, you, I think what you said too is you develop a strong point of view as well. Like you came in and you had to go solve for some real.
Nagging issues mm-hmm. Within the organization. And then you develop a strong point of view that you bring into those other organizations. Yep. Because you’re the one beating the drum every day. Yes, yes. Yeah. So you, you gotta come at it with a very consistent theme.
[00:32:46] Alyssa Fitzpatrick: And I think the consistency is critical because I, um.
I, I’ll, I’ll give you a fail fast. Um, it wasn’t as fast as I’d like it to have been, but uh, when I came in we had a bunch of metrics that we would put up and say, okay, these are our partner numbers. And I started watching my sales team and, you know, they kind of just started tuning out and I’m like, what is going on?
Like. What, what’s wrong with my data? Why? Why don’t they like this? And I got closer and closer where I was like, okay, and here is the source revenue. Here’s the deals brought by partners. Here’s the deals we’re co-selling. Here’s the deals that are going into marketplace. And they started to finally clue in and they’re like, well, that number’s not right, or That doesn’t work for me.
And I finally got them to wake up and I was reporting partner data. That my partner team deemed important, but my selling team didn’t care at all. Hmm. So make sure your data, your whatever you’re reporting against, lines up to the way that sales reports theirs, because if you’re looking at different slices, you’re gonna lose the audience.
I love it. So
[00:33:57] Vince Menzione: many great nuggets. It’s really important. So many great nuggets because I did lose the audience, but I got ’em
[00:34:01] Alyssa Fitzpatrick: back. But
[00:34:02] Vince Menzione: yeah, that was a, that was a surprise for me. But the course correction is important. I know we’re running up on time now, but I think just to the point there is you come into these organizations, the team is already set up line a different way that what they’re reporting is not relevant.
And you have, that’s where you have to come in with that very strong point of view. Yep. And go fix it. Yeah.
[00:34:20] Alyssa Fitzpatrick: And ask yourself, is this right? Yep. I didn’t do that until it, it was too late. Not late, but it obviously has worked. E so
[00:34:28] Vince Menzione: well, I want to thank you. Yeah. This has been a really great tutorial, I think a great instructional, um, we’re gonna, we’re gonna play this again.
It’ll probably be on the podcast because I think most of us as leaders in organizations, we miss this. We miss all. How do you get to that pinnacle? Mm-hmm. And there’s so many things you need to do in an organization to drive this level of success that an elastic will drive. Mm-hmm. Within a Microsoft or within the hyperscale community.
Yep. So, so thrilled to have you join us. Thank you. Today. You, this was wonderful. Thank, I really enjoyed it. Thank you. So
[00:34:56] Alyssa Fitzpatrick: it’s my favorite talk topic to talk about. I love
[00:34:57] Vince Menzione: it. I’ll you back again. Thank you all. All right. Well, thank you Alyssa. That was fantastic. Thank you. What a great conversation. Thank you for joining us this morning.
Thanks for tuning into this episode of Ultimate Guide to Partnering. We’re bringing these episodes to you to help you level up your strategy. If you haven’t yet, now’s the time to take action and think about joining our community. We created a unique place, UPX or Ultimate Partner Experience where leaders come to learn from each other.
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Jul 6, 2025 • 0sec
266 – Mastering Microsoft Partnerships: Agility, AI, and the Path to Growth with Lori Borg
Join Lori Borg, Vice President of Microsoft America’s Go-to-Market, as she shares her evolution from a Microsoft partner to a pivotal executive. She emphasizes the necessity of technical intensity and agility in navigating today’s tech landscape. Lori dives into the vital role of AI in partnerships, stressing how it can drive growth and innovation. With insights on fostering a culture of adaptability and collaboration, she highlights the importance of strategic alignment among partners to succeed within the Microsoft ecosystem.

Jun 29, 2025 • 40min
265 – From First Click to $1B: Winning in the Cloud Marketplace Era
Recorded Live at Ultimate Partner LIVE in Redmond, WA
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Is your business ready for 2026?
Welcome back to the Ultimate Guide to Partnering® Podcast.
Join industry leaders John Janke of Tackle.io and Shane Wilson of Cohesity as they delve into the transformative power of cloud marketplaces. This engaging discussion explores the evolution of marketplace adoption, from its early pioneering days to its current status as a multi-billion dollar opportunity. Discover how buyer behavior is shifting, the increasing importance of channel partners, and the strategies that winning ISVs are employing to achieve unprecedented scale in the cloud go-to-market.
We’re curating the very best of these moments—fireside chats, expert panels, and executive insights—so you can stay ahead of the curve and fully aligned to where Microsoft and the industry are heading.
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Thanks for being on this journey with us.— Vince
https://youtu.be/kydm0sEq6ac?si=XbuyStK3opiB-i6e
KEY TAKEAWAYS:
The cloud marketplace has evolved from a niche concept to a multi-billion dollar ecosystem, with projections to reach $100 billion by 2026.
Buyer behavior is shifting, with a significant increase in buyers utilizing cloud marketplaces for procurement across all software and partner types.
The role of channel partners is becoming increasingly critical, with marketplace strategies shifting from ISVs to channel partners who own the buyer relationship.
Successful ISVs are integrating marketplace and co-sell motions into a unified company-wide cloud go-to-market strategy, encompassing sales, product, rev ops, and marketing.
The concept of “storefront evolution” is emerging, where buyers discover products in new places beyond traditional marketplaces, leading to more specific solutions and bundles.
Consistency in strategy, execution, and celebrating wins is paramount for navigating the evolving cloud marketplace landscape and achieving long-term success.
If you’re ready to lead through change, elevate your business, and achieve extraordinary outcomes through the power of partnership—this is your community.
At Ultimate Partner® we want leaders like you to join us in the Ultimate Partner Experience – where transformation begins.
https://youtu.be/s33fltuizEo
Key Tags:
Cloud go-to-market, cloud marketplace, ISV, channel partners, co-selling, procurement, software sales, digital transformation, B2B software, multi-party offers, ecosystem, strategic partnerships, revenue growth, sales motion, alliances, rev ops, marketplace operations, product-led growth, SMB, enterprise, storefronts, cyber resiliency, Microsoft partnership, NetApp, Amazon, CrowdStrike, Salesforce, Workday, ServiceNow, Wiz, PAX8, Ingram Micro.
Transcript:
[00:00:00] John Janke: Another big, and this I think trend will be next year. It’s happening right now, but it’s still really early, is this idea of evolution of storefront. So if you want to change buyer behavior, you have to meet buyers where they show up.
[00:00:14] Intro: We believe this time is like no other. We believe we refer to these as the tectonic shifts, all the hyperscalers in the world, if you add them all together, managed services will be one and a half times larger
[00:00:26] Vince Menzione: because it is the customer buying behavior that has created the need for all of us to rethink our models
[00:00:33] Intro: until we have data quality, the effectiveness of AI cannot be realized, and effectiveness of the partnerships cannot be realized.
Can you figure out first, what your purpose is and how Microsoft can support your purpose and how you can support Microsoft purpose? Now we have a partnership. It’s the ultimate partnership.
[00:00:52] Vince Menzione: Welcome to The Ultimate Guide to Partnering. I’m Vince Menzi, own your host, and my mission is to help leaders like you.
Achieve your greatest results through successful partnering. We just came off Ultimate Partner Live at Microsoft’s Redmond campus, our most powerful event. Yet, over two days, we gathered top leaders to tackle the real shifts shaping our industry. If you weren’t in the room, this episode on marketplaces featuring John Yanke, the CEO of Tackle.
And Shane Wilson from Cohesity brings us right to the edge of what’s next. Let’s dive in and we’re gonna have some other leaders in the room to talk about marketplace. Uh, in fact, we’re very pri privileged to have both. I. As sponsors, but also really partners in driving the success working with the Marketplace organization.
Some of the top organizations that understand Marketplace better than anyone, they’ve been at it the longest. I’m privileged to have John Yanke, the who’s been a great friend, a great supporter of Ultimate Partner, the CEO of Tackle io, and Shane Wilson from Cohesity, who’s also been around this partner partnering, co-selling.
Marketplace world that we, we know and love so much. So great to see you again my friend. Good to you. Great to see you, Shane. James, how you doing? Thank you. Good to have you both on stage today. So is the world to have you make the trip and to support us. Good to be here. So great to have Cy on stage too, right?
So I know you’ve been around, uh, John, you’ve been around this marketplace thing. We’ve been calling it the marketplace moment for some time. Shane, I know you as well from the ISV side, so I thought maybe we take a moment to have you both introduce yourselves. Maybe just spend a moment. I did a little bit, babe.
Didn’t do it justice. Maybe a little bit of your background and Sure. And what you all do and, and why you’re here today.
[00:02:36] John Janke: Uh, hey everybody, great to see so many friends, familiar faces. Uh, Vince, thank you for all the work putting this event on. I think it’s, uh, tremendous to be able to focus on Microsoft and everything they have going on.
So, I’m John Yanke. I’m CEO of Tackle. I’ve been with Tackle since the beginning. We started the company in 2016 with the idea that the clouds would change the way that software was sold and marketplace represented the initiation point of that. That was long before. Really anyone was buying that way.
Anyone was selling that way. We were working with some of the 2016 and there were some really early adopters who kind of saw the world the same way and were struggling to figure it out, and we just happened to be able to meet some of those large partners back then and help them find a way to. Launch their businesses and not only launch, but sell and sell repeatedly and then integrate that selling motion into their system.
So, uh, I’m a lifelong se. I grew up in se, which is like my default persona. So if you encounter me like either at a customer or at an event, I tend to be just super curious. I call myself a nerdy cloud go to market guy, which kind of route goes back to my se heritage and uh, I mean tackle. We really live to serve the ecosystem and, you know, support not only ics, ICS channel partners as as the marketplace moments.
I think it’s been a lot of moments, a lot of moments, you know, the time series of moments is, uh, interesting to see how it’s evolved. But, uh, it’s, it’s not just for ISVs. It’s really all partner types will go to market this new way, and it’s not just about one partner. Working with Microsoft, it’ll be about all the different partners and how they come together and how solutions get integrated together and just how we make that whole process easier.
And AI is like obviously dramatically increasing the quantity of software. So yeah.
[00:04:26] Vince Menzione: And I have some questions for you as well about what you’ve seen along the way. So we. I know, I know you’ve done some research on this, but super, super. I do wanna give Shane a moment to talk about his background and why he’s up here on stage as well.
’cause you’ve been at this a long time, Mike. We’ve known each other for a number of years.
[00:04:39] Shane Wilson: Yeah. Thanks Vince. It’s, uh, nice to see you in town. I’m glad you’re doing, you’re doing well. Thank you. Yeah, thank you.
[00:04:44] Vince Menzione: It’s, uh, getting much better. Much better.
[00:04:45] Shane Wilson: Yeah. Yeah. So, Shane Wilson, for those who I haven’t had the chance to meet yet, uh, I run, um, Cohesity’s Cloud, cloud business, and, um.
Yeah, like John, I’ve been at this for kind of since the beginning of the marketplace, co-sell, sell with, you know, motion, call it like 13 years ago maybe. Um, you know, I got my start sort of working with Clouds, ISVs at NetApp actually. And, um, I was just chatting with John backstage about this, but we were trying to figure out how to put NetApp into the cloud with Amazon and with Microsoft and, and everybody really.
Um, and that was more of a, a build with motion of how we’re gonna partner with. Ias PAs and do something new in the market that’s meaningful for customers and for partners. And um, but since then, co-selling marketplace has become a major motion. Right. And so I’ve spent my time post that at a bunch of ISVs, as small as, um, you know, a 50 person, 40 mil, a CB company, um, up to up to, you know, 10,000 plus.
I was gonna say some of the largest
[00:05:42] Vince Menzione: up there as well. Yeah, yeah.
[00:05:43] Shane Wilson: Yeah. So I’ve been fortunate to work with a lot of, uh, great partners and, you know, had the experience of. Trying things and failing and then trying things and winning huge multiple partner of the year awards and all that with the different clouds.
And with Microsoft in particular, I’m really passionate about, um, the partnership potential and really the, uh, the selling potential in the field because Microsoft has such a leadership position when it comes to co-selling, engaging with, with ISVs and all partner types, and really helping people evolve how software is bond sold.
So. Well,
[00:06:14] Vince Menzione: so great to have both of your perspectives and expertise, John. So 2016, like marketplace wasn’t even a thing, in my opinion. Right? It was just really, you, you, you clipped it right at the very beginning. You started off early. Uh, I wanna talk to you about like what you’ve seen, and I know that you spent an inordinate amount of time on the.
Understanding what’s going on in the marketplace. And I come to you every year and ask like, what’s happening? What’s changing? I know you, you’ll have, we’ll talk a little bit more about your event that’s coming up. I’d love to get your perspective. We’ve talked about this a hundred billion dollar moment that was, that is, uh, still playing for 2026.
Uh, a lot of, uh, ingestion, I would say a lot of organizations getting past that 1 billion Mark. Love to get your perspective on what you’re seeing right now in the marketplace and, and what partners in this room and others need to understand and how they need to embrace it differently.
[00:07:03] John Janke: Yeah, it’s been, I mean, it’s been really interesting.
We started in 2019 to write research on cloud. Back then it was just marketplace cloud go to market as a term wasn’t pioneered yet. Uh, and we did that because no analysts were covering the space. Yeah. And you know, back then the thing we would hear from partners was like, how big is this thing? Like how like are people selling?
Is buyer behavior changing? Are partners thinking about this? And we really tried to. Think about what research we could do that would just help. At that time, mostly ISVs build their justification to create these routes to market. And, uh, we’ve done that. We published the state of cloud Go to market report every year.
It’s a really fun research report. People are like, oh, who do you have? Write that. I mean, it’s my co-founders and I write it. Uh, we, we create the survey. We listen to our customers and what they wanna talk about. So if you ever are like, Hey, we’d really love to hear about these trends, please tell me ’cause we’ll, uh, weave them into state of cloud, go to market.
And back then it was. Very little dollars were flowing like we were, this was probably, we were in maybe hundreds of millions of dollars were flowing through the cloud marketplaces back in 19. Um, and we played it forward just based upon a lot of different research and, and you start to think about the trillion dollars of B2B software sold, let alone the other trillion dollars of.
B2B software sold to the SMB, which is different. Uh, all of that starting to migrate to the cloud. Similar to how infrastructure, like you think back to 2006 or 2007 when the primitives of cloud were created, people are like under, you said the underestimate overestimate in two years, underestimate in 10 years like that, that was kind of the scenario.
With, with marketplace back then. Um, and I think a couple years later, we built this a hundred billion dollar prediction for 2026, and it was bold at the time and a lot of people were like, that’s crazy. But when you go back to that $2 trillion of software, it’s really only 5% of software migrating to the clouds and all data points signal that that’s coming through.
And there were a handful. Of linchpin moments to enable that volume of dollar shift to start to happen. And I think for a lot of years it was the pioneers who were creating this new movement. And I put Shane in that pioneer category, uh, both with small and medium and large companies pushing the envelope.
Uh, like changed the way that you sold along the way and your company sold? Uh, it, it was that pioneer moment, but along the way, that pioneer moment led to larger companies acknowledging the shift and starting to say, wow, something’s happening here. Uh, and as those larger companies started to. Embrace the shift that led to even larger companies and, and I think the thing for me over the last two years, we’ve seen this huge shift from this is not just about cloud technical categories.
This is a change in procurement and it’s across all software and partner types. Yeah. So, and there were some big moments. I remember like thinking back in 2018, what would be. A, a, a bellwether moment for the industry. It’s like when the largest software companies in the world start to sell this way. And CrowdStrike was a long time customer tackle.
Yeah. We worked with them and they were always the one who kind of set the standard and then someone like Salesforce shows up and Workday shows up and ServiceNow shows up and you’re like, whoa, something’s changing. Uh, not only are they. Monstrous companies with huge ecosystems and large go-to-market systems, but they saw this movement as a way to continue to grow.
Yeah. And they were business applications. They weren’t like security, DevOps, storage, infrastructure, so that business applications, large companies showing up. And then I think the multi. Partner, like the evolution of channel has been a huge, and we’ve talked about this consistently over the last few years, but it’s still like the, the quantity of dollars now flowing through channel, with marketplace is, it’s huge.
Is staggering. It’s growing faster than direct, which I think is a, a big thing. Um. And it’s still early. Like I think it’s like there are, there are, and there was a recent, a channel partner recently announced they processed a billion dollars through Marketplace, which was I think the first time a partner talked about that the same way a lot of software companies do.
And it wasn’t
[00:11:15] Vince Menzione: the largest reseller partner out there that did it, right. It was a company that was a little bit smaller, but a little bit more agile and nimble in terms of the way approach to it. So
[00:11:23] John Janke: that, that’s a, a second part. And then the third part is like we’ve, buyers do not. Buy on marketplace, which may sound a little controversial, if you’re not really close to this market, it’s, it’s still more of a fulfillment vehicle.
Um, that behavior is starting to change and it’s the intersection of everyone’s trying to figure out what is their PayGo product-led growth strategy to complement their traditional selling motion, and then how do they, if cloud. Marketplace has become a component of their system. How do they not only have their like enterprise motion aligned to it, but their kind of user discoverable free trial, PayGo style motion.
So that’s been like last year it had started mostly with startups. That is trickling into all companies are thinking about, yeah. This, which I, I do think signals buyer behavior change. I mean, we’ve seen 400% increase in buyers over the last couple of years. So massive number of buyer increase, and that’s wide across the distribution of buyers.
So unpacked a lot of data there. Yeah. Uh. Yeah. Happy to dive in deeper as we go. Yeah. And you’re, you
[00:12:30] Vince Menzione: know, tackle’s gonna be leading a workshop after, after the main sessions on stage here, so there’ll be some great opportunities to get face-to-face with you and your leadership team. Yeah.
[00:12:38] John Janke: Shout out to Colton and Rebecca, who are probably in the audience, who are two practitioners on our team who support large ISVs as they go on this journey.
So this will not be me talking about high level. Uh, kind of industry stuff. It will truly be the people who help partners figure this out leading that workshop.
[00:12:55] Vince Menzione: Well, there’s still a lot of high level, but I want to give Shane an opportunity here. ’cause you’ve been at the forefront of this marketplace opportunity and, and done it at many organizations that were at the early days of doing it, right?
Like kind of a Yeah. The pioneers, I guess, for lack of a better term. Yeah.
[00:13:09] Shane Wilson: We, we failed in many ways and one in many ways. And I, I do wanna pick up on the, the partner, uh, reseller, billion dollar milestone too, because, um. When I, I was familiar with this partner, uh, from a couple years ago when they first made their billion dollar commit.
Uh, at the time, I think it’s when it was actually Amazon, but when they made their, their billion dollar commit, um, it was the first time I’d really heard about a channel partner, um, going deep right with that. And I was like, really? A billion. You could do it. You got some big contracts and, uh, you know, it was a multi-year commit and they actually hit it faster than than expected.
So they, uh, yeah, it’s, it’s probably the first and the biggest, but also they got there faster than they were, they were, um, expecting to, it just speaks to the, not just the volume, but the velocity right behind it all. Um, and then, yeah, from an is SV perspective, uh, yeah. I think if you wind back the clock, I even six, seven years ago, right?
Uh, you know, ISVs, were just trying to figure out how to do their first, uh. Yeah. Their first deals, right? Yeah. How to start cashing that cloud, GTM, check how to cash in on the Mac. Uh, that was even before the Mac was, was as big as it is. Um, but I remember doing our, our very first marketplace deal at, uh, it was a, a startup mid-size ISV.
And, uh, this is before we were actually working closely with, with tackle, uh, and, uh. It was hard. Yeah. We were, we were literally taking customer demand who wanted to buy software, uh, you know, on the marketplace. Yeah. And trying to figure out how to get it done. So working with engineering and PM to get things listed like a day before we needed to close the deal.
And it was one of the largest, um, retailers, uh, in the, in the us. And, uh, so we got it done. It was very challenging and that was the early, early days. But you fast forward to, to the last 3, 4, 5 years and, and yeah. What, what I’ve seen is, um, ISVs that actually. Didn’t have any real meaningful engagement with clouds.
Um, start to connect the sales motion, and not just for marketplace, but for co-sell, right? And doing it with, uh, with tackle and core. And, and there’s some history there, like getting, getting sellers connected early stage Yes. Start to get leverage. And there’s so much to unpack behind that, but that, that’s such a meaningful motion where, you know, I took ISVs from essentially zero impact, zero lift with, uh, cloud providers to 500 mil a CV impact annually, right?
Getting walked into accounts. By the hundreds every quarter. Right. Um, now it takes, takes work. Um, there’s a lot of things you gotta do from a company buy-in perspective to get there, but, um, yeah, there’s a lot of upside and that’s, that, that’s sort of the ISV story. And then I think what’s more interesting now beyond ISVs is the partner element to it, because where I see the future opportunity is actually with partners doing NPO, uh, together.
And so I think that’s more exciting for everyone across different segments and across different, uh, reseller. And even Disney communities. Right. We’ll see how the, the, you know, that, that market evolve. Well, you bring up an
[00:15:57] Vince Menzione: interesting point too, because in the very early days, it was really just the largest ISVs that had their own direct selling organizations.
They would utilize a core solution or tackle solution together, and they would do face-to-face coverage with the partner sellers and, but that’s not necessarily where the customer buys. And so there were these resellers and we could mention all of their names. A lot of them are here at our event, a lot of ’em are watching today.
Uh, that would go after that market. And you would, you would have this tug, this tug of war going on too, like a customer. You’d be educating the customer saying, Hey, you could, you could burn down against your Mac agreement, you, your Microsoft commitment. Uh, and then the, you have a seller on the other side trying to sell a different way because they get paid a different way.
So you had this. This tug of war that was going on back in the days and that those seem to be going by the wayside. You, you heard Cyril on earlier right in this conversation saying, we’re gonna do away with that challenge that we have today. We’re gonna get out ahead of it. And John, you saw, you know, you talked about this, uh, you talked about this moment.
I guess you’re right, we’re in a series of moments. I think we’re at the next moment, in fact, beginning of the next moment. Um, what, what else in perspective that you wanna share here with regards to. You know, we talked about some of the largest ISVs and some of the smaller ISVs, both you and Shane, probably this conversation here in terms of, uh, uh, you know, the balance of ISVs selling in larger ones can do their own and then channel partners.
What, what does that balance look like?
[00:17:20] John Janke: Yeah, I mean, maybe, um, pros and cons with success is there’s a lot more competition for attention. Like, uh, cloud sellers have a lot in their bag already. Yeah. Uh, so if you’re a small ISV and you’re showing up, uh, you have to compete with not only the core things that they care about, but all the other ISVs who’ve established precedent with success in the market.
Um, so I think. You know, and then there’s, even in the Microsoft world, there’s the managed versus unmanaged, and That’s right. Like your perspective as a partner as to how do you approach Microsoft when you operate in those two camps and they’re different and, and it really does just come down to work.
There’s ways to be successful. The playbooks are slightly different. Uh, you probably, if you’re smaller, have to do more work to stand out and you have to be really thoughtful. About the work that you do and when you do it. Um, and a lot of times I, ’cause I, I think there’s still this misnomer in, you know, having been at this closing in on 10 years, it, it’s surprising to me sometimes that people are like, if I list people don’t just buy.
Like, I thought that’s the way these marketplace things works, field of dreams. I, I would love for that be true. It’s still not true. Um, but if. If you can refactor that to be like, that’s the starting point in the journey and not the destination, and then what work do you have to do to go build your brand?
Help your early customers. ’cause there’s a clear and compelling value prop that you can use independently to go help your customers. That then allows you to show up with the clouds and be like, Hey, I’ve got something to say and the something I have to say is good for you and it’s good for our joint customers and it’s good for me, and why can’t we just do more of that?
Yeah. So I think that like. You gotta own it. If you’re small and you gotta put the work in. And if you’re big, you really have to understand like the what works and how to scale it. Where do you focus? ’cause there’s so much, Shane and I were talking backstage about all the, there’s a lot you can take on, uh, at any given time and really like what is the best layer of the go-to-market stack to focus on?
A lot of people try to figure out. Like especially large companies, how do I do the bigger deals? How do I tap into the big customers? That seems like the easiest spot to spin the dials. And then how do I layer channel in? If I can add channel to that, then I can maybe double that. And then how do I think about international?
How do I think about product-led growth, like SMB? There’s all these different layers of the stack, but you have to prioritize ’em based upon what’s important to you and what’s gonna have the biggest impact for the cloud partner, uh, and not try to do everything at once.
[00:19:54] Shane Wilson: Yeah. And I think from a, from a small ISV perspective, um, marketplace sort of is the channel, right?
So, and historically they were like, if you’re a small SaaS company, yeah. I just want to get scale at this thing. I wanna list, list and, and sell. Right? Um, so sometimes that’s a more of a challenge for, it’s, it’s an opportunity for the isv, but it’s more of a challenge for say, the partner community at large, right?
Yeah. But if you get into this mid-market or enterprise ISV space, the winning opportunity is very clear. Um, you, I think you and I were talking a couple days ago, John, about, okay, the first wave of CrowdStrike hitting a bill was, hey, doing a lot of direct business. But guess what? They’ve accelerated even more and faster by pushing everything.
The channel partners and you look across the ecosystem of. The ISVs winning or not, are not doing it in this direct model. They’re doing it in conjunction with channel partners. So, um, so when I look at the segment on a smaller ISV, yeah, you can get scale, uh, through the marketplace and that’s essential.
You get relevance with, uh, the cloud sellers as well from Microsoft. But you know, if you’re really looking to go from say, a hundred mil to a billion or more, right? This is where, hey, all this business is channel first and channel best, right? Yeah. And that’s, I think the, the future together.
[00:21:01] John Janke: I mean, you, you had an interesting comment where you’re like, is the marketplace.
A channel or not, right? Yeah. And I think to some people it is. To some people it is. I’d be like, it’d be interesting just for you to share some of that perspective. ’cause I think there’s probably a wide range of points of view in the audience. Well, there is,
[00:21:16] Shane Wilson: and even internally per ISVI think there’s, uh, dialogue around is this direct or not direct.
And, um, I’ve started to use language, which is like one tier versus two tier. Um, because. The reality is, um, I’ve been using direct so far today, but I, I like to use one tier and two tier because at least then it, it gets everyone internal to a company. It helps you get buy-in from stakeholders that matter, whether that’s legal or finance or operations, sales, right?
You go across the stack of getting company buy-in to go do it. It’s helpful to progress the dialogue if you start talking about one tier and what that means on a per region basis. Mm-hmm. Like one tier in the US maybe it’s not that hard, but if I’m an ISV trying to scale and trying to go. Across Europe or a PJ, uh, basically outside the us Yeah.
One tier is hard, right? It is. And so you, you absolutely need the channel partners in there to, to scale the thing. Um, and uh, so yeah, for me, like I said, it’s, it’s a partner game. And, uh, yeah, I, that’s what I try and promote with all of my ISVs to think about being world class is like. Never, never cutting avar out of a deal.
Always gr putting a growth plan together with them. And that’s, that’s where you get the, well, it’s multi, well, it’s presumptuous too. We think,
[00:22:25] Vince Menzione: like we own the customer, whether it’s us or the, you know, we’re the gateway, the mark marketplace becomes the gateway to the Microsoft seller. Yeah. But neither of you own the customer.
The customer makes his own buying decision. And that might be on the third party. That’s why the multi-party offers come into play here. Right.
[00:22:38] John Janke: And I, I think that this, some of these signals when you think about what’s happening, yeah. The last three years, the ISV has owned the channel strategy for Marketplace and really kind of pioneered Who are the partners I work with?
Yes. Help them figure it out. That’s gonna flip like in the next year or two. That’s right. Where the channel partner will actually own the marketplace strategy for the buyer. Where they own the buyer. That’s right. Which is a change. And I, I, I was talking to someone on Shane’s team and she was like, I spend a lot of time educating our channel partners on how to work this way, which is again, further signal they’re, they’re learning to work in this new way.
So some have punched through, the early adopters have punched through and been like, this is a material new business for us. But I think that’s gonna be for all the ISVs in the room, that’s gonna be a shift for all of us where we somewhat relinquish control to be like, okay, you got it. Now what? What target are you gonna drive and we’re gonna manage that differently.
[00:23:33] Vince Menzione: And what and what I hear from ISVs, the largest ISVs, in fact, is that they need help building out their channel strategies. Some of them are here, in fact, for those conversations, because it is a multi-party solution that is being offered, the customer is making a decision, not just on the one solution.
They’re thinking about a complete solution set, right? If we were talking about data and ai, we’ll have data and AI up here. Next we’ll talk about governance. We talk about all the components of data and ai. It’s not just one vendor that’s coming in to solve for that. Shane, I want to get your perspective on some of that.
[00:24:02] Shane Wilson: Yeah, I think multi-partner is huge, right? I, I, uh, I think it’s a little early, but I’m intrigued by the potential, um, of having a couple different ISV segments wrapped into, um. Uh, you know, a multi, multi-party offer, right? That a channel partner can put together. And it, it’s already happening to a degree. I don’t think it’s happening at scale, like it has the potential to, but, you know, being in the space that I am, we’re in, um, sort of a data security space, and the security ecosystem is broad, right?
And so there’s a lot of different aspects of cyber resiliency that matter, uh, for our customer base. And there’s nothing we wanna see more than, whether it’s Presidio or CDW, or, you know, you pick here. You, you pick your channel partner then actually putting together a really strategic offer for, you know, their customer, leveraging the Mac to go get the deal done right.
And then bundling multiple solutions together, uh, in a portfolio sale for the, for the customer. Yeah. Um, it’s, you know, it’s what they’ve done with Disti in the past, right? Yes. Yes. It’s, but the reality is there’s a lot of mutual value exchange with the Mac, with the Microsoft sellers for the customer, with procurement.
Now that buying motion has just evolved, right? And so, um. Yeah, there’s, there’s so much upside for this multi-partner aspect of it.
[00:25:10] Vince Menzione: Agreed. Agreed. John, I know you’ve got your event coming up in another week, and I, I don’t want to take away any of the excitement around some announcements that things are going on.
What are some of the trends you’re starting to see? I.
[00:25:21] John Janke: I mean, a lot of what we talked about is we do this cloud, go to Market xp. It’s a digital event, uh, where we bring, you know, kind of the cloud providers, ISVs practitioners. We break ’em down into categories. Uh, so that’s next week we do a day on strategy.
So the first day is really about where the market’s going. The second day is practitioner grade, so there’s a rev ops track and an alliances track because for cloud go to market, to get the super scale, you gotta get the alliance team, the rev ops team, and the revenue team to work together to drive an outcome.
And that is what the people who get to a billion dollars do and do well. And then they think about, you know, how many of my reps know how to win this way? Uh, you know, Wiz was an interesting one where they, they published last year, 99% of their sales reps knew how to win with marketplace, which, like that was, they were kind of born cloud go to market native, uh, which was.
Really fascinating to see, but that’s a lot of what we’ll focus on next week is kind of that intersection between rev ops, alliances and revenue and thinking about, ’cause there’s a lot of discussion around automation, like how, how do you automate this process? How do I integrate it with systems and automation is totally important, but.
Revenue generation is more important. They’re like, that’s what people actually want. Uh, and I, I was talking to an ISV last week and they were like, Hey, you know, we, we did some automation, but we’re not getting the results we were looking for. How can we rethink that? So we’re gonna really try to continue to share examples of people who have cracked the code on not just learning how to win and setting up the infrastructure, but win win repeatedly.
Win at scale. Shane, any
[00:26:56] Vince Menzione: insights from your side on what you’re starting to see as we enter 26?
[00:26:59] Shane Wilson: Yeah, I, I think I’ll take the trend topic and talk about kind of what. What’s most important, which is like the, the trend is that winning ISVs that do it, right. Um, pull the whole company together in one strategy around cloud go to market.
And so it’s, it’s, you know, it’s a dovetail on what John was just talking about. Yeah. But if you don’t have sales product, rev ops right? The whole company, even marketing right. Really geared around this motion, it’s gonna be challenging. And so, um, I can share a couple things that I’ve done at a couple companies now to build out teams to sort of, um.
Fast track that in and make it more possible, which is, you know, when I think about how to like create partnership teams that matter, it’s like, yes, you need the alliances team in there first. Um, but then you also, I like to have my hands on the actual marketplace operations motion of it too. ’cause how companies do quote to cash.
Um, and process orders matters a lot. And, you know, reps aren’t gonna sell in the marketplace if it’s hard. And so we need to be able to make things field turnkey to field sellers. Um. To get to that 99%. Like Wiz, we’re not there yet. ’cause we’re born there we’re, I’m, I’m coming from, uh, hey, no one’s ever done this before, to, Hey, we’re gonna go win in this space.
So, yeah, it’s important to get everyone on board. And so it, when I think about how to build an organization, a winning organization structure around this, it’s like the I, the Alliance team comes first, but beyond that, like I need to get a marketplace operations. You know, e either on the team or super, super tight, um, dialed in.
And then beyond that, there’s a go to market element of, of selling, right? And so that’s the sort of the third wheel of, I think real successful ISV partnerships is do you have folks focused on the motion helping en enable all the broad, the broad sellers to. You know, do the motion correctly, not to make too many mistakes on first calls with Microsoft and go cash that Mac check.
Right. Um, and it sometimes it’s hard to get the internal stakeholders to believe in that quickly. Right. So, but I, I, I’m happy to chat with folks more post session as well on this, right. But I, the, the three legs of the stool are super key with alliances and then the actual marketplace sales motion to make it real turnkey and easy, um, operationally inside the company.
And then actually have go to market specialists, right, to go and, and push that. So. Um, if folks wanna talk about your, your company, about that with me, I’m happy to. Yeah, that that’d be great that you offered
[00:29:07] Vince Menzione: that time.
[00:29:07] John Janke: I like this workflow shift where this used to be about like, Hey, how do I help a deal?
How do I win with a customer? Yeah. And it really, I, I had an, you know, again, I, I get to spend a lot of time with ISVs who are. Pioneering this and just really learning from them and then trying to apply those practices to the company and the ecosystem. But someone was talking about from lead to renewal, like that’s really the process that cloud go to market needs to be aligned to.
And if you break down your lead to renewal process and then you look at all the different touch points, and then how do you inject, you know, people, process, technology into that entire lifecycle. It will. Change the way you think about this because a lot of people are like, Hey, why don’t I get more leads?
That’s right. And when you, when you boil down your lead to renewal process, if you skip all the way to leads and you haven’t done the work in the middle of the funnel to go build a brand, to enable you to go tell a better together story to co-market, I mean, you’re never gonna get the leads. Like, so I think that’s a, a good framing just for all of us to, as we think about the business and where we’re at, like lead to renewal.
’cause you can use a lot of different tools in there.
[00:30:12] Vince Menzione: I want to touch on, ’cause you talked about this a little bit earlier too, in terms of the, the framing was, you know, it used to be the largest organizations that had the largest commitments that went after it. Understood it. Uh, in the beginning you had to teach them how to go buy off of it.
Right. It seems to be moving down market. Right. And this is, some of this is the channel coming at it. Some of it’s also we’re gonna have PAX eight and Ingram Micro on stage here the next two days. People that have kind of stayed away from marketplace. Right. But in a way saying. Even the smallest customers need access to the same sets of tools and capabilities, and they want to purchase modern technology the same way.
And so it seems to be changing things. I know, John, you’ve had it some perspective on some of this as well.
[00:30:54] John Janke: Yeah. A, a big, another big, and this I think trend will be next year, it’s happening right now, but it’s still really early, is this idea of evolution of storefront. So if you want to change buyer behavior, you have to meet buyers where they show up, uh, and.
Like today, storefront, think Azure Marketplace or AppSource, those are the storefronts, but that’s not where people organically discover. So how do you initiate those buying moments where people organically discover? And that’s gonna be some sort of refactoring of storefronts. Uh, and Jay McBain has talked for years about how they’ll be more marketplaces and more storefronts.
That’s right. And, and I actually think that’s really starting to come to life. And PAX eight to me, I think is a great example of that, where they’re a marketplace for MSPs focused on s and b. And they’re gonna need specific solutions that their MSPs can package up to deliver value to their SMB customers.
But that’s gonna need to somehow connect to Azure Marketplace and AppSource. That’s, that’s right. Which is like a, a, a fuel system. So I, I think it’s a good signal of this change that’s happening like more storefronts. More marketplaces, more specificity around solution and bundle and what do people need?
So I’m, I’m excited to hear more from, I’m excited as well.
[00:32:06] Vince Menzione: I also think there’s a level of sophistication happening down market. I call the MSP market that wasn’t there even a year or two ago, right? These were organizations that were used to break fix and now getting involved in a much clearer, uh, ways in terms of driving a complete solution set in ways that they didn’t before.
Really, they weren’t involved in that level.
[00:32:27] Shane Wilson: Yeah, I would, I would double click on the, um, the storefront idea, right? Because folks are finding products in new places and trying to buy products in new places. So that’s a real deal, um, coming from a security and infrastructure perspective, um, even in today’s world of, hey, there’s a cloud buyer out there and there’s procurement that buys cloud stuff, and we’re attaching to that a, a major part of the motion that we actually have to put.
Time and investment into learning on is what I call building a bridge and building a bridge between say, a traditional buyer of software to whoever’s gonna click by on the deal. Uh, who owns, say the, the Azure tenant. Right. For a giving you customers you’re selling to. And so there’s, there’s, there’s topics like, Hey, how is budget attributed across the different, you know, lines of business inside this, toward the Mac?
Yeah. And then there’s the very sort of tactical process of like. Does the person that needs to accept the offer even know about what we’re doing in the deal, right? So there’s a lot of bridge building you have to do from an ISV and partner. That’s where partners play a huge role too, is like helping build these connections in and build a bridge early in a campaign, right?
In order to have success. So you can actually transact easily when you’re trying to get the deal done, but it goes to the point of, hey, the demand and purchasing, um. You know, center of gravity is changing, right? Yeah. So,
[00:33:39] John Janke: and every ISV, whether you think you have a marketplace or you don’t, most people would say, I don’t have a marketplace.
But everyone on their website has a tech ecosystem page that shows all of your partners. That’s right. And it shows your technical partners, and it shows your channel partners and your system integrator partners. And effectively that is a catalog and that catalog. Has zero actionability. All it does is you click on it and it takes you to your partner’s website.
So if your website is where all of your buyers discover you, why wouldn’t you want to enable them to take some action? Yeah. This is what storefronts will be, and that will not just be your storefront, it will be all your channel partner storefronts, and they’ll all connect together like that. This is a big wave that I think will really play out over the next 24 months.
Yeah, I think
[00:34:22] Vince Menzione: we’re starting to see that in a big way and, uh. Everyone’s gonna embrace it.
[00:34:26] Shane Wilson: Well, you see a consumer grade, right? It’s gonna move from consumer grade on, uh, say social media, buy a thing right into the enterprise space, uh, dramatically, I think the next two years.
[00:34:33] John Janke: Yeah. Shopify did this in B2C, like when Shopify and there, there’s really interesting like, um, story where when they were, I.
Early raising money. And they talked about how like in B2C e-commerce, there would be thousands of new storefronts and everyone’s like, no way. Like Amazon and Walmart Got it locked up like, this is never gonna happen. This company’s going nowhere. I mean, Shopify’s a hundred billion dollar company now.
’cause they created hundreds of thousands of storefronts for small businesses and entrepreneurs like. I think B2B will look very different than that, but that’s, it’s like B2C always trickles into B2B over time.
[00:35:10] Vince Menzione: So, final advice for our partners watching, listening, being in the room here today, and we, I know we’re gonna have some more time for you to talk with them.
Uh, appreciate you making time to do that. But any final advice for them as we finish this new fiscal year with Microsoft? We get into 26. And for the, the partner ecosystem in general, how they, you know, you talked about a few things, a few trends happening. Uh, what do you both have to share with this amazing audience?
[00:35:33] Shane Wilson: I mean, I’ll kick us off. I think consistency is most important, right? Yeah. So it’s one thing to, um, uh, you know, get a couple wins or, or, you know, know a play, but consistency across the organization and starts at like the C-suite down to the shop floor, right? Uh, of how you’re operating your strategy, how you’re executing on your strategy, and then also how you’re sharing wins.
So, ’cause this is a journey, right? And it’s not always, um, say the first month or first quarter that you get all the results that you want. But it’s really critical as a leader in a company to be able to help articulate what the stepping stones and the milestones look like to get to greatness and then to celebrate those wins all along the way.
And do that internally and also do it externally with Microsoft and with the partner community broadly. Right? So I would say consistency, that rhythm of business, just being very thoughtful around that is, is, is super important. And then, um, with that, just leveraging. The community. Right. Um, so events like, like up Right.
And just, you know, I’m happy to share any of my secrets to success with anyone in the room. Right. But just le leveraging the community and, and folks like tackle and others, right. That have so much experience in this space as well. So,
[00:36:36] John Janke: yeah. I, I think the, um, kind of back to the time series of marketplace moments, there is, uh, people who started in 2018.
A lot of people failed in 2020. People started. A lot of people failed in 2022, maybe less people failed, but still lots of failures. And there’s some PTSD in the industry around some failures. Like, I thought this was gonna work. I thought lots of people were gonna buy, I was gonna get all these leads. Oh my gosh, co.
I was gonna co-sell and I was gonna help my deals go faster and maybe it didn’t happen. The thing I would say is like all of these moments compounded lead to. A difference of experience, and that is like if you’ve struggled, take a step back and be willing to be like, Hey, the market is evolving and there’s ways to take a step back, look at the success or failure you had and refactor your strategy for the future.
So I would say, um. And, and it’s fun. It’s really fun to talk to ISVs who are hitting an unlock moment. Like I was talking to someone this morning and they’re like, Hey, like we, we had this major unlock moment. And like things have kind of taken off. ’cause a lot of times in the journey you end up with this like 10 x factor that happens.
You struggle consistency’s such great advice. Um, like you set a goal your first quarter, it doesn’t happen ’cause you’re, you’re still like. Trying to teach people second quarter, maybe a little bit happens and you’re like, oh my God, is this actually not gonna work? And then in the third quarter it starts to snap into gear like that consistency’s required and how do you get to that 10 x factor?
’cause they’re there. And this is a little bit about our event. I mean, if you’re interested in joining. A little bit of a
[00:38:11] Vince Menzione: segue for you, Jen.
[00:38:12] John Janke: Yeah, we’ll have, I mean, we’ll have, uh, and, and again, like on the practitioner grade day, we’ll have some folks from Microsoft joining us, Michael Clark, who owns the co-sell, uh, engineering organization.
Ryan, who’s been a long time part of the marketplace organization will join Adam Boyle or head a product just as we talk about how do we, I. Industrialize this for enterprise grade scale. Vince is gonna be on yeah, kind of doing a highlight reel of this week. ’cause there’ll be so much to share with the ecosystem.
Uh, and then a lot of really interesting customers telling stories, uh, throughout it that I think, you know, we’ll, we’ll get to take snippets of those and share ’em with the ecosystem. But, uh, if, if you register, you get access to all the content remotely asynchronously as well, so you don’t have to actually show up full time.
[00:38:54] Vince Menzione: That’s great. And I do think during this time of rapid change and transformation, it’s important. We had to stay, we had to lean in. We had to continue to lean in. We’re just at the early days of change. Right. We talked about many moments. Yeah. So, so great to have you both here. Um, thank you for making time as well, uh, networking with some of our community here.
I know that tackle’s gonna be leading a session, a workshop as well. So Shane, thank you for making time for us as well. Thank you, Vince supporting us. Yeah. Thanks Vince. Great everybody. Thank you. See you through the day. Thank you so much. Appreciate it. Thanks for tuning into this episode of Ultimate Guide to Partnering.
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Jun 24, 2025 • 34min
264 – AI Unleashed: Microsoft & NVIDIA Drive $1 Billion Marketplace Deals & Agentic AI Revolution
Recorded Live at Ultimate Partner LIVE in Redmond, WA
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Welcome back to the Ultimate Guide to Partnering® Podcast.
Join Microsoft’s Sandy Gupta and NVIDIA’s Pat Lee as they explore the monumental shifts driven by AI in the software landscape. Discover why “ISV” is transforming into “SDC” (Software Development Company) , the dramatic reduction in AI token costs and hallucination rates, and the acceleration of cloud migrations. Learn about Microsoft’s commitment to a “marketplace first” approach and a single $1 billion marketplace deal this quarter , and NVIDIA’s vision of embedding AI into every application. This discussion highlights the emergence of agentic AI, the convergence of ISVs and SIs, and the critical importance of embracing AI for all partners to drive significant business outcomes and avoid being left behind.
We’re curating the very best of these moments—fireside chats, expert panels, and executive insights—so you can stay ahead of the curve and fully aligned to where Microsoft and the industry are heading.
And this is just the beginning.More sessions. More voices. More of what you need to know.
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Thanks for being on this journey with us.— Vince
https://youtu.be/ld9h1pZJ_Ro
Key Takeaways:
The terminology for independent software vendors (ISVs) is evolving to Software Development Companies (SDCs) to reflect a broader scope of software innovation.
The cost of AI tokens has dramatically decreased, and AI hallucination rates have significantly gone down, leading to greater democratization of AI.
Cloud migrations are accelerating, largely driven by AI, which is broadening opportunities across the entire value chain for the ecosystem.
Microsoft is adopting a “marketplace first” approach, with a single $1 billion marketplace deal projected for this quarter, indicating a massive shift in how software is sold and consumed.
Agentic AI, characterized by headless agents focused on specific tasks, is a rapidly emerging area with significant potential for business process automation and interoperability across different applications.
The industry is witnessing a convergence of ISVs and system integrators (SIs), as customers require both robust software and hands-on implementation and change management support.
If you’re ready to lead through change, elevate your business, and achieve extraordinary outcomes through the power of partnership—this is your community.
At Ultimate Partner® we want leaders like you to join us in the Ultimate Partner Experience – where transformation begins.
https://youtu.be/s33fltuizEo
Transcript:
Key Tags:
AI innovation, software development companies, SDC, cloud marketplace, NVIDIA AI, agentic AI, digitaansfol trrmation, B2B technology, strategic partnerships, ecosystem growth, Microsoft Azure, AI monetization, enterprise AI, digital agents, industry foundation models, employee productivity, customer engagement, business process automation, drug discovery, cyber security, financial services, healthcare AI, channel partner collaboration, tech intensity, go-to-market strategy, cloud migration.
Transcript:
[00:00:00] Sandy Gupta: This space is moving so fast and it’s like I was talking to the Pearson guys. The fastest training that’s happening is people who are learning how to develop agents who are non-technical.
[00:00:14] Intro: We believe this time is like no other. We believe we refer to these as the tectonic shifts, all the hyperscalers in the world, if you add them all together.
Managed services will be one and a half times larger because it is the customer buying behavior that has created the need for all of us to rethink our models. Until we have data quality, the effectiveness of AI cannot be realized and effectiveness of the partnerships cannot be realized. Can you figure out, first, what your purpose is and how Microsoft can support your purpose and how you can support Microsoft purpose?
Now we have a partnership. It’s the ultimate partnership. Welcome to The Ultimate Guide to Partnering. I’m Vince Menzi, own your host, and my mission is to help leaders like you achieve your greatest results through successful partnering. We just came off Ultimate Partner Live at Microsoft Redmond Campus, our most powerful event.
Yet, over two days, we gathered top leaders to tackle the real shifts shaping our industry. If you weren’t in the room. This episode featuring Sandy Gupta from Microsoft and Pat Lee from Nvidia brings us right to the edge of what’s next. Let’s dive in. So I am thrilled to invite to the stage. Uh, first of all, I want, I’m inviting back somebody who was with me in Dallas for the very first time.
He was a day number 52 in his new role, Sandy Gupta, who’s an incredible leader. Uh, at the time we called his role infras, ISV independent software vendors. We’re kind of moving away from that. We’ll talk about that. And here’s the other cl. Piece, we’ve got Nvidia up on stage, right? So have anybody here who’s heard the name Nvidia before?
Uh, any, anyone there? Uh, we, we think that this is a formative moment in time and we talk about tectonic shifts, right? We talk about the world of ai, we talk about the build out. So I am thrilled to invite to the stage both Pat Lee. From Nvidia who leads the alliances and strategic partnerships and Sandy Gupta, who leads the software development corporations SD get ready to say SDC Software development companies.
This is the new terminology we’re getting away from the old world of ISV. So I wanna welcome these two incredible leaders to the stage, Sandy and Pat. Glad to have you. So good to see you, my friend. Uh, so good to see you. I love this guy. So good to see you again, pat. Great to meet you. Nice to meet. Glad you could join us.
Uh, Sandy, I gotta say, because I’ve, I’ve told you this before. We’ve had you on stage. We’ve had you on the podcast. I am envious, so envious of your hair. I just think
[00:02:49] Vince Menzione: it’s incredible. He’s got, he got the most amazing head of hair. Um, well, you know, just by the way, just looking at. I, I just got a haircut and you, and you got a haircut.
Like, and, and Pat, and I can, this will take me a full year to grow and Pat, I, and I can, I love it. So good. So join while we can. So good. So
good. Uh, I’m gonna let you both introduce yourselves and then we’re gonna dive into this conversation, but so great to have you back. Thrilled to have you both join us.
So I’ll let you introduce yourself and then turn it over to Pat.
[00:03:17] Sandy Gupta: Yeah. I mean, Vince, first of all, thank you. It’s an honor to be on this platform. Again, thank you with these incredible partners. But first of all, thank you that you are safe. Thank you. I think, uh, you played down the accident you had, and I’m just so glad you are safe, and I know it’s still not easy, but yeah, you’ll recover and thank you.
And, and, uh, you know, that’s, it’s, it’s amazing that you, you’re good. Um, look, I, I lead the global ISVs for Microsoft and so, um, or STCs. Yes, yes. Now it’s gonna take some while because it’s been a 32 years of practice of calling ISVs and. Well, we now see software companies emerge who are not like ISVs, what we used to think about as isv.
So that’s kind of the change. So I spent a lot of time working with our ecosystem of software companies, helping them grow their top line revenue. Been 18 years in Microsoft and learning every day.
Yeah,
[00:04:11] Sandy Gupta: and by the way, one thing also is like incredible partner here, pat Lee.
[00:04:17] Pat Lee: Well, thank you first of all, it’s a pleasure to be here, an opportunity to speak to this audience.
So I’m Pat Lee. I lead a strategic enterprise partnerships at Nvidia, and I’m focused on really the leading enterprise hardware and software providers and helping them bring AI to their platforms to, and let them enable all the power of the data and, and what they’re delivering to their customers. And I think there’s a great opportunity there, huge.
Once they’ve done that, it’s a great opportunity for all of you to help deliver and deploy it.
[00:04:42] Vince Menzione: So thrilled to have you both on stage. Um, this is gonna be a really exciting conversation. Sandy, I got to be with you day number 52. Uh, I’d love to dive in a little bit about what you’ve learned from, uh, that was early October of 24.
I. It seems like it was last week in some respects, but I, I would love, maybe we could share a little bit with this audience, like how you were thinking about this o other than the fact that we now stopped calling them ISVs and we’re calling ’em SDCs. Yeah. But I know that’s an overall vision for how you’re and how you’re supporting these partners.
[00:05:15] Sandy Gupta: Oh, thanks Vince. Uh, look, I think if I look about what I’ve learned both in terms of externally and internally, what has changed and how it’s shaping for us for next year. Um, one is just externally, if you look at it, the cost of tokens have come down dramatically. If you look at that, I mean, I was just looking at a.
Uh, report from Stan Stanford AI Index. It just came out. It was like the cost of tokens have gone from $20 per million tokens to seven, you know, 7 cents Wow. Per million token, right? And so, and the hallucination, which is also a big part of, hey, for enterprises, like for them to put an autonomous agent, they need to be very thoughtful about that.
If you look at the recent reports, the hallucination has really dramatically gone down. In the same linear scale as the cost. And, and that is because AI is now, you know, really also being trained to look at the outputs of AI to see, hey, is it actually hallucinating or is it not? So there is a lot of democratization of AI that’s happened very, very fast.
I will call it almost like a tech intensity. Mm-hmm. You know, when I joined, when we met first is, um, still the ics were connecting and say, Hey, should I do a co-pilot? Should I, yes. Infuse g PT four in my application, or should I develop a co-pilot? Now it’s like the co-pilots are already out there and, uh, for every role you can think of, whether you’re, you’re on a shop floor or you’re a physician, or there is a co-pilot for you.
And then a lot of them are now looking at, Hey, what’s going on with, um, with, with, uh, with my agent framework, how am I thinking of monetization, governance, security? Go to market, all of that. So massive shift happening. Massive shift in, in that. Um, I would also say that we’re seeing a massive shift in marketplace.
We, we talked about today with Serial and, and also we talked to John and and others about marketplace today. Uh, we are about to drive to a billion dollar marketplace deal this quarter. Wow. Single deal. Single deal. And, uh, that is, uh, so the shift to marketplace is real. And, and I think we are feeling it.
Uh, we are very committed to it. Um, so that’s kind of happening. Uh, we are seeing some in interesting things that, you know, cloud migrations are also accelerating very fast and, and I think part of it is AI is driving a lot of acceleration and it’s really broadening opportunity for the entire ecosystem because there’s just so many ways you can think about the value chain that’s emerging as you get to cloud.
So internally, I would say that this. Group of companies, the software companies that, you know, I’m managing as go to market is the fastest segment of our commercial business. Yeah. And so, uh, that’s fascinating. Good and bad thing is. Getting a lot of attention. Right. And so the good part of the attention was that Judson was like, Hey, this is important.
Yeah.
[00:08:21] Sandy Gupta: And here’s some money to go try a few things that you see are important for H two. Nice. So we can shape next year. Nice. So, so I think there is both internally, there is a lot of recognition of what’s going on and, and we need to, you know, invest and, and uh, and in certain specific areas. Uh, I would say, the way I quickly say is that shaping of for next year is we are going to have a really big focus on tech intensity in a sense of, hey, how do we help our customers do a quick fail fast?
Hmm. Fail cheap, you know, way of investment because you have to try a lot of things. Right. In ai And we’re
[00:09:03] Vince Menzione: saying customers, you’re talking about the ES software development corporations,
[00:09:06] Sandy Gupta: companies. Yeah. And with them. For the end customers and for the end customers. Right. As well. And, and because there is a lot of trial needs to happen, there’s a lot of innovation ideas.
Some of them will never see the light of the tunnel. But many of them are worth trying. And so we want, want to find a very agile way to invest resources and bring very specialized partners, small or big services companies who are deep in AI to really help our ISVs to do those things. Uh, we are gonna come up with a, one of the most, I would say, competitive migration program.
And I’m very about that. Oh, tell
[00:09:40] Vince Menzione: us more.
[00:09:41] Sandy Gupta: Well, I think we’re still cooking. Okay. But I think this is where we, I feel like. The tam of opportunity for still a lot of the ISVs to go to cloud is huge. Exactly. And, and it’s, I think it’s an opportunity for us. So I, I’m very thrilled about that. Um, that I think that’s gonna happen.
And then really next year is a big year for us to take a marketplace first approach. Good, good to hear that. And I can, I hear a roundup applause for that, by the way. I think that’s an incredible,
[00:10:10] Vince Menzione: yeah. That’s incredible.
[00:10:11] Sandy Gupta: I think those three things I would say, Vince, and, and, and overall, I was just telling Pat in the green room, hey, how we are going to stimulate our sellers to sell more with partners?
Yeah. And, and already like, you know, Nicole talked about how we actually put the money where the mouth is today and investing in the ecosystem, but. Making sure that our sellers are really creating the demand that’s out there with our partner. I would love, I want to, I want to give Pat some time as well.
Yeah. But I would
[00:10:38] Vince Menzione: love to hear from you, like, how are you thinking? When we, when we were up on stage in October, you had basically winnowed down the organization, right? You took the top 30. Directly, and then you push down to the field organizations, the other large, very large, significant ISVs or SDCs. Yep, yep.
How are you thinking about the management of this ecosystem? Especially in light of what you just mentioned in terms of the The adoption, the new adoption curve?
[00:11:04] Sandy Gupta: Yeah. Do you wanna go to Pat first or do you want, then we’ll come back. Yeah. And then I think we’ll come
[00:11:08] Vince Menzione: into Pat. Yeah. So
[00:11:09] Sandy Gupta: the way it is playing out is like we are starting to think about what is the right resource model for an ISV.
Where they are on the journey. Okay. I think we have had, for the longest time, you know, Microsoft super well, uh, that we had a very inflexible model that basically said, Hey, you can only do this if you have this designation or this or that. Yes, we have partners who are incredibly technical and they don’t need technical support from us.
There are partners who are incredibly good at Cosal, say, Hey. I’ve got my customers. Don’t worry about it. I’ve got it. What I need you is innovation and, and help us, you know, but we can do the direct co-sell. We are good. So we’re trying to figure that out. It’s like, hey, where do we meet the partners where they are rather than create a, a very rigid model.
I’ll tell you Vince, like I lean in like yesterday, I was in Orlando, just came back last night and we had like a, essentially a late stage startup with big partnership. Jason and I were both there. Very nice. And we are pretty much leaning in, so it’s less about now, Hey, do I have this global partner or do I have a startup?
Yeah, that’s what I was getting at. It’s more like, Hey, is the opportunity, is it the right opportunity? Dive into yes. Is it the right opportunity? And we bring, that’s great. The machinery.
[00:12:26] Vince Menzione: Well, at our next event, I’m gonna dive in even deeper on this conversation with you. Yes. This is a big one, pat. I’d love to hear your vision.
Nvidia is in a juggernaut right now in this industry. Uh, fastest growth of any company, uh, in my lifetime. Uh, we used to talk about compact getting to a billion dollars back in the day. I mean, NVIDIA’s market share and market cap has just been astounding. Uh, we talk about the infrastructure build out, uh, we talk about the, the commitments that are made around cloud.
And really AI is being driven from your organization. You really are the leader in driving the technology, and I’d love to get your idea and vision on how you’re thinking about it working with Microsoft. And how and how you’re doubling down and leaning in.
[00:13:09] Pat Lee: So from First principles, NVIDIA’s a full stack software and computing company.
[00:13:13] Vince Menzione: Yeah.
[00:13:13] Pat Lee: Everybody thinks about us as just providing GPUs. It’s not that. Yeah. We provide the full infrastructure and software stack required to make AI successful and we have partners that take various layers of it and what they need to make their business successful. But that requires partnership. Um, so for EX, and we have a deep partnership with Microsoft and how we work together to provide.
The best infrastructure possible for AI to meet the needs of their own apps, their partners apps, and the apps that all of you’re gonna help your customers build. It’s not one thing, it’s all of them, right? And I think what we need to do is make sure that we help provide the necessary platforms that can be used at all three levels.
Because what Azure OpenAI needs is very different than what a leading ISV needs. It’s very different than what a GSI needs to deliver a solution to a customer. So we’re really trying to make sure we provide the right hardware and software at the right levels to enable people to be successful across the board.
And by doing that, it allows us to help Microsoft be more successful. Great quarter for, uh, Microsoft This last quarter. Yeah. Congratulations. Just watching acceleration growth. I mean, we’re excited to see that because it means more and more people are taking advantage of the power of AI and that is us.
If our number one goal for Nvidia is like, I want every enterprise to have AI embedded in their solution. Yeah. That’s it. That’s our vision. AI in every application, that’s what we wanna see
[00:14:38] Vince Menzione: moment. Yeah. I, I think we’re seeing it. I, you know, it’s funny because we had this conversation a couple years ago.
It was like, it’s not happening fast enough. And I, again, I come back to the Bill g comment, right. ’cause we expect too much too soon. Mm-hmm. We’re getting there in incredible ways. The, the technology is taking off in some, so much more deep and intangible ways right now.
[00:14:57] Pat Lee: And as you see with some of these companies, like is v so a number of ISVs in the room here are partners of our ServiceNow.
Cohesity. Yeah. Um, we’ve done work, work with help them innovate to help bring their AI into their platforms. Right. If you look at some of their own comments about AI and how it’s growing, it’s a, it’s amazing to see how it’s grown and just the amount of time they’re able to first get into market with a basic solution.
And how the technology’s just growing every day. This is not slow. This is not the old days of adding a feature every 18 months, every, every month. Something’s changing, evolving, and people are looking to adopt it. And how do they really bring that power of AI to their customers? Mm-hmm. And then more importantly, figure out in what way Some companies are monetizing it through upsell.
Some companies are baking into their base product to drive more people onto a cloud computing model. Everybody’s trying to figure out the business model that makes the most sense for them. What is the metric that’s gonna allow them to be successful? Yeah. And driving the investment for AI to lead to the outcomes they care about.
[00:15:57] Vince Menzione: How does your team layer in support for Microsoft then? You know, ’cause you talked about three different areas of growth or growth opportunities working with these partners. Is there a level of specificity working with the Microsoft teams on on, I mean,
[00:16:10] Pat Lee: Microsoft’s a strategic partner. Yeah. We have a deep dedicated team focused on, yeah.
Delivering what we need at each level at these things. That includes everything from the infrastructure build out across the board to, you know, help helping Microsoft optimize internal applications that were then delivered on the cloud to then now, I mean, we look at that, one of the things that we’re excited about Nvidia from the software perspective.
That we’re part of, um, Azure AI Foundry, um, and we have a rich software stack that’s embedded in Azure AI Foundry that can be bought through the marketplace. Very nice to deliver high performance models that can be used to help build applications for your customers and delivered NVIDIA’s pride and joy is delivering the best performance ever.
Um, for example, we can deliver LAMA 2.8 times faster than the base solution in Azure AI Foundry. Wow. By leveraging our marketplace solution. It stays in the AI foundry ecosystem, and you can take advantage of that to build out applications to deliver. The best solution for your customers? Yeah. Vince,
[00:17:09] Sandy Gupta: just, you know, we, I, my team manages Nvidia as a software partner.
I see. Very interesting. Why customer, that’s a different approach. Yes. Which is a very different approach, approach to kind approach
[00:17:18] Vince Menzione: frame what Pat is saying. So you’re helping to forge some of these partnerships, uh, from Foundry over to some of these other ISVs that are gonna be building out solutions, ag Gen.
I wanna dive in on AG Agentic, ’cause I think this has been a huge topic area. Yeah. It seems to be the area of most growth right now.
[00:17:34] Sandy Gupta: Yeah. I mean like if you look at it. The taxonomy of it is like if you have a copilot, it’s specific to a role that’s helping the human. It’s like a AI assistant. Yes. And then if you look at AgTech, it’s about, hey, it’s, uh, it’s headless.
It’s specific to a task, and the idea of architecture is make it as narrow to a task as possible. So for a complex task, you can reuse a lot of different agents and, and all of that. I mean, I’d love to like even say, Hey, how many people here use teams? That’s pretty much everyone. Yeah. How many people have added an agent to teams?
It’s like 10%. How many people have created an agent in a team? It’s actually impressed. There is actually more than I expected. Four or five. Yeah. Look, it’s uh, this space is moving so fast and it’s like I was talking to the Pearson guys. The fastest training that’s happening is people who are learning how to develop agents mm-hmm.
Who are non-technical.
Yeah.
[00:18:36] Sandy Gupta: And if you look out to teams, and for those who have not done that, it is super easy to go and, and teams and co-pilot studios just. One framework. There’s just so many low-code, no-code frameworks out there, but it’s incredibly sort of, the pace is moving. But I wanna bring back to like, hey, how is it being used and how is it being consumed?
So I wanna go back to what Nicole was saying. This, this morning is kind of the frame and Judson talked about it, uh, last week. I don’t know if those who heard in his AI. L uh, tour in London. Yeah. Said, Hey, like there’s a four big pillars of how AI is being consumed. One is how we are using for employee experience, and that is a lot of things like, for example, M 365 co-pilot for knowledge workers, but there are a lot of fine tuned co-pilots in the market for different types of audience.
And he was talking about, hey, how, um, 65,000 of his sellers are now using them. And the top quartile of that has kind of seen, like, he’s seeing like a close rate go up 23% and per head revenue’s gone nine 9%, which should multiply by 65. It’s, it’s a, it’s a good number. Uh, so we are seeing a lot of that sort of adoption in the enterprise today on, hey, just employ productivity.
Productivity is incredible. Uh, there is a big pivot that is, we have seen a scale is like the customer engagement. And, uh, we talk about like our own engagement. Like we have like 15,000 support people, about 25,000 vendors. And, and Judson pulled like about half a billion dollar cost out. Wow. And the customer experience has gone up in terms of the feedback we are getting because it’s all now the triage is done through a Gentech framework and they, and the triage decides, the agent decides whether it’s, it’s time to go to a copilot with a human or.
Pass it to an agent to, to be able to, because they know the, the customer really well. But then I think the two big areas it’s emerging now is the third is like really around the business process automation. I was just talking to a big hedge fund yesterday in Orlando and they were saying, Hey, we’ve got one of the most successful hedge funds.
And they were like. We have like 400 business processes that we have identified to really kind of automate over time, but there’s like five that we really are going to really hit is gonna be the biggest, uh, impact for us, and they’re very focused on that. I think like that thing is kind of, I mean, imagine like EIF tomorrow got automated.
Yes. I mean this whole entire room will be full of joy and, and uh, and, and the employee no more
[00:21:17] Vince Menzione: whiteboards with, uh, calculations on them. Uh, our MDF
[00:21:21] Sandy Gupta: here, like, oh my gosh. And the Microsoft employees will play golf every day. Right. If that can happen, no matter what role you are in, you get sucked. EFI is like our investment funds and stuff.
So it’s like a business process that nobody knows how it works. Yeah. Uh, and then like, uh, you look at like, but the last thing I wanna say is he, she talked about bending the innovation. Yes. I think it’s the products that are coming in the market now. Like if you look at Siemens, I was in Hanover a few weeks back and Siemens published with us, like a co-innovate, like a industry foundation model.
Mm-hmm. Essentially putting all the modalities of engineering and manufacturing in GPT-4. And other models and all, and being able to consume that through hundreds of copilots that the ecosystem can develop. I mean, can you imagine Siemens, like company becoming a software company? Yes. Bringing their really core value to the market through a fine tune, you know, industry specific model.
So, so I think there is this way how things are sort of. Like what are the dimensions? But then when you look at, Hey, how’s it been consumed? How the co-pilots and Gentech has been consumed by enterprises in these four dimensions. I would say co-pilot is the best way for diffusion in the enterprise where everyone can touch and feel ai, whatever their role is.
And, and most of this, it is no more longer a debate. Everybody has a copilot now, right? For the role, uh, NISV has for their specific role, whether it’s manufacturing, healthcare, et cetera. And then the things that differentiate you. That’s where it’s really about working on, Hey, do I do, I buy and build? And, and that’s where this whole age agent framework is coming to life, which, which can go in more details here.
[00:23:08] Pat Lee: And I think with age agentic, it’s very interesting, right? Yeah. I think. A lot of companies are trying to say they’ve got the perfect agent solution, but the challenge you all know is nobody has a single system of record. They’re running their business ons. So what happens when you have systems of record from different vendors?
That’s where the fund’s gonna come into play with agent ai, totally and X. One of the things that we’re working with Microsoft on and how do we help agent interoperability standards. So when you want to go, I wanna write an agent in Salesforce and I wanna write one in Microsoft, I wanna write one in ServiceNow.
How can you tie them all together? Yeah. In a way to go back to that question, what business process do we need to solve? Because That’s right. It’s never in one app. Totally. Your business process runs across all these different apps.
Yeah.
[00:23:52] Pat Lee: So the best thing we can do, I mean, one of the things that we’ve talked about internally is like instead of having to learn complex APIs from each different application, you’re gonna be able to speak natural language.
To a set of agents and you’ll have
[00:24:05] Sandy Gupta: context.
[00:24:06] Pat Lee: Then you’ll have context on intention. Intention and, and there’ll be a reasoning agent there. I know this is geeky techy, but you’ll be able to ask questions and it’ll go off and spin up different agents that can talk to different languages and do it all and bring it all together for you across applications.
Yeah.
[00:24:20] Pat Lee: That’s the power of a agentic ai and this isn’t science fiction. This is, this is happening, and like you’re gonna see more and more over the next 18 months. You’re gonna see this growth and it’s a huge business opportunity because. People who are resellers or system providers, your customers are gonna want it.
That’s right. They don’t want end up paying for 12 different applications. They want a single way to solve the problem. Even if they have to pay for them, they don’t want have to interact with ’em 12 different ways. Totally. So how do we help them do That’s right. Yeah.
[00:24:47] Vince Menzione: And we’ve been talking about tectonic shifts for years now, but now it’s really accelerating, right?
Yeah. And AgTech AI is really, so what are the, the milestones along the way? ’cause we’re gonna be here sitting down from here a year from now, having very different conversations than we’re having right now. What do you see?
[00:25:03] Sandy Gupta: Well, I mean, just to bring this to life, if you have a phone, you probably, I have an iPhone where I use 300 applications, right?
Yeah. What if you contact switch from one to the other? What if you don’t need to do a contact switch and essentially go, they go to one another? You can, yeah. And, and you have an open table. Agent that goes and reserves the dinner for you and your wife. And That’s right. Without, as long as you have the intention, without having to go from hey, weather application to this.
And if you think about that system of intelligence that Pat just talked about, which is no longer this passive APIs, but it’s a system of intelligence that is talking to all these different, uh, different siloed, um, system of records that is a whole emerging sort of ecosystem right now. Say a couple of things, Vince, uh, that’s emerging in the ecosystem that we worth talking about.
Yes. You know, we are seeing a lot of convergence of ISVs and sis very
[00:26:03] Vince Menzione: interesting to see this.
[00:26:04] Sandy Gupta: And, and, and I, as I talk to customers, they say, Hey, um, would love to work with these ISVs, but I need them handhold me. And I’ve been giving that feedback to the ISVs, Hey, it’s not enough to just have build a software right?
On the other hand, the sis are having the same thing. It’s like you cannot, because you know for us, we are going and saying, here are the use cases in your industry, in your domain, and you can either build yourself or with the SI or you can buy and configure. And both of them require, there is a convergence of like what your capabilities are as a partner.
Even for consulting partners, I, you know, starting to get the feedback from our customers is that, hey, I love the change management because it’s super critical because we asked the, we have put the business process and nobody’s using them, but the change management has to be in the workflow. Not just an outside training, like how do you insert the change management right in the workflow, what you’re trying to do when you’re trying to do, so, it actually leads you there then doing it.
So,
[00:27:15] Vince Menzione: so we’re gonna see a convergence of ISVs and sis. Then it has to, it has to happen in order to have the velocity that you need to have for these businesses. Totally. Yeah. Yeah. That’s a, that’s fascinating. What else are you seeing, pat, on your side?
[00:27:28] Pat Lee: I, I think it’s the, it’s, it’s the accelerated growth of ISVs adopting this technology.
Some, the, the early ones are getting farther ahead. Yeah. And, but the good news is the technology’s evolving so quickly. It’s time to catch up and it’s not as hard to catch up today. You started two years ago on this journey. It was gonna take you a year to figure it out. Now you can start and have something to market in three months.
The opportunity is just there. ’cause the tooling, the technology. Is better. I know you’ve
[00:27:54] Vince Menzione: talked about healthcare. Is that one of the areas we’re seeing the most Emergence of health. Healthcare
[00:27:58] Pat Lee: is a great opportunity because you know we talk a lot about large language models.
[00:28:02] Vince Menzione: Yeah.
[00:28:02] Pat Lee: Those are not the only models out there.
[00:28:04] Vince Menzione: Yes.
[00:28:04] Pat Lee: Large language models are one component of all the models we have. We have a whole division in Nvidia focused on healthcare and by biological models that can be delivered. Bio nimo is actually gonna be coming to Azure AI Foundry. Wow. So you could do drug discovery inside Azure AI Foundry. That’s amazing.
Kick off the model there and have it tie into the rest of your business system. So there’s lots of opportunities. More and more models are gonna have across various businesses, whether it’s financial services, whether it’s healthcare, um, and security’s a big area. You’re seeing lots of growth in terms of agentic frameworks, just because the complexity of just providing the security needed in this very rapidly moving world.
Is really critical.
[00:28:44] Sandy Gupta: Absolutely. I would say cyber and with all this agent, I mean imagine like a, a company with 500 SMB, 500 people with 5,000 agents. Yeah. That’s gonna be the reality and the security, the pri like about governance of all of that entitlements of like which agent can do what. It’s gonna be a, where I think massive opportunity.
[00:29:05] Pat Lee: It’s interesting about agents. In some ways HR is gonna be it.
[00:29:10] Sandy Gupta: Yeah.
[00:29:11] Pat Lee: HR is gonna be in charge of agents. In some ways it is like I take over that IT it’s like it’s building new things out. It’s a very fascinating place. Everything
[00:29:18] Vince Menzione: you’ve talked about today has been about outcomes too. I think about healthcare being 19% of gross domestic product in the United States, right.
As a, as a, as a recent victim of it, and just, I’m thinking about security. I’m thinking about financial. You start layering in these incredible components of our, of our models today. The outcomes that you’re gonna drive is the derivatives are gonna be so valuable, the creation that’s created. Yeah. So we’re going into, you know, we’re going into Microsoft’s fiscal 26.
Yeah. What, what are the things we need to, with this amazing partner organization, these ultimate partners in the room, how do we need to think, what final advice would you give to them?
[00:29:52] Sandy Gupta: Look, I, I’ll start is one is, uh, I would say don’t stay back from ai. Just like, really skill yourself. I mean, just get into, build an agent today, just tonight.
Just build an agent and, and it’s not that hard. Don’t let the geeks. Frighten you. It’s, it’s actually more easy than you think.
Yeah.
[00:30:12] Sandy Gupta: And, and it’s helping me. I, I built an agent just to improve my English writing. Very nice. So it’s helping me. Every time I write something, it corrects me. Uh, second is, um, the time has come how the ISVs and the channel partners kind of come together.
We talked a lot about in the marketplace session and. We really need, want to go deep into that because if you look at the mid-market and SMB, they’re not gonna consume AI by building it themselves, the solution themselves. And, and I think the market, the time has come now for the, for these partnerships to come together.
And, and the P two P and third is, um. I’ll just leave it that we’re gonna have a massive focus on migration next year. Yeah. And, uh, and I wanna make sure that everyone here is part of that, uh, huge opportunity sort of opportunity. Huge opportunity. It lends every type of partner in that. Uh, but most importantly, thank you everyone for being the, being our partner and, and amazing ecosystem and Vince, amazing platform.
Thank you so much. Yeah. I,
[00:31:18] Pat Lee: I think now is the time. This is not, there’s not a time to wait. Um, and there’s all sorts of ways to get started. You can get started as simply as an agent there, but I think one thing that every business that you work with and support has a mound of business critical data that they need to maximize, to get value out of, to put it, to make their customers get value out of.
And if we’re not helping them get there. They’re gonna lose business. Yeah. Other people are gonna come in and take that business. If you can’t maximize the value in these applications, they’ll be replaced. Yeah. So if we don’t make AI the prominent and most important feature of these applications, they won’t be able to keep up.
[00:31:58] Vince Menzione: I hear you loud and clear. I hope everybody else hears this loud and clear. ’cause it is important. I think there was a sense of hesitancy in the beginning. Like there was this feedback that was coming from CFOs saying, we’re not seeing the value yet in ai. This was in the beginning.
Mm-hmm.
[00:32:13] Vince Menzione: And I do think like organizations need to hit the gas pretty hard right now is the impression.
And they
[00:32:18] Sandy Gupta: don’t need to build everything today. Right. Like I think that’s the key thing is like, and there’s something they should build. So,
[00:32:24] Pat Lee: yeah, they, they should build what’s right for their business. What, yeah. Like as I said earlier in SA platform play. Yeah. Yeah. If I look at number of the partners I talked about like earlier, we’re providing the platform.
Yeah.
[00:32:33] Pat Lee: They’re bringing their business value on top of it. Yeah. And then they’re getting the value out of it. That’s that, that’s the thing. It’s like you don’t have to build all this. There’s a lot of foundation you can build on top of.
[00:32:43] Vince Menzione: Fascinating conversation. I want to thank you both, incredible leaders on stage.
I hope you all valued as much as I did Sandy, so great to see you again my friend.
[00:32:51] Sandy Gupta: I learned so much from you. Every time once we talk, I learned a lot from from you. Thank you, pat.
[00:32:56] Vince Menzione: So great to have you join us. Having the video up on stage at our Ultimate Partner event has been of great value for us as well.
Pat, thank you so much. Thank you very much, so much for joining us. You’ve both been incredible and I hope you’re staying around for a little while. Yeah, yeah, I will. Uh, there everyone, I’m sure wants to spend time with both of you. Yeah. Absolutely. So I want to thank you so much for joining us at, at our event this year.
I will see you at the, at the dinner. Yes. We’re gonna, we’ll see you up on, we’re gonna have a great meal together. Much Thank you much so much. Thank you so Pat, much Pat, so much. Thank you so much. Thanks for tuning into this episode of Ultimate Eye to Partnering. We’re bringing these episodes to you to help you level up your strategy.
If you haven’t yet, now’s the time to take action and think about joining our community. We created a unique place. UPX or ultimate partner experience where leaders come to learn from each other. It’s more than a community. It’s your competitive edge with insider insights, real time education, and direct access to people who are driving the ecosystem forward.
UPX helps you get results, and we’re just getting started. We’ve got big plans for you this summer as we’re taking this studio, and we’ll be hosting live stream and digital events here. And it’s all coming to you soon. So visit our website, the ultimate partner.com to learn more and join us. Now’s the time to take your partnerships to the next level.

Jun 22, 2025 • 22min
263 – The Lightbulb Moment: Microsoft’s Vision for AI and its Partners
Cyril Belikoff at Ultimate Partner LIVE in Redmond, WA
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Welcome back to the Ultimate Guide to Partnering® Podcast.
I’m excited to bring you even more from the Ultimate Guide to Partnering®—and this one’s straight from the main stage at Ultimate Partner LIVE at Microsoft’s Conference Center in Redmond.
If you haven’t been in the room yet, these events are something special. The energy, the insights, the access—it’s where strategy meets execution, and the partner community comes alive.
In this episode, we feature a powerful session with Cyril Belikoff, Microsoft’s new leader for Marketplace, who joined us to share his bold vision for the future.
Cyril dives into:
The “lightbulb moment” around AI and why it changes everything
How Microsoft is mainstreaming the Marketplace as a core GTM motion
What partners need to know about incentives, MCAPS priorities, and the rise of multi-party offers
And how the shift to AI and ecosystem selling is redefining what success looks like in this era
We’re curating the very best of these moments—fireside chats, expert panels, and executive insights—so you can stay ahead of the curve and fully aligned to where Microsoft and the industry are heading.
And this is just the beginning.More sessions. More voices. More of what you need to know.
If you’re not yet part of the UPX Community, now’s the time to join us. Access exclusive content, events, and strategies that keep you in front of what’s next.
Thanks for being on this journey with us.— Vince
https://youtu.be/yIfT1HZriGQ?si=yq_hIvNSp1pvrWtS
Key Takeaways:
AI adoption is creating exponential opportunities for partners, with leading customers seeing 10x ROI in just over a year.
Microsoft’s marketplace is centralizing digital transactions, incentivizing co-selling, and simplifying procurement for customers.
Microsoft prioritizes its partners, offering the highest compensation among hyperscalers and integrating marketplace deeply into its products.
The multi-party offer (MPO) capability is driving significant sales growth, enabling partners to collaborate effectively and increase deal sizes.
Microsoft emphasizes a channel-led approach, empowering partners to scale and leverage the marketplace for software and application sales.
Microsoft views the current AI landscape as a “light bulb moment,” urging partners to innovate and build solutions within its ecosystem.
If you’re ready to lead through change, elevate your business, and achieve extraordinary outcomes through the power of partnership—this is your community.
At Ultimate Partner® we want leaders like you to join us in the Ultimate Partner Experience – where transformation begins.
https://youtu.be/s33fltuizEo
Transcript:
Key Tags:
Microsoft, Partner Ecosystem, AI, Marketplace, Cyril Belikoff, AI Adoption, Digital Transformation, Cloud, Azure, Co-sell, Channel Partners, ISVs, Software Development, Multi-Party Offer, Customer ROI, Partner Profitability, Technology, Innovation, Business Strategy, Future of Partnerships, Microsoft Azure, AI Foundry, Trade Ledger, Content Square, Hyperscalers, Managed Services, Data Quality, Ultimate Partner Live, Ultimate Partner Experience, UPX.
Transcript:
Cyril Belikoff Transcript
[00:00:00] Cyril Belikoff: You know, as the AI adoption increases, the opportunity for partners sort of exponentially explode, customers are seeing almost four XROI on average, and then the, the leading customers who are really leading into AI are seeing 10 XROI. They’re seeing that ROI in like 14 months.
[00:00:19] Vince Menzione: We believe this time is like no other.
We believe we refer to these as the tectonic shifts,
[00:00:25] Intro: all the hyperscalers in the world, if you add them all together. Managed services will be one and a half times larger
[00:00:31] Cyril Belikoff: because it is the customer buying behavior that has created a need for all of us to rethink our models.
[00:00:38] Intro: Until we have data quality, the effectiveness of AI cannot be realized and effectiveness of the partnerships cannot be realized.
Can you figure out, first, what your purpose is and how Microsoft can support your purpose and how you can support Microsoft purpose? Now we have a partnership. It’s the ultimate partnership.
[00:00:58] Vince Menzione: Welcome to The Ultimate Guide to Partnering. I’m Vince Menzi, own your host, and my mission is to help leaders like you achieve your greatest results through successful partnering.
We just came off Ultimate Partner Live at Microsoft Redmond Campus, our most powerful event. Yet, over two days, we gathered top leaders to tackle the real shifts shaping our industry. If you weren’t in the room. This episode featuring Cyro Beov, Microsoft’s new leader responsible for marketplaces. Brings you right to the edge of what’s next.
Let’s dive in, uh, all up, uh, Cy Beov, I’m so glad to have you join us. So good to have you here today, sir. Thank you. Thank you for joining us. Thanks for having me. I’m I gonna grab a water here. Oh, please do. Yeah. I’m gonna grab a coffee. In fact, you uh, you were, you’re second next to me here. Great. Perfect.
We put you in the center. The hot seat. In the hot seat. Yeah. So, so great to see you. Yeah. Um. Yeah, we were, I was sharing this with, with the audience, but you and I were supposed to get together in person. Exactly.
[00:02:00] Cyril Belikoff: We had a snowmageddon here. I think, you know, I picked the heck of the time. You get a dusting of snow and Seattle sort of shuts down.
[00:02:06] Vince Menzione: You know, I grew up in the Northeast, we get 48 inches of snow overnight, and everybody would continue on. And I was like, oh, what happened? I mean, I was, I literally was at the hotel going, okay, well I was doing all these, uh. These teams calls because I couldn’t get people in the meetings and that kind of thing, so I’m so glad we could.
Thank you. Do this in person. Thanks for the
[00:02:22] Cyril Belikoff: invite again.
[00:02:23] Vince Menzione: Thank you. Thank you so much. See you, all of you. So, uh, I thought we’d talk a little bit of a broader, uh, conversation too, and then we’ll dive in on marketplace. Great. Because I think it’s a greater conversation. Great. I happen to know your organization.
Um, Alyssa Taylor has been a podcast guest here, somebody I worked with at Microsoft. Yes. And who’s taken on bigger, bigger, and bigger responsibilities within the organization. Uh, leading. Leading, I would call it cloud Go to market probably is probably the right term. But, uh, talk to me about your organization because.
You, you drive a tremendous amount of the energy and effort around Azure and industry Yep. And partners, uh, even before this marketplace changes. Yes. Or happened recently. So tell us a little bit about your background. A long time at Microsoft Over, yes. Over 20 years.
[00:03:11] Cyril Belikoff: Yeah. Um, so yeah, I’ve been at Microsoft, I think 27 years.
27, 28, something like that. Right outta
[00:03:17] Vince Menzione: college.
[00:03:17] Cyril Belikoff: Yeah. Lots of different, pretty much. I, you know, I had, uh. I had three days at, uh, PricewaterhouseCoopers, and then I decided, no, no, Microsoft’s my thing. Um, it’s my move. And so, uh, it sort of paid off, I think. Um, so yeah, I, uh, I’m part of, as you mentioned, uh, the commercial, um, cloud and ai, uh, organization.
Yeah. Uh, and my particular remit is around solutions and. Partner marketing to really focus on how we take all our products and take them to market with more of a customer outcome solutions basis. And then obviously, how do we enable our partner ecosystem? And that’s where sort of marketplace sort of has now, um, fit, uh, fit in there.
So it’s, it’s, you know, it’s an exciting time for software development companies, system integrators, all types of partners really, particularly around this AI transformation. Yes. And what’s going on? Um, you know. And of course being in the, the AI team, I’d be remits to talk a little bit about that and what it really means for partners.
I think Please do, please do, please do. Um, for, you know, this is a massive platform shift, I think everyone is, is is talking about it sort of at the same altitude as cloud or mobile or the internet. I sort of prefer the light bulb analogy. Um, and what I mean by that is, you know, back in many, many years before cloud, um, someone invented the light bulb.
Yeah. And it, it really changed. Both the con the, the, the life in the home and in the workplace, productivity, you know, sword. Um, but then people were like, well we, now we need sources for that light bulb, so we need to build infrastructure. Yes. And power and then power stations. And then the power station companies built this power stations and then realized, well, we can actually produce more power.
So are there other things we can put in a home in a factory? Um, and then. People started to innovate. And then not only were they light bulbs, but dishwashers and washing machines, that’s, and all these sort of innovations came. And so AI is sort of at the same platform level. Yeah. Um, and we are com commit.
We are committed in building out tons of data centers. We’re buying. Endless amounts of incredible amounts, AI chip sets, uh, to put into the infrastructure. We are building a few light bulbs, yes. But we need partners to build dishwashers, washing machines, and innovate, um, uh, across the new opportunities for the customers.
And it’s just, it’s an exciting time and that’s where sort of marketplace comes into that. Yeah. Portfolio.
[00:05:37] Vince Menzione: Well, and I love the fact that it, you, you’ve taken and embraced it in such a more deliberate way. Right? Because when we first started thinking about it, cloud, you mentioned cloud really changed things in a big way, uh, because it, it opened up opportunities and AI of course became that.
Yeah. Um. So, you know, marketplace, it felt like it was on an island in many respects. And not, this is not diminishing or just, it was just, I think it just kind of grew up on its own and it was, it was tied into a product team and just now seeing the evolution of where we’re going with this and how it’s more cohesive into this whole cloud go to market.
I’d love to get your. Uh, perspective on what is changing and how it’s going to enhance things for, for the partners in the room today.
[00:06:20] Cyril Belikoff: Yeah, so if we connect back to AI and, uh, and even back to our history, we’ve always been a partner first company and, and like when we started the marketplace, you’re right, we had to incubate it, we had to build it at many years back now.
Um, and we needed to mainstream it into the core business so that it can be part of our product strategy and we’ve. Our products are, you know, we’ve always wanted to be great partners for partners, um, and with our core products. And so marketplace should be no different. And you know, for marketplaces has both the sort of supply and demand side.
So we have our classic customers, but then our partners need to. You know, provide supply into the marketplace. And so we want to be awesome partners for those software development companies. Give them a great stack to build on. Um, allow them to innovate and differentiate with ai. Help them to, you know, have amazing productivity with their own developers with things like GitHub copilot.
Yep. And then to leverage our own footprint to grow with our sellers. Exactly. With our, with our products and sort of the broad distribution that we have. And so marketplace becomes the center of that. It does becomes the core of how we go to market faster, sell more, uh, and we are investing on the demand side to get customers more to marketplace, right?
And so we’ve doubled our marketplace revenue just in this last year. Um, of course. Now much more money is made by partners. Yeah. Through that revenue. Um, and, uh, we have aspirations and on the path that this is the store to buy your AI solutions. Yes. With Microsoft as the platform and then partners providing whether it’s software as a service or agents, and it’s fast becoming that.
So we are seeing, even on ai, we’re seeing a hundred, 200% growth on ai, particularly in our marketplace. That’s outstanding. Lots of momentum. You’re right. We, we sort of had to incubate it like any, excuse me, any good product. You want to incubate it so it doesn’t get caught up in. Sort of the requirements of the machine.
[00:08:17] Vince Menzione: Yes. Right? Yes. And
[00:08:18] Cyril Belikoff: now, now it’s time to mainstream and we want to go really big, as you said.
[00:08:21] Vince Menzione: Well, I think what you’re signaling to the audience and to the partners watching today is this, that like Microsoft is doubling down. Right. And I always talk about the seven seats at the table because I’ve always believed, I mean, from the old days, it was like, you know, you get a large GSI in the room and you have one throat to choke, but customers are making and dictating their own decision process, and they’re looking at the seven seats at the table.
They’re looking at. They’re looking at data and, uh, AI partners, they’re looking at security and governance partners. They’re looking at maybe systems integrators or managed service providers. They’re bringing it all together. And because they’re buying off of your marketplace, they can do that. They couldn’t do that before.
Right, right. And now there’s a new, a new vehicle to get there. So,
[00:09:00] Cyril Belikoff: yeah. I, I, I totally agree. I think there’s, um. Lots of opportunity as you talk about the multiple seats at that table. Yeah. And so if you bridge into the connection between a partner and a customer and Microsoft and what that might look like, you know, the marketplace, as I mentioned, is becoming the center for the digital transaction, whether it’s a large customer or small, but also we putting the right levers in place to connect partners with our own sellers.
And so if we wanted to be at the center to provide the right solution to the right customer at the right time. We need to make sure that our own sellers have marketplace in their compensation, and we’ve made that change.
[00:09:39] Vince Menzione: Nice. Um, so what is the connection point now across Azure Consumer Revenue marketplace?
Yeah. And co-sell. So the first is,
[00:09:46] Cyril Belikoff: so the first on co-sell is that our sellers are incented to co-sell literally in their compensation plans. Nice. That marketplace can help them retire their quota. Like, it doesn’t matter how much strategery stuff I do in my ivory tower. Yeah. That lever is golden. ’cause sellers follow their back pocket.
Fantastic. They’re, we tell them to follow their back pocket. That’s literally how we ask them to, to operate. Um. Then from the customer side, uh, we have this concept called Microsoft Azure Commit to consume or the Mac. Yes, we love our acronyms and so customers will negotiate with their account reps or our executives and they’ll make a commitment to Microsoft for their Azure commitments over a three to five year period, and then they’ll get some sort of discount.
Simplistically, I’m just simplifying it. Yes. A hundred percent of the marketplace transactions can retire that customer’s commitment. So if a customer makes a $10 commitment to Microsoft, it’s a little bit more, add some more s zeros. But something like this, say $10 and they’re buying an application through the marketplace and that application cost $2 and Microsoft’s getting, you know, sense and the, the, the software development companies getting much more, uh, percentage wise, they are able to retire them.
Full Microsoft commitment on Azure. Uh, based on the full commitment that they’ve bought, bought in the marketplace, including the cost of the, the ISV or software development company application. So we are incenting the seller and we are incenting the customer to get to, to encourage their flywheel to go even faster.
And, um, many customers look at that, uh, Azure commitment and that contract as also a procurement, um, accelerator. Yes. So if, uh, software development companies. Have things in the marketplace, the procurement requirement is substantially reduced because. That acquisition has already been approved by the business.
Yeah. And as long as there’s a business leader that says, yes, I want you allow, I will allow you to decrement the, the Azure commitment. There’s the procurement side is close to zero in some cases. Now, not all cases, but in many, many customers are going that way.
[00:11:55] Vince Menzione: You’ve simplified it, you’ve taken away all the legal language.
Correct. You’ve taken away the, the whole, the whole term, the terms, and then worrying about payments. Right. It’s all, it’s all handled now for partners.
[00:12:04] Cyril Belikoff: Yeah, and then obviously we incent the seller and then we incent the the customer too. And then lastly, a lot of software driven companies. Sort of on the medium si medium to small size.
They love the fact that it’s a global transaction. Yes. They don’t have to deal with taxes across B country boundaries. That’s all handled in the marketplace. And so there’s just so much value to getting scale. Um, I. We’re very excited by, as you can tell. Yes. I’m, I’m,
[00:12:28] Vince Menzione: I’m excited with you. I’ve, I’ve talked about this as the marketplace moment, and you know, of course we’re gonna have some of your other leaders up on stage.
Right. We’re gonna have Sandy talking, talking with Nvidia and some conversations. We’ll have some of the marketplace vendors that help enable these ISVs or software development companies on how to, how to attract and work with Microsoft. We’ll also have some of the co-selling leaders in the room that will help.
How do I, how do I become more relevant with Microsoft? So I’ll have some incredible conversations here. And this all ties in. I, we talked about marketplace, but the Azure consumer revenue number. Um, I think we know that there’s a paradigm between marketplace and channel sales. What’s the advice on how to balance the best of both worlds?
This is an interesting conversation I hear all the time. From reseller or channel partners operating in one direction and the marketplace operating in a different direction, or at least that was the past. Yeah, that was the past paradigm.
[00:13:19] Cyril Belikoff: Yeah. It’s a, it’s a great question. The first I would say is use it.
Give us feedback and we’ll get better. Um, and that’s how we work with our partners. We work for 50 years like that. Um, and so we wanna work for the next 50 years. And so there is no. Either model that we have to crack besides our channel integration with marketplace, it’s just vital. Yeah. Um, we spend a lot of time with Nicole and her team around how we, what we call sort of co-sell at scale and like how do we get scale through our channel without a Microsoft seller involved.
That’s right. Um, and so we are, we are thinking deeply about that and, and really working through that. And so it’s really about the channel led sale and how we enable marketplace and transitioning. Um, the classic business where needed to marketplace. Yeah. Now there’s obviously parts of the business that might not be on marketplace, but if you’re selling a software, um, a software application, the marketplace is the right place to do it and then connects to everything that we just discussed on that value that the customer values.
Um, and, you know, we want to enable access to the 500,000 partners at scale that rely, uh, on our classic partner, um, engines. On the new marketplace and we, we started to do that. And I guess the, the hero, uh, capability is, uh, multi-party office or NPO.
[00:14:43] Vince Menzione: Yeah.
[00:14:43] Cyril Belikoff: Um, the ability to do. Multi parties that this a partner with a software company or or app provider and a customer multi-party offer sort of that capability.
And we’ve, you know, we’ve, we’ve launched it in select markets, us, uk, Canada, and already we’re seeing sort of a third of our sales with, uh, almost two times the average size. That’s incredible. With that capability, it’s obvious, like we know, like, yes, we had to incubate the business. Now we’ve gotta mainstream, we’ve gotta mainstream into.
Our channel partners too. And so while I don’t have tons to share, you can be sure that we are building more capabilities in the future that. Empower more channel led growth and more partner to partner selling.
[00:15:26] Vince Menzione: That’s fantastic. It is an incredible engine, the multi-party offer engine. And then some of the early learnings were that it wasn’t always the largest partners in the world.
It were, but it was partners that were closest to the customer providing some capability along with the other solutions that were coming along with the multi-party offer. Mm-hmm. So, um, just in, uh, in, so I think, you know, it is an inspiring time for all of us as we, as we think about this, uh. T we were, we’re at the end of 25.
25. You’re leaning in on 26 in a big way. Yeah. I’m, I’m assuming here. Of course. So I do think it would be great for you to give some of the learnings to this group of leaders in the rooms, all the people that are gonna be attending or watching this on livestream. Um, anything you’d like to leave us with going into fiscal year 26 for this group?
Yeah.
[00:16:13] Cyril Belikoff: And thank you for, again, for the opportunity. So as we close out here, um, you know, as the AI adoption increases. The opportunity for partners sort of exponentially explode. Yeah. Now I use the light bulb naturally, but I’ll give you some numbers right around numbers. Customers are seeing almost four XROI on average, and then the, the leading customers who are really leading into AI are seeing 10 XROI.
Wow. And the amazing piece about that is. In addition to it being 10 x is that they’re seeing that ROI in like 14 months. In typical other IT projects, it’s been like two to three years. And you write a business case and the CFO looks at the business case and they have this, you know, risk analysis and it goes three, sometimes five years.
They’re seeing ROI in 12 to 14 months. Yeah, that’s fantastic. And um, it’s not surprising ’cause that’s literally the pace of the industry right now and AI is even. Faster than that. And so there’s, there’s customer, real, customer tangible value. In addition to that, for every dollar that Microsoft makes, our system integrated partner makes almost $9 and a software company makes almost $11.
So the, the math on the partner side. Is very good too. It’s very good. And so when you just, just think at a high level of that flywheel, okay, the customer is seeing value, there’s opportunity in the partner. Of course we see value, we are investing that flywheel has to move. Yeah. And if you’re on that bus, you’ll get value if you miss the bus.
You don’t get value. Like we try to get on a few buses, many across the years. I won’t mention mobile, et cetera, et cetera, but maybe I just did. I, I remember those days I was in this room. Um, we try to get on a few buses. We have not missed this bus, and we are leading this bus and we want, we need our partners, um, because as I said, we, we are building platforms and so, and the
[00:17:57] Vince Menzione: compensation for partners is the highest in Microsoft amongst the three hyperscalers if you do the analysis work that I, yeah, we are
[00:18:03] Cyril Belikoff: pretty aggressive.
Yeah. Uh, in looking after our partners, and again, all different private partners, channel partners, system integrators, software companies. And really, as I said, the marketplace is the connector for it. If you haven’t engaged in the marketplace, get on, take a look, try it, do a few transactions with some customers and then give us feedback and you know, we will continue to evolve it even deep into our products.
For example, uh, it’s a good example. So Azure, AI Foundry. So it’s basically our core product for that customers use to implement. AI applications, whether it’s advanced machine learning or generative AI or AI search, pick your thing. It’s, it’s got all the goodness in there. It’s, you know, confidential ai, trustworthy ai, all all the pieces, AI foundry.
So customers literally are going to this product. In the product. It has the most models on the planet, like 1800 large language and small language models. Wow. Customers need to transact those models. Yes. So what we’ve done is we’ve connected that core product. And when the customer is trying to implement it says, do you want to transact this?
And it, it’s an automatic behind the scenes link to marketplace. So it gives you a mental model on how we think about this is not just gonna be like a classic partner transaction in front of a customer thing. We are going to embed it in our products more and more and more to, to really encourage that flywheel between customers and partners in a really seamless integration way.
Um, so many. Great examples. Yeah, I get super passionate about it. I guess I would, um, before I close out, I’ll mention one or two, uh, partners, so please do. Trade Ledger is a good example that I love. Trade ledger, um, end-to-end like lending platform. They literally did their first go go, uh, COSAL deal with a big bank.
And the deal that the previous previously negotiated went from 4 million. To 25 million. Unbelievable. And that might not sound lot, a lot to some Microsoft people. Yeah. But for a company like Trade Ledger on one deal, then they can try do it on 5, 10, 20, and a hundred deals. That’s, that’s real return. Um. I guess Content Square is another one.
They do insights, analytics. Yeah. And they’re seeing marketplace help them close deals, 11, 12, 13% faster with more than a hundred percent uplift on on their deal value. And so there, as I mentioned, we are integrating into product, we’re driving demand, we’re getting software companies to build, integrating with channel.
And so we are, we’re investing deeply. Right. And I guess I would just close out with where I started. We have a light bulb moment. So let’s go build some washing machines, get it onto the marketplace. I love this. And go
[00:20:45] Vince Menzione: learn together. I love that. And this is your first time really, I would say, at an event like this with partners in the room.
So, so great to have you. Thank you so much. This effort and having you hope, hope to have you on stage many times. Great. Because I think it is a light bulb moment. I think we are just at the beginning, the precipice of this opportunity and really it’s gonna be an exciting time ahead. Perfect. So, so great to have you.
Thank you
[00:21:06] Cyril Belikoff: so much. Great to appreciate it. Great to have you. Thank you sir. Appreciate you making time for us. Thank you. Yeah, thank you. Thank.
[00:21:11] Vince Menzione: Thanks for tuning into this episode of Ultimate Eye to Partnering. We’re bringing these episodes to you to help you level up your strategy. If you haven’t yet, now’s the time to take action and think about joining our community.
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Key Tags:
Microsoft, Partner Ecosystem, AI Transformation, Nicole Deason, Microsoft Partners, Generative AI, Cloud Solution Provider (CSP), MCAPS Priorities, Customer Zero, Skilling, Business Growth, Profitability, SMB, Fiscal Year 2026, Microsoft AI Cloud Partner Program, Innovation, Industry Solutions, Channel Partners, System Integrators, ISVs.

Jun 16, 2025 • 25min
262 – Microsoft’s Partner-Led Future: Nicole Dezen on AI, FY26 Strategy & $661B SMB Opportunity
From Ultimate Partner LIVE in Redmond, WA
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Is your business ready for 2026?
Welcome back to the Ultimate Guide to Partnering® Podcast.
This episode is something special.
It was originally recorded as the kickoff conversation for our May Ultimate Partner LIVE event—a powerful session that featured none other than Nicole Dezen, Microsoft’s Chief Partner Officer, and a true champion of the ecosystem.
Now, we’re bringing it to you, our amazing Ultimate Partner Podcast community.
In this candid and insightful conversation, Nicole shares Microsoft’s unwavering commitment to its 500,000+ strong partner ecosystem—especially poignant as the company celebrates its 50th anniversary.
We explore how partners are not just part of the Microsoft story—they are the story.From driving innovation to fueling growth in the era of AI, this dialogue makes clear that partners are at the heart of Microsoft’s transformation agenda.
You’ll hear about the company’s FY26 strategic priorities—known as MCAPS—including renewed focus and record investment in the SMB segment, and the role of partners in shaping what’s next.
https://www.youtube.com/watch?v=3vuEsmcPvD4
Partnerships are Microsoft’s Core: Microsoft’s foundational commitment to its partner ecosystem is deeply ingrained in its 50-year history and remains central to its future strategy.
AI is a Partner-Led Opportunity: Partners are crucial to driving AI transformation, with Microsoft actively supporting and incentivizing those who leverage AI for customer solutions and business growth.
Substantial Profitability for Partners: The Microsoft ecosystem offers significant financial returns, with partners earning multiple dollars for every dollar of Microsoft revenue, boosted further by generative AI.
Strategic Alignment with Microsoft Priorities: Partners can maximize their success by understanding and aligning with Microsoft’s five MCAPS priorities, which guide both Microsoft’s internal sales and partner incentives.
Targeted Investments for Ecosystem Growth: Microsoft continues record investments in its partner ecosystem, with a strong focus on empowering partners, especially those serving the high-growth small and medium enterprise (SMB) segment.
“Customer Zero” Enhances Partner Credibility: Partners are encouraged to use Microsoft technologies, particularly AI tools, internally (“Customer Zero”) to build authentic experience and credibility for customer engagements.
https://youtu.be/s33fltuizEo
Transcript:
(0:00) So I wanna take this moment to welcome a friend, (0:03) an incredible leader, somebody who leads the largest, (0:09) imagine this, the largest ecosystem in our industry (0:12) is the Microsoft ecosystem, (0:14) with over 500,000 partner organizations. (0:19) Nicole Deason has done an outstanding job (0:22) of taking this organization to the next level. (0:26) In fact, we recognize, Nicole was on my podcast last year, (0:29) we were up here in Redmond, (0:30) we recorded a really great interview.
(0:32) If you haven’t had a chance, (0:33) you can find that on our YouTube channel. (0:35) You can find that incredible discussion that we’ve had. (0:38) I’ve asked her back because a lot of things (0:40) are happening at Microsoft.
(0:41) And I also wanted to recognize her. (0:43) Like see, we did this Partner Leader of the Year Award (0:46) at the end of 2024, and we recognized Nicole (0:48) for how she’s reshaped Microsoft’s landscape, (0:51) how she’s really tightened up Microsoft’s focus (0:54) and strategy, and I wanted to have her back today, (0:57) A, to recognize her up on stage (0:59) for her outstanding leadership, (1:01) but also have you hear from her (1:03) about her point of view as partners (1:06) and how Microsoft thinks about this ecosystem (1:09) and its approach to support this incredible thing (1:11) that was created over 40 years ago. (1:14) Microsoft was the first company (1:15) to really embrace partnerships, (1:18) and still is at the very forefront of it.
(1:20) And so I’m excited to have Nicole join us. (1:23) Nicole and team, but we also have a little something (1:27) we’re gonna bring out here. (1:28) So here comes Nicole.
(1:30) Nicole, so good to see you. (1:31) So good to see you. (1:32) Thank you for having me.
(1:34) I love having you. (1:34) Thank you so much. (1:35) I love your jacket, too.
(1:36) Obviously, I’m really into the green, okay. (1:38) Yeah, I love the green. (1:39) I love the green.
(1:40) I need to wear more green. (1:41) We have a little gift for you. (1:44) I try and lift it.
(1:45) They told me it weighs about 300 pounds. (1:46) Okay, well, I’ll do it. (1:47) Here, we’ll do it together.
(1:48) We’ll do it together. (1:49) So this is just our recognition (1:51) for all the work that you’ve done (1:53) and all the support you’ve given (1:54) these partners in the room, (1:55) and the thousands and thousands of thousands (1:58) that will be watching us, (1:59) listening to your amazing guidance and leadership, (2:03) and so glad that you could spend some time (2:05) with us this morning and kick off our event. (2:07) Thank you.
(2:07) This is a really nice honor. (2:09) Thank you so much. (2:10) We’ll proudly put that there.
(2:12) You’ve done an incredible job, (2:13) and we’re excited to have you for a little fireside chat. (2:18) We have some people in the room. (2:19) We have a bunch of people on the live stream as well.
(2:22) So we got to do this in a studio. (2:24) It’s a little bit different, (2:25) but I wanted to have the opportunity (2:27) to spend some time here with you (2:28) because I think there’s some really incredible things (2:30) we need to talk about here. (2:32) First off, we haven’t even talked about this yet.
(2:35) I was saving this for you. (2:37) Microsoft’s 50th anniversary. (2:38) Yeah, so exciting.
(2:40) I mean, it is incredible that it’s been 50 years now. (2:43) It’s amazing. (2:44) It’s really hard to believe, (2:47) you know, 50 years of so much heritage.
(2:50) And, you know, when I think about our 50 years, (2:52) I think of it as 50 years of partnership. (2:54) So massive, massive thank you to all of our partners. (2:58) Our success is absolutely based (3:02) on all of the work we do with our partners (3:04) and organizations like yours, Vincent.
(3:05) Thank you so much. (3:06) Thank you for your support as well. (3:08) We feel that as well, these partners wouldn’t be here.
(3:10) We wouldn’t even have this thing called partners (3:12) if it wasn’t for Microsoft. (3:13) You know, we’re incredibly fortunate here. (3:17) The company was founded in this heritage of partnership.
(3:21) It’s in our DNA. (3:23) And every single one of our three CEOs (3:26) has proudly focused on partnership. (3:31) And, you know, Satya always says, (3:32) this company has always been (3:34) and will always be a partner-led company.
(3:36) It’s pretty exciting. (3:38) You know, when I, if you think about (3:40) where the company started, (3:42) we started with this really bold vision (3:45) that technology could change the world. (3:47) And it certainly has and continues to, you know.
(3:52) And I heard your very nice introduction, by the way. (3:55) Thank you. (3:55) You know, Microsoft is so proud (3:57) to have 500,000 partners in our ecosystem.
(4:01) It’s remarkable. (4:02) We actually, we grew the size of our partner ecosystem (4:05) 20% year on year in the last year. (4:08) That’s fantastic.
(4:08) And there’s a whole bunch of reasons why. (4:11) And, you know, it’s really exciting (4:12) to see the excitement and enthusiasm (4:15) for everything we’re doing. (4:16) And, you know, you and I go way back.
(4:19) And it started in this company. (4:21) Well, you know, I’m sorry we were five. (4:22) You were a lot younger than I was.
(4:25) But, you know, it started with building (4:28) and selling Windows PCs in the office, (4:32) still going strong today. (4:34) And then we sort of evolved into cloud migrations. (4:37) And then, of course, now it’s all about the era of AI.
(4:42) And, you know, our partners are really the backbone (4:45) of AI transformation, solving complex customer challenges (4:49) around the world. (4:51) Microsoft has always been really deeply committed (4:53) to partner success. (4:55) And I love just seeing how amazing it is (5:00) to see our partners thriving in this time.
(5:04) We, just last year, we did some IDC research. (5:07) And the research told us that for every $1 (5:09) of Microsoft revenue, our services partners (5:12) earn $8.45. (5:14) Wow, that’s outstanding. (5:15) And our software partners earn $10.93. (5:18) And it’s one of the measures we hold ourselves to.
(5:20) It’s really, really important that we can create (5:23) a healthy, thriving, profitable ecosystem for our partners. (5:28) Then you add generative AI on top. (5:30) And, wow, like hockey stick growth in so many dimensions.
(5:33) It’s amazing to see just the growth faster (5:37) than the overall IT market, which is amazing. (5:40) Generative AI, fastest platform adoption (5:43) in the history of technology. (5:46) These stats are pretty awesome, if you think about it.
(5:49) It took mobile 16 years. (5:52) And then it took the internet seven years (5:54) to reach 100 million users. (5:57) LLMs achieved that in months.
(5:59) It’s incredible. (6:00) Right, and we’re just getting started. (6:02) And for me, when I look across our partner ecosystem, (6:06) and I see the demand and opportunity for the work (6:10) that every single one of our partner types is doing, (6:13) it makes me really motivated and excited.
(6:16) And then the partners that are betting their business (6:18) on Microsoft AI, those with more than 25% (6:21) of their Microsoft revenue on AI, (6:24) receive higher margins and revenue growth. (6:28) And, you know, I’m just incredibly proud (6:32) to see what we’ve already done in our 50 years. (6:36) And I know so much excitement ahead.
(6:38) Just getting started. (6:39) What is it that Bill has always said, right? (6:42) We expect too much in the first year or two. (6:44) We expect rapid growth, but we underestimate (6:47) what we’ll see in 10 years.
(6:49) That’s right. (6:49) I think we will underestimate what we see (6:51) in three and four years. (6:52) Oh, absolutely, and I am beyond confident (6:55) that it’s actually our partner ecosystem (6:56) that will lead the way here and teach us all things (6:59) that we never imagined.
(7:00) Yeah, it’s going to be an outstanding day (7:02) of conversations around these topics. (7:04) So glad you could join us for this. (7:07) So we’re at the end of 2025, Microsoft 2025.
(7:11) People don’t always understand (7:12) the fiscal year differences, right? (7:14) Hey, two months have to go. (7:15) Let’s not forget it’s Q4 at Microsoft. (7:18) Yes, get out there and sell partners.
(7:20) We still always get encouraged, that’s right. (7:23) People don’t understand, if you haven’t been (7:24) around Microsoft for a long time, right? (7:26) July 1st is the beginning of a new year. (7:28) Yes.
(7:28) And I think it’s a super important time (7:31) to have you here because it is like giving people (7:34) a little bit of a forward glance to what’s happening. (7:37) Like there has been a lot of change, right? (7:38) A lot of change, transformation, (7:40) and I would love for you to share (7:41) with our incredible partner ecosystem (7:44) what you’re seeing and where we’re going. (7:46) I think we’ve definitely accomplished (7:48) more than a year’s worth of stuff (7:50) in the 10 months of this year so far.
(7:53) So I’m just incredibly proud and grateful (7:55) for the excellence I see across the ecosystem. (7:59) For Microsoft, it’s been a record year (8:01) of investment in our partner ecosystem (8:03) and I’m thrilled to be able to say that. (8:06) There are several things we’re doing.
(8:09) For us, it starts with our five MCAPS priorities. (8:13) Every Microsoft employee sort of has these (8:15) tattooed on their foreheads. (8:16) Yes, right up here.
(8:17) And the thing that’s cool is I love it (8:19) when I’m having partner conversations (8:21) and we talk about the work that our partners (8:24) are doing across the five priorities. (8:26) So they’re co-pilot on every device, (8:29) AI design wins, securing cyber foundations (8:32) for every customer’s, delivering the M365 core, (8:37) and of course, cloud migrations (8:39) because customers can’t take advantage (8:40) of all of this amazing AI goodness (8:42) until they’re in the cloud. (8:45) There’s a few reasons why understanding (8:48) these priorities I think is so beneficial (8:50) to our partners.
(8:51) Number one, understanding how Microsoft sells, (8:55) how we coach our own sellers, (8:56) I think is incredibly valuable (8:58) because it allows us to go to market together in harmony. (9:03) Excuse me, the second thing is we pooled (9:06) our partner incentives around those five priorities. (9:09) So there’s real economic benefit (9:12) for every partner out there to get after them.
(9:15) So important. (9:16) Yeah, and the thing that I’m really excited about (9:18) is these priorities apply to every customer segment, (9:23) every partner type. (9:24) So whether you’re an SI, an ISV, a channel partner, (9:27) a device partner, you name it, (9:29) there’s a role for you to play in these priorities.
(9:32) And this is really about how we support your work (9:35) as you deliver value to our customers. (9:38) The next thing is, you’ll hear us talk a lot (9:42) about customer zero, and Vince, (9:44) you’ll remember the days where we talked dog food, (9:46) which I just saw. (9:47) I’m so glad we got rid of dog food.
(9:49) We’re so over that. (9:50) Then we were drinking our own champagne, (9:52) but now we’re in the era of customer zero. (9:55) Customer zero really means that we use our own things first.
(10:00) And Microsoft has always had this principle of doing it, (10:03) but it’s actually more important than ever with AI. (10:08) And where I’m seeing the most growth, (10:11) the most rapid transformation in our partner ecosystem (10:16) is those partners that are utilizing this technology (10:19) in their own business, (10:20) because that’s when you have the most credible examples, (10:24) the most authentic experiences (10:26) to go have those customer conversations. (10:28) Customers are counting on you (10:30) to help them understand what to do in their business, (10:33) and they’re looking for you to tell them how you’ve done it.
(10:36) And when we talk about AI transformation at Microsoft, (10:40) we talk about it in terms of enriching employee experiences, (10:46) reinventing customer engagement, (10:48) reshaping business processes, (10:50) and then bending the curve on innovation. (10:52) And there’s just- (10:53) Oh, I love bending the curve. (10:55) Bending the curve, yeah.
(10:56) We love to bend the curve around here. (10:59) You know, it’s really amazing to see (11:02) what each part of our partner ecosystem is doing. (11:05) It’s actually been less than 12 months (11:08) since we launched Copilot Plus PCs, (11:11) you know, near and dear to my heart.
(11:14) It’s amazing to see what our device ecosystem is doing (11:17) with the most powerful NPUs in the market, (11:20) you know, provided by our largest silicon partners. (11:23) Our ISV ecosystem, you know, (11:25) this is a place where there’s just, (11:28) we’re just fueling innovation in the market. (11:31) And the things I love the most (11:32) are when I see these solutions come out (11:35) from ISVs around the world (11:38) that are just helping customers solve real problems.
(11:43) There’s a really cool example recently from Sitecore. (11:46) They introduced some capability (11:49) that helps marketers pre-test content (11:54) before they publish it. (11:55) It sounds so obvious, right? (11:56) But they didn’t have that capability (11:59) until Sitecore introduced it, (12:01) and it’s running on Azure and Azure Open AI.
(12:04) And so I love it when it solves (12:06) really real-world problems for people. (12:09) You know, our systems integrators (12:11) are really leading the way, (12:12) particularly around industry solutions. (12:15) It’s been really impressive to see (12:17) the way that system integrators have paired (12:19) our customer solution areas with AI capability (12:22) across industries, delivering real value.
(12:25) And then, last but certainly not least, (12:27) our channel partners. (12:29) You know, the channel is really the face of Microsoft (12:32) in so many cases for the small (12:34) and medium enterprise customer. (12:37) And I’m really, really proud to see (12:39) the way the channel has embraced, (12:41) you know, supporting the entire lifecycle, (12:44) or we like to say all five MSEM stages.
(12:47) There’s so much TAM to be captured here. (12:51) $661 billion of TAM (12:53) in the small and medium enterprise segment. (12:56) So welcome, one and all.
(12:58) There’s lots to do here. (13:00) And you know, this is a place (13:02) where we are heavily, heavily investing (13:05) in these partners for growth. (13:07) 70% of our investments are pooled toward the partners (13:11) that service the small and medium enterprise segment.
(13:14) So it’s an opportunity. (13:14) And we’ll hear from some of your leadership (13:16) on how to best engage with sellers, (13:19) as partners working with sellers in those organizations. (13:22) We’re also gonna hear from the SMB market as well.
(13:24) We’ve got both Pax8 and Ingram Micro (13:26) coming on stage here over the next two days. (13:28) What an incredible opportunity now, right, (13:30) to take some of the modernization and marketplace (13:34) and extend it out and be much more deliberate (13:37) with smaller customers. (13:38) Yes, yeah.
(13:39) The SMB space in particular is a segment (13:44) with so much growth opportunity (13:45) and so much dependence on very strong, capable partners. (13:51) Yeah, so it’s an incredible, incredible opportunity. (13:53) You’re gonna hear things on stage here.
(13:55) They’re gonna hear some more from what you’re sharing, (13:56) but also from some of your leaders (13:58) that are gonna share some more. (13:59) There’s gonna be some very insightful (14:01) and provocative conversations the next two days. (14:04) So let’s talk about 2026.
(14:06) So people are like, happy new year. (14:07) Like July 1st is just around the corner. (14:09) So I know you have been incredibly busy.
(14:12) I know what this time of year is like, a lot of change. (14:16) Let’s observe what happened in the year so far. (14:18) Let’s address what’s not working right.
(14:21) Let’s pivot to what’s working even better. (14:23) And then you’re laying it out, right, (14:25) in the next couple months. (14:26) I’m excited for what you’re gonna be providing.
(14:28) These partners need to listen in to you (14:30) on what’s happening. (14:31) Yeah, we’ve been hard at work for planning, (14:34) and you nailed exactly how we do it, by the way. (14:36) That’s awesome.
(14:37) I’m really excited about what we’re doing. (14:39) I would start with what isn’t changing, (14:42) because I think that’s really important. (14:44) Our five priorities are enduring.
(14:48) We’ve seen really great momentum (14:50) from our partner ecosystem. (14:53) The partners that have embraced these (14:55) are making meaningful progress with customers (14:57) and we just wanna continue to fuel that. (15:01) We will continue significant AI investment, (15:05) and we will do all of this (15:07) through the Microsoft AI Cloud Partner Program.
(15:09) And this is where any partner can get the technology, (15:13) the tools, all of the capability (15:15) to build healthy, profitable businesses (15:17) where we co-sell together. (15:20) And so I think that it’s super important (15:22) for partners to understand that. (15:23) I am also going to encourage everyone (15:26) to plan to attend MCAP Start for Partners.
(15:29) That’ll be on July 15th, so two weeks into our fiscal year. (15:34) We do this readiness event. (15:36) At the same time, we’re readying all of our sellers.
(15:39) So partners get access to the exact same information (15:42) that Microsoft’s entire field sales force gets, (15:45) and it’s all about ensuring that you have access (15:47) to the latest and greatest, (15:49) all the goodies in our toolkit for next year. (15:53) And that’s gonna be digitally available. (15:55) So everybody in the 500,000 can all embrace (15:59) and this change is happening.
(16:00) And we will not be shy about letting everybody know (16:03) when registration opens. (16:04) That’s coming soon. (16:05) And one more thing.
(16:07) I know everybody’s busy here today, (16:09) but we did publish a blog today, this morning, (16:12) with a lot of new CSP announcements. (16:14) Yes, please share that. (16:15) So don’t distract yourselves from today’s amazing agenda, (16:19) but maybe when you go back to your hotel rooms, (16:21) check out the blog.
(16:23) Because we’ve announced a ton of new capability (16:26) for the CSP partners, the Cloud Solution Provider partners. (16:31) There are a couple things I’ll share here. (16:33) Number one, probably the most requested thing (16:36) from every partner and frankly, every employee at Microsoft (16:40) is today we’ve announced we’re introducing (16:42) three-year CSP SKUs for M365 and Teams Enterprise.
(16:47) I’m really, really thrilled about this. (16:49) We’ll have some nice promotions to support it as well. (16:52) And the other thing that we’ve been really hard at work on (16:56) is enhancing CSP capability with systems and tools, (17:01) reporting, enabling better upgrades, upsell, renewals.
(17:06) As you would imagine, all of this is infused with AI. (17:10) All designed to make sure that we have a healthy, (17:13) profitable, thriving ecosystem. (17:16) We’re also updating some of our authorization requirements.
(17:19) We’ll align our incentives to all of that. (17:22) There’s tons of information in the blog, (17:24) so I encourage everyone to go check it out. (17:27) And really, this is all designed to ensure (17:29) that our partners can deliver great success (17:32) to our customers.
(17:33) I know your team has been hard at work on this (17:35) and so you have some incredible leaders been driving. (17:38) The system and tools component alone is really enhanced (17:41) and been enriched over the last couple of years. (17:44) Yes.
(17:44) Great teams work there. (17:46) Lots of AI capability there. (17:48) We have to be our own customer zero, right? (17:51) Absolutely, yes.
(17:52) I love it, I love it. (17:54) So what advice do you have for these partners? (17:56) Obviously the CSP reading all of that, (17:58) what advice do you have for them in terms of leading in? (18:01) We obviously talked about the co-selling, (18:04) the ability to engage, understanding the priorities (18:07) at the SEMCAPS event. (18:09) Anything else in particular we should be aware of (18:11) and lean in on? (18:13) Yeah, you know I like threes, (18:15) so I’ll go with three things.
(18:17) Yes, please. (18:18) First of all, I really encourage partners (18:21) to continue to take advantage of all of the skilling (18:24) we’re pumping out into the market. (18:26) Record year of skilling investments this fiscal year (18:30) for really, really good reason.
(18:33) I don’t know about you, (18:34) but I feel like the rapid pace of advancement (18:37) of the technology is challenging each of us (18:40) to really stay current. (18:41) Exactly. (18:42) And so, you know, please take advantage of the skilling.
(18:46) The partners that leverage our skilling the best (18:48) are also the ones that have earned designations, (18:51) earned specializations, generating more revenue (18:54) and more profit. (18:55) There’s a very, very logical connection there. (18:58) So I encourage everyone to do that.
(19:00) The second thing is, obviously I talk a lot about CSP. (19:05) We’re quite excited about the investments here. (19:08) I really encourage our CSP partners (19:11) to focus on developing the muscle of upsell.
(19:15) The beautiful thing about CSP (19:17) is that it’s this always on motion. (19:19) So when you’re renewing an ME3 customer, as an example, (19:24) we wanna help you get all of the tools you need (19:28) to do the upsell. (19:29) And that could be attaching co-pilots.
(19:31) It could be attaching a mini bundle. (19:32) It could be upsell to ME5. (19:34) There are a wealth of tools available to our partners (19:38) to help you do that.
(19:39) And at the same time, we are skilling our own sellers (19:42) to do this work with you together. (19:45) This is the next wave of how we work together (19:48) with CSP as a hero motion in our business. (19:51) And then last but not least, (19:53) I have to say it again, customer zero.
(19:55) It’s really, really important. (19:57) The partners that utilize this tech (20:01) are truly the ones that are the most credible (20:04) and really leading the way with customers. (20:06) I would encourage every partner out there (20:09) to go check out CoPilot Chat.
(20:11) It’s free. (20:12) So there’s no blocker here. (20:15) And it’s a great way to familiarize yourself (20:18) with the easiest way to experience AI.
(20:21) And it also allows you to build agents. (20:25) And the thing that’s really powerful about this (20:28) is agentic is the most asked about topic. (20:33) You know, if you go into the ABC just next door, (20:35) there isn’t an ABC with a customer (20:38) where they don’t ask us about agentic.
(20:40) And so we’re in this zone of bringing in partners (20:45) that have already built their own agents (20:46) inside their own businesses. (20:48) Microsoft is doing this ourselves too. (20:51) And so the partners that are customer zero (20:54) on this technology are the best equipped (20:57) to co-sell with us and go to market with us.
(20:59) So I’m quite excited about this. (21:01) And Nicole, you could have, (21:02) it’s almost like I gave you a list of things (21:04) to cover for people because we’re gonna cover (21:06) so many of these topics up on stage the next few days. (21:09) That’s awesome.
(21:09) So, so great to have you back here. (21:11) Thank you. (21:12) Your leadership is commendable, (21:14) really commendable for what you’ve been driving (21:15) to the organization, (21:17) the alignment of the sales organization (21:19) and some of the work your team has been doing (21:21) just this year alone.
(21:22) But everything you’ve done to support this ecosystem (21:24) in such a big way, (21:25) I applaud you for all the work that you’ve done, (21:28) the support of this Microsoft ecosystem (21:29) and these partners up here today. (21:31) So thank you so much for making the time for us (21:33) at a very busy time of year. (21:35) Thank you.
(21:35) Thank you for all of your support (21:37) and just a massive thank you again to all of our partners. (21:41) Your success is phenomenal. (21:43) I’m so inspired by it and I’m beyond confident (21:46) in what you’re gonna deliver in the year ahead.
(21:48) It’s gonna be an incredible year. (21:49) Yeah. (21:49) It’s just getting started.
(21:50) So glad to have you help us kick it off. (21:53) Thank you. (21:53) And coming up on stage with me.
(21:54) Thank you. (21:55) I so appreciate you. (21:56) Thank you.
(21:56) Thank you. (21:57) I have to take my beautiful award. (21:58) Yes, yes.
(21:59) Thank you. (22:00) I love to see it up on your mantle. (22:02) Absolutely.
(22:02) Thank you so much. (22:04) Thank you so much. (22:05) How about a round of applause for Nicole? (22:07) Is that incredible?nd some procurement things, right? Because they just went in, did it through the portal with the existing agreement, so it’s a little easier on them. So that’s kind of where you, yeah, they didn’t get the Mac decrement, but it, it is a better story for them
.
Key Tags:
Microsoft, Partner Ecosystem, AI Transformation, Nicole Deason, Microsoft Partners, Generative AI, Cloud Solution Provider (CSP), MCAPS Priorities, Customer Zero, Skilling, Business Growth, Profitability, SMB, Fiscal Year 2026, Microsoft AI Cloud Partner Program, Innovation, Industry Solutions, Channel Partners, System Integrators, ISVs.

Apr 27, 2025 • 53min
261 – How Cloud Marketplaces Are Reshaping IT Sales — And How You Can Win on Azure, AWS, and Google Cloud
The Marketplace Revolution: Transforming How Software is Bought and Sold.
Unlock the secrets to explosive growth in the digital landscape!
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If you haven’t yet attended one of our Ultimate Partner Events, you’re in for a truly magical and industry-leading experience. In case you missed our Winter Retreat, we’re bringing one of the final sessions to you here: the Ultimate Guide to Partnering.
In this session, join industry leaders Jason Rook, Dux Sy of AppPoint, and Dexter Hardy of Integral as they dissect the reality behind the cloud marketplace hype.
This dynamic panel explores the tectonic shifts driving customer behavior and how major hyperscalers are responding. Industry leaders Jason Rook, Dux Sy of AppPoint, and Dexter Hardy of Integral dissect the reality behind the cloud marketplace hype.
This dynamic panel delves into the tectonic shifts driving customer behavior and how major hyperscalers are adapting. Discover firsthand accounts of achieving unprecedented reach, accelerating deal velocity, and transforming sales strategies through platforms like the Azure Marketplace.
Explore the evolving promises of marketplaces, from lowering the cost of goods sold to the strategic shift in salesforces and the power of co-selling. Gain invaluable insights into public vs. private offers, multi-cloud strategies, and the role of enablers in navigating this complex ecosystem. Whether you’re a startup or an established enterprise, this session provides actionable takeaways to leverage the immense potential of cloud marketplaces and future-proof your partnering strategy in the age of AI.
https://youtu.be/FGed2N2JC2U?si=p9T33-eu5Y7PnhK0
Here are 8 key takeaways from the discussion:
Cloud marketplaces are experiencing real and significant growth, driven by customer buying behavior and the need for digital transactions.
Marketplaces offer unprecedented reach and the potential for rapid global expansion, as demonstrated by Integral’s experience.
Co-selling through marketplaces aligns incentives and can accelerate deal velocity and increase deal size, particularly with cloud consumption commitments.
The “lower cost of goods sold” promise of marketplaces is more readily realized by startups with simpler offerings than large enterprises with complex sales motions.
Marketplaces are driving a shift in salesforce strategies, with companies increasingly embracing digital-first approaches and leveraging marketplaces for customer acquisition.
Combining channel strategies with marketplaces, including multi-party private offers, presents significant opportunities for growth and new service offerings.
The choice between public and private offers depends on the company’s maturity, brand recognition, and the nature of their solutions, with public offers being beneficial for initial brand building and private offers for larger, custom deals.
While professional services can be offered through marketplaces, they don’t typically decrement cloud consumption commitments, making software sales the primary driver for leveraging those commitments.
It was another bold, thought-provoking, and energizing discussion that left the audience inspired and eager to take action.
And we’re just getting started.
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Keywords & Transcript
Jason Rook Panel AUDIO EPISODE
[00:00:00] Dexter Hardy: It absolutely blew my mind the amount of reach and scale that we were able to accomplish just through the marketplace. When you look at there’s 7 million or more and growing active users in just Azure Marketplace alone, those become your captive audience for your solutions.
[00:00:22] INTRO: We believe this time is like no other.
We believe we refer to these as the tectonic shifts, all the hyperscalers in the world, if you add them all together. Managed services will be one and a half times larger
[00:00:34] Dux Sy: because it is the customer buying behavior that has created the need for all of us to rethink our models.
[00:00:40] INTRO: Until we have data quality, the effectiveness of AI cannot be realized and effectiveness of the partnerships cannot be realized.
Can you figure out, first, what your purpose is and how Microsoft can support your purpose and how you can support Microsoft purpose? Now we have a partnership. It’s the ultimate partnership. Welcome to, or welcome back to The Ultimate Guide to Partnering. I’m Vince Menzi, own your host, and my mission is to help leaders like you achieve your greatest results through successful partnering.
On February 20th, 2025, a small group of industry leaders converged here in Boca Raton, Florida, in this very studio for Ultimate Partners Winter Retreat. What followed was an incredible discourse on the tectonic shifts and the rapid change. We’re all seeing as partners. If you weren’t able to join us in person or on the live stream, we’re bringing this incredible session to you here.
This is my gift to you. All I ask in return is that you tell your friends, subscribe. Consider joining the ultimate partner community and hopefully joining us in the future. At an Ultimate Partner event. I hope these sessions provide you the learnings you need to continue to achieve your greatest results.
And now here to this amazing session.
[00:01:57] Jason Rook: Um, but my first question I’m gonna ask is, uh, ducks and ducks are both, is is the marketplace hype for real? And then within that, introduce yourself. Tell us a little bit more about what you guys have been doing in marketplace, and we’ll continue to dive in from there.
So Ds, I’ll start with you. Tell us a little bit more about AppPoint and then is this marketplace hype for real?
[00:02:15] Dux Sy: Sure. Well, thank you. Hey everybody. My name is Ds Raymond SI serve as a Chief Brand officer at AppPoint. We’re the global leader in data security, governance, and resilience. And we’ve been in business over 20 years and these days we’re so stoked about the channel as, uh.
Um, Janet mentioned we’re all in a hundred percent. We’re helping a lot of our partners build new businesses around ai, making sure their customer’s data is secure as they journey through this new world of, uh, uh, transformation. So it’s the hype reel. Absolutely. Now we’re in the early stages, and I can answer that multiple ways, but I, I, I’m gonna highlight three things why I think the hype is real.
Number one, if you have large customers, specific to the Microsoft world. So a lot of these customers have what’s called Mac. And what we’re seeing for a lot of our large customers, they want to draw on their Mac and it just helps our uh, deal cycle to go through much faster. So that’s number one. If you’re an enterprise Azure marketplace, for us it’s real second beyond the Microsoft marketplace, there’s tons of marketplaces out there.
That’s how really we scale and go to market with our channel business. Uh, we’re in over a hundred marketplaces around the world, and that’s one, one of our top strategies to grow our business in the channel ecosystem. And number three, that’s the reality of the world. Looking forward to the future, you can only hire so many sellers in your organization.
You can hire so many p dms and channel uh, leaders. You need automation. You need technology. You need a better way to distribute. So I think that’s why the hype is real.
[00:03:50] Jason Rook: So Dexter, I’ll kind of come to you with the same question. I know you’ve, you’ve been on this journey for a little bit of time now. Um, you’ve got kind of a little different business model that you’ve built and you’re building, um, for you is the marketplace hype for real?
And then tell us a little bit more about Integral.
[00:04:05] Dexter Hardy: Okay. So, uh, glad to be here. Dexter Hardy, president, CTO at Integral, Inc. Uh, simply put, we help you move to the cloud. Um. We started out as an si, so doing a lot of the app application development, migrations, things of that nature. Um, the small thing called covid happened, you may have heard about it in the news, but, uh, what we did was we focused on what was our superpower, what did we do really well, and we created cloud solution accelerators, putting them in the marketplace, Azure marketplace specifically.
And what we saw, and this is answering a long-winded way of saying. It’s not hype. It is actually a real thing that allows you to grow. We went from being a small regional organization to the first year of being on the Azure marketplace. We were in 44 countries by the following year. We were in over a hundred countries, and that’s continuing to grow to this day.
So I think the first thing that people need to really focus on if you’re leveraging marketplaces, are what is the value proposition of your software and or solution? Second, what is the experience? I heard a lot of conversation about AI and the agents and what it’s gonna do and how is it gonna impact us?
Well, people don’t buy an iPhone because it has a feature list. They buy it for an experience. And so I think the marketplace is going to amplify experiences, uh, for by buyers.
[00:05:31] Jason Rook: Well, I would, I would just chime in and, and say from the a representing the hyperscalers, um, that it’s absolutely for real. And I think if you think about why it’s for real, it’s really for real.
Because of all the things that Jay just laid out for the next 10 to 20 years. Right. And so for all of the hyperscalers to participate in the AI evolution, microtransactions, consumption based services, we all have to build these mega data centers and we have to have people in there using them. And the path to get there is to get more software development companies building on our platform.
And you can’t get. Software develop, develop companies to build on a platform if you don’t have a way for them to sell today. So it is absolutely for real, wherever you’re at on that adoption curve, it’s going to happen. Right. So I think the next thing, when I think about the, the hype about marketplace, we also talk about the promise of marketplace.
There’s a couple things when you, when you think about marketplace and what it does for you as a software development company or a channel partner, um, there are a couple things we often kind of refer to and one. I’ll go back to the marketplace promise of kind of expansion and reach of customers, um, docs.
From your perspective, um, has that promise kind of been true for you, the reach and expansion with Market Cloud Marketplace?
[00:06:47] Dux Sy: Absolutely. So at point, we’re a 20-year-old company and we started our business, frankly, doing the hard things first. We went after the enterprise business. We built a global.
Platform and we’re in 17 countries. That’s what we did first, and then frankly, we’re playing catch up on channel. We, we realized and recognize that channel is the way of our future, and through the marketplaces, that’s how we’re growing so fast. We’re doubling down on channel. We’re committed to it, and not just from making sure that we get new partners, but we also get feedback.
We are building new technology specific to the channel ecosystem, and we’re gonna deploy it through marketplaces as well.
[00:07:31] Jason Rook: Another thing about this conversation is that it is a little bit unfair because I do know all of your marketplace data, right? And so this question about expansion and reach Dexter, um, give us, I mean, your numbers are off the charts with that.
So give us a little bit of your perspective about marketplace and your ability to reach new customers and grow.
[00:07:50] Dexter Hardy: Okay, so, uh, he has a back, he has a back channel to see our, our statistics. But like I said before, um, it absolutely blew my mind the amount of reach and scale that we were able to accomplish just through the marketplace.
When you look at there’s 7 million or more and growing active users in just Azure Marketplace alone, those become your captive audience for your solution. A lot of companies are missing out on those eyes and those buyers, but the marketplace is a 24 hour sales guy that’s like ready to transact whenever your customer wants to transact.
Add on top of that research from Gartner. Tech buyers now want to buy digitally. They don’t want to necessarily get out on the phone and just go through the traditional sales cycle that comes second. Now, like if they want, if they want to engage with you in a very deeper way. Well, can you get your foot in the door first and the marketplace opens that door up for you?
So for us, like I said, over 18,000 I think, or so customers, we have, you know, over a hundred million Azure consumption hours on our solutions and growing. I think that is the opportunity where you see we’re adding value, you’re changing the experience, and for us is an absolute amazing ride.
[00:09:13] Jason Rook: Okay. So another marketplace place promise that you often hear from, from everyone in this space is that, and, and, and Dutch, you kind of alluded to this with the Mac component.
Yeah. But it’s that deals move faster and deals are larger in cloud marketplaces. Um, I’d love to get your perspective on that particular marketplace promise. Are they faster or, you know, deal velocity and are they larger deals?
[00:09:35] Dux Sy: So maybe before I answer that question, Jason wasn’t expecting this. For, for the benefit of the audience.
Maybe some folks may not be familiar with Mac, uh, especially folks watching as well. Yeah. So yeah, the official definition of Mac,
[00:09:46] Jason Rook: yeah, well, uh, Microsoft Azure consumption commitment, but in reality, all the hyperscalers have some type of cloud consumption commitment that a customer can make. So you have the EDP or the PPA with AWS, you have the CUD with G-D-G-C-P.
Um, and you know, if you think about modern procurement and those new millennial buyers, they probably know those ments acronyms today because that’s how they’re thinking about cloud purchasing, cloud software, right? So customers that have this cloud consumption commitment. And in many cases, they have the ability to draw down that commitment when they purchase, let’s call ’em eligible applications through a cloud marketplace.
[00:10:21] Dux Sy: Very good. So to answer your question, um, yes and no. Yes. In our enterprise customers, so a lot of our enterprise customers, big companies, they have a lot of these commitments. And what we’re finding is not only that, it makes it faster, sometimes makes the deal size bigger for us, because in the past, let’s say they, they, they wanna procure.
A lot of solutions from us, but they’re like, you know, based on budget phase one, phase two in the next two years. Whereas, you know what, we could do them both and draw it from our Mac commitment. So on the enterprise level, absolutely makes it faster, makes it better for us. But then if we go down to the SMC space, for example, it’s, it’s still growing because in some cases the flexibility of the Azure marketplace is still not on par with the other marketplaces.
For smaller organizations. Yeah.
[00:11:10] Jason Rook: Um, Dexter, same question to you and then I’ll kind of respond to that. Okay.
[00:11:15] Dexter Hardy: So what we see is, well, first of all, we would be considered a startup because no one would’ve known our brand. No one knew who we were. So what we did was we used the marketplace one to spread out and grow our brand.
We, we, I worked in marketing, supporting marketing agencies. We focused on the marketplace as a groundswell opportunity. So what we did was the marketplace has so many people out there, our barrier to, we lowered our barrier to entry. And the marketplace gives you that easy transaction to kind of acquire and build out your brand.
And now what we’re focused on is deepening those relationships through a channel and through additional, uh, you know, deepening that relationship with the customer, going in, cross selling, doing different things, talking about AI readiness, et cetera. So that’s where we different approach. Mm-hmm. Same outcome is really just expanding your reach and we were able to do that in the marketplace, to deepening that relationship and then going into co-sale, going into, uh, you know, bigger, more tangible, uh, sales within, within those organizations.
Yeah,
[00:12:26] Jason Rook: so I think docs, especially around your point around cloud commitment, from my purview, there’s no doubt right, that marketplace deals. In some ways are larger granted now. So Microsoft, we don’t know what those deals look like off marketplace, right? But what I do see is a lot, um, a lot of upfront annual payments or a lot of upfront deals, right?
So what used to be a three year term is now turned into a one year upfront, right? We see that a lot ’cause that customer’s trying to manage that cloud commitment that they have. Uh, we’re gonna talk a little bit later about in integrating channel into that, and I think one of the things that the channel does.
Really well is that the channel helps a customer with that procurement journey. And we see channel partners that have just amazing kind of cloud estate practices, right? Where they help the customer make those purchases. But I do see larger deals. Um, I. I would say from a velocity perspective, it’s absolutely true as well.
At least from what we see from the minute a deal enters the pipe to the minute it closes. A lot of times we find out about those deals like three days before the end of the month. Right. And which, which might not be typical off marketplace experience. So the, I think those two marketplace promise topics are kind of, have.
Positive answers, but I got another one that I don’t, I don’t know where you’re gonna go with this one. So one of the, the promises of cloud marketplaces is this idea of, it lowers the cost of goods sold for the software, develop the development company, right? So, you know, all these promises of automation and scale and those types of things.
But when you think about your journey in conversion and selling through cloud marketplace, mm. Have you really seen your costs go down? Have you seen fewer people? Have you seen the deal cycle get easier? And you know what I’m gonna change. I’ll go to Dexter to start this one and let you finish ds.
[00:14:09] Dexter Hardy: Okay, well, absolutely for us, uh, we focused on the automation first.
So leveraging ai, having a small team that can punch way above our weight with regard to being able to deliver our solutions are out there. Again, you have this 24 hour salesperson that’s pushing that out. Our costs of goods sold are not increasing relative to the amount of, uh, expansion and growth that we’re seeing in our organization.
And that’s really been a powerful thing for us.
[00:14:40] Dux Sy: So for us, not yet. So for us, the velocity is faster. And I think this is where we’re different because a lot of our, uh, marketplace transaction are private offers. So the idea is we’ve done the work. We pitch, we sold and we created this private offer for transactional purposes.
So a lot of the backend is still the same, but what it does help is just the velocity.
[00:15:06] Jason Rook: Okay. So I would, I would say my perspective on this particular marketplace promise has a lot to do with. Who you are and where you’re coming from. So in Dexter, your, your situation, you’re more of a startup. Right. And I know your business, you have lots of different skews, but I think more of the startups that I talked to, like the ones that come outta the Microsoft ISV success program mm-hmm.
Where they, they. Kind of, they’re born in the marketplace. We used to term them born in the cloud, right? But they’re kind of born in the marketplace. They’ve designed their entire sales motion around it, and maybe they have one, two simple SKUs, right? That that’s it. And I think they see that as a lower cost of good sold opportunity.
When I talk to the big guys, the household names, the NetApps, the Palo Altos of the world, that’s not the case, right? They have hundreds of SKUs, hundreds of agreements. Um, they’ve, they’ve got everything they do as a custom private offer deal. Mm-hmm. And so I don’t think they’re realizing just like you, much like you docs the, the lower cost of good sold promise of, of cloud marketplace today.
Um, so let’s, let’s move forward to kind of building off that cogs conversation into shift of your sales force. Right. Um, and I think you both have an interesting perspective on this, um, Dexter, let’s start with you again as well, because I think you shifted from a different business model, right? Yeah, absolutely.
Um, what, what’s the shift of Salesforce look like for you with cloud Marketplace?
[00:16:28] Dexter Hardy: So again, cloud marketplace, we are digital first. We didn’t even want to have a representative out trying to sell our product first. Because we were changing from an SI to an ISV. This was a new model. Obviously we wanna prove it out, but the proof is in the pudding to use a southern term.
We are, we are benefiting from that 24 7. It’s right there in your face. It’s click to add, you download the product or deploy the product to the cloud. And it moves like our time of our customer acquisitions, three to 400 downloads a week, like customers are quickly. Able to acquire and move with our solution.
So for us, we wanted to go there first, and then what we add on that, which was brought out another section is customer set. Right? We make sure we follow up and then that’s where we do our cross sale or deepen that relationship and then do co-sell from that perspective.
[00:17:26] Jason Rook: So what about you Dux shifting that sales force that you already had in place for 20 years?
[00:17:30] Dux Sy: That’s right. So, uh, we’re, we’re in this great transition, so I would say. Marketplace. And frankly, all these uh, new cloud models is a catalyst for us. So, as we’ve said publicly, we’re really pushing to shift our business to be very channel focused. Not to say we’re going to, uh, uh, forgo our current sales organizations ’cause we still have a lot of great customers around the world that are enterprise level, that our sales teams we need to focus on.
But what’s happening today, even a lot of our enterprise sellers. They recognize the value of the marketplace because it can accelerate deal velocity. So that’s one. But then knowing that the future for our organization is really support a lot of our partners, the, the understanding and also the value our organization putting on marketplaces is continuing to grow.
So I can see eventually there’s gonna be a, a huge shift, regardless if it’s our direct sellers or our channel team. Uh, but we’re in that transition phase, right?
[00:18:31] Jason Rook: So what do you think’s the bigger leap for your direct seller sellers? Is it the leap to understand marketplace transaction model? Or is it the leap to selling better through channel?
[00:18:45] Dux Sy: I think, are you asking which one would come first?
[00:18:48] Jason Rook: Yeah.
[00:18:49] Dux Sy: I think it’s, it’s actually both happening at the same time. ’cause a lot of them are seeing the value today. Like for example, a lot of our top customers are big Microsoft customers. So they’re seeing, wait a minute, my sales cycle is much faster if I go through the marketplace.
So everybody’s excited about that. But then at the same time, on the channel side, this myth that channel is for mid-market and SMB, it’s not quite true anymore because even there’s a lot of channel partners working with enterprise customers. So that’s very attractive for our direct sellers too.
[00:19:26] Jason Rook: Um. So let’s, let’s move forward to another question, and I’m going to, I think it’ll, especially at, uh, ultimate partner, we use the term co-sell a lot, right?
And I think at, especially at Microsoft co-sell can both be a noun and a verb, right? So the verb is going out and selling jointly with everybody in this room. The noun is the program, right? So, um, you guys have both participated in co-sell the Noun or the program for several years. And today in the Microsoft world, that’s a very Microsoft specific cloud marketplace question.
But, um, co-sell is marketplace, right? You can’t do one without the other. I’d love to get Dexter, we’ll start with you. I’d love to get your perspective on what co-sell and marketplace is changing in your business. Good and bad.
[00:20:11] Dexter Hardy: Okay. So I think just speaking from our journey, um, you have to be at a certain level.
Of sales within an organization to even think about co-selling. And a lot of people miss out on, you know, are people buying your product now? Well then co-selling is not gonna work for you, right? So you have to have a certain level of critical mass that you’ve been able to obtain within your organization, and then you activate that part of selling.
So that’s the first thing that I would say. Is it good or bad? I think it’s great because now you have the ability to amplify. And get those relationships built deeper across, uh, organizations where you may only be in one business unit now, now you have an enterprise agreement. So I think, you know, combining the Mac, telling the story that you, you know, you have this critical mass within your organization.
Hey, company, we’re over here. You’re, you’re using us, you can pay down your Mac. You have the, don’t go in the store and pay cash. You have a coupon. That’s what a Mac is. I always tell people that like, it’s like. You have a Publix coupon, go with the coupon. Don’t go spend cash, right? So just making that awareness for your customers so that they understand the value of your solutions and how they can leverage that to save, uh, potential dollars.
[00:21:29] Dux Sy: I haven’t seen those Sunday paper coupons in a long time. It’s all digital now. It’s
[00:21:34] Jason Rook: all it all digital. Yeah. So docs, um, yeah. I mean, endpoint’s been a co-sell Yeah. Partner of Microsoft for years, right? Mm-hmm. Um, what’s your experience been as, as you’ve shifted this model and as you, the Microsoft sellers that you’ve known for Yeah.
Decades, right? Shifted it to the new co-sell model. I think it’s
[00:21:52] Dux Sy: great. I think first of all, right, speaking of the Mac again and again, not to belabor my point, it. Increases the velocity because with co-sell marketplaces, customers, they just want to draw from their Mac. That’s number one from our Microsoft counterparts.
It hits their a CR and they would walk us in because they know, oh, your solutions are a marketplace. It’s gonna help me, it’s gonna help you. The third part, it just broadens our sphere of influence at that point. And while we, we may be a, a larger ISV since we’ve been around 20 years compared to others, but there’s.
A big market out there. There’s a lot of customers out there that don’t know us, um, and, and they see us and we can take advantage of it.
[00:22:37] Jason Rook: So I, I, I think I would echo both of you. I think the interesting part about co-sell is in the marketplace world is that it does have clear and accountable. Um, alignment to seller compensation, right?
Mm-hmm. So that has changed a lot of the relationships. I think the other thing, and I’ve talked about this at Ultimate Partner before, is it’s moved the cheese for a lot of traditional Microsoft partners. Mm-hmm. Um, especially those that are not software development companies that are more systems integrators, GSIs, MSPs, VARs, those types of partners, whatever acronym you wanna throw on them that have always struggled to have a relationship with Microsoft.
Um, because they were, um, VMware reseller, a Cisco reseller, and Microsoft wasn’t the top of their line card. Um, now those channel partners are selling massive ISV deals through marketplace. Mm-hmm. And they’re bumping out some of the more traditional Microsoft partners that were there at the table because they had relationships.
And I think that’s an interesting trend. That’s only gonna continue as we see this marketplace momentum. Uh, go on.
[00:23:42] Dux Sy: I want to add to that, and that’s, I think, where the future promise is, right. It’s this better together partner to partner story. It’s the, the ability to do multi-partner offers. And, and that’s a lot of the things we’re working on today.
And what, what really, uh, gives us that good combination, be it an ISV, an si, an MSP. So I think that’s where there’s a lot of room for growth in that aspect.
[00:24:04] Jason Rook: So let’s just jump into that top area right now. Doc, you, you’re, you’re trying to really flex this channel muscle. Tell us a little bit more about what you’re doing with multi-party private offer and embedding channel in your sales.
Sure.
[00:24:17] Dux Sy: Uh, so we work with a lot of different partners in different shapes and sizes, and the team has done a phenomenal job with putting together multi-part offers. Some of them we may be behind the scenes that the partners just going forth, so, so a very specific example. So we talk about ai. We all know that the holdup of ai.
Is not because of ai, but because of poor data.
Right?
[00:24:42] Dux Sy: And you can see all these reports, you know, copilot pilot stays there. It’s just a pilot. And the challenge is not because of copilot, but the data states not ready. You know, you have 40-year-old TPS reports that’s sitting there, right? Uh, oversharing is a problem.
So all these things, right? So what we’re working with a lot of our partners today is, Hey, this is an opportunity. If you do services around migration or cloud protection, introduce a new service around ai, data security, and let’s put it together in the marketplace as a multi-partner offer. So people can click, Hey, I want AI data readiness or co-pilot confidence, whatever you want to package it as.
So those are some of the things we’re working on and it’s really exciting ’cause it’s, it’s introducing a new line of service for our partners to expand their business in. Yep.
[00:25:33] Jason Rook: So Dexter, you and I chatted about your channel strategy, right? And when I look at your marketplace business that I would say today, I’ll just say it’s not very channel heavy, right?
And it’s super attractive marketplace business to me, right? So I’m, I, my question was why are you gonna go down that path? So I’d love to know more about what you’re thinking about how you’re gonna grow utilizing channels and marketplaces together. Right?
[00:25:54] Dexter Hardy: So the first thing that we focus on again, is, are, do we have, and are we adding value?
With our huge span of customers and the amount of usage that we’re getting on it, that answer, that answers hand, hands down. Yes. So now what we look at as a channel partner, our solutions help sis do their job. That’s what we cut our teeth on. That’s what we were. And so that’s how we started as an organization.
So now it’s just getting the word out to other sis. We can help you reduce your cost and be more profitable by leveraging our solutions. So selling through the channel becomes the opportunity through a multi-party private offer. Through that channel relationship to say, Hey, we’re not competing with you Big five three, whichever consulting you are now, right now.
Right. So where we’re looking to partner with you one to give you more, um, profitability margin. You know, you look at margins, you can say, Hey, this is how we get here faster to. That a CR that you’re looking to get to become a better version of the partner program. ’cause there is A-A-K-P-I that you need to get.
You get that because now we’re sharing, and now that becomes part of your KPI as well. The third piece is, well, it’s a big pie, right? Even if we’re looking at, we’re talking about trillions of dollars, the law of large numbers, we multiply any percentage times a trillion dollars. That’s a large number, right?
So that’s how we look at. Holistically growing that market. And so instead of having just one line of business or one way to go to Market Channel adds another growth opportunity for us and also partnering through the MPL.
[00:27:34] Jason Rook: So I think there are probably some software development companies that have tuned into this or even in the room today, um, that are still thinking or still really early on their particular journey.
Right. Yeah. And I think one of the things that if you’re in that case, you might have some questions about. The utilization of a public offer versus a private offer. Right. We usually, we refer to public, our private offer as a custom deal. Mm-hmm. Um, and I know both of you have different perspectives on that or different levels of success.
Um, Dexter, let’s start with you. Public offer and private offer. Your business has been very good, which is public offer, right? We are public all the way. Yeah.
[00:28:14] Dexter Hardy: Okay. So, and I, I, I say we start public all the way again. That barrier to entry. Customers don’t know your name. You gotta build your brand, you gotta build your momentum.
You get out there, you’re acquiring customers, you know, 33, 33 government agencies, you know, over 160 countries. And now you can then build on that second layer, right? Which is the private offer. You can say, Hey, X, Y, Z customer, you’re, we see you’re using all of these solutions. It would make sense to do this private offer with us, as opposed to.
We don’t have a name, we don’t have a brand. We come in with our sales person and we’re saying, Hey, come do business with us. No, you don’t even have the credibility to do that. But now, because we’ve taken that ground soil approach, we’ve gone out, we’ve, you know, built out our brand using public offers, now we can then step into that next tier.
[00:29:05] Jason Rook: So, so ducks, from your perspective, WI, you, it sounds to me like you’re mostly all custom deals.
[00:29:13] Dux Sy: Today. Correct. So a lot of our deals, ’cause it’s the nature of deal size, a lot of ’em are very large and we have custom private offers, but long term we want to build our muscle in the public offering and especially a lot of the new solutions we’re, we’re coming out with.
[00:29:27] Jason Rook: Yeah. I think my perspective is, I’ll, I’ll say in the, in the Microsoft commercial marketplace, um, if you think about revenue wise, definitely private offer is king, right? And 17 times larger than public offer deals on the whole. But what you do see is. ISVs or software development companies that do have the, your story, Dexter.
And again, back to the way I kind of framed you up when I see that they’re mostly those that started in cloud marketplace. Right. And they’ve been that way forever. I think we’re still in this phase. I know early majority, you know, that we’re there, but we’re still in the space where I think customers come to the marketplace to buy, not to shop.
Mm-hmm. Still. Um, and if you think about the ones that are really coming here, they’re coming to draw down their cloud commitment from some hyperscaler. And they’re, they know kind of what they’re looking for in most cases. And I, I think even with you, Dexter, they know what I mean. ’cause the solutions you saw are really unique.
Right. If I’m looking for Bantu or something like that, I, I am gonna find that I’m not just coming out to the marketplace, say, oh, who has something I could buy today? Right. I don’t think we’re there yet. I think in the future when we get more further down the path that Jay kind of outlined today with microservices and that type of thing mm-hmm.
I think there’ll be more of that shopping. But the most successful ISVs today are. Are really wrapping around that, that custom story, or they have, I would say you have very clear and unique offers in the marketplace. Dexter.
Yeah.
[00:30:48] Jason Rook: Um, so there’s a lot of work here that you guys have put in to get into cloud marketplaces, a hundred marketplaces for you, DS and, you know, in Dexter.
Um, I’m sure. Let’s, let’s just ask right now, what’s your strategy around multi-Cloud Dexter? We’ll start with you.
[00:31:04] Dexter Hardy: So, um, I’m a huge proponent of doing one thing really well, first. And then expanding on it. So we focused, we Microsoft partner, we focus on Microsoft. We’re doing that really well. Our customers are in AWS and GCP.
So we are moving out into those ecosystems based on what we see our customers, where our, where we see our customers. Mm-hmm. So that way we’re able to give them a full picture of how we can support them. If they chose us over here, they know that they’re gonna do the same quality across every cloud. Uh, so that’s our approach is just not that we are saying, Hey, let’s just, you know, go out and, you know, shotgun approach just kind of go everywhere.
But no, it’s a systematic, we’re doing this really well here. Our customers are there and so we’re, we’re following our customers
[00:31:54] Jason Rook: docs. How, how are you handling them?
[00:31:56] Dexter Hardy: Cloud? So for
[00:31:56] Dux Sy: us, I think the, the driver for us to invest in marketplaces is not necessarily direct customers. So when we started this journey, this is way before mm-hmm.
Um, uh, Microsoft Marketplaces is we were committed to growing the channel, and we know a lot of our partners transact through marketplaces. So that’s how our marketplace journey started. However, through time, uh, especially through AppSource, anybody remember AppSource or
it still
[00:32:24] Dexter Hardy: exists
[00:32:25] Dux Sy: as your marketplace, right?
Did I just say, do they remember? Okay. Um, but through Azure Marketplace, we have a lot of large customers really transacting there. So that’s our direct side. So, so we look at it, uh, two-prong approach, right? We scaled fast because we wanna make sure we want to meet our, uh, channel partners where they are.
But then now as customers are really buying and transacting to marketplace, we’re also serving them, um, in these marketplaces as well, right? Multi-cloud. Absolutely. That’s part of our growth strategy as well. Cool.
[00:32:55] Jason Rook: So a another question for maybe those that are early in their journey with cloud marketplaces, especially if you’re a software development company.
And I think today we have, um, we have this ecosystem that continues to evolve that we, at Microsoft, I think we’ve thrown a title on ’em. Then in a lot of the other hyperscalers have, have as well, we’re calling them the enablers, right? So we, one of those keynote sponsors here at UPL is sugar. Um, you know, you got tackle, we transact Azar work span.
Every day I get a new email from another enabler. Um, I don’t think either one of you used an enabler yet, but you both have different opinions. And Dex I’ll start with you and then Dexter, you can kind of give us your opinion on the enablers. Like where do they play for you and where don’t they?
[00:33:34] Dux Sy: Correct.
So I think what the enablers are doing, uh, for, for marketplaces are fantastic. And I think when we started our journey, uh, and, and maybe a lot of them haven’t, didn’t exist yet. We had to figure this out. So we thought, boy, we’re in this business for 20 years. We figured out how to grow direct, working with large customers, government agencies.
We can figure this out. Right? Which we kind of did and we’re doing today, but it’s, it’s work, right? It’s, it’s, we have a whole team doing all the different pieces that needs to be done, marketplaces. Whereas I can see for, let’s say you’re a startup, you want to scale, you want to interact with different marketplaces, and you don’t have that team.
I think enablers are, are uh, uh, fantastic partners to work with. It.
[00:34:18] Jason Rook: So Dexter, what’s your take on the enabler
[00:34:21] Dexter Hardy: ecosystem? So we personally do not use enablers. Um, and again, that’s, that was our choice from a startup perspective. You know, price point being a barrier. You need to, as a, as a startup, you have so many other barriers in front of you.
If technology is your strong suit, which was ours. A lot of it we kind of understood. So we leverage our own internal knowledge to go to market and, and, and take that, take that step. So if it’s not your superpower, obviously the enablers are going to get you there quicker, faster. And so you can, you know, justify that cost.
But for us it was a scenario where, okay, we already understand how to deploy the, to the cloud. We understand what the, what the rubric is, so why add that additional cost to our. Additional stack. Right. So for us, we, we chose to go net new on our own. Mm-hmm. And so that’s allowed us to kind of build faster, quicker, because we don’t have to integrate with something else.
Right. We automated that. And we do use copilot. We use creating our own agents as well. So, uh, like I said, we’re leveraging technology to deliver technology. Okay.
[00:35:30] Jason Rook: Yeah, I’d say, you know, from my perspective, I think. Hmm. A couple things. I think, again, I mentioned the, like the larger, more historical household names, security and data providers.
Um, definitely when they have legacy business and they’re bringing it over and they have, you know, hundreds of SKUs makes a lot of sense. Um, I think the next evolution of that whole group will be the additional value they provide, right? Mm. So, you know, everything from, like we talked earlier about just the.
The effort to put together private offers and the effort to do that with a channel partner and, and those types of things. Um, the effort to track that business, Dexter, when you go multi-cloud, maybe that’ll push you over the edge, right? So I think there’s, that ecosystem will continue to evolve a little bit.
So, you know, we wanted to save about 10 minutes for some questions. I’m gonna just ask you, you know, for some parting thoughts for the, the audience, like what, what would you like the audience to take away about your journey that might help them out in Dexter? I’ll start with you.
[00:36:30] Dexter Hardy: Okay. Um, well, as an, as an entrepreneur founder of a business, obviously you have to take calculated risk and emphasis on the risk side because you know the market is changing.
What will used to seem steady is changing rapidly. AI is just making that faster so, you know, have confidence in what you’re doing. Focus on being 1% better, do one thing really well and you will be just fine. Yeah,
[00:36:59] Jason Rook: ducks. What
[00:36:59] Dux Sy: would for me, uh, three quick things, right? Number one, who’s your audience? Who’s your market?
Are you selling direct? Are you selling or you want to do partner to partner? So once you’re clear of that, then you decide which marketplace you want to go to. I, I agree with Dexter, right? Focus, at the very least, go, go with the top three hyperscalers, and if solutions would. Would support those audiences in the three, uh, marketplaces and or four go for it.
And then last, but not the least. As you build that muscle, then think of scaling through channel.
Right? Yeah.
[00:37:33] Jason Rook: Good. So we’ve got about 10 minutes left. Let’s, uh, let’s open it up to some q and a. I know there’s microphones and we already, oh, cloud marketplace. We have ’em stacked up.
[00:37:42] Question: Yes. Yes. Uh, so first of all, I, I want to say this was a really, um.
Really great contrasting conversation, the two different parts of having success in the marketplace. So absolutely amazing. Um, I’ve got kind of a two part question, uh, because I think it’s really important for a lot of ISVs to hear this experience is, and, and I’ll start with that point because it’s something I have familiar, uh, fam I’m familiar with.
Um. A procured app app Point back in 2018, 2019, brought it into a big bank. Um, it was purchased through Kaizen, which was a partner of your all’s Microsoft brought in great experience. Um, so I can see the benefit and I can hear everything that you’re doing is, is exactly what, uh, ISVs need to be targeting in terms of co-sell.
So congratulations on that. I love to hear all the progress that you guys are making. Um, my question for you is, it’s something that I run into all the time with with companies is we hear these, we hear these ISVs just say, you know, our product is just our product. It’ll never be anything other than custom.
We’re always just gonna do private offers. They just dismiss the, the frictionless type experience that you can get it in, in a marketplace. Like what, what you’re seeing with Dexter. And so, you know, it’s one of those things you, you hear repeatedly and I see at point you, you’re having a whole lot of success with co-sell.
But what type of obstacles are you up against in terms of getting the alignment inside the organization to actually start working towards PLG motions mm-hmm. That are going to enable you the way that Dexter is because you’ve got that, you know, that, that, uh, contrast. Yep. Where a startup is born in the born in the marketplace, natively deployable.
You’ve got that experience and then you’ve got more legacy systems that are extremely customizable. And rely on private offers and, and yet stay away from growing towards that trajectory. Mm-hmm. So I’m curious from, from your standpoint, what are those obstacles? How are you bringing that to light inside the organization?
Mm-hmm. To, to make that change? Yep. And then my second question, so I’ll, I’ll tee you up, Dexter, is what is it that you’re seeing with the click to deploy type mechanisms, the public offering that you offer? What is it that you’re seeing? That’s creating the most success for you because I think, um, it’s really important the experience that customers have.
It’s not just about finding your product, it’s being able to be easy to use, try then buy. So I’m curious, you know, what has been successful for you? Um, what’s your name, sir? Justin Murphy.
[00:40:12] Dux Sy: Justin, thank you. I love your glasses.
[00:40:14] Question: Oh, thank you. I like your suit.
[00:40:15] Dux Sy: Okay, so fantastic question and uh, maybe let me preface it with this.
I think. I think what I love about it, I, I’ve been here 12 years and, uh, I think this is like the best year I’ve been here with all these changes in the growth. So AppPoint started and, and I, I share this and I’m not, you know, I’m shamelessly plugging this, but I think AppPoint is the only ISV started with two people building the first SharePoint migration solution in 2002 in a public library in New Jersey.
Fast forward today that went public. We went public on the backs of Microsoft. So thank you Microsoft. Right? And and the reason why is App Point’s a very entrepreneurial organization. Now we start our business with the enterprise, like enterprise is the hardest nut to crack and we cracked it and we’re continuing to do well.
That’s great. And we realized though, to scale and to grow, we gotta do channel. We gotta hit. Those what folks with the SMC audience. But we can’t do it. We can’t hire enough people to do it. ’cause we gotta focus on the enterprise. And from a change perspective, pivoting, I would say we we’re pretty up for that.
As Dexter mentioned risk. We love risk. Right? When, when, uh, Microsoft back in 2010 announced, Hey, we’re gonna go full B pause if you don’t know what that is, you weren’t born yet. This is the granddaddy of 365. And they reach out to us, say, Hey, we’re gonna go full on the cloud, but we need partners like you to build on the cloud.
We said, yes, we’ll do it. And then when they shifted to, uh, subscription, we did it. That was a big jump. ’cause back then everybody was like, what are you smoking subscription? Ha ha ha. Nobody’s gonna pay monthly. Right? And then, and then this idea of scaling our platform globally, we’ve done it. So we’ve done all the hard work.
And a few years ago we realized. We got to invest heavily in the channel in which we have. So certainly we start and say, Hey partners, we’re in the marketplace. Here’s our solution. Enterprise grade solution, now available to SMC. Great. But we didn’t stop there. We listen, partners like this is great, but uh, we have a lot of partners and it’s so manual.
We need multi-tenant management, we need workspace governance. We need, you know, risk monitoring. We need like a full knock so we can see all the different clouds environment. And we built it. So we have a fantastic partner specific platform called Elements Platform, and we, we just bought a company a few months ago to integrate with that and we’re gonna continue to grow and invest and double down in it.
So, to your point, right, yeah. Today, at least in the Microsoft marketplace, we have a lot of private offers because we still have a lot of those big customers we work with that they want to draw from Mac. But at the same time, from a, a. Growth standpoint, we’re really gonna invest a lot in our channel. Not not just from a selling motion, but innovation as well.
So our partners, not only can they sell more and grow their business, but they can run their businesses better. So our greatest challenge really is just time. It’s, it’s really, ’cause unlike maybe other organizations like you mentioned, how did I, how did you convince your internal leadership? It’s reverse for us.
We don’t have to convince internal leadership. You know, you talk about, uh, uh, Vince talked about growth mindset. We live and breathe it. Like, great idea. Go do it. Right? If you fail, it’s okay. You learn from it then, but let’s move on. So really, our, our greatest, uh, uh, thing we’re, we’re, we’re, we’re fighting with is just time.
It’s like, there’s just not enough time. But other than that, I think it’s, it’s, it’s a wonderful time to be a partner in this ecosystem. There’s so much to do. Hopefully that answers your question, Justin.
[00:44:00] Dexter Hardy: So I’ll start with a little bit of a quote. If we change the way we look at things, the things we look at change, and I say that from a standpoint of being an engineer.
When you’re out creating software or building anything, right? You’re thinking about features, functionality, turn that lens and say, what is the experience? Our solutions are set up to help DevOps teams. Mm-hmm. Who someone gets a, they read an article and they’re like, oh, we need to implement this technology.
And now that DevOps team is like, oh. What we’re doing, what and how long do we have? No. Our solutions help them with their life experience. Like you click to deploy, like you go in, you need to deploy this. Five minutes later it’s in the cloud, we’re onto the next thing. Okay, we can do those things. Right?
You’re improving their experience. So that’s what we started to look at from a, from an ISV perspective, is not just software, but what are you doing to improve the quality of the people’s lives that would use your software. And that’s, you know, like I said, we were sis, we did that. So we knew, oh my God, these people are gonna be raving about this.
Right? And then the market proved that out. So I would say focus on, just change the lens. If you’re looking at click to deploy or whatever it is you’re trying to evaluate, it could be, you know, rocket science, which with chat DBT and all the AI tools out there can be really made simple within your solutions.
I. You just have to change the lens. Don’t just do technology for technology. Do it for the improvement of quality, uh, improvement within, uh, life experience, uh, and, and getting your, um, constituents time back. So, next question.
[00:45:48] Question: So I, I know we’ve been talking a lot about software products in the marketplaces.
Um, how do services, sides of marketplaces work? And I’m sure it’s different for each of the hyperscalers, right? But like. Can I, as a services provider say, oh, here’s a 50 KPOC. It’s all gonna be custom built. Right? And then like we sell it through the marketplace, it retires. Mac is, is that, is, does that work?
Or is it only for software? Can I
[00:46:14] Dexter Hardy: jump in on this? Yeah. If you talk to me afterwards, you can partner with an ISV and do a multi-party private offer that’s transactable in the marketplace. So including the services, right? So let I, let
[00:46:26] Jason Rook: me just make, in the Microsoft commercial marketplace in the Microsoft, uh, you can now you can, well, in the Microsoft commercial marketplace in the us, Canada, and the United Kingdom, you can now sell a private, a professional services private offer.
Proof of concept 50 K, proof of concept, great idea workshop training, managed service contract training. The only thing you can’t do is the time materials contract within there. Right. Your question though? No, it does not decrement the Mac. Um, so mm-hmm. Yeah. So software sales are the only thing that decrement the Mac in the Microsoft commercial marketplace.
Now, all the hyperscalers have professional services capabilities and they all have different, you know, models in which those may or may not decrement cloud consumption. Um, but I think the rule of thumb for professional services providers, or if you’re a peer play si, um, it’s all about cloud consumption.
And you can look at most recent AWS announcements. You can look at our earnings report. You can look at all those things. It is about driving cloud consumption of our first party products, so software’s king. Um, and so that will always get the, you know, that’s always gonna be at the top of the list. And I think you’ll consider, you’ll, you’ll, you’ll realize that we continue to provide features to allow professional services in ways that we think pull software, right?
So, um. That’s the way I would think about it. If you are a pure play si, which there are a lot of those that have yet to, you know, like I was mentioning earlier, the traditional sis at Microsoft that have yet to adopt marketplace. The reason why you do it really isn’t because you want to become a transactor, although some do, because it is pretty easy money in some ways.
Um, the reason why you do it is you want to keep or build relationships with Microsoft field. That’s the reason why you go down the marketplace path if that’s the the business you’re in. But from a proser perspective, yes you can do it, but software will be key.
[00:48:14] Question: So then is the buyer buying that private offer and that bundle because they’re getting to retire the Mac on the software side.
And then like the partnership that we would strike within the ecosystem is more like, Hey, we can accelerate your journey, right? Um, the customer’s journey, buying your software with our services. So then we bundle that together into a private offer. Customer says, oh, like Mac drawdown is gonna be 10 K, but then I need to create new outlay for 50 K for the POC.
Right. Like, it, it, it feels, so when I reconcile that with some of the things we heard earlier today, right? Like $7 for every dollar that goes to cloud consumption, it sounds like, at least with your setup at, at mac, right? Like. The drawdown is only for the dollar. The $7 is like new money from the customer.
[00:49:05] Jason Rook: You remember that? $7 of net new revenue that’s attached to that transaction, right? So that could be $7 of product sales, $7 of your services, the whole pie. So if you think about the most typical pro in the Microsoft commercial marketplace today, the most typical. ProServe engagement is, I’m gonna use some names just to make it up.
’cause earlier I think Jay mentioned Palo, so let’s use Palo. So you’re a system integrator and you do a great job of implementing Palo NextGen firewall or an FWS or whatever they call it today. So you go to the customer, customer has a Mac, they wanna buy Palo Firewall, but you’re gonna do a hundred thousand dollars implementation.
You would, you would say, I’m gonna sell you a Palo Alto multi-party private offer for the firewall. Or a million dollars let’s say, and I’m gonna sell you my professional services private offer to do the implementation. It’s a hundred K fixed bid deal, right? So Palo’s gonna send you a private offer for your, for the firewall.
You’re gonna mark it up, you’re gonna send it over to the customer. So you’re gonna make some margin on what Palo just sent you. When the customer clicks buy on that offer in their Azure portal, that million dollars decrements their map right? You, when you also send, when. In parallel, you will send over your private offer through partner center into their Azure portal.
And when they click buy on that a hundred thousand dollars offer, it does not decrement their Mac, but it does end up on their Azure invoice. So the value to that millennial buyer now is they only had to go into the Azure portal and click, click, click, and they’ve bought all that. The invoice is only gonna be one invoice from Microsoft.
It’s gonna come with all their other stuff. Um, also. They probably maybe got around some procurement things, right? Because they just went in, did it through the portal with the existing agreement, so it’s a little easier on them. So that’s kind of where you, yeah, they didn’t get the Mac decrement, but it, it is a better story for them
We have rowdy questions in the front. I know. I love it. Yeah. So one more question because we had somebody on the chat. I wanna be respectful of the fact that the chat and then we are gonna take a break for lunch for 15 minutes. So, manic rain from, uh, NetApp, you probably know. Question for you Jason. Can you speak to Microsoft’s recently announced SME and C org?
Specifically, what changes is Microsoft planning? To make with regard to channel partners and marketplaces. Loaded question.
[00:51:33] Jason Rook: So I, I, man, probably we can, we can set up a call to talk about that. Okay. Um, if you’re still tuned in, um, I can’t speak to that today. That was, I mean, you know, Microsoft ecosystem that was recent, so we work in months, quarters, and fiscals, so we haven’t got to that point yet.
So, yeah, good answer. Thanks for the question. Thank you, thank you.
[00:51:56] Vince Menzione: Thank you for joining this episode of Ultimate Guide to Partnering. And if you haven’t done so already, mark your calendars. Ultimate Partner Live Spring is coming to Redmond, Washington on May 1st and second. This is going to be an incredible event like each of our Ultimate partner events.
This one is going to be just a little bit better than the one before. We’re having incredible leaders from Microsoft. Industry leaders talking about co-selling marketplaces, aligning to Microsoft priorities and more. You don’t wanna miss this event. Sign up today before seats run out.
Keywords:
cloud marketplace, azure marketplace, aws marketplace, google cloud marketplace, marketplace strategy, isv, software development, channel partners, co-selling, private offers, public offers, multi-cloud, digital sales, sales growth, customer acquisition, partner program, tech partners, ai, data security, cloud migration, SaaS, B2B sales, tech industry, business growth, entrepreneurship, startup, digital transformation, Microsoft, AppPoint, Integral, Jason Rook, Dux Sy, Dexter Hardy, ultimate guide to partnering, tech trends, online marketplaces, software sales, cloud consumption, deal velocity, cost of goods sold, salesforce transformation, partner to partner, multi-party private offer, channel strategy, marketplace enablers

Apr 16, 2025 • 55min
260 – The Partnering Revolution: AI, SaaS, and the Future of Work
Why the C-Suite Must Rethink Everything—From Sales to Strategy—in an AI-Driven World
How to challenge conventional thinking and how executives must adapt to the current marketplace.
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This dynamic panel discussion dives deep into the tectonic shifts impacting the tech industry, particularly the role of AI and the evolution of partnerships. Industry experts Jay McBain, Janet Schijns, and Greg Sarafin challenge conventional thinking, emphasizing the urgent need for companies to elevate partnering to the C-suite and adapt to the rapid advancements in AI. The conversation explores how AI is poised to disrupt SaaS, reshape revenue models, and even alter the very nature of work. The panelists debate the balance between direct sales and channel strategies, the impact of marketplaces, and the importance of integrating partnering throughout an organization’s operating model.
The discussion also addresses the potential for AI to both streamline operations and create friction, with panelists highlighting the importance of data integration and the development of agentic technologies. The panel grapples with the promise of AI-driven efficiency gains versus the need to preserve human-centered experiences, particularly in local communities. Ultimately, the conversation underscores the transformative power of AI, the evolving dynamics of partnerships, and the critical need for businesses to embrace change to remain competitive in a rapidly evolving landscape.
https://youtu.be/OkN7nfSLuKY?si=A8q9mu-niYhFZLwL
Key Takeaways
AI is Disrupting SaaS: The panelists believe AI is rapidly changing the SaaS landscape, potentially rendering traditional SaaS models obsolete within a few years if they don’t adapt to autonomous SaaS.
Partnerships Need Elevation: There’s a concern that partnerships are not being prioritized at the board and C-suite level, which could negatively impact companies’ success.
AI Will Change Work: AI is expected to significantly impact the workforce, with agents potentially replacing task-oriented roles and digital twins augmenting human capabilities.
Revenue Models Are Evolving: AI is driving a shift away from traditional subscription models, with new pricing structures emerging.
Marketplaces Are Important: Marketplaces are playing a growing role in shaping buying behavior and influencing which tech stacks and ecosystems are successful.
Direct Sales vs. Channel: The panel discusses the evolving balance between direct sales and channel strategies in an AI-driven world, with a potential shift in the calculus of cost of sales.
Data Integration is Key: Effective use of AI in partnerships requires robust data integration across different systems and platforms.
Human Element Matters: Despite the rise of AI, there’s an expectation that human-centered experiences and local businesses will remain important, particularly in the SMB sector.
Don’t miss this opportunity to gain insider knowledge from industry leaders shaping tomorrow’s digital world. Tune in now for an inspiring conversation that could redefine your business strategy!
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Keywords & Transcript
Keywords:
AI, artificial intelligence, partnerships, channel, SaaS, software as a service, technology, business, digital transformation, agentic AI, marketplaces, hyperscalers, cloud computing, sales, marketing, C-suite, leadership, innovation, tech trends, future of work, automation, digital twins, revenue, go-to-market, partner programs, tech industry, enterprise, enterprise tech, channel strategy, co-selling, integrations, tech industry, generative AI, cloud computing, digital marketing, B2B, technology, business, software, IT solutions, partner enablement, partner management, tech partnerships, AI trends, autonomous SaaS, agent layer, data integration, revenue production, cost of sales, sales enablement, partner development, channel account managers, partner account managers, digital twin, co-pilot, autonomous CRM, partner ecosystem, OEM partnering, strategic partners, small p partnering, Big P partnering.
Transcription:
Winter Retreat Panel Audio Episode
[00:00:00] Greg Sarafin: I tell you how many people, they think more partners equals more revenue. That is completely the opposite of the truth. Fewer strategic partners equals more revenue. Everybody else should be on your platform. If you’re a platform company orchestrated in your platform ecosystem, when it comes truly to partnering, it should be a very short list.
[00:00:19] Vince Menzione: We believe this time is like no other. We believe we refer to these as the tectonic shifts,
[00:00:25] Jay McBain: all the hyperscalers in the world, if you add them all together, managed services will be one and a half times larger
[00:00:31] Intro: because it is the customer buying behavior that has created the need for all of us to rethink our models until we have data quality, the effectiveness of AI cannot be realized, and effectiveness of the partnerships cannot be realized.
[00:00:44] Intro: Can you figure out first what your purpose is and how Microsoft can support your purpose and how you can support Microsoft purpose? Now we have a partnership. It’s the ultimate partnership.
[00:00:56] Vince Menzione: Welcome to, or welcome back to the Ultimate Guide to Partnering. I’m Vince Menzis and my mission is to help leaders like you.
[00:01:04] Vince Menzione: Achieve your greatest results through successful partnering. On February 20th, 2025, a small group of industry leaders converged here in Boca Raton, Florida, in this very studio for Ultimate Partners Winter Retreat. What followed was an incredible discourse on the tectonic shifts and the rapid change we’re all seeing as partners.
[00:01:26] Vince Menzione: I’m joined on stage for a panel discussion. With Jay McBain, principal analyst at Canals, Janet Schein, the CEO of JSG Group, and Greg Raffin, vice Chairman Emeritus at ey. If you weren’t able to join us in person or on the live stream, we’re bringing this incredible session to you here. This is my gift to you.
[00:01:50] Vince Menzione: All I ask in return is that you tell your friends, subscribe. Consider joining the Ultimate Partner community and hopefully joining us in the future at an Ultimate Partner event. I hope these sessions provide you the learnings you need to continue to achieve your greatest results. And now here to this amazing session, I would say Eco somewhat.
[00:02:12] Vince Menzione: I just want frame the conversation here. Janet sits on a couple of boards. I’ve asked her to join the conversation ’cause we wanna learn not only what partners need to think and do differently. But what do organizations all up need to think and do differently? Greg has led the largest, I would say, one of the largest ecosystems in the industry at ey, taking it from under a billion dollars to 11, 12, maybe even more billion dollars a year in annualized revenue with a really true partnership strategy.
[00:02:41] Vince Menzione: So we wanna get their perspective here in the conversation. Uh, I’m going to start with a little bit of a softball. I want to, I want to go back to these tectonic shifts. Jay, Jay just shared a whole bunch of new information with us. Anything that was most striking from that conversation with Jay? Just now?
[00:02:57] Janet Schijns: I think that,
[00:02:59] Vince Menzione: just let it, yeah, let it, let’s see. Yep. You’re on. Everybody awake now? Okay, good.
[00:03:05] Janet Schijns: Uh, I think that the big thing that struck me in the conversation is how few senior leaders are elevating partnership to the board and the senior level. Yeah, I, I see instances of it. I’m on some of those boards, but then I see a lot of instances not of it, where the, where the channel or partner, um, community and leader is being shoved down in the organization rather than risen up.
[00:03:29] Janet Schijns: And I think this is the biggest risk to that Fortune 500 list. You wanna know who’s gonna be off that Fortune 500, less than 20 years, the people who didn’t get to that, elevated to their C-suite. And truly, if you’re not a company whose CPO is in line to be your next CEO. You’re gonna be off that list.
[00:03:51] Greg Sarafin: I, I’m actually gonna hit on the AI point since my 88-year-old father asked me about ai. Every time I talk to him, see your earlier question. I started laughing. I’m like, okay, I gotta talk to Pops this weekend. Um, here’s what I’ll say about ai. It is, I, I do not believe we’re over indexing on ai. In fact, I believe many SaaS companies are under indexing on it.
[00:04:12] Greg Sarafin: I believe SaaS as a species will cease to exist in five years. Unless it makes the pivot to autonomous SaaS, right? So building the agent layer. If you talk to Christian Klein about his strategy at SAP, you saw the BDC announcement last week with the partnership with Databricks. It is fundamental to SAP and every SaaS vendor on the planet large and small, that they get you to build the autonomous layer in their platform.
[00:04:37] Greg Sarafin: Otherwise, you’re gonna build it in Microsoft or Hyperscaler or on video. And then they’re going to become a database in the future because the value capture will be in the agent layer, not in the legacy system of record SaaS platform. So that to me is if I’m a SaaS company, that is the thing I’m thinking about.
[00:04:57] Greg Sarafin: What is the autonomous version of me? And then ultimately, what is the services on software version of me, which is the ultimate realization of like what I call the convergence between the SAS market and the professional services market. I could wax poetically about what’s happening in professional services.
[00:05:11] Greg Sarafin: Yeah. But I’ll spare you all that one.
[00:05:13] Vince Menzione: Well, we’ll go there. We’ll go there. Okay. But, but I wanna clarify in that, ’cause I, I do think that’s an interesting point because today we act, we, we feed the data into the CRM or ERP system, right? Very manual process. And then we act on the data, or we ask, we ask the system to tell us what to do.
[00:05:30] Vince Menzione: So how, so how does the agent ai, so the entire,
[00:05:33] Greg Sarafin: so the entire SaaS industry exists. To allow really inefficient humans to do things reasonably efficiently and very large multi human business processes. And how does it do that? It creates these little tasks and turns all humans into task reps, right? When you, if you have the misfortune of most of your days spent on a so platform, you’ve had that experience.
[00:05:54] Greg Sarafin: It’s horrible. Right? So here’s the problem for the humans in that equation. Yeah. Task rabbits can easily be replaced by agents. Yes. Yeah. That is the truth. And they don’t have to be particularly smart agents. They’re, they’re really an agent based on an R three at this point, or a, uh, you know, a Gemini two oh is probably sufficient.
[00:06:15] Greg Sarafin: It’s equivalent of maybe a college grad. Uh, to be able to do those types of tasks, rather things. Where it’s really gonna get interesting is in three to five years as that adjunct layer gets smarter and smarter, and now all of a sudden the intelligence about the finance function, facts function, whatever it is.
[00:06:31] Greg Sarafin: Ends up in that layer and the old legacy SaaS database and all of the, you know, configuration files and all the hard-coded workflows and everything else, that’s meaningless, right? All that really matters is there’s a place to persistent data so it can be audited and validated and so forth, right? So it’s going to change tremendously.
[00:06:56] Greg Sarafin: It’s gonna start by replacing the humans that are acting as task rec. Rabbits and the SaaS platforms, and it will ultimately be the margin capture in AI will land in two places. It’ll land at the agent layer and it will also land at the base of the stack. It’ll land in what we call the hyperscalers today.
[00:07:15] Greg Sarafin: Nvidia will join them, I think XAI will probably join them, maybe Oracle will. Mm-hmm. And you’re gonna have these platforms where, from the data center, floor silicone, all the way up to the top layers of the stat. It’s completely owned by these major players and you’re gonna run your workloads on those stacks.
[00:07:32] Greg Sarafin: Right? So it’s a very dystopian world. Yeah. Uh, it’s gonna feel like we have five different purveyors of IBM mainframes. Uh, but that’s the world that we are betting on in terms of how we think about how our business is gonna evolve.
[00:07:46] Vince Menzione: So sas, SAS will go away in five
[00:07:47] Jay McBain: years. I’ll, I’ll say that, you know, that the fight that the public fight in the last couple of weeks between Mark Benioff and Satcha at Microsoft has been about.
[00:07:55] Jay McBain: Yeah. You know, software kind of ate the world. And then AI eats software. It’s not that eats the software, it’s eating the model. The idea when you don’t have as many tasks people out there is you don’t have to buy as many subscriptions. And when Salesforce starts charging you $2 per outcome or per conversation in Agent force, that’s a different model.
[00:08:16] Jay McBain: But if you’re already spending $150 for the subscription and then you start looking at your bill and you’re getting the $2 hit. At, at some point, you know, wall Street, you’d love to say Wall Street, we’re gonna charge people $300 per person. Yeah. And it’s just not gonna happen. The subscription prices are gonna start to come down to the people that could actually go in and create reports and do analytics, do intelligence, but that’s, you know, 10% of people that might ever need to go in and log in.
[00:08:41] Jay McBain: That’s the head of, of the model, the ui, ux on top. What, uh, Greg is, is talking about, and it’s absolutely true, is that 90% of people are not gonna need that head. Because your copilot or your agent force or whatever agentic AI piece is not gonna come log in and pretend to be you. It’s going in the back door.
[00:09:00] Jay McBain: There’s the data, but it’s not gonna know what to do with the data. I mean, with 250,000 pieces of SaaS out there, there’s no way that these big models are gonna understand how the data is structured and how, how they could use it. Yeah. So the workflows that you build on top of the data layer, you know, if you own a channel software text, you know.
[00:09:20] Jay McBain: Stack company, you’re gonna, well this data and this data and this data we connected and this is the value. And boy is that valuable to the sales person, the marketing person, the CX person, the product person. And that’s the co-pilot’s gonna talk to a co-pilot and behind the scenes be able to bring that value at the right time.
[00:09:37] Greg Sarafin: They all really blow your minds. Imagine a world where you as a manager have 10,000 agents on your workforce, and then you have a digital twin of you. You can call it a copilot if you want, but it’s really your digital twin that is the interface between you and those 10,000 agents because you as a human being, cannot manage 10,000 agents, but your digital twin can.
[00:09:58] Greg Sarafin: Your digital twin can then talk to you at human speed, which is a fraction of the speed of talking to those agents where you need to make a decision or you need to be aware of something. Right. So this is a business architecture that’s quite, uh, interesting. Uh, and, uh. We can talk about this at the bar tonight perhaps.
[00:10:16] Greg Sarafin: ’cause I don’t think you want to take the conversation this direction. I you’re, anyway, I probably don’t wanna go there. I would just add
[00:10:20] Janet Schijns: one thing. Yeah, go ahead. I think if you talk about where your C-suite and your board is having the conversations, they were promised something by the industry. They were promised by Microsoft and other 30% reduction in staff.
[00:10:33] Janet Schijns: That’s what they were promised as the outcome of ai. So as we talk about agents and we talk about digital twins and we talk about everything else, there is a check. That was written for technology that the C-suite and the board are not yet seeing a payout for towards that. Hey, we get there, we buy all this meta stuff, and then nothing happens.
[00:10:53] Janet Schijns: Buy all this AI stuff, right? What’s gonna happen next? This is where the people come in. The people are resisting the change at certain levels, particularly in the partner ecosystem. As an example, if you have 375,000 partners, why isn’t the first place you look for a digital twin? Your channel leader? Yeah.
[00:11:11] Janet Schijns: Your channel leader can’t possibly scale, right? But that’s not the conversation they’re having. They’re having conversations about, hey, especially we could cut 30% of accounting. So that’s again, where you need to change that conversation at the C level in the company to make sure that you’re doing the right thing.
[00:11:27] Janet Schijns: It’s gonna magnify growth rather than just cost savings with ai. And I think that’s where the break is right now.
[00:11:33] Vince Menzione: So how do we solve for the break? Yeah,
[00:11:35] Janet Schijns: well, I would, I was in the channel. I would put together a group of people, you know, think of class action lawsuits, but we’re not gonna sue. Um, I would put together a group of partners and get them a way to communicate to your board and your C-suite.
[00:11:47] Janet Schijns: Their voices are being masked, their voices are being shut down. They’re being treated like transactional partners and they’re not. And, and so all of the C-suite and the board is relying on a group of people that don’t know anything about partnering as they make these large decisions. And so they’re bringing in experts that sell the technology, but those experts that sell the technology are telling them things that won’t even work for the actual go to market model we have in our own environment.
[00:12:17] Janet Schijns: And so if you’re a channel leader listening, if you’re a partner listening, start reaching out to the board. Start making your decisions about who you partner with by who they have on their board. I look at the boards of some of these companies. They have no one that even understands sales or marketing, much less the channel.
[00:12:33] Janet Schijns: They’re hiring channel leaders, partners, CPOs, that have no partnering experience because they went to college with them and they’re friends with them. You need to have the discussion. You need to take a Michelle McBain, and I’m looking at her right here in the front row, who’s an amazing channel person and, and have her voice heard.
[00:12:51] Janet Schijns: Have my voice heard, have Jay’s voice heard. Right. Have all of Vince’s voice heard. Get the voices heard by the C-suite and the, and the, and the entire board, or honestly, I think they’re gonna go in the wrong direction. Yeah. Uh, and, and it’s gonna be very damaging. And, and again, I’ll repeat myself from earlier, those are gonna be the companies that fall off the Fortune 5,000, much less the 500.
[00:13:11] Vince Menzione: I I do think there’s a skills gap and I’ll, a massive skills gap. And I’ll, I’ll look at the end there. Greg is a, is an example of somebody who brought financial chops into the board, right? Mm-hmm. And I think that one of the challenges we talked, we’ve all talked about this conversation. That the, the path to chief partner officer today looks like somebody who was a channel leader, who became a channel chief, who just took on the title chief partner officer, maybe has some cred in at the C-suite and maybe doesn’t.
[00:13:39] Janet Schijns: Right. Right.
[00:13:39] Vince Menzione: And that I think is, I think that’s one of the biggest challenges, is that nice
[00:13:42] Janet Schijns: titling change and will make you believe that you’re important. And even though we do 80% of our sales through you, you’re not really important. And that’s the conversation you need to push that conversation. If you’re a partner listening to this, you need to push that with your top vendors, suppliers, ISVs, and if you’re a ISV vendor supplier, you gotta push that with your C-suite, push that with your board.
[00:14:02] Janet Schijns: You are not listening. You’re, you’re not, and you’re running past your partnering and it’s gonna, it’s gonna really damage these firms that don’t really adapt because AI is, is great, but only if you apply it to the right place, which is your predominant go to market, your channel.
[00:14:16] Vince Menzione: I know Jay and I had this conversation, maybe it’s two years ago now, right?
[00:14:19] Vince Menzione: About the the new skill. Do you think we’ve, we’re seeing the new skill set apply generally? Because I don’t, I don’t know if I agree we have
[00:14:28] Jay McBain: No, I agree with Janet and I spent a lot of time again Yeah. Boards. Yeah. And you know, looking and they’re very impressive people, you know, getting called into these big reseller boards, you know, there’s the head of United Healthcare, there’s the head of Boeing.
[00:14:40] Jay McBain: I mean, these are people with ridiculous resumes. And really rich and famous and, and everything else. And I’m looking around the room going, you know that, that’s different. I go back to Janet’s originally original concept. And this isn’t just the technology industry. These are all 27 industries grappling with this.
[00:14:58] Jay McBain: Yeah. Uh, one of the things that jumped out to me like two years ago when Apple was doing an iPhone launch, like later in the broadcast, you know, Tim Cook kind of stood up and said, do you know that 79% of people today will not buy a car unless it has Apple CarPlay? I’m sure he meant to say Android Auto as well.
[00:15:15] Jay McBain: But imagine, you know, just switch gears and you’re in this $3 trillion auto industry, you know, 63 brands, 365 cars. Yeah. But it’s 120 year old industry. You’re just taking over a dealership from your great great grandparents or passing it down and because of a tech integration you’re missing, you’re about to lose four fifths of your buyers.
[00:15:36] Jay McBain: So this isn’t just SaaS companies, right? This isn’t just marketplace. This isn’t the rich getting richer. This is every industry to Greg’s point has to lose kind of this ui ux on top. And I want my copilots talking to my pharmaceutical company, my pharmacy. I want them talking to my, um, all the industries I work in, um, or live in every day.
[00:15:59] Jay McBain: And that’s part of every board. Yeah. Great. And I’ll say that there’s a 90% miss. Yeah. In terms of people that will be able to enunciate that and bring it up as a topic of. Critical importance, tectonic shift, inflection point is the best and quickest way, you know, into a board absolute or into a C-suite.
[00:16:17] Jay McBain: And right now is absolutely the time.
Yeah.
[00:16:20] Jay McBain: Yeah. And I would
[00:16:20] Janet Schijns: say, I know board seats are at a, you know, there’s not a lot of board seats available. A board advisor, you know, it just get to the point you saw J slide had 117 consultants in it. There you go. 117 people plus the top channel chiefs. That could be an advisor to your boards.
[00:16:34] Janet Schijns: Absolutely. And I think the skill gap is just widening and it’s, it’s concerning.
[00:16:39] Vince Menzione: And why isn’t it happening?
[00:16:40] Greg Sarafin: I think it’s because we continue to conflate small P partnering with Big P partnering. Yeah.
Mm-hmm.
[00:16:47] Greg Sarafin: So small p partnering is partnering equals go to market equals channel one equals effectively indirect selling, right?
[00:16:54] Greg Sarafin: Um, we forget that not every company is a platform company, but if you’re a platform company, you will not be a success. And by the way, platform not just top out, you know, my favorite platform company is Rebi. Go to Home Depot. Bloody thing is a huge platform. It’s a battery platform with an amazing assortment of tools.
[00:17:09] Greg Sarafin: And I’m a tool geek, right? They’re auto, Tesla is a platform. Yeah. Right. So you know, generally in this world, you’ve got platform business models and vertically integrated business models. There’s probably an oversimplification, but if you’re running a platform business. Partnering is not just about channel, it’s also about co-innovation.
[00:17:27] Greg Sarafin: It’s about co-investment and it’s about extending your platform through an ecosystem of partners and then being an outstanding orchestrator of that ecosystem, right? Which to me is really the center of gravity for partnering. ’cause that also then connects you back to the other side of partnering, which everybody forgets about, which is OEM partnering.
[00:17:49] Greg Sarafin: Right. I drive my car, I’ve got my Apple car play, but I’ve got my RO seats. I’ve got my Brembo brakes. Right. This is not a new concept, folks, right? Right. But we’ve somehow, we’ve made partnering small p and I’ve been in many organizations where they have multiple partnering functions, not talking to each other, not realizing they all should be connected to maximize the flow of value through that value chain, and also reducing the number of partners they have.
[00:18:13] Greg Sarafin: Because I gotta tell you how many people, they think more partners equals more revenue. That is completely the opposite of the truth. Fewer strategic partners equals more revenue. Everybody else should be on your platform. If you’re a platform company orchestrated in your platform ecosystem, when it comes truly to partnering, it should be a very short list.
[00:18:31] Greg Sarafin: So to me, that’s the issue we have and we’re not explaining that to boards. Yeah. And we also frankly don’t have like a CPO if I said, okay, what is the role of A CPO and what is the career path to CPO? And I asked 10 smart people, I would get 10 completely different answers guaranteed. Maybe 11. ’cause one would change their mind extremely.
[00:18:50] Greg Sarafin: Right? I pick that one. If I asked 10 PE those same people, what’s the role of A CFO? I get very similar answers, both in terms of the role and the career path,
[00:18:58] Janet Schijns: and you know what that says to me. We don’t really have cpo. We don’t have CPOs. Right. The CPO isn’t actually a member. That’s right. The C-suite.
[00:19:04] Janet Schijns: It’s a glory title we gave because we thought it might raise our throughput production in the little P by 10 or 15% to have a CPO. Ooh, maybe they can sell a little bit more next year. And I have to tell you, if you’re working with or working for a company, that that’s how they’re talking about the channel.
[00:19:18] Janet Schijns: I like that little PI usually call it transactionally. Um, if that’s how they’re talking about the channel, you should run because your career is at risk. If the channel is about just distribution your, your career is at risk. That company’s going nowhere. It really should be integrated into the fabric of your company.
[00:19:36] Janet Schijns: Where I would say back in the day, there was a quote from the head of Kellogg and he said, you could take everything we have and leave me the brand and I will survive. And I would say, now you can take everything I have and leave me the real partners and I will survive. And that’s the mindset that they need to get at the top of these companies.
[00:19:54] Janet Schijns: Yeah.
[00:19:54] Greg Sarafin: Which they don’t. Speaking of channel. Go ahead. Just one last point on channel. And channel is kind of like super sweet sugar cereal. Mm-hmm. Right? It tastes really good and it has no nutrition. In fact, it’s making you sick. Mm-hmm. Okay. For the most part. Mm-hmm. Uh, everybody needs a little cereal now and then, don’t get me wrong,
[00:20:15] Janet Schijns: yes.
[00:20:15] Janet Schijns: Sunday morning. There are two.
[00:20:16] Greg Sarafin: There are two issues with over indexing on channel in your enterprise. The first is, um. You lose fidelity on your revenue forecast and if you’re a public company in particular, but even if you have, you know, LPs and gps that really care about your business performance on a quarterly basis, not being able to forecast your revenue because too much of your revenue is un forecastable is a really bad idea.
[00:20:38] Greg Sarafin: Second thing is, particularly if you’re in an industry like tech, where it’s actually not the first sale that matters, it’s the renewal that matters. Selling through the channel typically has a much lower renewal rate than selling direct with customer success. Right. So your, your channel feels good because you’re moving some of your cost of sales.
[00:20:57] Greg Sarafin: You’re making it invisible as cost of revenue, as effectively a discount. It’s only two or three points of discount, but then you add a bunch of cost of sales on top of it because now you’ve got a whole team that’s trying to define with those wooden sticks what the actual revenue forecast is gonna be from each of your channel partners.
[00:21:14] Greg Sarafin: Right? And we’re heading to a world where the productivity of direct sellers is about the 10 x. Right, because autonomous CRM, what is it going to do is gonna eliminate all of that layer of sales enablement. People that suck at their jobs and can’t enable pretty much anybody, and are a huge drag on expense ratio, expensive cost to sales or sg and a to revenue.
[00:21:37] Greg Sarafin: And it is going to now create sellers that actually you can expect to have 10 times the quota that they had yesterday, right? In three years, let’s say. So you actually need to be thinking about. Channel as don’t eat too many of those cocoa puffs, particularly given that you’re about to see a step change in the productivity of your direct sellers in terms of their ability to address the market for you.
[00:21:59] Greg Sarafin: Then I’ll stop. I’ll just, uh,
I’m gonna jump in on
[00:22:02] Greg Sarafin: that. I thought that might get right. I thought that might get right. It’s
[00:22:05] Jay McBain: provocative, so I’m gonna disagree with the.
[00:22:15] Jay McBain: To determine how their customers buy your category or your industry dictates to you. Uh, I mentioned cybersecurity. If you went with your advice and ignored the 91.6% of customers who bought through channels, you’d be competing in 8% of your tam. If you sell PCs, 70% are bought through Larry and the white van.
[00:22:36] Jay McBain: If you decide that Larry and the white van’s not good for you, you’re competing with Dell for the 30% direct. Market by market. There’s 2200 categories on G two crowd of categories that are all predetermined by your buyer and procurement and how it works. Yeah. So your channels, you wanna participate in a hundred percent of your TAM if, if you can.
[00:22:57] Jay McBain: And you wanna participate in all the ways that money changes hands, whether it be indirect, marketplace or direct. And that’s one muscle. That’s small. P partnering. That’s the part I agree with. The bigger P partnering is, I’d love to partner with the other six people That’s right, who are doing the co-selling co-marketing, who are doing the consulting design, who are doing implementation integrations.
[00:23:18] Jay McBain: That’s right. Who are lowering our cost to acquire the customer who are building bigger deals and closing them faster, and who get us a customer for life. If I can take those six and equate them back to my revenue targets, which is what boards and CEOs and CFOs care about, and do that in a repeatable, reliable way.
[00:23:36] Jay McBain: That is the big P partnering. And by the way, every company has to do both.
[00:23:42] Janet Schijns: Yeah. So, hey, I’m gonna, so I don’t know if you guys think I should sit between them or like.
[00:23:51] Janet Schijns: I’m gonna, so here you go. I’m gonna do the thing. I’m gonna reconcile the two views, right? I think they’re both, I think they’re both right.
Yes.
[00:23:58] Janet Schijns: So on on the one level, we are seeing a seed change in reliability and how partners, because many of the partners are not commercializing the offer, it’s very hard to figure out, particularly in the enterprise and large multinational space.
[00:24:12] Janet Schijns: When the deal’s coming in, if you’re not working it. That’s why folks like I’m looking right here at Partner Tap at Cassandra, that’s why they’re having so much sex success because that integrated selling model is how people are really understanding how they’re gonna get the master kind of massive opportunity from enterprise by doing it with direct and indirect as the old school thing would say.
[00:24:31] Janet Schijns: But then to Jay’s point, um, if you don’t do that, if you don’t partner with partners, um, you start to have conversations that sound a lot like funnel reviews. At the C-suite, which means, again, run from the company ’cause they don’t understand partnering. Because partnering is about integrating it through the fabric of your product development, of your enablement, of your sales, right, of your innovation, of your compliance, of your governance throughout the organization.
[00:24:58] Janet Schijns: It because it’s 90% in security, it ought to be a core element of your operating model. And if you have flow charts in your company, I always challenge people with this and those flow charts don’t show where the partner tap partner spot is in every single area. Then you are not in partnering, you are in
[00:25:15] Vince Menzione: channel
[00:25:16] Janet Schijns: to my friend’s point here, channels.
[00:25:18] Janet Schijns: So you’re
[00:25:18] Vince Menzione: eating Cocoa Puffs, you’re eating Cocoa
[00:25:20] Janet Schijns: Puffs, and you’re gonna be disappointed every quarter because unless you have a, a small business kind of package that you know, you get your volume and that kind of even got your, your forecast, you’re being disappointed every quarter. You’re never gonna able to what’s coming in.
[00:25:34] Janet Schijns: And they’re friends and they’re gonna hug later.
[00:25:38] Jay McBain: I remember sugary cereals were always part of a nutritious breakfast, but you had to have the orange apple and the juice. Lucky Char with all the other stuff that made it part of a nutrition breakfast. Correct? Correct.
[00:25:48] Janet Schijns: You had, you had the juice. Yeah.
[00:25:51] Vince Menzione: Well, I also think that ignoring the business model in this conversation where Greg is.
[00:25:57] Vince Menzione: At the very top of the pyramid. Right. Large enter mostly large enterprise, maybe some mid-market. And I’m, I’m not ignoring the other fourth ’cause you’re right on the channel versus partnering piece. Absolutely. But also as you get higher up in the stack and you have the luxury, I would say, of resources attached to each of those customers that are driving the, the executive level conversations.
[00:26:20] Vince Menzione: It’s different than a channel that may or may just come in and accelerate or juice your revenue for a period of time. Right, right, right. Yeah. And I
[00:26:27] Greg Sarafin: do tend to buy as big, right in my thinking, right? ’cause I’ve been a big company for a long time and my statements are not meant to address every market segment.
[00:26:35] Greg Sarafin: And I do agree with Jay actually, that there are certain companies in certain market segments for, in today’s market, must address the market through channel. They have no choice. I’m also suggesting that the way the world works today and the way the world’s gonna work in five years may be very different.
[00:26:50] Greg Sarafin: And so I’m front running that a little bit and there’s no way to know if I’m right or wrong. I’m just telling you the bet we’re making. Yeah. Yep.
[00:26:57] Vince Menzione: Let’s, that makes sense. That makes sense. Let’s dive in on that. ’cause I do, you know, you, you, you touched on a AI and AG agentic, and I’d love to see how we talk about this.
[00:27:07] Vince Menzione: Like for the hyperscalers in the room. How are we thinking about partner development managers? How are we thinking about partnering in general? We have so many, we’re still using Excel spreadsheets for crying out loud, and we’re doing funnel reviews and we’re having conversations with account executives that are going nowhere because they’re overwhelmed with what they have to go drive with partners, with a group of partners.
[00:27:29] Vince Menzione: Again, for every one of their customers, they have to rely, they have to talk to at least seven seats. They have to have all these conversations. They can’t really navigate it. How does AI help us improve that? Like how do we, how do we get better at that through ai?
[00:27:43] Greg Sarafin: Uh, I’ll tell you, uh, the perspective that we, we have right now, uh, we believe that we and a lot of our large clients, but I would extend that to any, any customer honestly need to get serious about taking the people cost out of revenue production.
[00:27:59] Greg Sarafin: Yeah. Uh, revenue production either needs to be through marketplaces and other automated mechanisms of. Commerce, uh, or it needs to be highly productive sellers, either in your direct sales force or in some channel partners direct sales force. Right? Uh, the cost of sales enablement at most companies, including mine, is outrageously high when you then index it to the benefit you’re getting.
[00:28:25] Greg Sarafin: Mm-hmm. Right? I can tell you that I run a, an awesome team of partner development and partner operations people, most of whom I’ve moved offshore. Over the years and then put ServiceNow and other technologies underneath of them to automate all their, I’ve made them TaskRabbits, I suppose. Yeah, to my earlier point, uh, because there was no off the shelf software, we had to build all our own, uh, to satisfy the needs of our business.
[00:28:51] Greg Sarafin: That has been reasonably successful. But at any given time, I can only address the needs of maybe 3% of my total sales force across the 160 countries that we operate in. And it is not sufficient. It is too expensive for the benefit we’re getting, and it’s not scalable. I need something I can scale at zero marginal cost to cover 100% of every selling opportunity to any given time, whether it is a partnering selling opportunity and or a selling opportunity where I need to have a deep understanding of a solution that we’ve developed, maybe with a partner, maybe not, right?
[00:29:28] Greg Sarafin: So to me, the answer is. All of sg and a that is not direct revenue. Production needs to move to agent capabilities. Mm-hmm. To enable all of sellers and our average bag color should, should have ultimately have 10 x the quota they have today if we do it right, that is our, that is our view and that is our bet on the future of.
[00:29:54] Greg Sarafin: Selling it, you
[00:29:55] Janet Schijns: know, at least in our shop. Yeah. And we’re seeing the same thing in partners, right? Yeah. The larger partners across the, whether an SI and MSP of, of Iron work or var, right? Um, they’re starting to look at AI and where it can eliminate friction in the system, um, more than where it can eliminate headcount.
[00:30:10] Janet Schijns: So instead I wanna repurpose that headcount to build the next great product to sell the next great product to go 10 x um, you know, our revenue, the issue is. That everybody’s doing their little piece products. It’s kind of like when we started putting things in the cloud. Everybody, every single department in a company bought an extra large cloud.
[00:30:28] Janet Schijns: Um, they didn’t really need it, but they bought it and they all swiped credit cards and usage rates were going crazy and right. And all of a sudden, at one point in time, the CFO was like, what is happening? Why are our IT expenses so high? Um, and then they consolidated back into centralized it again, right?
[00:30:44] Janet Schijns: We’re gonna, we’re gonna manage all the cloud. We’re seeing the same thing starting to happen now with the AI journey across, um, in the partner community, particularly where a lot of pet projects have happened. Um, and they’re not really what’s important. And I’m gonna use a specific example that’s on that chart.
[00:30:59] Janet Schijns: You shared the telecom industry. I was the, you know, chief channel officer at Verizon. Um, there’s a massive expense. To run pipe if you actually want an enterprise to have all this great stuff we’re talking about ai, cloud service, the whole nine yards to actually work, it actually has to connect. Um, and so that has been really left behind to a certain extent because the cost is so high, it could cost you $5 million to put a vertical riser in a corporate building.
[00:31:26] Janet Schijns: Right. And so what’s happened, innovators have come around like broadband, GPT, who have said, you know what? We can do all the build function up until the person puts the pick in the ground, right? To dig the permits, the sizing, the everything with with ai, and that’s going to not eliminate hundreds of installers and hundreds of engineers.
[00:31:49] Janet Schijns: It’s going to mean that rather than waiting nine and a half months on average for an enterprise network. You are going to get an enterprise network in a month. Think about what this does for your level of innovation. So it’s not just a snazzy, pretty hyperscalers and ISVs that are gonna use ai. It’s the the toasters, right?
[00:32:08] Janet Schijns: The, the plumbing and it’s gonna get faster and faster. And that pace of speed is what we’re all gonna be measured on. Are we as fast as ai?
[00:32:16] Jay McBain: Let me, let me do a real life channel example, uh, in agentic ai. So in the 28 measurable moments. That a customer moves through from, I have a problem to making the purchase and, and how to measure those.
[00:32:29] Jay McBain: In today’s world, uh, we live as the products on the internet. So the world of buying buyer intent data, those early moments. And what did they search for? 81% of customers start on Google or now, you know, chat, GBT. Um, where did they move from there? What did they find on Google? Well, they found an ebook, they found a podcast.
[00:32:50] Jay McBain: So it’s those early moments. You know, both Google and Facebook have created $6 trillion of value on us being the products and the internet. When you speak in your kitchen, Alexa overhears you and Facebook serves you up an ad two minutes later. That’s 6 trillion of value on the stock market.
Yeah. Yeah.
[00:33:06] Jay McBain: So we kind of all went to elections last year, 45% of the world and 90% of the incumbents lost.
[00:33:14] Jay McBain: And we kind of told our, our elective uh, representatives we’re done with that. So the end of the cookie. It’s creating the biggest change in those 28 moments ever. Another tectonic shift, right? So Google goes and Creeds version two of the cookies, goes to sell it to the European Union, which are the toughest people to sell to, and failed.
[00:33:33] Jay McBain: A week later, they lost an antitrust suit in the us. So this was kind of the final, you know, moment. So when you start to look at those 28 moments, especially early, you start to say, well, how am I gonna get to them? Who owns the moment and how do I partner with them? So you use Partner Tap as a perfect example, which is perfect agent,
right?
[00:33:51] Jay McBain: Not only looking at the two CRM systems for SQLs, but looking at the marketing automation systems for uh, M qls. That’s right. But if I could go and have an agent say, you know, Hey, they, you know, found your ebook, they listened to your podcast, they come to my website and they actually came to my event. You know, just between the two of us, we found four of the first 10 moments.
[00:34:11] Jay McBain: Yep. Boy, would it be a great time either digitally or physically. Ushering the customer through the next 18 moments to make sure that we both win. Yeah, absolutely. And in this new world, it’s not just partner Tap. Now I, I have to have an attribution tool. I have to have my, uh, to, uh, my, um, through channel marketing tool.
[00:34:28] Jay McBain: I have to have my deal registration tool, my opportunity passing my LEAP app. So here’s like five or six things that I can’t go log into all six and go figure out for a particular deal. All the stuff that’s happening. But boy, could my copilot or my agent go and tap into all these places, put it like in cohorts
[00:34:46] Janet Schijns: and Perfect.
[00:34:46] Janet Schijns: Yeah. Yeah.
[00:34:47] Jay McBain: Um, scenario of, oh my goodness, I’ve now seen 14 of the first 28 moments. I know exactly the customer who they are. I know exactly what they want, and I actually know the seven layers of the stack and the seven people that would be perfect for this. Let me orchestrate the 14 things going on, and let’s go win more deals, but I can’t do it without these layers.
[00:35:09] Jay McBain: And I just, in the headless world, I gotta have this data and, uh, be able to execute, you know, within milliseconds.
[00:35:17] Greg Sarafin: I’ll also, uh, use a real example. I’ll use us. Uh, we’re working right now with, uh, several of our largest partners and a third party, none of whom I’ll name, uh, at the innocent. But, uh, so here, here’s, here’s the thing we’re solving for, um, in order to replace partner development.
[00:35:38] Greg Sarafin: And make it scalable. I wanna say it differently. To make partner development scalable, we need to be able to scale it with ai, not with people. It’s not scalable with people alone.
Mm-hmm.
[00:35:48] Greg Sarafin: Um, now I could build a bunch of AI on my side, but in order for that AI to really work, it also has to be able to then do work.
[00:35:59] Greg Sarafin: And my partner’s systems of record as well. Well, guess what? My partners love me, but not that much.
Mm-hmm.
[00:36:05] Greg Sarafin: They’re not gonna let me go trade, send around in their patch. Right. And by the way, I have the same view of them. So what we’ve determined is we actually need to work with a trusted third party to sit between us to build the agents to our specifications.
[00:36:18] Greg Sarafin: That’s right. And those agents can work both sides of the street, literally. So they understand all my business rules and all of my constraints and, and how to access my systems of record, including my CRM, uh, et cetera. And then they also understand the same thing about the other sites, and they also understand the translation later.
[00:36:36] Greg Sarafin: And they also know how to enable my sellers and their sellers to work together, even though they’ve never, they’ve never, never done that before. Right? So that is really where we’re hyper-focused right now, is how you create that sort of. Agent force to use Benioff’s term that works both sides of the organization, but protecting my data from them and their data from me, right, in order to accomplish and then really take the cost out and make it infinitely scalable to do partner enablement.
[00:37:05] Janet Schijns: I love that. And that sounds too heady. If you’re listening, uh, here and the audience are on, you’re like, that seems we’re talking headless. That seems like a lot. Okay. But it seems like a lot to do. Right? Um, the simple thing I’ve encouraged people to do is go out and look at the seven or eight. Big partners that you have in your stack, right?
[00:37:23] Janet Schijns: You know, maybe your checkpoint for security. Who else is in your stack that a partner would sell? And I know the guys from Unifier are here. They’ve built a cool platform as has Partner Tap, to let you actually integrate with those other parties,
the third parties,
[00:37:39] Janet Schijns: right? And, and maybe you start there, right?
[00:37:41] Janet Schijns: Maybe you start at the very practical, like, hey, if a partner just didn’t have to. From a go to market transactional standpoint, register a lead in nine platforms, maybe that would get us more business. Um, you know, and maybe it would because maybe you’re kind of a pain in the neck to deal with. Um, and so those kinds of platforms that are just saying, Hey, let’s make it one motion for our partners, rip out to Greg’s point, that sales enablement issue where you have to have 10 people just to interface with systems.
[00:38:07] Janet Schijns: That’s where you’re gonna see it. And you know, we see this at AV point. Now look, I’m biased, I’m on the AV point board. DS is here and he’s the best marketer in the world. But AV Point stood up one day and said, we’re gonna put a channel expert on the board. We’re gonna go hard at helping the MSPs with their business.
[00:38:24] Janet Schijns: It wasn’t about the revenue, but the revenue followed. Right? When the MSPs saw the dedication, the, the things that at Point was doing to simplify their. Life to simplify their business, to help their business make money. The business came with it because the bottom line is partners do vote with the quote, right?
[00:38:44] Janet Schijns: They’re not gonna quote you unless you’re a good partner. Um, and while we can sit up here and say, Hey, it’s not gonna be about transactions, it still is half about transactions. And so I would say that the better partner you become, and AV point has demonstrated this, the more and more business you get, the more your partners grow, the more your partners become the top Microsoft partners, because that’s the ecosystem that AV point is in.
[00:39:05] Janet Schijns: The more the partners start to use you more and more in their business, the better partners they become. The more big companies now wanna be your partners and integrate into your stack, right? It really comes down to saying, I’m gonna put the revenue over here, as uncomfortable as that sounds. I’m gonna put it over here and first I’m gonna be a good partner and then I’m gonna get the revenue.
[00:39:24] Vince Menzione: So I love what you have to say about a point. And, and Ducks is gonna be on a session in a little while talking about marketplaces. In fact. So I, we haven’t really touched on marketplaces in this conversation. We have two of the three are here in the room talking about marketplaces today. So I think it’s a really great, like we have $419 billion in durable cloud budgets today, right?
[00:39:48] Vince Menzione: Why, why isn’t it moving as fast as it? I believe it should. I don’t feel like it’s moving as fast as it should. Partners are selling
[00:39:54] Janet Schijns: against it. That’s my final answer. Okay.
[00:40:00] Jay McBain: It it’s that there’s a couple layers to the answer. Yeah. Uh, one is that 82% compounded growth is nothing to scoff at. Right. That’s almost doubling in size every year.
[00:40:10] Jay McBain: Yeah. AWS became a top 10 distributor in less than two years. A distribution business has been around 40 years. Mm-hmm. Agree. It took them two. Agree, agree. And that was top 10. Now we’re starting to talk about them as a top five, right. Joining TD Cynics Ingram, who are 60 and $50 billion distributors bigger than Nike and Coca-Cola and Starbucks and McDonald’s combined.
[00:40:33] Jay McBain: That’s the size we’re talking about. That’s pretty fast. And that’s doubling almost every year when you add the agentic models. It continues to grow even faster than that,
[00:40:44] Vince Menzione: but how much of it is fulfillment on private offers versus net new revenue? That’s, that’s the question I have. The thing that
[00:40:50] Jay McBain: doesn’t change that quickly, which, which you know, is procurement.
[00:40:54] Jay McBain: Procurement and large enterprise, especially procurement. In the government, 56% of our industry is enterprise. Mm-hmm. 44% is SMB does turn faster. Right. But SMBs are not buying cloud consumption. No. So to go to the procurement divisions, uh, and the government is getting dozed pretty quickly. Yes. In terms of how they buy.
[00:41:16] Jay McBain: In other words, they’re turning everything off. Now. It’s a verb. I like it. And getting everything turned on. So we saw yesterday that, you know, Gartner just got like $5 billion of business shut off by the federal government. Yeah. And nobody looked to see if there was creating value and why, and who and where.
[00:41:31] Jay McBain: And all they said is, it’s all off now. It’s canceled, and now you’ve gotta go reapply for the money.
Mm-hmm.
[00:41:37] Jay McBain: And so it’s just a kind of a 50% cost savings. But procurement is in, you know, dog years. Yeah, yeah. And that’s why it’s happening. And procurement, what you feel is slower procure and procurement has the
[00:41:47] Janet Schijns: relationship with who?
[00:41:49] Janet Schijns: The partner. Right. We’ve seen this 70 plus percent of the time they’re buying through the partner. The services is leading the sale inertia. So now when you try to push that to the marketplace and cut the partner out, and I’m sorry, with all the love in my heart to the hyperscalers, you are trying to cut the partner out.
[00:42:02] Janet Schijns: You can talk to me about your partner program and what you’re trying to do and how you’re helping, but it’s not true. 50%, right? Exactly. It’s not true. You’re not integrating the partner into your marketplace play. So you’re forcing the partner to do the only thing they can, which is sell against you. And then the next thing they’re gonna do is find an alternative and we can smile and say, we’re too big to fail, but the hyperscalers are not too big to fail.
[00:42:24] Janet Schijns: We have seen big companies in our industry fail before. So the hyperscalers that get it right. That. Get the partner to understand how it works in their business and how they can use and place orders in the, in the marketplace. Use it as part of their thing, lower their costs, because they’re putting their customers through marketplaces.
[00:42:43] Janet Schijns: That’s the hyperscaler that wins.
[00:42:45] Vince Menzione: I think we’re gonna hear some of that later.
[00:42:47] Greg Sarafin: I’ll just give a slightly different take on marketplace. Different perspective, I suppose. So I, I don’t know where marketplaces end, but I can tell you they have already had a massive impact that may not be as visible to many of these.
[00:43:00] Greg Sarafin: Uh, so in our business, you know, we, we sort of go to market by industry and then by buyer, right? So the, the head of, you know, uh, insurance operations at, in the insurance industry. And so it used to be for years that we had a partner ecosystem curated around that buyer. With a bunch of different technology products that we had pre-integrated together, and that was sort of our easy button offering.
[00:43:26] Greg Sarafin: Now, if you wanted to piece part it out, that’s fine. We would do that for you too, but we always would come with an easy button. What’s happened with the marketplace is it is so dramatically changed buying behaviors. We had to actually create three versions of that ecosystem. One for the Microsoft stack, one for the Amazon stack, and one for the Google Stack, because clients want the draw down.
[00:43:47] Greg Sarafin: That they get through the marketplace. Mm-hmm. And so if you go to them with an ecosystem that has something that can only be drawn down in Amazon, and it’s a Microsoft, it’s a Mac, that that client has a massive Mac and they need to draw down there, that’s gonna be a losing value proposition. So those marketplaces from one perspective are extremely, uh, successful from my per ’cause.
[00:44:05] Greg Sarafin: They are shaping the winners and losers around each of those stacks. And then that has a wash back effect on us because we now have to support three different versions that’s right, of ecosystems for each of the solutions that we bring to market. So that’s a different take. I’d share with you all.
[00:44:21] Jay McBain: I’ll take, uh, just three reasons why looking forward of all the trends coming together.
[00:44:26] Jay McBain: One is the new buyer. 51% of our buyers now love marketplaces.
Yeah.
[00:44:30] Jay McBain: The second reason is all the models, subscription consumption, and now micro consumption over the next 10 to 20 years. Favor. Marketplaces.
Absolutely.
[00:44:40] Jay McBain: So this is, you know, your buyer creating change. This is the marketplaces. The one thing I haven’t talked about, which is a major trend is the new buyer, which is finops.
[00:44:49] Jay McBain: There’s a new set of people, there’s 24,000 of them now that are 50% trained in tech and 50% trained in finance, and they’ve been employed now between the CFO and the CIO originally to kind of move around hyperscaler workloads to save money. Then moved out to kind of edge to cloud. Hey, should we run, run this on that old Dell server ’cause we, you know, could do it cheaper.
[00:45:11] Jay McBain: And now they’re expanding into this agentic ai, which is the cost to the organization of tech, of every company in the world is outrageous. And the boards and everybody else have a laser focus on it. And now there’s somebody that’s trained on both sides and these, if you go to finops.org and, and study this model, these people love marketplaces.
[00:45:34] Jay McBain: It this commit, the $419 billion of commit is coming out of Fin Ops because I don’t want shadow it. That’s right. I don’t want managers putting things on credit cards, bringing in security risks and other things. I don’t want our pub, our data going out to public clouds consolidate. This is becoming a center where the CFO and the CIO are both gated.
[00:45:55] Jay McBain: And they are reporting up to the board
[00:45:57] Vince Menzione: consolidation. Yeah. Yeah. I wanna open up the, I’m sure there’s gonna be a lot of questions and we have a short period, short window time. Mm-hmm. Uh, but for, for the studio audience, they’re gonna get more time with you all later. But questions I, I see. Is anybody up at the mic or anybody have any questions they want ask?
[00:46:14] Vince Menzione: I’ll ask you to go to the mic though, if you can, Erica.
[00:46:21] Audience: Well first I feel personally attacked by the comment, um, around the nine different platforms. ’cause I work at Microsoft, so it is a pain in the butt. Oh, thank you. Uh, that was not my question though. Um, earlier, uh, mark and I, I don’t know where he went, but we were chatting about some companies are actually, they are not, they’re drawing a line in the sand when it comes to ai and they’re, they don’t want it.
[00:46:46] Audience: And I started to really think about that. And I’m just curious, you know, are what your thoughts are. Are those folks just doomed? You know, are they gonna have to pull it together or should there and could there be an uprising of people that are like, listen, we have got to make some changes here. Not just for compliance and safety reasons, but for human reasons.
[00:47:11] Audience: And I’m just super curious on your thoughts about that.
[00:47:14] Jay McBain: Yeah, I, I, I can take a stab. Two things to look at is, um, the integration first fire. And if, you know, a certain company in my stack, personal or professional life doesn’t wanna play and my co-pilot can’t go and do the work I need and I have to manually go and do things, I’m gonna stop by kinda like today, if, if somebody doesn’t take, uh, my version of payment.
[00:47:38] Jay McBain: I, I find a new place to shop. Mm-hmm. Yeah. Mm-hmm. So that’s kind of the, your customers are gonna force the change on the integration first world. And then, you know, one thing I didn’t say is 50% of the Fortune 500 fail, and over 20 years, 71% of tech companies fail that aren’t in the Fortune 500 and can’t buy their way outta problems.
[00:47:59] Jay McBain: 71% fail within 10 years. Yeah. Yeah. So what creates, you know, change? And if you’re not playing in this stack. And if you’re not having that agent and data model that you can add value, you, you know, this is, I, I can’t see a way forward and that’s why this is different than I ot and it’s different than other changes.
[00:48:19] Jay McBain: It’s just the way we’re evolving, uh, as a society and the way we’re evolving in business to, I do agree
[00:48:27] Janet Schijns: though that there’s going to be a, not a reckoning maybe is too call of a word. You know, back to the Arnold Schwartzenegger. Um, but there is a, a movement among younger people, gen Z, particularly back to the basics, back to hands-on loving bookstores, loving record stores, loving experiences.
[00:48:46] Janet Schijns: And I do think that especially in SMB, if you think about shopping local, there’s gonna be a huge return to anti-technology to places you can go and get away from it. Where the robots won’t be, where there won’t be automation, where like actual humans talk to you. I, I represent this myself. My daughter has a PhD.
[00:49:03] Janet Schijns: She was in research analyst in this industry. She’s dropped out of this industry and she’s opening an independent bookstore. Why? Because that’s where the money is for her long term. That bot’s gonna replace her as a research agent, and she sees it and she talks to her friends, and she knows that’s where the money’s gonna be in the local community.
[00:49:22] Janet Schijns: So I think in the local community, you’re going to see an anti AI kind of sentiment in small business.
[00:49:30] Greg Sarafin: Uh, I’ll just do a quick, quick take. Uh. First, I think co-pilots were certainly the place to start, but we’re never gonna be successful because changing the ways people work is super expensive. Nobody wants to spend that money, especially for somebody that does not have easily quantifiable benefits, which co-piloting does not.
[00:49:47] Greg Sarafin: Uh, we are a use case for that at my firm. Uh, the second is that in general, companies want to have big returns that are measurable. Not little returns. And so if they’re gonna allocate capital, they don’t allocate capital. They, they, they have capital projects to make big changes to the equation of their value in the market.
[00:50:09] Greg Sarafin: And so genic technology, when it is fully mature, I think will be that break point where you’re really gonna start to see capital allocated in large chunks to then change the way the enterprise operates.
[00:50:20] Audience: That makes good sense. Yeah.
Alright,
[00:50:23] Audience: I have a question. We have a question. I have a question for Greg and then I have one thing.
[00:50:26] Audience: So, Greg, you talked about how, you know, with agents, sellers, we’re gonna have fewer sellers. They’re gonna rise to the top, but, and, and the channel’s basically gonna go away. Totally disagree here. And I’m wondering, you know, with agents and looking at channel account managers, partner account managers. I mean, it’s the same thing on this side of the house too, on the partner side.
[00:50:53] Audience: There’s so much coming out, so much technology coming out that’s gonna do the same job on the sales side as the partner side and trim that fat. But these channel relationships, like the seller, needs to have the needs to have those relationships. But I see fewer channel account managers, fewer partner account managers, fewer sellers, but we’re using agents to really get the right people to the dance for the relationships.
[00:51:27] Greg Sarafin: Yeah. I don’t believe channels going away. My point was fairly, it didn’t make it well. Okay. It was trying to be a little provocative here to get him going, but, uh, I like to get rise.
[00:51:40] Greg Sarafin: Yeah. Is you gotta think about your balance. Mm-hmm. And you also have to take to account as this genic technology makes your direct sellers much more effective. How do you rethink allocating cost of sales that way where you have much higher likelihood of draw down and renewals as well as potentially a better customer experience if you do it well?
[00:52:02] Greg Sarafin: Right. That’s my only point. You’re still gonna have channels and all this is gonna play out. But my point is start thinking about what is that balance? Because the calculus is gonna change a bit for a whole lot of reasons, including how channel will evolve,
right?
[00:52:16] Greg Sarafin: Right. And these mechanisms like marketplace, not other things.
[00:52:18] Greg Sarafin: So I’m just, the only point I’m really trying to make to you is think carefully about your entire go-to-market calculus and realize that direct. Done correctly with this technology can be a much more powerful way to shape the future of your business revenue plus,
[00:52:38] Janet Schijns: oh, and I just have to say, no. I’m so sorry.
[00:52:40] Janet Schijns: I really do like you. But yet you have thousands of partners who sell seven to 13 solutions to the customer. You are one solution If you are thinking about your direct team, right? You’re one solution. Yes. I would really focus first on empowering and automating and streamlining in your partner community.
[00:52:59] Janet Schijns: Because your direct sales team is much smaller. Um, and then you can apply what you learned in your partner community to your direct team. So I’m just gonna flip that on its head a little bit, um, because I think the efficiencies are more from your partner community that you can get them from your direct team.
[00:53:12] Janet Schijns: And again, some 28-year-old that comes in and swears he owns Bank of America, doesn’t own Bank of America, the partner probably does
[00:53:21] Vince Menzione: final answer.
[00:53:27] Vince Menzione: And I wonder, but I have to keep us somewhat on time. Let’s do it. So, uh, I wanna thank each of you, uh, it was really a provocative conversation, which is what I was hoping for today. So we’re gonna have some more talk and then there was a question about marketplaces and ai, and I’m gonna ask one of either Microsoft or Google to answer that question for Jeff Chewy, who is in the live stream and asked that question.
[00:53:49] Vince Menzione: Thank you. So thank you so much.
[00:53:57] Vince Menzione: Thank you for joining this episode of Ultimate Guide to Partnering, and if you haven’t done so already, mark your calendars. Ultimate Partner Live Spring is coming to Redmond, Washington on May 1st and second. This is going to be an incredible event like each of our ultimate partner events. This one is going to be just a little bit better than the one before.
[00:54:18] Vince Menzione: We’re having incredible leaders from Microsoft industry leaders talking about co-selling. Marketplaces aligning to Microsoft priorities and more. You don’t wanna miss this event. Sign up today before seats run out. up today before seats run out.

37 snips
Mar 23, 2025 • 39min
259 – Tech Trends and Predictions for 2025 with Jay McBain
Jay McBain, an industry analyst at Canalys renowned for his insights on tech trends, dives into the future landscape shaped by AI. He discusses the seismic shifts influencing the partner ecosystem, emphasizing the immense investment in AI and the necessity for vendors to adapt to changing buyer behaviors. McBain highlights the rise of 'micro-consumption' and the importance of engaging the 'seven trusted partners' surrounding customers. He encourages businesses to transition from traditional sales models to strategic partnerships, aiming for growth in a rapidly evolving market.