Organizing for Marketplace Success

Sanjay Mehta:

Welcome, everybody. Lots of you joining the webinar, so thanks for tuning in today. We’re going to give everybody another 35 or 60 seconds to join in and then we’ll get started. And until then, we were rambling about local rodents in our various cities. Don’t let me interrupt, though, guys. Michael, Eric, it was just getting interesting. [crosstalk 00:00:58].

Michael Bull:

I was just saying we’ve got wild turkeys in our neighborhood and a bunch of neighborhood cats, a lot of outdoor cats, too. So there’s a dynamic out there. There’s definitely a pecking order, I’ve noticed, over the years as well. So …

Sanjay Mehta:

We’ll give them another maybe 20 seconds. The flow seems to be slowing down a little bit in terms of the number of people joining, so we should be ready to roll.

Michael Bull:

Sounds good.

Sanjay Mehta:

Sounds good. Let’s get rolling. So thank you, everybody, for joining this tackle webinar today. We’re going to be talking about organizing for success with Cloud Marketplaces, spending time about the journey that Fivetran and Astronomer, who’ve taken … Talk about how they got started, where they are today, what they see ahead, and really what the impact’s been on their business and their organizations.

Sanjay Mehta:

So it should be pretty lively. You can drop questions in at any time in the Q&A. If we have time at the tail end, we’ll take some live ones as well. And for the most part, we want to help, so nothing’s off limits. And if it is, we’ll let you know. So fire away.

Sanjay Mehta:

With that, I am Sanjay Mehta. I am the Chief Cloud Officer at tackle. I’ve been running around technology and technology go-to-market for about 25 years. And I’ve been pretty involved in Marketplaces for the last five or six, that time spent at Trend Micro, a big global cybersecurity company and really spent a lot of time understanding the journey going from traditional sales models of direct in a really well-built channel to new models like Marketplace selling. And super happy today to have Michael and Eric with us, and I will allow them both to introduce themselves.

Eric Elias:

Yeah. Thank you, Sanjay. My name is Eric. I’m running the Sales Operation Group here at Astronomer. Astronomer is the commercial developer of Apache Airflow, which is open source standard for data orchestration. As your data engineers move data around, Apache Airflow is the one that can coordinate that. Being in the Marketplaces has been a journey and I’m excited to talk about it and obviously excited to talk about how tackle’s helped us become successful in the Marketplace.

Michael Bull:

And hey, everybody. I’m Michael Bull. So I head up our Strategic Alliances, notably our Technology Strategic Alliances, here at Fivetran. Fivetran is a managed data pipeline. So we make it easy for data analysts, data engineers to get their data from their databases or SaaS sources and into Cloud data warehouses. So my team predominately focuses on our destinations. Prior to my time at Fivetran, I worked at Segment in a similar capacity, so really activating our go-to-market and our sales teams and how to leverage Marketplaces, notably through tackle, to help us scale and operationalize that go-to-market motion with our strategic partners.

Sanjay Mehta:

Perfect. Thanks again. I really appreciate both of you being here. So maybe to get us fired up, why don’t we just start by saying, how’d you get involved in Marketplaces in both of your current organizations, maybe where you were and why you made that choice. And Michael, we’ll start with you.

Michael Bull:

Sure. So today, we’re about midway through our Marketplace journey here at Fivetran. How we got started is, as you can imagine, with Fivetran being a managed data pipeline, we are oftentimes purchased in conjunction with a destination, whether that is one of our Cloud data warehouses or wherever the data is going. So Marketplaces are really a natural fit, notably from the likes of a GCP, Azure, AWS, where buyers are purchasing that data warehouse. They oftentimes need a tool to go alone with it.

Michael Bull:

So we oftentimes get purchased together. So that’s how we started our journey, buying what we’d call a modern data stack. And then from there, it has evolved to a much more elaborate and a much more scaled operations on our side, which includes co-selling, transactions around Marketplaces, procurement, which I’ll get into all here in the next few minutes.

Michael Bull:

But that’s our journey today and where we sit and how we got started ultimately.

Sanjay Mehta:

Fantastic. And Eric, you want to share a bit about your journey?

Eric Elias:

Yeah, definitely. We’re probably on the early end of some of our journey, even as we are in the Marketplace, as of 2019 in the AWS Marketplace. And similarly to Michael, actually there’s a partnership with Astronomer and your company and how they work together with the ELT and the data strategy and the integrations between the two.

Eric Elias:

But for us, it’s similar in terms of the buyer, right? You have technology professionals, you have head of data infrastructure, you have head of data engineering who are making these purchases. And they’re used to purchasing on the Marketplace. And so it made a lot of sense and we’ve seen early momentum to meet the customer where they are, which in the Marketplaces.

Eric Elias:

And so early on, we were just in AWS. That was a core place where certain customers were. And then as the maturity of the other Marketplaces came about, we have now moved on to GCP and now Azure and are seeing strong growth across all three.

Sanjay Mehta:

Yeah, it’s great to see some of you taking advantage of all the big three. And what’s to come, we’ll see. Your job will get more complicated, I’m sure. When we look at Cloud, I look … from a customer perspective, you think they have your traditional data centers, a bunch of physical servers, they move to virtualization. Now, they’re in Cloud. Maybe they have an AWS fleet and a GCP fleet, maybe an Azure fleet.

Sanjay Mehta:

And it’s interesting to see the business of the customer transform. But I think sometimes the complexity of transforming inside of a software vendor or SaaS company gets lost in that. So I’m curious, where does Marketplace sit today within your business? Is it a big piece of the business? Is it the exciting piece of the business? Is it scary or unknown? Why not just do that a bit? And maybe I’ll start with you this time, Eric.

Eric Elias:

Yeah. No. Great question. And it’s definitely where we sit as a company, is how we integrate with the Marketplaces. Right now, we’re still evolving our product. We’re developing new features on the product, rolling out new features. And in the same way, our Marketplace interactions has developed over time as well, where it was initially a customer pull, where they’ve pulled us into the Marketplace because there’s interest from the customer, and then we’ve had to evolve and develop processes around that customer demand, around the requirements of the Marketplace.

Eric Elias:

And each Marketplace has been different and has different challenges. So it’s not like we understood one Marketplace and then immediately transferred knowledge over to the other Marketplace. It did on some of the internal controls, but where the rubber really hit the road and where we worked internally to produce orders, to produce private offers, to make sure that we were tracking these offers, that was different per Marketplace.

Eric Elias:

And so internally, we had to both evolve and learn both from tackle and the lessons learned that you’ve had there and our own experience of how do we incorporate Marketplace into our business operations, how do we incorporate Marketplace into the sales operations. When the sales reps are talking to the customer, how do they engage there? And there were multiple evolutions across each of those threads.

Michael Bull:

I can build on that one, because maybe Fivetran might be on maybe the next phase of our Marketplace adoption from where Astronomer is. So today, Marketplaces sits within our alliances org. With that said, we have big cross-functional stakeholders around finance, revenue operations, our deal desk function, which I’ll elaborate on.

Michael Bull:

Where we started, though, was it all lived in the alliances org and with product. We obviously need our product teams to build these integrations where we started. Douglas, I saw your question link. We started initially choosing a Marketplace where, one, we had product support for that as a destination, and, two, nothing gets you started like a lost deal or two. So where, to Eric’s point, if you’ve got a customer who says, “I will buy and I will only buy if I’m able to transact on the Marketplace,” that’s a really good motivating factor to get adopted to that Marketplace ultimately.

Michael Bull:

So we started with one, we expanded to a second set. Today, it, again, sits in alliances, but a lot of those functions that alliances has started with have now moved to other cross-functional stakeholders. I mentioned our deal desk team. They manage the quote process. Our revenue operations team, they manage the account creation, the sales force operational aspects to the entire transaction. Our sales teams are now enabled directly to work with their counterparts at AWS, at GCP, and they both speak a common language around transacting on the Marketplace.

Michael Bull:

So it’s really allowed the alliances team to scale. Tackle has really made it possible for us to, one, not necessarily always ask product to make updates for Marketplaces, and, two, it’s allowed us to become more influencers throughout the business as these particular functions are owned in these groups throughout the team.

Michael Bull:

So we are much more in scale mode, when maybe an initial establishing mode for Marketplaces, they’ve become a pretty big component of our transactional nature for closing deals ultimately, notably with our big Cloud partners.

Sanjay Mehta:

Yeah, it’s interesting. I think there’s a common misperception that if you build it, they will come. So you do your listening, you drop it in the Marketplace, and all these customers just show up knocking at your door. And Michael, you just touched on an interesting point that I think relates back to Douglas’s question, too, which is how do you pick?

Sanjay Mehta:

And I think a lot of software providers choose where to start in their Marketplace journey by where they think they can get the best alignment with a field motion and with technology integration and things like that. So that quickly transitions into a co-sell conversation, which how do I pivot my organization to maybe augment their existing channel strategy with a Marketplace strategy? And that means how do I sell with the Cloud providers themselves?

Sanjay Mehta:

So maybe, Michael, we’ll continue on that thread with you and talk about how you’re doing it at Fivetran.

Michael Bull:

Yeah. So we have sort of … The nice thing is because this lives … because tackle and all this lives within our alliances org, we sit within the sales org. So we roll up into our go-to-market teams, and we have a partner manager and a field alliance manager dedicated to these partners. And to that end, what they do is they are constantly enabling the field sales teams internally at Fivetran, but also externally at our partners. So they are incorporating Marketplaces as a level that those teams can pull in the co-sell process.

Michael Bull:

It’s not necessarily to say that they’re always going to transact on Marketplace, but it creates a common language. And ultimately, it is a … it’s something that is familiar to our partner reps at AWS, at GCP. They know how Marketplaces work. They know that they are incentivized to utilize the Marketplaces. And they ultimately know it’s also just an easier transaction vehicle for our mutual customers and prospects.

Michael Bull:

So it’s advantageous to them as well, and they would prefer to go to the Marketplace. So we’re doing it through two sets of enablement and then incorporating it also into our documentation. I can’t stress that enough. Internal documentation that recognizes the Marketplaces, acknowledges them, and, more importantly, acknowledges their nuances and the differences between them so as to enable a rep to have that conversation without an alliance partner manager, without their deal desk person. Really, we are in that scaling mode. So empowering the reps to do it directly is a big focus of us right now.

Sanjay Mehta:

Cool. Eric, anything different on your side?

Eric Elias:

Yeah. No. And what Michael said on how your different groups are running it to provide the … to counter that and how we work into the co-sell, I am the one-person shop where, without tackle, I couldn’t actually manage three separate Marketplaces. So I’m able to manage three separate Marketplaces, ensure that both the sales is educated and enabled on it, and be able to work with revenue operations and make sure everything is updated in Salesforce and others.

Eric Elias:

And again, when we scale to the product side, we’ll probably have to better integrate with Marketplace and through tackle’s features there. And on the … I actually have used tackle’s documentation, you spoke on that, Michael, as a translation guide. So I have a translation chart that has all the different topics that may come up during a Marketplace discussion in that later stage sales development, where they’re working with a customer and working to close the deal. The introduction to Marketplace usually comes in that point. And that’s where I’m coaching and training the reps to be able to have that translation guide and how to talk about what’s required in the Marketplace.

Eric Elias:

And from that success then, we’ve had interest from each of the Marketplace’s partners. So their sales teams are now interested in talking to our sales teams, talking about our product. And that is, I think, the true opportunity within the Marketplaces to work functionally with them and then also operationally with them. Operationally with tackle, we can make that work. Functionally now, aligning their sales, their marketing folks with our sales and our marketing folks is a huge opportunity and one that we’re just getting started on.

Eric Elias:

There’s obviously huge benefits for the Marketplace, as Fivetran and Astronomer both have very technical products that allow customers to get more data into the Cloud. That is a direct incentive, as there’s just general incentives for those Cloud providers and their sales teams to help bring our market to the product.

Eric Elias:

And I’ll caveat that with, even if there is a similar product that that Marketplace is offering, the teams that we work with are 100% on board with finding the right solutions with the customers, which would include both Michael’s products and our products.

Sanjay Mehta:

Also, we have somebody in ops on the call, and I think that when we talk to customers or perspective customers, that … It’s what Michael was talking about. It’s owned by an alliances person. There’s some product people that are excited for some integration hooks and plugging into some Cloud services. And the potential impact on the broader organization is frequently overlooked.

Sanjay Mehta:

So maybe, Eric, you can dig another layer deeper in that. Order management, finance, legal, procurement. And depending the longer your company’s been around, the more entrenched those operations processes are and the more glass you’re probably going to need to break to adopt Marketplace. So maybe a best practice or two that you might share with the group here.

Eric Elias:

Definitely. We’re launching our own two-week sprints inside operations, inside Astronomer, which you hear that a lot on the product side and on the engineering side. But in our two-week sprints, we are looking at ways to improve processes. One of those is building our own data plan, our data federation across Astronomer, using Astronomer and other ELT-type tools.

Eric Elias:

And one of those pieces is Marketplace. How do you bring the data from each of the Marketplaces, which is different, which is complex, which is not as simple as working with an API that developers are normally working with, and how do you then translate that information into your Salesforce, into your forecasting, into your product usage, and then into larger trends? Because you want to do analysis on that data to say, “Great. Where were the last X number of Marketplace deals and the days to close on those deals?”

Eric Elias:

And so making sure that you have that process in the back end really integrated and having essentially data strategy process that incorporates Marketplaces is both difficult, but essential, I think, as you start to scale up as a company.

Sanjay Mehta:

Yeah. Awesome. Michael, how about Fivetran?

Michael Bull:

Yeah. I don’t know how else to say this. Be as nice as you humanly can to your revenue operations teams. Be very kind to your finance teams and to your … I think it was definitely a journey for us and for myself individually, too. A lot of that time, at least in alliances, that back office aspect is abstracted and we are never a part of that.

Michael Bull:

I think this particularly, sitting in alliances, was a bit of a first view into that world. And I think oftentimes it becomes foreign to us. We are typically go-to-market professionals and we are focused on driving revenue and all the good stuff that comes along with that. But then we get introduced like, “Well, wait a minute. You mean I need to find an integration into our SAP system? I don’t even know how to go about that.”

Michael Bull:

Enter the likes of tackle. I think tackle really helps provide that abstraction layer for all of those cross-functional partners, and it has an answer for them, to some degree, for everything like, “Yes, we can automate that,” “Yes, that information is included in this AWS API,” “Yes, it’s included in GCP, but it’s slightly different. So make sure your finance team handles billing slightly different.” All of that needs to get put in place.

Michael Bull:

My recommendation would be to start with your revenue op … your operational team. And from there, use them as champions, because what I found was oftentimes they already have existing relationships across the organization that maybe otherwise, at least in the alliances team, we don’t have. So using them as the stakeholder to help prioritize, to be very transparent and clear about what is needed, and being honest there ultimately, and taking it in baby steps, taking it in easy to digest phases and scaling and automating from there, and ultimately owning it.

Michael Bull:

At least for us at Fivetran, we owned it in the alliances org, honestly for the first year and a half, almost two years. We owned all of the functions, and only over time, then started to stand up a deal desk team who would take over the Marketplace aspects of deal desk that they were working on internally. Same with sales, same with billing, so forth and so on.

Michael Bull:

So it was like trying to do as much as we could as a singular group before permeating into the rest of the org, because there’s prioritizations and there’s risks to doing that ultimately, scaling too [crosstalk 00:19:32].

Eric Elias:

Michael, I think I was blessed then to have to walk our chief revenue officer through the process as we were closing a big deal, right, our head of sales. And he saw the pieces and the complexity and how tackle was integrated in the process. And so the executive sponsorship was by natural occurrences there.

Michael Bull:

And you’re going to need that. Again, nothing helped like a few deals that maybe otherwise wouldn’t close to bring those stakeholders in, because they have the most to gain incrementally versus anything that … We’ve really got a lot to lose, too, by not taking these deals.

Michael Bull:

But it helps. It helped big time, particularly to have a go-to-market sponsor for the project, to get buy-in holistically and to really drive it. And I think you need somebody. You need an executive sponsor. And for us, that was in the revenue org. We’re going to drive forward with this because we see upside to it.

Michael Bull:

But that can’t go understated. You need to have somebody that is willing to champion that for you internally.

Sanjay Mehta:

Yeah. I think that’s an awesome point. And what you talked about with we do find alliances is very frequently at the center of operations a little more, right? And it’s all about finding the recipe, and it might be the recipe of how do you do Marketplace, and it might be the recipe of how do you co-sell, and it might be the recipe of how do I use ACE from AWS or Partner Center or whatever it is.

Sanjay Mehta:

At some point, you got to figure out how to blow that up in scale. And we find very frequently, like anything else in life, the first time you do something, it’s really, really hard. And I think in Marketplace, it’s really, really hard for each seller in your org, right? So finding a poster child to say, “This is how you do it,” to find those early adopters in your own company really helps, and then that can help proliferate.

Sanjay Mehta:

But maybe I’ll take a real-time question from Sophie. I think everybody wonders how big is this Marketplace business for you? Is it a big piece in your revenue? Is it small? Is it a million bucks? Could it ever be a hundred million bucks? I’m telling you, Sophie, we do see customers that are doing a hundred million dollars in Marketplace. So it can be very, very big.

Sanjay Mehta:

And then we see questions about is it faster, does it slow you down, what is it mean for my channel, and are margins better or worse? So there’s all these metrics questions that seem to come up around Marketplace. So maybe I’ll ask, Michael, you to lead that one and say what are the things you’re looking at and what have you experienced so far and how might they get better in the future.

Michael Bull:

Yes. And I’m happy to elaborate on what I can here. Marketplace is a continuing, increasing channel for us, without question, as are our direct channels and otherwise. But the area where it really accelerates our overall sales philosophy, at least at Fivetran, is we’re all about use Fivetran, make it easy to use, get some value from it. And if you are seeing value, you will therefore use more.

Michael Bull:

Marketplaces really helps with that because it reduces the barrier to entry from some pretty entrenched prospects and customers who have long-standing agreements with our Cloud partners. So in a lot of ways, what it does is it reduces the time to close for us, like, “Hey, you’re already at an advanced stage. We know this is going to go faster towards the end of our deal cycle because it’s transacting on Marketplace. So that’s a big one.

Michael Bull:

The other part of it is aligning with our partners. A lot of times, they will have promotions, GCP, AWS, where they wish to transact through the Marketplace, webinars, areas for awareness. That helps big time in co-selling aspect and in a lot of ways gets the reps to help us engage with these mutual prospects. Some of the metrics that we look at, absolutely time to close, absolutely deal size relative to Marketplace verse non-Marketplace, overall deal size, the number of customers coming in through that channel versus our standard direct channels. Those are all metrics we have in dashboards. We review them.

Michael Bull:

We review a lot of the forecasts as well. So we enable our reps and look to our reps to forecast their pipeline. Is it going to be transacted through Marketplace or not? That’s part of the discovery question that they should be co-selling with their partners. So that also helps visibility from the alliances team understand how the channel’s performing, where we could provide some help, support, scale, or not for the reps as well.

Michael Bull:

So those are all metrics that we look at today from the reps.

Sanjay Mehta:

Yeah. Awesome. There’s maybe a follow on question from Neruv. I’ll flip to you, Eric. Which is, “How do you get your reps to adopt Marketplace and don’t look at the Marketplace tax or the channel tax, if you will?” How have you navigated that?

Eric Elias:

Yeah, definitely. And I’ll echo a lot of what Michael said. But for us, we’re in the fast growth/high growth phase. And when customers want to go through the Marketplace, we’re encouraging it. Again, the Marketplace is sometimes an area that they’ve done this before, or there is actual incentives for them to do it for the first time. The big three are providing those incentives, and so that is a consideration during the qualification, during the technical scoping to explore that option when we’re getting to the last stages of closing.

Eric Elias:

And for us, we’ve definitely seen deals. I’ve seen deals close in days that would definitely not close if we weren’t going through Marketplace. You’re looking at an area where if they’re buying through Marketplace, it’s generally a technical product. And they generally have certain budget allocated towards the Marketplace purchasing. And they have committed spend that they have to also hit.

Eric Elias:

And so there’s an alignment on both approval of Marketplace documentation. We had one just the other week that said, “Do you use the standard contract or the enterprise contract?” We said, “We’re open to both. We’ve used both depending on what size company you are.” They said, “Oh, we’ve used the enterprise contract before.” That was a three email legal discussion that usually could have five or six red line exchanges over a number of days and unfortunately sometimes weeks.

Eric Elias:

And so that’s a prime example of why we really do enjoy working through the Marketplaces. We do see large deals through the Marketplace. We do see faster close through the Marketplace.

Eric Elias:

And for us on the fees, we do not punish our sales reps for going through the Marketplace. We are incentivizing speed. We’re incentivizing adding logos, because for us and for many high growth companies, the more you use Astronomer, the more you orchestrate the data, the more you really use us throughout your organization. If we’re just moving one piece of your org or integrating with Fivetran to move one database warehouse, you’re most likely going to need to move three more across three different divisions.

Eric Elias:

And so for us, it’s about adding the logos, making it easy for the customer. And the time saved from the sales reps can translate into more opportunities they can pursue. We have the inbound, we have marketing running the campaigns. There’s plenty for folks to go and engage with. And so for them to close a deal faster works in everyone’s favor, and the fees are an afterthought in terms of how we close the deal.

Sanjay Mehta:

All right. Maybe I’ll try to tie two totally unrelated questions together, one from Neruv and one from Rob. One’s about what type of customers are we seeing, SMBs or enterprises, and the other talks about just how do you co-sell with Cloud providers.

Sanjay Mehta:

And I’ll share a bit of my own experience, which is I think there’s another myth that Marketplaces are for small companies and for startups, both to sell and to buy. But I like to say that companies that our parents would buy stocks in, good, value-oriented, dividend-paying, blue chip stocks are actually purchasing through the Marketplace, lenders that are growing all around the world.

Sanjay Mehta:

So certainly, you get some SMB-type activity and a lot of technology, but you see really big deals, too, multi-million dollar deals with enterprises. And when you’re seeing those deals, you’ve got to imagine the Cloud providers are maybe inclined to sell first party product first if they can. And then if you’re talking about organizations as big as the Microsofts and AWS’s and Google and some of the biggest companies on the planet, there’s bound to be some overlap, regardless of what space you’re in.

Sanjay Mehta:

So Michael, we’ll give it a start. You’re probably facing that most days, and how do you navigate it?

Michael Bull:

A thousand percent. The good news is this. The Cloud providers, I think, are pretty customer-centric, as evident by that they maintain these partner Marketplaces. If a customer wishes to purchase a solution that maybe is competitive or maybe they don’t offer, they much rather have it go through the Marketplace from a partner than not. So right there, that gives you a leg up against all other solutions that are out there in the market.

Michael Bull:

The other thing to address, the enterprise versus SMB maybe commercial segment, we view and what we see ultimately is Marketplaces are an empowerment. Oftentimes, these larger corporations, everyone you had just mentioned is in it, is like … They’re hungry to be able to do something. Part of working at this large corporation, oftentimes you’re told what you can and cannot do. They already have approval to purchase solutions through a Marketplace. That’s their portal, if you will, into the solutions of the ecosystem, versus have you ever tried to get a new vendor through, like, “I just want to run a trial of Astronomer and Fivetran?” That could take you six months at a company like that, just for a two-week trial that you want to try a new …

Michael Bull:

Whereas they can do it all through a Marketplace. So we see a lot from an enterprise perspective around, “I just want to try Fivetran out. I already have my BigQuery instance. Let me try it out. I’m this one team inside this larger enterprise. And if this works for me, then we can have a larger conversation across the organization.”

Michael Bull:

So I actually think it’s foreign enterprise. It’s accessibility. Marketplaces provide accessibility that maybe you otherwise would not have. Now, listen, SMBs and … Yes, that’s their bread and butter. I’m a one, four, five, seven-person shop. I already purchased through the Marketplace. I have access to that. It’s already in one bill. It’s so much easier to just go through Marketplace.

Michael Bull:

And we see that all day. And a lot of times, they don’t even want to engage with a salesperson. And that’s cool. No problem. No big deal. We want to get out of the way. We just want to get you access to Fivetran, and Marketplaces help us with that.

Michael Bull:

So hopefully, that addresses a little bit of the question around enterprise versus some of the other companies or sizes of companies that we see come through Marketplace.

Sanjay Mehta:

Eric, anything to add there?

Eric Elias:

Yeah, definitely. And you’ll know with your own product if it’s more catered to the SMB or enterprise requirements. And that direct ratio will apply to Marketplaces as well. I don’t … I see SMBs who it’s their first time going through and enterprise one it’s their first time going through.

Eric Elias:

And then at the same time, we have small companies who they only purchase on the Marketplace, and that’s how they’ve simplified their life. And so we’re able to meet them there. And then enterprises, when they say, “Well, I still have X seven figures to spend. Let’s go through the Marketplace.”

Eric Elias:

And so we’re seeing both of that. And I think in terms of selling similar products, I hit on it before. And I saw a number, and who knows where, right? But it was some 10% of total Cloud spend has been achieved so far. That means we have a large, large amount of data that needs to move. And we’re seeing this because Astronomer is part of that data strategy, as if Fivetran. We want you to move to the Cloud. We want you to be able to move your data. The Cloud providers want you to move to their Cloud. And so they are aligned and incentivized to meet you, whether you’re a small business or a big business.

Sanjay Mehta:

Yeah. It’s interesting. When you look at these Marketplaces now, some of them have thousands of vendors and approaching 10,000 solutions. And you can almost think, “Am I too late?” But when you think of it from the terms you just talked about and everything, 90% of the Cloud market’s still out there. And I would argue maybe 98 or 99% of the IT software procurement market is still available, right? That’s almost a 500 billion dollar market.

Sanjay Mehta:

So even though these Cloud providers talk in terms of 50 billion dollars a year, the Marketplaces are still a relatively new phenomenon really that has caught on over the last three, four, or five years, depending on how you define catching on. So lots of room.

Sanjay Mehta:

But Josh posed a question as well that I’ll broaden a little bit, which says, “If you have a channel or if you one day dreamed of having a channel, ” and maybe that’s a VAR to expand on Josh’s question or maybe that’s a global system integrator like Accenture or Deloitte or a Capgemini or one of the big outsourcers. How do you see either your own organizations or just in general, since your Marketplace experts, how do you maybe predict that evolving for organizations?

Michael Bull:

I’m happy to take this first if you want. This is a tough one. This one gets into honestly around a lot of the future functionality of what’s supported and/or what is not across the Marketplace providers. They all offer some different version, if you will. There’s a bunch of nuance here between what’s supported from a resell or a GSI/SI perspective transactionally.

Michael Bull:

With all of that outside, let’s just table that for a second. We have a ton of activity for SIs and GSIs across all of our partners. Oftentimes, and this is maybe more so specific to Fivetran, we’re oftentimes purchased in conjunction with a whole host of other solutions, a modern data stack, if you will.

Michael Bull:

Our partners in GSIs and channel and SI, they are integral to working with our prospects to suggest what their prospects look like from a modern data stack. Now, the good news is, with Fivetran being listed on the Marketplace, we are the easy component in that maybe suggestion from those people to say, “Just go transact on the Marketplace.”

Michael Bull:

Now, we have an agreement with those GSIs and channel providers directly. So however they wish to transact through their customers on the Marketplaces, that’s between them and their customer. We still respect and acknowledge all of the partner agreements maybe we have with them directly. So again, it’s almost like Marketplaces become this mutual distribution channel for us, because it’s just as advantageous for the channel to say, “Hey, customer. Do you want to buy and transact however you want to? We can do that. We can support that for you as a result of Fivetran being on the Marketplace. Let us help you navigate the Marketplace and Fivetran supplies the actual software.”

Michael Bull:

So they’re a big component to it. And if anything, they like it because they also acknowledge the benefit of, “These deals are just going to close quicker and we can focus on providing value added services, rather than just standard, ‘Here’s how you get through procurement.'” Nobody wants to spend time on paperwork. We’d much rather spend time building a modern data stack or updated infrastructure.

Sanjay Mehta:

Your turn at the crystal ball, Eric. What do you see coming out of it? Last year, AWS announced services in the Marketplace, and you’re starting to see, I think, more and more customers say, “Hey, these catalogs are huge. Can you help me be prescriptive? What works? What did my peer group do in financial services?,” or whatever it is.

Sanjay Mehta:

So you see a convergence of solution sets wrapped with services. When you look at it a little bit in the future around that, what do you get excited for?

Eric Elias:

Yeah. No. I definitely see the services trend. I know it used to be from SaaS company perspective, “Oh, you can’t have services because the margin’s less. It doesn’t scale as well.”

Eric Elias:

Yes, it’s harder to scale some of the services, but it absolutely is integral because the data strategy and the approaches and the need for competitive advantage for all of our customers is to move their data fast and it’s to move their data where they can interpret it. You can’t do machine learning if your data is in five different places and it takes five days to get there. That’s just not going to scale. It’s not going to add value. It’s not going to add value where you want it.

Eric Elias:

And so definitely services are a key component to the success with our customers, and I think it’ll be a key component of how things transact on Marketplaces. In the larger play, Marketplaces are still a large component of your go-to-market strategy, but they are a component of that. You still have to have your success stories. You still have to have your value propositions put in play.

Eric Elias:

I think it’s less of when we just search for services and search for something on the Marketplace. There can be discovery there, but I do think it is the other pieces of your business that are going to market that allow the Marketplace to be successful.

Eric Elias:

And Michael, you said it before, I think, and we hear it all the time with our customers. And what we provide, we provided the value added where the customer doesn’t have to do the undifferentiated lift. I know that’s an old term and maybe we’ve heard it multiple, multiple times. But that’s what’s happening here again, right? Marketplace is new, but the layer that tackle provides is a ton of value, because our internal engineers don’t need to build those things.

Eric Elias:

And I think the same thing will happen in services. Services are going to add to that. There will be a repetition of, “We know how to integrate with Fivetran and Astronomer on AWS. This is how that gets done.” And I think we’ll continue to see that be successful, especially as lean operations still occur in some of the larger businesses within the IT and technology budgets. They’ll rely more and more on services and the automations that we provide.

Michael Bull:

Yeah. You bring up a good point. I don’t know. For all of the other panelists out there, are we … Fivetran is a data integration company. I get a handful of requests to my product team every quarter, maybe a handful. The last thing I want to ask them to do is build an integration tool Marketplace. That’s completely undifferentiated from a user experience perspective, with the exception of, yeah, it’s easier to procure.

Michael Bull:

Fivetran does not build integrations to Marketplaces. We build integrations to data sources and destinations, and that’s what my product team is good at. But having tackle, at least on my team, if I get six requests, I don’t need to have one of them build towards this API of AWS Marketplace. I get to replace that with a product feature specific to my partners, and that is a … There’s just a huge upside there.

Michael Bull:

So really, that’s, to me, from a product perspective and a differentiation … that really helps me internally utilize tackle and ultimately just expand my business and ask for things that are of value and high impact, versus the undifferentiated aspects, which is just like, “Eh, nobody wants to integrate this API.”

Eric Elias:

Sanjay, I spent two days going through one of the Marketplace’s documentations just for this reason. And I said, “What would it take for our engineers to do it?” And I wrote up really, really rough product requirements. But after looking at it for two days, I quickly went back to my head of sales and my CEO and I said, “This is how much time I think it’s going to take just casually making requirements. We definitely should just add another Marketplace through tackle.”

Eric Elias:

And so it’s a fun anecdote, and I know it’s promotion. But at the same time, it truly was. I was knee deep in the documentation. I said, “Wait. We have to build what again?” And so very much took what you said, Michael, and made it very real for me. So it was a quick ROI slide that I had to make.

Sanjay Mehta:

Well, we love it. And we say internally that software developers don’t like to write software to sell their software, right? They have sales teams and marketing engines and everything else. If you have to devote two or three resources that could be innovating in whatever, whatever your business model is or your business space is, then maybe the time could be better spent. So we do see that.

Sanjay Mehta:

There was a question that was in the Q&A in Advantage, and I liked it, which was … And it’s interesting, 2020 in a way for me was a year of validation. You heard the analysts saying, “Hey, 70% of the research is done before a customer ever contacts a vendor,” right? They know what they want to buy, and now they just want to go through a procurement motion. And then suddenly, last year, the six-legged sales call of the salesperson and an SE and a manager or a channel person or whoever went away, and everybody still did pretty well, right? We survived the sales pandemic, and lots of folks are reporting numbers this week and things are looking good.

Sanjay Mehta:

But the question was, “In a Marketplace world, how do you differentiate from your competition?” Maybe that’s your direct competition. Maybe that’s your Cloud provider who’s your competitor. And I would add is Marketplace in and of itself actually a competitive advantage for either of you? And Maybe, Eric, we’ll start with you.

Eric Elias:

Yeah. And again, we’re evolving our product a lot. So we’re thinking about how our solution is working in the general market for our customers, and then obviously that translates into how we position it on the Marketplace.

Eric Elias:

What I have found and what I continue to actually work on is building our profile. So each Marketplace does have a pathway, and one of the Marketplaces even gave us a partner to work with. I had a PR person that I wrote different items with or reviewed slides with to make sure that it fit what that Cloud provider strategy was, as well as what we provide.

Eric Elias:

So each Marketplace has its own pathway for what you can follow and how to differentiate yourself. That said, if there are 10,000 different solutions out there, it is less about … There is organic search, I’m sure. For us, it is still about engaging on multiple fronts. So you are going to engage on social. You’re still going to engage on technical webinars and have customer success stories that are then translated to the Marketplace.

Eric Elias:

But then there’s still … And I know it’s different for a lot of different products. There’s a still a value proposition that if it’s self-serve, it needs to be a great experience of self-service. Marketplace and tackle can provide that great experience. And in our case, while, Sanjay, most of the planning and research might be done, the technical scoping of how does Astronomer actually integrate with this type of Kubernetes and this type of CI/CD and this type of software delivery process, that is very technical and it’s hard to do just documentation or research on it.

Eric Elias:

So our sales is still very much and our technical solutions team is very much engaged with the customer, and that ultimately is our differentiated piece. But the Marketplace still provides that edge and advantage that is worth the time and worth the effort and why we’re here today.

Sanjay Mehta:

Okay. [crosstalk 00:41:47] had something to add.

Michael Bull:

Yeah. Spot on. Marketplaces are strategic advantage, in so much that it just reduces the barrier to saying yes. And selfishly, on the alliances side, it creates thousands of defacto proxy sellers for Fivetran. A big part of this is enabling the Cloud reps to sell your solutions to complement what they’re ultimately attempting to do with their customers, our mutual customers. Marketplaces does exactly that. It becomes all in one little ecosystem. If you’re a GCP seller or an AWS seller, you already have 130-some odd, 60-some odd services you’re trying to sell.

Michael Bull:

Every little tiny thing that you can reduce down to make it easier for them both to say yes, to pick up your call for co-selling, but ultimately for them to navigate their buyer, who ultimately, let’s be real, it’s their buyer who’s transacting on a Marketplace, that’s how we differentiate, right? If you have three versions and, Sanjay, to your point, we just want to go through the procurement process. One person is listed on the Marketplace and the other person is not? We do this on a daily basis. Buyers take the path of least resistance, as they should. I do it in my professional and personal life.

Michael Bull:

Same rings true for these people sitting behind computers, buying software. Marketplace is a differentiation in that it reduces the barrier of entry. And I’ll leave it with this. At least at Fivetran, we try to have our direct experience near the experience as close as humanly possible for the buyer on Marketplaces so as to not … When we say, “Is there a differentiation between …” No. We want to have you as a customer. We want to meet you wherever you are. You want to buy direct? That’s cool. If you want to buy on the Marketplace, that’s cool. It’s the same thing that you are purchasing through the same ways.

Sanjay Mehta:

Yeah.

Eric Elias:

Michael, on that, and I mentioned it briefly, but the full story is we did about a week and a half of red lines of services agreement and software services agreement, and then at the end the customer said, “Let’s just go back to Marketplace.”

Michael Bull:

Yeah.

Eric Elias:

There was two emails and we were done. And I was like, “Oh my goodness. That was hilarious.” But also, proof in that story.

Michael Bull:

Yeah, exactly. So-

Sanjay Mehta:

And you talked about path of least resistance. And maybe to Dean’s question in the chat here, it’s maybe path to most benefit as well. So there’s an understanding that when a customer procures through Marketplace, they might get some benefit against their Cloud provider committee, whatever that’s called, maybe a MAC, maybe an EDP, maybe a whatever.

Michael Bull:

Yeah.

Sanjay Mehta:

And it’s not always as straightforward as it sounds. So I think there’s a little mystery and there’s a little difference in behavior from Marketplace to Marketplace. Though maybe just at a high level, have you experienced the glory of such a thing happening, and did it actually help, I always say, Zamboni the ice, to use a hockey term, to make things smoother in procurement? Because they’re actually, and you mentioned it earlier, using allocated budget and actually got some benefit.

Sanjay Mehta:

So have either of you … have you seen that? Eric, we’ll start with you.

Eric Elias:

Yeah. No. Late 2020, it’s like four days before the new year, we have another inbound. We had talked to him earlier before. We knew there was a fit. But obviously, budget and timing and project prioritization came about through COVID. And they talked to us about four or five days before the new year and said, “Hey, can we transact on the Marketplace? We have dollars.”

Eric Elias:

And my sales manager called me. I said, “Heck yeah. I’m going to go find a computer.” And we put together a private other. Of course, tackle’s help. So I wanted to make sure I was doing it right, because every Marketplace is different. And that helped us put it across the goal line. And so that was … we were all impressed by it.

Eric Elias:

And speed to get it on the Marketplace was important for another deal last year, that same Marketplace. They wanted to go on the Marketplace, they had budget within the quarter, and with tackle we were able to add … build the ROI slide, get approval internally, get onto the Marketplace, and conduct a private offer in a number of days, which was pretty impressive for what we were trying to do.

Sanjay Mehta:

Yeah, fantastic.

Michael Bull:

Our side, yes. All of that is yes and. Around the Cloud consumption piece, Fivetran today is a fully SaaS offering. So we don’t necessarily “spin the meter,” if you will, at an infrastructure level from our Marketplace transactions for a GCP rep. So we’re maybe not the hook for them to retire big time quota.

Michael Bull:

What we do do, and I think where the selling motion has really been nicely aligned, is we have a direct correlation to driving consumption for a high value product at our partners, whether that, today, for us, would be BigQuery or would be Redshift, right, driving compute against that and hydrating those warehouses leads to consumption for a larger deal for your AWS rep.

Michael Bull:

So we are less about the direct consumption, and we are more so telling a holistic picture of activating consumption broadly within AWS for a rep. And where we see this play out time and time again is a Cloud provider will sell a big, committed deal. Sanjay, to your point, hey, it’s whatever you want to call it. And then the customer’s like, “Well, I’m having a hard time actually these numbers. How do I fasten … how do I accelerate my time to value for this larger purchase that I made directly with you, AWS?” That’s where we oftentimes, at least Fivetran, enter the picture as a solution for that seller, to help accelerate what it is that customer was looking to do with AWS.

Michael Bull:

So it’s less about the, “Yeah, we’re going to drive a bunch of consumption directly,” versus we make AWS a better version of themselves. GCP, we had better version maybe of what they are capable of doing right then and there at that time. So think of it more so as an assist metric for us versus us directly retiring it, if that helps.

Sanjay Mehta:

And [crosstalk 00:47:48].

Eric Elias:

You’ve worked with the Cloud providers to help tell that story so that the reps are there telling that story. I think that’s a big piece of that being successful.

Michael Bull:

Yeah. And that comes back to customer stories. It comes back to customer stories, proof points, the enablement, all that other background hard work that you see on the go-to-market. People just don’t transact on Marketplaces in a vacuum. That all leads to something, and it can’t go understated, the awareness that you need to play both with the partner and internally to make … honestly, just to generate awareness so that they know that they can do this. It’s a huge deal.

Eric Elias:

Right.

Sanjay Mehta:

So we’ve covered a ton of ground. Maybe we’ll wrap up with a two-part question. If you could do it all over again, knowing what you know, maybe even a couple of gray hairs like mine along the journey, thankful for the hairs I have left, and let’s make it two points, one from the internal side of the house, what would you have done differently inside your own organization and with the various stakeholders? And externally, what would you maybe have done differently in terms of trying to team with the Cloud providers themselves or on co-sell motions or whatever? What’s the big takeaway that we can leave our audience with so they don’t fall into the same pitfalls that we did?

Sanjay Mehta:

Eric, we’ll start with you and finish up with Mike.

Eric Elias:

Yeah. So what I would do is definitely take one Marketplace at a time, stage it out so that you’re able to really understand that Marketplace, understand the nuances of it and how to work within that Marketplace, integrate it within your go-to-market strategy. Then, take on the next Marketplace. I know that’s a bit of a waterfall approach, which I know in software engineering we want to do everything very agile.

Eric Elias:

That’s not saying you can’t do it that way. It’s just taking on two Marketplaces at the same time, which I may or may not have done, was a challenge. Definitely would not have been able to do it without tackle, of course. But I would say if I were to build out a strategy, coordinate with my marketing team, coordinate with my business development, coordinate with sales. And you have those teams already in place. We were growing those teams at the same time. That would be a suggestion. That way, you can have a really great playbook to roll out each of the next Marketplaces.

Eric Elias:

And which one do you pick? That depends on where you’re meeting your customers to. And you can obviously have those overlap as well.

Sanjay Mehta:

Yeah.

Eric Elias:

What would I do internally? I would definitely have better documentation from day one. I think that could be said across any function at any place, but I think there are resources at hand with that from tackle and online. And so building that and making sure that each of the sales folks have that will save a lot of rework or additional questions internally.

Sanjay Mehta:

And [crosstalk 00:50:29].

Michael Bull:

… flip them around. Externally, what I’d so first, I’d focus on the internal technical teams more. I think historically you have this preconceived notion of, “Well, it’s a procurement vehicle. Therefore, we should go focus on the AEs and focus on the FSRs. They’re the people that are closest with the customer.”

Michael Bull:

Yeah, that’s not wrong. They ultimately get involved around closing the deal. But I think to generate demand, we would have historically focused on the solutions engineers. They are the ones ultimately, I think, providing that technology recommendation, and, two, validating whether or not it is in the Marketplace or not. They are typically the ones with a challenge that they are trying to solve for, and they internally go in and say, “Well, great. I can get these done the fastest. Oh, I’m going to recommend Fivetran, because they’re on the Marketplace.”

Michael Bull:

So focusing on that technical audience and internal community with the partners, I would have done more, maybe to start. We focused on the sellers first.

Michael Bull:

Internally, I think I mentioned this earlier, two things. One, I’d find a champion, an executive level. I would argue it needs to be at the C-level. You should have your CRO, maybe it’s your CEO, maybe it’s the COO. Whoever it is, you need to have somebody that you have convinced almost blindly to take this path forward, and they’ll break down doors and barriers for you without question.

Michael Bull:

The flip side of that is I would have focused more so on, like I said, operation, revenue operations, finance. A lot of the internal operational teams, I think, were the hardest to get on board. And those are the people that you’re going to need long term to help sell them on, “Here’s what it looks like short term and here’s what it looks long term,” because long term, those teams need to take on ownership of these channels that sometimes is like, “Well, I already do this other channel. I don’t want to spin up another one. Why should I do this?” And that goes back to having that champion.

Michael Bull:

So that’s what I would do internally. I think we got there, but a few more bumps and bruises that we otherwise maybe could have avoided would have been nice.

Sanjay Mehta:

Yeah. I wish I would have known both of you five years ago. We could have at least had coffee and shared stories. But thanks again to Michael and Eric and the organizations from Fivetran and Astronomer for sponsoring you to be here today and for your partnership. It was nice to get a couple of shout outs from you, but I know that tackle is benefiting just as much from our partnership and going through this journey together.

Sanjay Mehta:

And thanks to all of you who attended and gave us an hour of your time today. Hope it was useful, and we look forward to seeing you again in an upcoming tackle webinar. Have a great afternoon.