What You Learn From Being Launched in a Rocket

The Lessons are Simple, BUT HARD

What does it feel like to be launched in a rocket? They say you feel like you weigh three times your body weight. It’s like you have a pile of bricks on your chest. The whole thing can be summed up as controlled violence, the greatest display of power and speed ever created by humans.

?And that’s a pretty good description of how it felt growing two software businesses through their formative years. Controlled violence and speed. Trying many things fast that were simple, but hard. And hoping we were doing more right than wrong. I found two absolutes common to the growth of both businesses. First, you had to be able to paint a clear vision of what success looks like, so far down the road that nobody can see the destination. Second, you need to learn to manage many egos along a winding road of disagreements that leads to any high performing team’s success.

I’ve had the opportunity to help lead two software business from their launch through sustained compounded growth of more than 50% each year. And I learned the powerful impact that partners and an external channel can have in achieving and sustaining that level of growth.

After seven years of leading the direct salesforce for one enterprise software business, I knew that we could not reach our market potential without the help of the many partner companies taking technology solutions to market. I spent the next six years leading our partner sales teams that led partnering relationships of all types and we learned a lot in motivating these partners to extend our market presence.

Predictability, Consistency, and Profitability

We found that the things that our partners most needed from us as their technology OEM partner were predictability, consistency, and profitability. A competent sales team that has succeeded by aggressively taking its solutions directly to market does not cede control to, or share deal ownership with, partners easily.? But that is exactly what we encouraged. Why? Because there is magic in the evolution of partnering with third party companies toward a common goal of success for both. In the early days, the software company may do most of the hard work to get a prospect to buy your software and hand a nearly complete deal over to a partner that has good relationships with the purchasing organization of a customer.

The magic happens when you give a deal to partners, then ask for their help on something else in return. Maybe access to a prospective customer that they know better than you. Or maybe to get their technical professionals to take training you offer to become accredited or certified and then to be able to carry more of the presales system engineering work of architecting a solution for your common customer. But each time you work together more and better, you’ll work together again more and better. You bring a deal to a partner and they bring two back in return. And if you take the time to develop relationships and trust with partners, they'll bring back many more deals to pursue together.

Building Services Businesses That You Don't Own or Control

In the second software business I helped launch and grow, we learned the power of giving up post-sale professional services to partners that have technical delivery implementation capacity. We did this by creating both our own branded professional services delivered by partners and to also promote partner-branded, partner-delivered services.? These services for partners often generate greater than 35% gross margins and if you can keep the delivery engineers off the bench 75% of the time, partners will do two things that create profound growth. First, they will hire more delivery engineers to grow their PS gross margin dollars. Then, they will direct their sales organizations to sell more of your solutions to keep their delivery engineers busy!

The next step in our evolution was to allow partners to do the most basic (usually called Level-0 or Level-1) support calls from customers and share the recurring support dollars with the partner. The partner that architected the customer’s implementation was best at resolving issues that arose once in production. As we evolved these partner-led support delivery services, the customer satisfaction scores given to our partners for their support were even higher than those scores given to us when we supported customers directly.? Resolving differences is one hard part of creating good chemistry with other companies in a partner-first go-to-market strategy. The reason many company’s try going to market directly for as long as they can is because it’s less friction with other highly successful and assertive people. I found that allowing a partner organization to be graded at the end of each 13-week quarter by both the partners we served and our own sales teams we served was the path to figuring out if you are making progress in resolving the many differences that will most certainly arise in partnering.

Partners, and partnering with them, are a big part of any technology OEM's best plans for sustained growth.

Scott Strubel is the Vice President of the Americas Partner Organization for Darktrace and author of the book Simple, but HARD (https://simplebuthardbook.com/ ). You can find more articles on leadership, sales, and partnering at Scott's blog scott-talks.com .

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