Bold Journeys Podcast

CJ16. This episode features Karl Palachuk, founder and CEO of Small Biz Thoughts. Karl’s mission is to train IT consultants and Managed Service Providers (MSPs) to be better at the business side of their business. He accomplishes this by writing, speaking, blogging, podcasting, coaching, and consulting. And that’s just his day job.

We talk about the MSP community, the impact of exponential innovation, and his own secrets to massive productivity. If you want to know more about MSPs, how to find them, and how to make them successful, this episode is for you.

[3:30] A lot of people who were in the industry 10 years ago have either retired or gone out of business in the recession or have just decided to leave all together for whatever reason. Now we have a new influx of 20-somethings just starting their first business. They consider themselves IT consultants and have no idea what the term MSP even means.  And they’re asking the same questions that break-fix consultants asked 20 years ago.

[7:00] We are in an era of exponential growth in technology, it’s no longer linear.  The innovation growth rate in not just computers, but in many industries, is doubling every year. This makes the statement “if we’re at 1%, we’re almost there” possible, and it’s creating new opportunities everywhere.

[12:00] Whatever technology is going to change the world in 2020 is already here. So it’s not that difficult to anticipate the future (from the book The Anticipatory Organization by Daniel Burrus).

[14:00] While some agents are starting to look more like MSPs and some VARs are becoming MSPs, there will always be break-fix consultants.

[16:00] Most MSPs have the potential to add more advanced technologies. The most successful ones pick a niche vertical to focus on, adopt more  technology, and create services that address that niche.  It’s a smaller market, but they can own that market.

[20:50] The challenge for his larger MSP clients, $5M to $10M in revenue, is freeing themselves from the operating procedures and culture that got them there and adopting new ways to get to the next level. Doubling from $10M to $20M is a lot different than getting from $5M to $10M.  For example, it takes a really good sales manager. But too much focus on sales and not enough on services can hurt you.

[25:00] Once IT owners reach the limit of what they can sell, they should get outside help to hire a sales person and a sales manager.

[27:45] The place for IT vendors and IT professionals (partners) to meet is on online communities and at conferences. Karl thinks the ChannelPro, ASCII, and TechFest events are good places for vendors to meet IT consultants and managed service providers.  If you’re a vendor, make sure you send great presenters to talk about what is in it for the partner, not the speeds and feeds of your product. And don’t forget to follow up when you get back to the office.

[33:30] When you go to events to recruit partners, if you lead with a freebie at a show that’s not connected to what is going to help the partner, you have a disconnect. If you focus on getting warm bodies, rather than on performers who are going to embrace your technology, you have a disconnect.

[33:30] Karl offers 10 5-week classes per year for a fee, plus mini-classes offered free to his MSP community. And he does live training on-site and takes on one or two coaching clients per year.

[39:00] Karl is just finishing his 19th book, this one on Cloud Services. He takes the processes and procedures that have worked for him and shares them to help others.

[43:00] Karl’s side passion is work-life balance. He wrote a book and has a blog called Relax, Focus, Succeed.  Through his own personal trauma, he learned that he could be more productive while working less. His secret to high productivity is prioritizing absolutely everything and being brutal about things that aren’t a priority. To Karl, a phone call is an interruption and doesn’t even put his phone number on his business card.

[45:50]  Choose the single most important thing you need to do. And only do that. Then choose the next single most important thing you need to do, and only do that. Only do one thing at a time. And it makes everyone in the company far more effective. Which means that there’s some crap that’s just never going to get done.

CJ15. This episode features Heather Margolis, Founder and CEO of Channel Maven Consulting. Heather shares how her company helps IT and telecom vendors improve their channel marketing to and through their channel partners.

Heather provides at least 5 valuable channel marketing tips in this podcast. Start using these immediately to capture greater mind-share with your partners, drive more leads and boost sales.

[2:00] Channel Maven is a small boutique consultancy agency launched 10 years ago out of Boulder, Colorado. They have about 20 people who are focused on helping IT and telecom vendors communicate to partners and run demand generation campaigns through partners.

[4:00] Their sweet spot is working with the channel vendors vs. the partners; 98.5% of their business comes from the vendor side.

[4:40] There are many aspects to channel marketing that vendors should be thinking about. And there are many ways to do channel marketing to and through partners; email, direct mail, events, and webinars. plus social media, texting, chatting. The challenge is you must do them all.

[6:15] A lot of people wonder is anybody reading email these days? If you get an email list, nurture that list first on LinkedIn. Start posting relevant content so that they feel like they have a relationship with you. And then send an email and they’ll be more likely to open or click it.

[9:00] If you set up marketing automation tool, it’s not the if you build it, they will come scenario. If you build it, then you need to launch it. Put out communications around it. And not just at the time of the launch. Keep letting partners know what’s new on the marketing automation tool, what’s new with the different resources, what’s new in your program, what’s new in your product.

[10:00] The typical partner is working with 5 to 25 different vendors. If they’re getting 30 emails a month from you, and they work with 20 different vendors there, that’s way too much email.

[11:00] Use a partner newsletter to aggregate content. Put everything in one place and training the partners to read it or to use it. Make sure that information for the sales people or marketing people or technical people is always in the same place on the newsletter, or a segment in your newsletter to those audiences. Information for sales people should be in the top left because they will not look further down. For technical people, their information can be further down because they tend to start at the top and read to the end.

[12:00] Be sure to write the newsletter in terms of what’s in it for them (the partner). The biggest mistake they see is the vendor talking about themselves and not putting information in terms of how it benefits the partner.

[14:00] Partners are so busy today. Consequently, make sure the marketing apps and tools you provide them are super simple to use.

[20:15] Maven that is Yiddish word for someone who knows something about a specific topic, which is how she came up with the name “Channel Maven.”

[23:00] Heather finds the most effective social platforms for channel B2B are LinkedIn, Twitter, and Instagram. LinkedIn is her go-to for her business and it helps her as a thought leader. She uses Twitter when at an event to follow what’s going on or to post a picture with a partner. Finally, she uses Instagram on a more personal level for relationship building. Doesn’t see Facebook as a place to prospect.

CJ14. This episode features a top channel chief, Taylor Macdonald, who is SVP of Channel Sales at Sage Intacct. Taylor shares a wealth of learning and knowledge in this podcast.  You’ll learn how he is successful in driving rapid sales growth of their SaaS accounting software using an alternative channel of accounting firms.

Taylor describes what many vendors are doing wrong and what a best-in-class partner program and philosophy, that he calls “Channel 3.0” , looks like. He provides a long list of ways  you can catapult your channel sales. It all boils down to focusing on one singular priority; making your partners successful.

[4:30] Success Tip: Having a channel person in the office is never a good thing.

[5:00] Joined Intacct in 2010 to run channels as employee 125. Acquired by Sage in 2017 at 10x revenue. Started channel from scratch and today it represents 50% of all new business.

[6:15] Has a hybrid channel strategy with a direct sales team and channel sales team. Intacct product is 100% cloud, a SaaS multi-tenant solution.

[7:30] Became a Sage partner in late 1980s when he launched an accounting software VAR firm. He then became Sage’s largest partner in the world for 7 years in a row. Taylor grew the business to 30+ people then sold the firm and joined Sage to run their North America channels.

[10:00] When joined Intacct, they had already made some unsuccessful attempts to launch a channel. Taylor had the opportunity to create a cloud channel program from scratch and look at all the things that on-prem partner programs had done wrong.

[11:15] Spoke with potential and former partners to find out what they didn’t like about their vendor’s partner programs, what were they looking for in a true partnership, what made them waste their time, what caused them to feel uncomfortable with the relationship.

[12:15] Learned, for example, that partners hate the program tiers. Want a program that rewards all partners the same. Worked to create a program that partners would immediately know was different, that didn’t have tiers. But also decided to de-authorize the bottom 10% of partners every year. As a result, he could put greater focus on successful partners who are investing in the business.

[13:15] Partners get tired of games around incentives and spiffs. Goes to partners with a bucket of marketing funds available if partner will put in half for activities to generate new business.

[14:30] Provides margins to partner for life of the customer. Gives partner opportunity to build large long-term annuity streams as they grow the account. Partner earns same margin on renewals as new subscription.

[16:30] Mistake that Intacct made prior to Taylor joining was going to traditional partners like MSPs and ISVs without experience selling accounting software. In most cases, the only people who are successful selling accounting software are people who already sell accounting software and understand the customers’ business and accounting challenges.

[18:30] CPA firms are making jump back into selling technology and becoming great partners. Got into technology in early 1990s when accounting software first became popular but exited when they couldn’t sustain growth of software sales. Companies don’t change their accounting software very often. Came back when cloud accounting software became available.

[20:00] What people call the alternative channel or shadow channel is what Taylor has been using for decades. The beauty of the CPA channel is that many firms are large, scalable, cover multiple regions.

[21:50] Difference in managing alternative channels like CPA firms vs. VAR is that the CPA firms are less entrepreneurial, more conservative, less likely to invest ahead of revenue. CPA firms have advantage of built-in client base, scalability, and accounting knowledge. Spends a lot more time on sales and marketing than they would with a VAR partner.

[24:30] Sees all types of partners building vertically-focused IP on top of the Sage Intacct platform.

[25:00] Came up with term “Channel 3.0” as a philosophy and a way to express brand new way of thinking and create a partner program that fostered a true trust-based partnership. Has a small channel with an annual partner fee, limits number of partners they bring on board, provide high-level of enablement and support. Limits number of partners in a geography to minimize conflict. Partners sell on their own paper, so they own the customer, they own the renewal, they own support.

[27:00] Charging a small partner fee (under $10,000) weeds out partners who aren’t serious and don’t have ability to succeed. With fee, they get unlimited training, support, marketing assistance, etc. etc.

[28:45] Partners don’t ask enough of us, and we don’t ask enough of partners. For example, when a partner asks for a discount to win a deal, requires that partner follows the Sage Intacct sales methodology. Know that by following methodology, they win 70%+ of the time.  When they spend the time doing discovery and provide a summary of findings document to the decision maker the Sage Intacct way, they separate themselves from the competition and double the close rate.

[31:00] The enablement part of on-boarding has a complete plan with progress report card, getting partner to self-sufficiency in 90 to 100 days.

[33:00] Taylor’s Channel Executives are almost all former partners in the industry. Have been owners, sales people, consultants. They are respected, knowledgeable, effective in their single goal of making the partner successful.

[36:00] Attributes his success to being a former partner, having great mentors, and being very curious and always learning. Need to continuously grow, evolve, re-invent how you do things.

[38:00] If you believe your number one goal is to make your partners successful, you have to then ask if your organization is aligned to that goal. That alignment must be earned and maintained, but also needs agreement at the board level.

[39:00] There’s a direct correlation between percentage of services done by partners and the success of the channel.

[43:00] Taylor is passionate about hard work, being successful, and his family. And he’s been name the top 100 most successful people in accounting for past 15 years.

CJ13. This episode features Lorna Garey, Editor-in-Chief of Channel Partners and Channel Futures. She is also the producer of the Channel Partners events including the CP Expo 2019 in Vegas where the theme is Channel Disruption.

Lorna launched her journalism career in the Army working under the general of the 2nd Armored Division. She even has the Hell on Wheels patch.

Lorna shares an insider’s view of the continued growth of the Channel Partners events in this period of disruption, how the channel publication world is evolving,  and how channel professionals can grow their business and their careers.

[3:50] Channel Partners event takes place April 9-12 in Las Vegas. This is the 22nd anniversary of the CP Expo and the 5th that Loran has been the producer. The event has doubled in size and revenue in those 5 year.  Twenty-two years ago they had 200 participants. This year they’re expecting 6200.

[4:50] Theme this year is disruption and the uber-ization of business. The channel is not dying, but it is changing. You can either change your business or wait for a born-in-the-cloud business to change it for you.

[6:00] About 50% of the partners at the spring Channel Partners event are agents. The fall CP Evolution show in DC is predominantly MSPs. A burning question is will the agent and MSP models merge?

[7:30] Of the 6200 attending CP Vegas, about 60% are partners, up 10% over last year.  Most of the rest are distributors, master agents, and suppliers.

[8:30] Channel Partners Evolution taking place this fall in DC with a predominantly MSP audience.

[9:50] New this year – launching the first Channel Partners international event. It’s taking place at the Park Plaza London very close to Windsor Palace in December.

[10:50] Lorna got her start in the channel when she was asked to join Channel Partners. She’d never heard of the channel, which she sees as one of the problems of mainstream tech journalism.

[14:00] Hired a millennial editor, James Anderson, right out of the Walter Cronkite School of Journalism. James launched Channel NX2Z a group dedicated to helping the next generation of thought leaders see the channel as a career path.

[18:00] When Lorna joined the Army, she was requisitioned to Ft. Hood, Tx by the commanding general of the Patton’s 2nd Armored Division and she even has the Hell on Wheels patch.  The general asked Lorna to become his graphics department for briefings.

[19:30] Lorna was stationed in German before the wall came down. Her biggest adventure was going into East German through Check Point Charlie. That showed her the night and day difference between Communism and Capitalism.

[23:20] What kind of stories get the most attention? If it bleeds, it leads. Channel stories about layoffs, bankruptcies, other problems get the most attention. In positive news, open source, security, PSA, and RMM content is king on Channel Futures. On Channel Partners, stories on business models and how to add monthly recurring revenue get a lot of attention. LinkedIn is the most popular site for readership.

[27:00] Vendors can speak at CP events through paid slots and be featured on Channel Partners online through contributed content. Channel Partners is one of the few sites that accepts content from suppliers. That could lead to a speaking spot at a CP event.

CJ12. This episode features Josh Lewis, Vice President of Global Channels at Alteryx, an analytics firm on hyper-growth. The channel strategy that got Alteryx to a $50M company wasn’t going to scale and continue fueling hyper-growth. The channel program reached a plateau. As a result, Josh needed to take a different approach to accelerate channel performance.

Breakthrough performance is defined as a dramatic improvement achieved through consistent, focused, and synergistic efforts. Josh is adding fuel to a hyper-growth engine through consistent, focused, and synergistic efforts to drive breakthrough channel performance. This podcast is loaded with tips on recruiting, culture, and team alignment that you can use to accelerate channel performance in your own company.

[2:45] Alteryx an “overnight success” that started 23 years ago as a consulting company solving customer problems. Gradually shifted from services company to product company. Outside investment put them on hyper-growth track. Managing channels in hyper-growth requires special approach. Josh’s role is to add fuel to the growth engine.

[5:00] Josh came into a good foundation of partners. However, what got them to a $50M company wasn’t going to scale. Needed to make existing partners more successful and bring on more.

[6:55] Culture of partnering was there from the start. Josh found Alteryx to have a partner-friendly culture. But he needed to do more to make it easier for partners. Having the right culture in place makes it easier to accelerate.

[8:20] The channel program reached a plateau. Therefore Josh needed to take a different approach. Had to be more selective about which partners can join the program. Needs partners who will build a practice; not single transaction partners. Understanding who shouldn’t be in the ecosystem as important as who should.

[10:00] Culling old partners from your program is hard. Some are friends. But at some point it may not make sense for either side to continue. If partners want to reengage and commit, welcome them. But if not, it’s time to part ways.

[11:00] Josh is getting hyper-focused and data-driven on partner recruiting. For example, he hired a partner development manager for healthcare. Spent months analyzing the most important characteristics and patterns of the ideal partner for that market segment. Then built a cadence with the marketing team to target those partners. They went healthcare events and made sure their value prop was crisp. Has had great results, finding and landing partners they couldn’t have otherwise.

[12:00] They first looked at existing partners to see which ones were healthcare relevant. Then they used Alteryx’s own analytics to automate the analysis of partner data. Many happened to sell into healthcare, but weren’t healthcare partners. Wanted partners who woke up every day thinking healthcare and analytics. Analyzed industry reports, scanned websites, and attended events and trade-shows to develop a tight target list and hone value prop message.

[15:20] Now he’s rolling out the same vertical-targeted recruiting model globally, targeting other verticals with collaboration between business development and marketing teams.

[16:45] Also rolling out a new PRM system (Web Infinity) that will include full-blown deal registration system. This system is focused on the partner journey and allows them to segment partners by vertical. Can’t double staff, so needs systems that scale.

[19:00] Also rolling out a new Partner Program in June, fusing the brand into the program. Want partner experience to mirror the Alteryx brand experience. More than just swag and t-shirts, its very much about getting partners aligned with how Alteryx views the customer. Building in measurements around customer success and certification.

[20:30] Plans to start surveying partners this year to measure partner satisfaction. Have global partner advisory council to get feedback from their top partners and hold 3 partner summits.

[23:00] Digging into their customer data and renewal rates. Looking at retention rates for partners versus direct customers. Found that reseller customers have higher renewal rates and higher growth rates than direct customers. (great sound clip)

[25:30] Alteryx has a strong focus on land and expand. Hence partners play a major role in expansion. Rely on partners to have the deep industry domain knowledge to weave themselves into the customer’s analytic journey.

[27:40] On hiring top talent, Josh looks for partner managers who have a big picture view. Looking for people who can run their own channel “franchise”, acting like a general manager of their region. Josh looks for sales relevance, meaning are his managers relevant to the direct sales team and to the partner. Not just managing transactions or the partner, but also working closely with the sales team. You have to hire people who understand that, who can develop trust internally with the sales team and externally with the partners.

[30:00] A partner manager diminishes their value when isolated outside the sales motion.  Align your channel team with the regional sales team to achieve the highest partner-attach rates and most productive partners.

[31:15] Likes to hire partner managers with both a direct and indirect sales background. Hire people interested in the big picture with intellectual curiosity. Then empower and enable them to think as general managers running a franchise.

[32:30] Sometimes we hire transactional channel managers. There’s a need and a role for that. But when you’re looking to double the business you absolutely need people who can lead breakthrough performance from partners.

[34:30] Channel relevancy in a company is based on chief executives’ perception of the channel and their experience with the channel. Sometimes channel chiefs can get too hung up on an approach and it becomes almost a religious conversation.

[36:00] The importance of culture and cultural fit – the partners who are most successful are the ones with the strongest cultural fit. Therefore, find partners who speak your language. Its hard to measure on a dashboard, but you know it when you see it.

[38:50] Josh made a leap into sales after getting his English major by getting a job at Eastman Kodak and going through their 3-4 month sales training program.

[42:20] Tips for channel managers looking to rise up the ranks – it’s a journey. Have a personal network, find the right mentors, be humble. Learn new things and learn from the hard lessons. Find a great company and surround yourself with great people.