June 19, 2019

Avanish Sahai: The 5 Myths of Application Platforms

42 minutes

Tips for Building Successful Application Platforms and Developer Channels

Application platforms provide a framework and a marketplace for a community of developers to create solutions on top of a SaaS vendor’s technology. Salesforce has been hugely successful in growing their business by offering the App Exchange platform for partners to develop custom applications on top of Salesforce CRM. Yet despite the many advantages of application platforms, there are still many myths holding partners and vendors back from leveraging this powerful channel opportunity.

This week’s guest, Avanish Sahai, is an expert in building application platforms and ecosystems of development partners. Avanish was previously the Vice President of ISV and Channel Alliances at Salesforce. There he launched App Exchange and grew the platform to over 2000 applications. He’s now applying his platform magic at ServiceNow where they just topped 500 applications on the ServiceNow store in four years. Avanish dispels five common platform myths as we talk about platform trends, developer partner ecosystems, and how to build a successful developer channel.

KEY TAKEAWAYS

Top Myths of Application Platforms

Myth #1: Vendors want to copy their partners’ apps.

Platform vendors want their developer partner ecosystem to be rich and successful. Consequently, stealing partners’ ideas would severely damage trust and hamper success.

Myth #2: There is always a “winner take all” in any given category.

In any given category, there will be multiple vendors at different paces of innovation. Likewise, if a market is available and proven, there will be multiple partners who can and should participate in that market.

Myth #3: If you build it (an application), they (the customers) will come.

Partners need a go-to-market plan from a marketing, sales, customer support, and customer success perspective. Therefore partner should take ownership of marketing and selling their individual solution with support from the vendor.

Myth #4: Partners are being charged a tax to be on the platform.

Running an application platform and creating and connecting API’s for partners is not free for the vendor. That is why many vendors’ application platforms run on a revenue sharing model which helps the vendor build the partner ecosystem.

Myth #5: The only exit for partners is being acquired by the platform provider.

While nothing is certain, financial exits in a variety of forms can and will happen. Acquisition by the vendor, another partner, a private equity firm, or even an IPO, are all possibilities.

Application Platform Trends

From Healthcare to Education, developer ecosystems are growing very quickly. Customers are looking for partners with deep vertical expertise who are developing vertical-specific applications.

Global system integrator are building applications alongside their core service businesses. As a result, many are taking advantage of software vendor’s APIs and application platforms to expand their service offerings.

Building a Successful Developer Channel

It is critical for the vendor to have a thoughtful strategy around the building and maintaining API’s, the data exchange between partner, customer, and vendor, and business workflows.

As with any channel program, executive commitment at the CEO and board level with alignment up and down the organization is crucial for success.