Article
|
2
 minutes
ELG Insider Daily #619: The GTM Attribution Conundrum
Article
|
3
 minutes
ELG Insider Daily #616: Rollworks' Crawl-Walk-Run Approach to Achieve Time To Value Faster
Article
|
2
 minutes
ELG Insider Daily #618: Get the Exclusive Story of the Crossbeam x Reveal Merger
Article
|
3
 minutes
ELG Idols: A channel sales leader’s 10 lessons for SaaS orgs transitioning to partner implementations
Article
|
3
 minutes
ELG Insider Daily #617: The Darling of 2010s Marketing Died. Who Did It?
Article
|
3
 minutes
Nearbound Weekend 06/22: Steal This Framework For Strategic Alliances
Article
|
2
 minutes
ELG Insider #679: Build a revenue-driven partner ecosystem
Video
|
46
 minutes
Nearbound Podcast #168: The BIG Announcement
Article
|
7
 minutes
Nearbound Daily #613: Reveal and Crossbeam Got Married—The Dawn of a New Era
Video
|
2
 minutes
Crossbeam explains: Co-selling
Article
|
2
 minutes
Nearbound Daily #614: BREAKING NEWS: Crossbeam and Reveal are Joining Forces
Article
|
2
 minutes
Is Your SaaS Org an Ecosystem Business?
Article
|
3
 minutes
Nearbound Daily #611: How To Best Use Account Mapping At The Expand/Engage Phase of the Bowtie
Article
|
3
 minutes
Nearbound Daily #610: Nelson Wang #1 Lesson Working With Resellers
Article
|
3
 minutes
Nearbound Daily #609: Five Ways To Create Nearbound Sales Champions
Video
|
36
 minutes
Nearbound Podcast #167: Building SaaS Credibility in a Skeptical World - Bobby Napiltonia
Article
|
8
 minutes
The GTM Bowtie: How To Overlay Partners Across the Complete Customer's Journey Part Two
Article
|
3
 minutes
Nearbound Daily #608: Validate Your Partnerships Strategy with 'WOW' Moments
Article
|
5
 minutes
My #1 Lesson in Reseller Strategy that led to $250M+
Article
|
3
 minutes
Nearbound Daily #607: Find and Leverage Signals for Partnerships
Article
|
3
 minutes
Nearbound Weekend 06/15: The Soul of Nearbound
Video
|
32
 minutes
Howdy Partners #70: Generating $5 Million Through Partnerships with Pedro Mattos
Article
|
4
 minutes
Nearbound Daily #605: Are You Utilizing All Four Channels For Intros?
Article
|
4
 minutes
Nearbound Daily #604: The #1 Lesson Every Partner Leader Should Learn From Walmart's Sam Walton
Video
|
45
 minutes
Nearbound Podcast #166: Pete Caputa’s Return: The Partner Led Startup Story
Article
|
4
 minutes
Nearbound Daily #603: Steal This Play to Engage Customers With Partners
Article
|
3
 minutes
Nearbound Daily #602: We Can Do Better With Partner Onboarding
Article
|
3
 minutes
Breaking News Roundup: Microsoft Exec Becomes CTO, HP's Business Model, and Cisco Investing $100 Million in Partners
Article
|
4
 minutes
Nearbound Daily #601: Doing Events The Nearbound Way
Article
|
3
 minutes
Nearbound Weekend 06/08: Use the ICE Framework to "Partner Pill" Every Department
Article
|
5
 minutes
Nearbound Daily #600: 5 Common Mistakes to Avoid When Starting Your Partner Program
Article
|
3
 minutes
The GTM Partners x Reveal partnership
Article
|
5
 minutes
Nearbound Daily #599: Steal This Partnership Value Model
Article
|
7
 minutes
A Deep Dive Into the Nearbound Book, With Mike Midgley
Video
|
47
 minutes
Nearbound Podcast #165: From Zero to $400M in Revenue - Finding Success in a Crowded SaaS Market with Jeff Cheal
Article
|
4
 minutes
Nearbound Daily #598: American Airlines' Recent Mistake Validates The Nearbound Era
Article
|
4
 minutes
Partnership Value Modeling
Article
|
4
 minutes
Nearbound Daily #597: Robert Cialdini On How To Influence Partners To Give You More
Article
|
4
 minutes
Nearbound Daily #596: How to Apply For a Job Like a Pro
Article
|
7
 minutes
How Bynder doubled the size of their tech ecosystem in just six months with ELG
Article
|
4
 minutes
Nearbound Weekend 06/01: How to Solve B2B Marketing with Nearbound
Article
|
6
 minutes
Your ELG buy-in playbook: How to bring your org’s key players on board
Article
|
4
 minutes
Nearbound Daily #593: Partners Are Not Your Glorified BDRs
Article
|
5
 minutes
Nearbound Daily #592: Tap Into Partners To Help Close a Deal In The Final Stages.
Article
|
4
 minutes
Nearbound Daily #591: Great Partners Are Like Diamonds
Article
|
3
 minutes
Top takeaways from the 2024 Ecosystem-Led Growth Conference
Article
|
4
 minutes
Nearbound Daily #590: How to Expand Into New Markets Through Partners
Video
|
56
 minutes
Nearbound Podcast #162: "I Built My Entire Business on Nearbound Principles" - with Tim Chermak
Article
|
9
 minutes
How sales teams use ecosystem-led sales to hit revenue goals
Article
|
4
 minutes
Nearbound Daily #581: Partner Fleet Shares Their 9-Step Guide to Buy-In
Article
|
5
 minutes
Nearbound Daily #579: Metadata.io Kills Their CS Team (And Why It All Points To Nearbound)
Article
|
5
 minutes
The Era of Ecosystem Orchestration is Finally Here
Article
|
4
 minutes
Nearbound Daily #580: How Fullstory Increased Their Renewal Rate by 14%
Article
|
8
 minutes
How Fivetran powers its Ecosystem-Led Sales with data
Article
|
5
 minutes
Meet the RevOps-turned-partnerships leader who transformed LeanData's sales and attribution processes
Article
|
6
 minutes
Nearbound Weekend 04/27: My Key Takeaways from Goldenhour
Article
|
13
 minutes
A hiring manager’s guide to partnerships roles and job titles
Article
|
5
 minutes
Nearbound Daily #574: Steve Jobs On Buyer Preferences (And How It Relates to Nearbound)
Article
|
6
 minutes
Nearbound Daily #573: Meet NearBOT, Your Handy Nearbound Assistant
Article
|
5
 minutes
Nearbound Daily #571: Sapphire Ventures’ Guide to Building an Effective Partner Strategy Framework
Article
|
5
 minutes
Setting strategy and getting buy-in: Braze’s ELG Sales Tetrahedron
Article
|
4
 minutes
Nearbound Daily #570: Use Chris Lavoie's 2x2 Matrix To Prioritize Partners
Video
|
54
 minutes
Data Sharing Best Practices: How to Talk with your B2B Tech Partners
Video
|
0
 minutes
Chelsea Graham: The Unglamorous Art of Winning Your Sales Team’s Trust | Supernode 2022
Article
|
6
 minutes
Nearbound Daily #565: Here's How To Do Co-Marketed Events Better Using Nearbound Data (Step-By-Step)
Article
|
5
 minutes
Nearbound Daily #564: An Email Checklist to Make Better Impressions
Article
|
12
 minutes
How to Use Partner Data In Your Sales and Marketing Dashboards (Part 2 of 2)
Video
|
46
 minutes
Nearbound Podcast #161: 3 Things You Need to Know: Attribution Crisis, Early Majority, and the Consolidation of Tech with AI
Article
|
5
 minutes
Nearbound Daily #563: Every Stat to Help You Prove the Value of Partnerships
Article
|
5
 minutes
Nearbound Daily #562: How Oneflow Saw a 190% Surge in HubSpot-related Opportunities
Article
|
7
 minutes
Nearbound Daily #561: Get The Respect of Your Sales Team in 60 Days (Resources)
Article
|
2
 minutes
Nearbound Weekend 04/13: The Only Way To Create A Nearbound Culture
Article
|
3
 minutes
What’s an IPP—and (when) do you need one?
Article
|
5
 minutes
Nearbound Daily #560: How Pigment Increased Win Rates 5-10% with a Nearbound Overlay & Reveal
Article
|
4
 minutes
Nearbound Daily #559: Clari's CEO Complete Guide To Run The Best Meetings
Video
|
51
 minutes
Nearbound Podcast #160: How Open Source Unlocked Our Ecosystem - with Clint Oram
Article
|
7
 minutes
Unleashing the power of nearbound: The stats you need to know
Video
|
28
 minutes
Howdy Partners #68: Automating Revenue Generating Partnerships with Rob Rebholz
Article
|
6
 minutes
Nearbound Daily #557: Alexis Petrichos' Quick Start Guide To SaaS Partnerships
Article
|
4
 minutes
Partner Professionals Need to Pick a Career Path—It’s Either Partnering or Ecosystems
Article
|
4
 minutes
Nearbound Daily #556: The Circle-Back Play: How To Get Meetings With Top-Level Execs
Article
|
8
 minutes
How nearbound can help keep and win back customers
Article
|
6
 minutes
Nearbound Weekend 04/06: Revenue Leaders (Want To) Believe In You
Article
|
5
 minutes
Nearbound Daily #555: The Back-A$$ward Way To Do Community
Article
|
12
 minutes
A Deep Dive Into the Nearbound Book, With Mike Midgley, Part 3
Article
|
3
 minutes
Nearbound Daily #554: Inverta's Jessica Fewless On How to Fill Your Pipeline With Nearbound Leads
Article
|
16
 minutes
How to do co-marketing when you’re not a marketer
Article
|
2
 minutes
Follow the 'Customer Value' Rule in 2023 and You'll Win
Video
|
52
 minutes
Nearbound Podcast #159: Meet Your Partnerships Mentor - Nelson Wang on First Principles
Article
|
4
 minutes
Nearbound Daily #553: The Convenient Age of SaaS Is Over
Article
|
5
 minutes
Insider Daily #682: Winning in the ELG era
eBook
Nearbound and the rhythm of business
Article
|
2
 minutes
Nearbound Weekend 03/30: A letter to founders and execs from Jill Rowley
Article
|
4
 minutes
Nearbound Daily #550: Three Reasons You Need PartnerOps This Year
Article
|
5
 minutes
The Role of Nearbound Partnerships for Customer Success
Article
|
5
 minutes
Nearbound Daily #549: Atlassian's Missed Ecosystem Opportunity
Video
|
45
 minutes
Nearbound Podcast #158: Why Agency Programs are the HARDEST. The Pirate Island Problem, with Max Traylor
Video
|
30
 minutes
Howdy Partners #67: Sales Insights Unleashed - Jakub Hon
Article
|
4
 minutes
Nearbound Daily #548: Learn to Say No. It'll Save You
Article
|
4
 minutes
Nearbound Daily #546: 9 Creative Ways to Showcase Your Champions
NU - GoToEco
The what, why, and how of B2B SaaS tech partnerships: Part 1
by
Dylan Charles
SHARE THIS

Forrester suggest that we’ve got a 10X increase in the number of SaaS companies. And technology startups have come to realize as they grow that they have to work with other technology companies.

by
Dylan Charles
SHARE THIS

In this article

Join the movement

Subscribe to ELG Insider to get the latest content delivered to your inbox weekly.

Why do so many companies run into a wall when building out a tech partner ecosystem?

 

The goal of this series is to look more deeply into the topic of tech partnerships, building on a series of conversations Allan Adler had with Avanish Sahai on Tidemark’s The Platform Journey podcast: Part 1 - Monetizing Technology Partner Ecosystems.

 

This first article in the series focuses on why ecosystem-based tech partnerships are becoming increasingly important in the lifecycle of a technology company. I’ll focus on where they fit in that lifecycle, and how they are different from traditional partner relationships that large companies have come to rely on.

 

The B2B SaaS explosion

With the massive explosion in SaaS and a ridiculously large number of new companies entering the market—data points from Forrester suggest that we’ve got a 10X increase in the number of SaaS companies. And technology startups have come to realize as they grow that they have to work with other technology companies.

 

It’s just a function of how many software applications are being used by end customers. Companies that don’t figure out how to succeed at partnering with other tech vendors invariably get marginalized and see their growth curves stall.

 

Most early and mid-growth tech startups focus on two initial types of partnerships: the programmatic & transactional category, and the business development & strategic category.

 

Transactional partners include channel partners: value-added resellers, managed service providers, and sometimes smaller system integrators who tend to think, “Give me a lead, I’ll close the deal, close some software, make some services.”

 

Strategic partners offer fancy QBRs, and big meetings focused on long-term trajectories and product road maps. But, quite frankly, if you gave them a program, they’d spit it out like it was yesterday’s smelly fish. They are very, very non-programmatic in nature.

 

Ecosystem-based tech partnerships fit right in the middle.

 

They’ve got a lot of programmatic and transactional aspects, like a channel, but also many of the co-innovation, business development, and product road-mappy features found in big alliances. However, going to market through an ecosystem is very different from a direct go-to-market model.

 

The difficulty of tracking revenue attribution with an ecosystem approach

It’s very difficult to easily quantify and attribute revenues with a go-to-ecosystem approach, particularly if you don’t have a platform business model with a proven, stamped-out, repeatable motion. It’s hard to determine the causal relationship between a dollar in and a dollar out because there are a lot more variables to consider. If you go to market through an ecosystem, there’ll be thousands of points of contact.

 

The direct go-to-market model, myopically, appears to be a more formulaic and structured funnel leading to dependable revenue (in truth, it never is, but at least finance, rev ops, and funding sources all think, “Yep, that’s it. That works”). If you look at B2B SaaS and the way VCs have incentivized their CEOs, and Wall Street to a certain extent, it’s very formulaic.

 

You put money into BD, into the top of the funnel, to marketing, and then into a channel; that spend produces a marketing-qualified lead, and that produces a sales-qualified lead or a partner-driven lead, and that produces a Closed Won.

 

There’s an economic formula for it. If you put this much in on the top, you get this much back. You see, the VCs are talking about formulas. Like $18 of return for every $1 invested. This highly formulaic, programmatic way of going to market, has been the de rigueur of the go-to-market for B2B SaaS.

 

The panoply of software companies emerging in today’s marketplace are all following this script, and the poor customer is getting bombarded with piles of direct and channel crap. Companies are starting to see conversion rates go down and cost structures go up.

 

GoToEco vs. GTM

Sales cycles are increasing, and layoffs are happening with the impending jaws of recession. All of a sudden, the easy direct formula that worked for so long is coming up against demand constraints.

 

This is the challenge many young companies face. They follow the traditional growth curve, which dictates a direct motion, and then add a channel motion, with strategic alliances thrown in for spice. They quickly realize that they can’t ignore an ecosystem motion, so they strap on an ecosystem as if it were a channel.

And it’s a recipe for ecosystem failure.

 

There’s a fundamental difference between going to market directly and going to market through an ecosystem.

 

Monetizing tech partnerships is different and difficult.

 

Unlike a channel, where you have a relatively straightforward give-and-get—I give you my software, you get the services—in the tech partnership, you’ve got two software companies.

 

It’s kind of a weird structure.

 

One wants to sell their software. The other one wants to sell their software. Maybe they compete. How do they work together? How does it fit into that commercial structure?

 

It’s all about attention

At the end of the day, with all these software companies trying to compete for the attention of one customer. The customer matters because—and this is the most important CRO/chief customer officer awareness moment—customers are misaligned with the way most companies go to market.

 

We use the analogy of a customer wanting a car and a software vendor wanting to sell them a steering wheel. Nobody goes to the car to say I’m going to use my steering wheel today, and yet that software company is out there saying, “Have this steering wheel; would you like to have a bigger steering wheel? How about buttons on the steering wheel?”

 

While customers are asking, “Why are you talking to me about steering wheels? I’m a car person. I drive a car!”

 

Companies tend to think about parts instead of wholes; they’re misaligned with customer expectations. This is one of the reasons why customer success organizations are delivering neither customers nor success. They’re delivering product retention, or product upsell.

 

There’s no customer success in customer success because we’re trying to get people to buy more steering wheels instead of thinking about the car.

 

The gestalt of the chief revenue officer and the chief customer officer is completely out of sync with the way B2B customers want to be treated, need to be treated, and, quite frankly are insisting that they be treated.

 

That’s why stamping a direct approach on an ecosystem go-to-market model is impossible, and why those that try the standard approach fail.

 

In our next article, we’ll start digging into what is needed to change this trajectory and to steer towards a more successful ecosystem model, including key prerequisites for success, recommended monetization frameworks and commercial models, and some examples of success.

You’ll also be interested in these

Article
|
4
 minutes
Article
|
4
 minutes
The Partner Experience Weekly: Drop the CRM
Article
|
4
 minutes