Through co-sell, ISVs can steadily build sales momentum with trusted Cloud Partners, close more deals faster, and increase sales efficiency. Co-sell (and building relationships with Cloud Providers) is the glue that holds together an effective Cloud GTM strategy.
However, that doesn’t mean pulling together a scalable co-sell discipline is easy. In fact, ISVs often struggle with co-sell basics, as well as more nuanced aspects such as cultivating and maintaining relationships with Cloud Providers (which is an essential element of co-sell.)
Fortunately, ISVs that have nailed co-sell are often willing to share their experiences to help others avoid pitfalls and possibly save a little time and trouble. During Tackle’s Cloud GTM XP event, Lindsey Kramer, the Director of Business Development for Microsoft, VMware; Mauricio Astacio, Senior Director of Global Cloud Alliances for Microsoft Worldwide, HashiCorp; and Thad Keating, VP of Cloud and Security GTM, Commvault; offered their perspectives on co-sell and building relationships with the Cloud Providers. Here are some of their tips and observations.
Getting aligned with Cloud Partners in the early stages
For VMware, HashiCorp, and Commvault, co-sell is not just a seller-to-seller motion—it’s a strategic decision made at the business level to co-engineer and co-market a software solution in partnership with the Cloud Provider. Building and marketing your solution within the Cloud Provider’s ecosystem is the best way to drive value for your customers and, ultimately, paves the way for a more meaningful relationship with the Cloud Provider. In fact, Tackle’s State of Cloud Marketplaces Report notes that the companies with the most successful Cloud GTM strategies have integrated with core cloud services and built a value proposition around why their product plus the Cloud Provider’s provides a superior experience.
“We’ve been co-engineering and co-innovating along with the Cloud Providers for quite some time,” said Mauricio. “So it was a pretty natural next step to partner more broadly by really building out the plumbing for co-sell, both internally and with the clouds.” Mauricio notes that “building out the plumbing” meant defining and identifying best practices around co-sell, and cementing co-sell processes and motions with HashiCorp’s sales team.
“When we looked at where our customers are using our tooling, how they’re using it, we’re really able to have that conversation alongside the Cloud Provider to say, ‘How does this match up with your use cases? And how are you talking about this part of the customer journey?’ And then asking, ‘Is this thing that we’re bringing to market really what customers want?’” Mauricio said.
Nailing the go-to-market strategy for future growth
Co-sell is a journey with multiple paths—and although aligning with Cloud Partners through co-engineering and co-messaging (specifically through a “better together” story) is an important step, it’s also crucial to ensure that your solution is a good fit for the Marketplace, and your sales efforts are properly targeted. “It becomes a challenge when you’re introducing what could be a fairly new go-to-market strategy and trying to pick which part of the portfolio, which part of the segmentation, which persona to pursue that makes the most sense,” said Thad.
And a key piece of ensuring that an ISV is shepherding the right solution to the right Marketplace with the right Cloud Provider involves the use of cloud buyer intent data. “For us, co-engineering was a big part of it in the beginning,” said Lindsey. “But when we started working with Microsoft and Tackle to stand up the co-sell process, we had to select the solutions that we saw the biggest market opportunity for. So we had to use data. We knew that we hadn’t done this before. Microsoft hadn’t done it before with us either—so we had to look at the data and identify maybe one or two areas where we saw a large opportunity.”
There may be other considerations to keep in mind as well as an ISV gets the co-sell ball rolling with a Cloud Provider. For Commvault, it was crucial to leverage channel partners as part of the company’s Cloud GTM strategy. “We’re a very channel oriented company,” said Thad. “When we first started going to market, we felt like that was gonna be a hindrance versus a value.”
However, Commvault deployed a peer-to-peer program that helped to kickstart their co-sell motion. “That was a mutually valuable program for our partner, for the customer, for Microsoft, and for us,” said Thad. “It was one of the most successful programs that we had ever launched because we took the time to figure out what’s in it for all four parties. It became a really good anchor point for the entire co-sell and go-to-market strategy with Microsoft in the beginning.”
The upshot of all of this is that nailing a Cloud GTM strategy takes a bit of forethought, but that shouldn’t dissuade any organization from taking the plunge.
The upshot of all of this is that nailing a Cloud GTM strategy takes a bit of forethought, but that shouldn’t dissuade any organization from taking the plunge. “It’s sort of like a domino effect once you start asking questions like, ‘What’s our customer success model gonna look like? What’s the renewal model gonna look like? What happens when a channel partner shows up?’” said Thad. “All of that stuff has to be considered when you think about what your Marketplace strategy is. But I would tell you, if you wait to get all of that perfect, you’re never gonna be on the Marketplace.”
Although it may be tempting to throw everything in your product portfolio into the co-sell and Marketplace stew, Lindsey cautions against doing just that. “Don’t try to tackle every single area in the world at once with every single product in your portfolio and try to get them all into the co-sell program and into the Marketplace immediately,” said Lindsey. “Identify an area where your solutions have good synergy with the hyperscaler. Find where you can augment what the hyperscalers are trying to do and where you see good market opportunity based on your data or data from organizations like Tackle or the hyperscaler about how you want to go to market and then get some successes under your belt.”
Overcoming challenges and lessons learned
Co-sell takes considerable time and effort and requires learning as you go. Even successful companies such as VMware, HashiCorp, and Commvault had to overcome some hurdles to get where they are today.
“I think one of the lessons that I’ve learned, if I could rewind the clock and go back again, I would help the company define what true ‘true north’ is as we think about our Cloud go-to-market strategy: What is the definition of success? What are we all aiming for?” said Thad. “That way, as you move forward, you get that flywheel going, so you can fail fast, pivot, and have the support that you need.”
Hand in hand with setting those definitions of success and pinpointing your “true north” is ensuring that everyone in your organization—and particularly sales—is enabled and empowered for co-sell. “It’s really important to recognize that for a lot of the other key stakeholders within the organization, co-selling is going to be completely brand new,” said Mauricio. “Your finance teams, sales, operations, legal, they’ve been doing things very differently from co-sell for a very long time. And so each one of these functional areas will really need to be educated and enabled along the way.”
Beyond drafting your internal story around co-sell, it’s also vitally important to ensure that you’re kicking off engagement calls with Cloud Providers correctly with messaging that aligns with their goals. This includes elements from your “better together” story—messaging that presents a united front between you and the CP: one joint solution, one team that addresses the customer’s problem.
“There are thousands of ISVs that these hyperscalers can spend their time with, and their sellers are all super busy,” said Lindsey. “So it’s important to think about where your incentives and solutions are aligned, like thinking about where you have synergy with the Cloud Provider sales teams in order for you to get anywhere with them.”
This becomes even more critical when the ISV’s solution might be very similar to one of the Cloud Provider’s offerings. “Even in the areas where we do augment each other very well, there are still going to be areas where we do compete with a hyperscaler,” said Lindsey. “My recommendation is to just make sure that you have the ‘What’s in it for you’ message down crystal clear for both the hyperscaler as well as your own sales teams. Make sure your sales team knows how they get paid, make sure they know how the other side gets paid, so you can clearly articulate how the incentives are aligned.”
But no matter what, it’s to your advantage to document everything, Mauricio notes, because as you scale your co-sell motion and build stronger relationships with the Cloud Providers, you’ll want to be able to replicate that success down the road. “Some day, you may not be doing this across just one Cloud Provider,” said Mauricio. “You may find yourself doing it across three or more at some point. And so you really want to document things early, document them often, and realize that you’re gonna be doing it again across possibly three different Marketplaces.”
Keeping the flywheel going
In the end, there’s no silver bullet for making co-sell work or for forging relationships with Cloud Providers. It’s a continuous process of trial, error, re-evaluation, and education—aided by a melding of processes and technology. But one thing is for sure: with all of the ingredients in place, ISVs stack the odds in their favor.
“There’s a lot of engineering, a lot of co-marketing, a lot of co-selling, a lot of enablement involved,” said Thad. “For us, all of that stuff is happening in real time right now, but it continues to be an ongoing learning process. That flywheel, I would say, is at high speed right now.”