Nearbound.com 45 min

Nearbound Podcast #166: Pete Caputa’s Return: The Partner Led Startup Story


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Here's what our other successful partners did. You should do exactly that. And

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every time you do that, you create a new competitor.

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And then really, like you said, they're gaming. What was that? Gaming the gains

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Then you're basically putting them in your directory where they have to compete

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with each other either on price or on the number of reviews that they get or

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something like that.

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[MUSIC]

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All right, we're back at last. Welcome to the Nearbound podcast. I love saying

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that. I love being with you all every week. And I couldn't be more excited to

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have the gadfly of partnerships, at least for me.

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The one who's told me I am wrong more than anyone on the show today. We have

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Peter Capuda, everybody. Welcome back, Pete.

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Thanks, Jared. I've told you you're right plenty of times, too, right? Just so

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I can't be balanced. Keep you eager.

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I'm stoked to have you here because it's been so interesting to get to see. I

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've had this thesis on the podcast from the beginning that some of my favorite

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and the best partnerships folks and the becoming entrepreneurs.

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And the data box story that I've followed from you kind of taking the helm

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there. I remember when you told me in Boston in person, I was like, "Yes, this

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is so cool.

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I can't wait to see what comes out of this in terms of SaaS go-to-market

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innovation from you kind of leading the helm there." And about a month ago, we

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saw this LinkedIn post where you had -- you'd launch something that I'm like, "

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This seems pretty unique.

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I have to talk to Pete about this." So maybe let's set the stage on the -- I

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want to see what you -- what did you call this? It was data box, like a white

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label.

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Should we read the bit of the whole thing? Yes, we have -- we've actually

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always had a white label add-on because our partners use us to report the

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results that they drive for their clients. They use us to report those results.

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And so a lot of them say, "Oh, I want this to look like it's mine. I don't want

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it to look like it's data box." And so we've always had -- not always, but for

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a while, we've had the ability for our partners to white label our software.

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But that's not the main thing that I would say is special about our program or

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unique about our program. There's lots of white label software tools out there.

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It's some of the other things that we do that allow our partners to create a

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unique offering that is their own.

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And it's not just like changing their logo. It's actually -- they're able to

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customize our software in a way that our other partners are unlikely to

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customize it or maybe even couldn't figure it out.

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I love just the starting point, the mindset of, "Okay, the agencies want this.

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So let's figure out a way to get them what they want in a way that also

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benefits us." Just like starting from that standpoint.

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I know that sounds really simple, but even the white label thing, as a marketer

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, you can feel like, "Well, no, that's my thing. I don't want it.

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The agency taking credit as if it's something that they're pretending -- this

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is my software that's presenting this data and this report. I want the end

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customer to see that it's data box." And to be able to say, "Look, the agencies

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want to be able to package this in a way that shows their value that has their

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branding on it." And being able to say yes to that, but then do more than just

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that, like, figure out a way to make that a win.

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It sounds very simple, but I'm telling you, a lot of people come from the --

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yeah, but what's that going to do for us? Let's make sure our brand is on there

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, right? Like starting from that standpoint.

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Ryan from vendor Pete, what's that going to do for us? I remember that call

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that's right the other day.

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Yeah, I don't want to go too far down.

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Yeah, we will go there today.

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And I like Ryan a lot.

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I was ready for a thought to break out.

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This is going to get spicy.

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[ Laughter ]

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Yeah, Ryan wrote a post -- we'll cover it since you.

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Ryan wrote a post saying, "What do partners do for direct sales teams?" And it

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kind of the question by itself kind of pissed me off because like --

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I don't think the direct sales team is the party that should be getting

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optimized for.

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When it comes to sales, it should be the customer, of course.

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First, then I would argue maybe the partner because generally the partner is

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investing in the relationship,

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whereas the sales person is getting a nice, usually comfortable, base salary

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and leads delivered to them.

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But yeah, I don't think we need to go too far down that path.

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But I do think it's important to optimize for your partner's success first, or

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at least programmatically.

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And we've talked about it before.

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And I think the most partner programs have in that they're -- when they say, "

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Let's launch a partner program," all they think about is,

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"How can I get incremental sales out of partners?

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How do I grow my revenue from my partners?"

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And to really make a partner program work, you have to think about, "How am I

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going to help my partners generate incremental revenue or higher margins or

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some benefit to them?"

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So I think that's the first thing to think about.

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Yeah, one of the -- yeah, that's one of my first things.

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Go ahead, go ahead.

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One of the ways to do that -- so the second mistake I think a lot of partner

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programs make is that they build a program and they want everyone of their

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partners to do and say the same thing.

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They want every partner to go out and say, "We use -- we sell ABM services and

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this is our stack.

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We sell CRM and this is our stack, right?

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We sell in the old days of HubSpot.

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We sell inbound marketing and this is our stack.

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We're marketing automation and this is our stack.

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And so in a way, the vendor is kind of labeling the movement or the market and

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then they expect their partners to kind of parrot or mimic those things.

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And so the one thing -- way beyond white labeling that we've been able to

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design partners to really customize our software in a way that they're unique.

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And so our offering is unique.

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And just to give a simple example, we have a partner who provides marketing

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services to large law firms.

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And what they did is they went and created a benchmark using with permission

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data from their clients.

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And that allows them to go to their clients and say, "Compared to hundreds of

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other large law firms, this is how your sales and marketing is performing and

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it's anonymized."

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And nobody's learning about their actual competitors or peers.

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They're just seeing where their performance falls against the median or the top

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quartile, bottom quartile of the group.

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So that is a unique offering that a partner can create.

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Now, there are other maybe marketing agencies that focus on law firms who could

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try to duplicate that, but their data would be different by nature because they

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're going to have a different set of clients that opt into that.

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And so that's one way that we allow our partners to kind of lean into their

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differentiation and build something unique that they can go to market so that

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they don't sound like our other partners.

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So that's -- I think the thing that caught your attention, Jared, and Gurnevie,

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you wanted to talk about?

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I love that approach of like, just given that we're in a world where ever since

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the SAS revolution, where you can sell your product direct to customers,

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everyone's so focused on that, doing the thing that scales and selling the one

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version or the tiers directly to your customers and thinking of partners as

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just like,

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"Hey, you should also be selling this exact same thing to customers," not

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thinking of them as like, if your partner can get access to something that

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other people cannot get, and if they can get something, if people can get

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through them something that they cannot get elsewhere, that is so, so big.

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I was just talking to somebody in an education space and they were saying they

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had a partnership with one of these universities that has like nationwide

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online degree programs, and they were like, "No, we have this partnership that

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's exclusive to us." We get to offer a version of their program that you cannot get anywhere else

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except for us.

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And they were like, "That's why we promote it to our people because it's an

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actual value ad that gets to be our program paired with their program, gets you

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something different."

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And I thought, "How brilliant that is that they go and do this with partners,"

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and they're like, "We're going to tailor it and customize it a little bit so

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that it's otherwise what's the point?

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If I'm an agency, everybody can just go buy the software, why would they buy it

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through me?" And then I'm just trying to tax services on, but to plug into them

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and say, "Hey, we're going to give you a slightly different version of the

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product that's customizable to you so you can go and offer something truly

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unique."

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Again, it sounds simple when I'm saying it, but it's rare. Nobody's doing this

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in SAS.

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No, no, it's a less like I learned the hard way in building the HubSpot program

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in that, you know, inbound marketing was this new thing in the late 2000s.

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And so we were teaching people how to do that and we're like, "Oh, well, if for

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teaching agencies how to do that, we'll just teach them to offer these four

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services."

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And then a few years into that, there were hundreds and then thousands of

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agencies basically all saying the same thing and just not, they weren't

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differentiated.

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And I think the hidden truth in most of these partner programs, I won't share

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HubSpot's data per se, but the hidden truth in these partner programs is that a

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small fraction of those resellers end up being successful.

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And it's because I think one of the reasons is that they're just not

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differentiated enough. And so they end up competing on price or, you know,

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other being the first ones, having more money behind them, right, as opposed to

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really trying to carve out something where they can be the best.

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Right, like game the games, right? So like game the review boards or the sites

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or like they're trying to win it something that is not unique to them, that

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does not solve a problem for them as a business or the end customer.

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And I think what I've learned by, you know, following alongside some of your

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collaborative growth journey that you've been building out at Databox Pete is

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like so many partner people will say the phrase like joint value proposition,

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right?

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And it's like they lose the concept of a unique value proposition. It's like

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the joint value proposition is, hey, can we package this the same for all 200

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of our partners? And it's like, no, no, no, it has to be unique.

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What about the verticalization or the segmentation is something that's

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important. And if you're not hoping your partners define their market and their

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customers and how they best serve them, you're not really doing partnership.

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You're doing marketing and sales alignment by another name where the economics

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of that model doesn't really help the end partner. It's about you, not about

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them. It's about you, not about their customer.

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I want to take it a step further and say that you're actually commoditizing

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your commoditizing or commodifying your partners as you bring them on, right?

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Yes.

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And then you're basically, oh, yeah, here's what our other successful partners

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did. You should do exactly that. And every time you do that, you create a new

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competitor. And then really, like you said, they're gaming at what was that

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gaming the games.

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Then you're basically putting them in their directory where they have to

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compete with each other either on price or on the number of reviews that they

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get or something like that.

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So, yeah, I think it's a race to the bottom when you build a partner program.

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And it's funny. I know with all of them, right?

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Sorry, sorry for the overlap there, Pete, must be lag on my side. But I've made

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this analogy a handful of times on this podcast here, but, you know, because

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before partner hacker and reveal, I was working in the career space and people

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on the job hunt and technology related to hiring and applying to jobs.

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And that idea of like, when you're going to apply for a job, if you basically

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just say, hey, I'll do all the things in the job description, there's nothing

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unique about working with you over somebody else.

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Whereas if you can say, hey, here's something, I'm so a value that the two of

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us together are going to create value that no other two parties can create,

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right? Yes.

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There's something unique and with partners. If you're like, hey, how about you

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do the same thing every other partner does? There's nothing about that that's

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additive.

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And if you say, let's find something that only the two of us can do together

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that has a value that couldn't be gotten anywhere else. Like, that's where it

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gets really magical. Those are the partnerships you want to go in on.

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Yeah.

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What this unlocks, if you approach partnerships by allowing your partners to

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create something and what that does is that unlocks the ability to actually go

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to market together in a very scalable way.

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Right. So most partner programs are all about reselling. It's like, you go

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generate your lead and bring it to me or maybe I'll generate a lead and bring

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it to you.

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But the real value in partners partnerships with given that the internet exists

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is unlimited reach. And so if you can go to market through marketing with your

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partners, then you can reach a significantly larger audience and generate

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significantly more demand.

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One of the things that I love about the program we've been building is that all

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of our partners are unique. So I have that partner who is only working with law

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firms, large law firms.

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I have a partner. All he does is help B2B brands launch and get to a certain

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level with their YouTube channels.

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I have another partner. All they do is work with international house schools.

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Those are schools that teach English language as a English language to students

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in foreign countries. Right. So, and those are just three.

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We have like a hundred partners and they're all somewhat unique, whether it's

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the market they serve or the services that they offer.

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But we're able to allow them to build something unique using our platform that

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only they have and that allows them to market sell and serve their clients more

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efficiently.

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And here's where I've been like, I've had like no remorse conversations where I

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've just been showing up to CMOs and being like, I'm going to throw something in

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your face here.

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Like, who on your team, who on your team has ever been like, who do you sell to

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? And they're like, oh, we have these, you know, verticalization strategies,

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right?

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And well, okay, you sell the CIOs and you're branching into like this part of

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security or you're branching into this part of info sec. And there's these

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growth opportunities where they're looking at more market expansion.

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And I always hit them with this. So tell me who on your marketing team has ever

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been a CIO. Right? Like, you don't, these are content marketing managers. These

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are product marketing managers. These are, these are all folks that lack any

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empathy or understanding of where the customer is tacitly

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and much less where they're trying to go. And in that world where that is true,

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why would you ever market alone?

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If you're expanding into like, there's, Pete, you would have to hire someone

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that's like an expert in like legal services, right? And probably pay them 2x,

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3x your media and salary in order to effectively reach that new market.

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Right. Exactly. Not yet. Even just to write content for that market, let alone

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reach it. Right. Meanwhile, he has a partnership with a company that has 90,000

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law firms opted into their unique directory. Right? And so he has access to a

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list of 90,000

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contacts. I would never even pursue that in our business. Right? Right. Which

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is, would never make the list. But with a few conversations with him and a

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quick campaign, we're running together. Like, he's going to basically promote

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our offering, our joint offering to 90,000 people.

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And he can market it better, can sell it better and service it better because

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you'd have to have that expertise across all three buckets. Yeah, we're talking

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about that. He does all that. Right. And we're in the governmental game. Yeah. When I'm

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talking near bound, that's my point is like, how are you going to do that? It's

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who? It's who is the end recipient of the value and who is best, you know,

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position to serve them to help them to reach them to help them grow.

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And so, there's going to be someone that's closest to the customer. And by the

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very nature of your business, or our business or any of our businesses that are

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listening, where we're trying to serve ourselves. And like, it's, there's any

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deviation from ICP. And I'd argue that even with your ICP and your defined, very narrow list of

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like, here's the thousand accounts that we want. Like, even then, you're

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probably selling to someone that you're not an expert of and around.

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There are some exceptions of that. Like, you know, for example, like, I think G

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ONG does a decent job selling GONG. Right. Like, there's a sales tool selling to

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salespeople. Right. Yeah, exactly.

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Well, I loved about Husband early on as we were selling to marketers, right?

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And we were marketers ourselves, at least some of us were.

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And then later on selling sales tools to salespeople. Yeah. I think that's rare

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, right? Most salespeople and marketers are not marketing to their own profile

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to people like them. They're marketing to some other market.

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So for them to really understand it, they have to spend a lot of cycles. And

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then if their market is broader, like in our case, data box, we sell a business

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analytics tool.

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So our market is horizontal. There's no way that I can be able to have a sales

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team or even a marketing team or whatever that can go deep on the data that a

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law firm needs to capture.

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Let alone even know the tools that they use to where they capture data and need

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to integrate with our system. But he can, right? He can not only know that

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stuff, but in our platform, he's able to actually build custom integrations

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that he can reuse across clients, build custom reports, custom dashboards,

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templates that he can reuse across clients.

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And so by having all those customization capabilities in our product and then

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having a partner like him, we can go after that market with very little

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incremental investment on our part.

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Yeah. It's interesting, Pete, as I was looking at your comment on that LinkedIn

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thread as well, you were kind of listing like, Hey, here are some of the ways

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that we help the agencies differentiate.

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And I'm looking through that. And I'm also just thinking of how I have watched

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you do things at data box over the last couple years.

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It's almost like, it's like a full stack partnership or like a multi surface,

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right? So instead of just saying, here's what partnering with us gets you, it

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gets you one thing.

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You have things that, okay, they get a customized version of your product. So

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there's a product component about being a partner that's unique.

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They get the branding ability, the ability to do the white label. So there's

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branding. But then also, they get to benefit from your branding and your work

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because you will often share and highlight a lot of things about these partners

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to kind of draw attention to them.

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So it's a, it's a, you know, heightening awareness of them in their market. But

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then here's where it gets really interesting.

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They get access to unique data. So it's not just your product. It's the fact

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that you have all these other customers and all this benchmark stuff.

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They get to give data to their customers that their customers wouldn't be able

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to get elsewhere.

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And it's like this flywheel, you start to compound things like a customized

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version of the product access to data. You can't get anywhere else.

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The brand component, the ability to reach, and then that lets you break into

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markets to your point. You would never have time to do all that and put it

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together and package it for all those different markets.

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But the fact that you have this core network and some of the data and the

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customizable product that you can give to them.

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Now they can take that and do something. And it's like, I mean, I just love it,

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the number of layers. And then you get to tell the story of doing that, which

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attracts other agencies to want to come and do that with you.

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It's what Jerry calls the zone of genius where you just start stacking things

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on top of each other.

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Yes, you said it also. What to add there? There's one other thing you didn't

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mention, which is my favorite part of it is that we have these turnkey

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marketing and prospecting campaigns that we've built.

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And we have like 60 of them. And so when we bring on a partner, we can say,

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tell us what your areas of expertise are. And then we say, okay, we have these

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turnkey surveys that we run.

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And so you can use these surveys in your marketing and your prospecting will co

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-brand the survey with you.

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And that allows them to go out and share data that we've already gathered

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around business processes and business practices.

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And then in order to establish their credibility, but also use that survey as a

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way to connect with someone and say, hey, I have access to anonymized data.

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Well, how companies do XYZ? Would you like access to it? Oh, by the way, I'm

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writing a report with the box about this where we're looking for experts that

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we can quote in their reports.

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So if you're interested in that, you're going to either talk to or have you

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fill out this form with some open answers to some open-ended questions that we

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have.

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And so by going out to our partners and saying, here's a turnkey marketing data

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and data that you can market with and use in your prospecting.

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And then benchmark data where you can show your prospects and clients how their

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actual performance compares and then follow it up with your services plus an

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analytics tool to help them keep track of how they're performing over time, set

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goals, forecast, etc.

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So yes, full stack, full stack.

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I'm such a fan girl. I'm such a fan girl. Isaac and I are going back and forth

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and chat about how much we're fan-girling over here.

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And it just reminds me of this quote in the nearbound book, "Great product

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never beats great go to market, but great go to market never beats great

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network effects."

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I think what you've demonstrated in the model, Pete, is that there are network

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effects from these things.

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The funnel versus flywheel analogy is people get, but it's played out in as

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much from a design perspective.

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People aren't designing their go-to market with that in mind.

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They think, "Oh, that's the destination." We're going to get to a flywheel at

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some of the few real features.

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It's between half customers.

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I think most people think of the flywheel as happy customers, then I get

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referrals and that's a really slow flywheel.

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If you have that in your business, you're not going to scale. If you don't have

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happy customers referring you, you're not going to scale.

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I guess the first thing to get right in any business and keep right.

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But once you have that, then it's about how do you leverage your customers and

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partners in order to market more effectively and build flywheels within your

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marketing and your sales processes.

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We probably have four or five flywheels. One of the ones that Isaac pointed out

23:37

of the fact that we tell our partner stories, where we include our partners in

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our marketing.

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They love it because they get highlighted, quoted, linked to their website,

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mentioned on social media, etc.

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But it also shows other partners and other perspective partners how we do

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things that we actually put them front and center of our audience.

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Then other people are like, "Oh, I want to get involved in that."

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We literally have partners that reach out to us and say, "I saw what you did

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with this agency over there or this bookkeeping firm over there. Can we do that

24:10

too? How does that work?"

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And then they're really surprised when we say, "Oh, it's all free."

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Because it benefits us. It helps us drive our audience and drive for our free

24:21

product.

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I feel like when you've described everything that you just have and the way

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that you have, Pete, that obviously we're the near-boundy folks over here in

24:31

that lexicon of language.

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But it really struck me that I think your framing of collaborative growth was

24:38

as crystallized and as clear as it's been to me.

24:42

I'm like, "Hey, are we saying the same thing?"

24:44

But I'm like, "No, collaborative growth, that just made the most sense to me

24:47

that it ever has."

24:48

I'd love to talk about that topic for a little bit and maybe tease out it.

24:52

How much are you continuing to document or maybe write about this? Because

24:56

whenever you told me, "Hey, I'm doing something with the phrase collaborative

24:59

growth."

25:00

I'm like, "I'm interested. I love this topic and I love how you think about it

25:04

."

25:05

I'm impressed that you're able to get a book out and it's awesome and I

25:09

appreciate the free press as well.

25:13

Where you talked about my accomplishments, gave a copy to my parents and they

25:20

're very proud.

25:22

But I'm amazed that you're actually able to do your job and actually put a book

25:30

out at the same time I know in your role, like marketing is more of your role

25:34

so you can get to focus there.

25:36

But in my role, I have not been able to focus and get the book out.

25:41

I also rationalized in my head that I want the DataBox Partner Program to be

25:48

close to as successful as the HubSpot Partner Program.

25:52

So that I can basically cover both in my book.

25:58

I want to tell both stories and the journey that I took to get there.

26:05

And I also wanted to be, like you said, I wanted to be kind of a methodology

26:09

that any company can follow.

26:11

And I think the Partner Program at HubSpot that I built is not something that

26:15

you would ever try to duplicate, I think, outside of a SaaS program.

26:20

Outside of a SaaS company.

26:22

But I think the stuff that we do at DataBox couldn't really be applied at many

26:25

other companies, whether it's SaaS or not.

26:29

I think so. So I'm eager to kind of scale up the DataBox Partner Program and

26:36

there's like two or three things that we want to still do.

26:40

I want to still do before I write that book.

26:42

But yeah, I have a good portion of the book written out.

26:46

I'm sure it'll edit it a lot.

26:48

But the second half of the book just isn't written yet because I haven't done

26:52

the work that I want to do.

26:54

So that's where we're at.

26:56

Well, let me ask you a quick question on that. You mentioned the HubSpot

27:00

Partner approach is something that you couldn't really do outside of SaaS.

27:04

But that what you're doing at DataBox is maybe more generally applicable.

27:08

What are the key differences? What makes that true?

27:11

Let me hop in here real quick. I want to interject something that Pete and I

27:15

discussed back in 2016.

27:17

I remember discussing this with Pete.

27:19

I said, I think one of the reasons or something that's really hard about

27:23

building agency or solutions partner programs is that there's these big macro

27:27

shifts where industries change.

27:30

And one of the things that I learned from Pete was that Pete helped these

27:35

agencies launch a new type of revenue model from one time project based billing

27:40

to recurring revenue models.

27:42

And today, most of these agencies now live in that world. So if you're

27:49

launching a partner program and you're like a French fry with the Happy Meal,

27:51

you're not really helping them transform their business.

27:54

And I think you have to really understand these macro shifts to truly build an

27:58

ecosystem of agency or solution partners and help them launch the nectar

28:02

iteration of their business.

28:04

And I think that would be my quick take, Pete. I'm like, why it's hard to

28:08

replicate or it would be hard for any company to wrestle with.

28:11

There's windows. There's times and windows. Right. So I think, I think actually

28:17

, Huddspott's done it twice. This is well beyond when I left it.

28:18

We planted the seed, of course, when I was there, but Huddspott's done it twice

28:22

with the second iteration is with RevOps and sales, sales kind of CRM

28:26

implementation.

28:28

And they've kind of created a new category there. And it seems like it's very

28:33

successful. There's lots of Huddspott partners who call themselves RevOps firms

28:39

or product technical consulting firms.

28:43

And it's really that connecting the sales marketing and service functions to

28:48

operate as one go to market function.

28:52

And so they timed that right and kind of drove it to a degree. I don't think it

28:56

was like any vision that anyone had, but it kind of just worked out when they

29:00

launched a few of the sales, the more sophisticated CRM and then the operations

29:05

hub.

29:06

And so I'd say Huddspott's done it twice now or is he in the middle of doing it

29:09

a second time.

29:11

But for as many of those that are successful, there are so many more failures.

29:16

There are not many marketing automation firms anymore, but if you go back to

29:21

2012, there were hundreds of these new brand new marketing automation agencies.

29:28

Now, pretty much every agency does marketing automation. There was also a huge

29:32

craze with account-based marketing. Everybody thought that was going to be the

29:36

new thing.

29:37

And so all these professional service firms jumped on that and said, we're

29:41

going to do ABM. And now really, everybody kind of dismisses that as like a

29:46

sole focus.

29:47

It's really a methodology that you use when you go after big companies and

29:50

everybody should be able to do it.

29:53

So I think you have to time those right. But if you go one level deeper with

30:07

the value that you're providing to the partners, then you have more staying power. And what I mean by that is like, although we taught Huddspott partners early on

30:17

how to do in-mom marketing, what we really taught them is how to sell consult

30:20

atively based on the ROI that they're able to deliver.

30:21

And so that, regardless of whether they're selling blogging services or ABM or

30:26

marketing automation or SEO or whatever, as long as they're selling that based

30:31

on the potential ROI that they can deliver and then following through and

30:35

delivering that ROI, that is what's always valuable.

30:40

It's timeless. And so it's less about selling a specific set of services. It's

30:45

more about how you sell them. And of course, prioritizing the success of your

30:50

customers.

30:51

And so I think that, if I had to say there's one thing that I accomplished is

30:55

like, yeah, teaching them out of sell based on ROI to be able to go from

30:59

project, what was heavy project to more of an ongoing relationship.

31:03

But that's really just because they were offering a higher level of service and

31:07

helping their clients kind of navigate how to market online, not just writing

31:12

blog posts and building landing pages.

31:15

And I think the big shift I see now is that there are literally hundreds of

31:21

different things any company could do, thousands probably, in order to market,

31:28

sell and service their customers better, whether it's applying technology or

31:32

anything else. And so I think the challenge for professional services firms now is like, you

31:37

can't do all of those things well.

31:39

And the real value that they can provide to their clients is helping them

31:44

navigate that and prioritize the things that will have the biggest impact.

31:50

And so again, I think if we go back to the basics, it's really about helping in

31:55

our case, our partners, leverage data so that they can sell more sell better,

32:15

right? So they can sell based on the ROI that they can deliver and so that they can

32:19

show their clients that they use data to actually make decisions.

32:24

They're not just using data to like say, hey, we did a good job, here's our

32:28

report.

32:29

They're using data to make the right decisions in order to optimize performance

32:33

or improve performance as efficiently and as effectively as they can.

32:38

So that's where I see the next stage is just like, there's going to be more

32:44

demand for consultants as opposed to professional services firms and the

32:49

professional services firms that can learn how to sell and deliver on

32:54

consulting services.

32:56

They'll be much further along.

32:58

And that's what we're trying to help them do.

33:01

So it opens up a line of thinking for me, Pete, that I've felt I've become

33:07

closer to this philosophy over the past several years is the difference between

33:11

, you know, let's say a service provider and a SaaS company is what they're

33:15

selling, or what they should be selling

33:18

at a high level is like outcomes versus access.

33:35

Why do I believe that? Why do I believe that? Because, well, we pay for

33:39

outcomes almost everywhere else as consumers. We're paying for the end result.

33:45

We're not paying for access.

33:48

Right. And when you say that we're going to need more consultants, I think this

33:54

is why your program's working well right now is that your value proposition is

33:59

you're helping your partners deliver outcomes.

34:03

That are measurable, that are repeatable, right? And you're going, hey, there's

34:07

so many solutions out there. There's so much software. There's so many service

34:10

providers. We're going to help you deliver outcomes. And that's the only way

34:15

you're going to have a retained relationship is if you can demonstrate that you

34:20

're repeatedly driving outcomes.

34:22

And in the podcast that we did with Jaco Vanderkweis from Winning by Design,

34:26

and Jaco's crazy. I love him to death. But it was probably the most terrifying

34:31

podcast in SaaS I've ever been a part of, because he was basically like, I mean

34:36

, without saying it, I think he pretty much said it's like the end of SaaS.

34:40

I mean, he was broadcasting from a van down by the river. I think he was like,

34:43

already, you know what, I'm out of here guys. I'm off the grid.

34:47

It was terrifying because he was like, look, here's my advice. My advice is if

34:51

you grew up on a family that loved farming, like you better go find a job in

34:55

farming. Just like do something you love because like you're not going, you

35:00

need some expertise on like an industry and like if you're not doing something

35:03

you love, your job is going to get disrupted.

35:05

And I think what makes your story so cool is that, and he was talking about B2C

35:09

, like, why do we trust Amazon? Because every single time we use it, we're

35:14

getting that package in 48 hours. Why do we trust Uber? Because when we hail a

35:18

car and it says six minutes, we get a car in six minutes.

35:22

Now, in SaaS, what repeated outcomes are we getting? It's laughable. It's

35:33

laughable. It's not acceptable. And back then I have to like have 16

35:37

conversations to do a renewal at the right place.

35:39

Exactly. It's laughable when we compare our consumer experience. Like, what did

35:44

I get when I bought my Tesla or got my new Tesla versus what do I get in SaaS?

35:49

I never even talked to a human for a $50,000 purchase. Never even talked to a

35:53

human.

35:54

Jared, I had this thought the other day because of all the years I've moved a

35:59

lot of times and had involved many, many trips to various states, departments

36:06

of DMV and all these things.

36:07

And I'm always joking with my wife. There's nothing makes me more grumpy than

36:10

dealing with these bureaucracies. And I'll be like, what do they not understand

36:14

I am trying to pay them money to come try and they don't want it. That's what I

36:20

feel like with some B2B products. I'm like, I am trying to use your product and

36:26

pay you for it.

36:27

And you won't just let me. You want me to do all these things and book demos

36:32

and just let me use the product and let me pay you for it, please.

36:37

Oh, it's more like a bureaucracy than a B2C experience sometimes.

36:43

Outcomes versus access. And I think that's the unlock that we're all going to

36:47

have to deal with. I think in the wider SaaS industry is that is your company

36:54

increasingly better at helping deliver client outcomes?

36:57

That's why in the book Nearbound, like, who's at the center of the Nearbound

37:00

narrative? It's the customer.

37:02

It's not the, you know, are you better at delivering that outcome more

37:06

repeatedly? And that means you better be helping your partners deliver that

37:09

outcome more repeatedly and their outcome more repeatedly.

37:12

And that's where the unlock is. And that's why I'm so like geeked out on your

37:15

programs is that it's very outcome oriented. It's data back and helps people

37:19

make better decisions, sell better market better together.

37:23

Totally. Yeah, no, that's what it's hard. It's hard to sell deliver outcomes.

37:29

It's really hard to like predict outcomes, but that's the challenge.

37:34

Right. As a CEO, right, I have to every day pretty much make decisions on what

37:40

to do and what not to do. And I'm always doing that on imperfect information,

37:46

even though we're very data driven.

37:48

And the reason the, but I still have to make those decisions to say like, I

37:54

think investing this time or these resources or this money into this thing is

37:58

the best thing, best next thing for us to do.

38:01

And that's really hard. And so the more data I have about how other companies

38:06

might be performing or what they're doing, the more data I have about my

38:11

historical performance experiments that we've run, right, easier those things

38:16

become.

38:17

And so that's if you're a consultant or professional services firm, that's what

38:22

you got to be focused on is how do you make it easier for your clients to make

38:26

those prioritization decisions.

38:29

And the better you are at that, the better their ROI is going to be and the

38:32

more they're going to be willing to pay not just for your hours, but for your

38:36

expertise.

38:37

And that's really, I think what's needed out in the market these days with

38:41

given this the plethora of options that we all have.

38:45

I love how you put that because Jared, Jared says this all the time that

38:48

strategy is choice and what's the hardest thing for any leader. It's just

38:52

decisions. You have to make decisions and framing it like your job is not to

38:56

just deliver a bunch of services because there's a lot of competitors that can

39:01

deliver those services better other other

39:03

agencies or software tools or whatever is to help that customer make better

39:07

decisions, make them feel better about the decisions they're making, feel more

39:12

informed like helping people make decisions.

39:15

I mean, it's exactly what you tell somebody when it comes to being a good

39:18

employee like, Hey, you can make your manager's job easier by helping them make

39:22

decisions.

39:23

And just that shift in framing from like, Okay, I got to deliver a bullet point

39:27

list of services here's stuff that I did. I don't know. Does that help me make

39:32

a decision? No, I'm not sure. But if you come to me and you give me things that

39:35

make my job easier those decisions and that's not going away.

39:38

Whatever gets replaced by AI and whatever else you need for humans to make

39:41

decisions is not going away. And we just have more and more information to sift

39:46

through and second guess ourselves to death on these decisions.

39:50

So anyone who can make that easier, you're still going to have, you're still

39:53

going to have plenty of work to do.

39:55

Yeah, I agree. Yeah, you've heard the phrase I'm sure like if you're you're

39:58

talking to your manager, right? You, a lot of people will bring their manager a

40:02

problem. And the better thing is to bring your manager a problem and solution.

40:06

Now, the ideal thing is to bring your manager the problem, multiple solutions,

40:10

pros and cons for each solution and a recommendation.

40:14

And that's what any good sales person should be able to do, right? Any good

40:20

consultant should be able to do is follow that process.

40:25

And those decisions are easy. Like if my employees or consultant brings me

40:28

something and says, here's the problem. Here's what's costing us.

40:31

Here's what I think here's what I think we can do. If we fix it. Here's option

40:35

A, here's option B, here's the pros of option B, here's the pros and cons of

40:40

option A, I recommend this one.

40:42

It's like those are like five minute conversations for me. I can say, well, I

40:47

like a little bit better. I'm a little concerned with this risk.

40:50

Go with go with me, right? But that's that's makes my life a main time.

40:57

Well, that and the trust that you build, I know this is like sort of a tangent,

41:03

but when you do more to your point, when you do more than just say, Hey, here's

41:06

what you should do.

41:08

And then I'm like, is that really what I should do? But when you say, Hey, here

41:11

's your problem. Here are three potential solutions. And here are the pros and

41:15

cons. Here's the cost on the upside.

41:18

The trust you build, like, I had a, yeah, totally. I had a head of engineering.

41:25

They used to come to me like that. And he'd be like, instead of doing the

41:27

typical thing, I need to hire five devs and I need to ever, you know, we need

41:32

to just tell me all this list of demands or else the whole world's going to be

41:35

on fire. He would be like, okay, we can do nothing. Here's the cost of doing nothing. We

41:39

can do a mid road, which is going to cost this and do this and here will be the

41:42

outcome, or we can do the best case, which is going to cost a ton and whatever.

41:46

And he would very dispassionately just present me with that. And usually I

41:49

would pick the mid or the, I almost rarely pick the right, the one that he didn

41:53

't want. Like, every engineer wants to build the world class, everything.

41:57

But like, he just presented it very factually. And the amount of trust I had in

42:00

him, where I could just say, well, you tell me which one would you do?

42:04

And then I would start to turn it over to him. But he built that by not just

42:07

coming to me and a lot of consultants do this and say, Oh my gosh, everything

42:10

is screwed. Your whole thing is terrible.

42:13

You need to replace everything. It's going to cost you this much.

42:16

Exactly. Yeah, that's one of the reasons why we really double down on

42:21

benchmarks, both performance benchmarks and business process benchmarks.

42:27

Because you can dispassionately tell people where they're missing the boat,

42:33

where they're underperforming, what they're not doing, that their competitors

42:37

or peers are doing.

42:39

And then you're just sharing that information. It's not opinionated. You're not

42:45

coming in and saying, here's what I recommend you do.

42:48

You're basically saying, here's the problem. If you see it as a problem, then

42:54

question is, do you want to address it amongst your priorities?

42:59

And so by starting with benchmarks, you can dive into those issues and, as you

43:05

're saying, come in without an agenda. You could basically say, Hey, here's what

43:10

I see. If you want to fix this, then I've done this a few times.

43:14

Otherwise, good luck. Right? And as opposed to what most professional services

43:19

firms do now, it's like, we do website design. We do SEO.

43:23

We do, we're Hubsport experts. We're active campaign experts. We're SEO experts

43:27

, right? Like, and then, but they're one of a million. And I don't know if I

43:31

need that stuff.

43:33

So I think, yeah, trying to flip the switch.

43:38

I absolutely love it, Pete. It was a gem of an episode. We got to live in the

43:44

future in the present.

43:46

You've done a lot of things that are very first principle oriented that I think

43:50

are timeless moving forward. And this is how entrepreneurs and great businesses

43:54

are going to be built.

43:56

We're going to continue to follow along the data box story and your journey.

43:59

And every time that we are fortunate enough to see you document some of the

44:03

collaborative growth strategy out loud.

44:06

I'm going to be right there on the front lines reading, consuming, and paying

44:09

attention to it because it's very instructive for the entire industry and all

44:11

these folks that are listening to this podcast.

44:14

So my mentor, my guy.

44:16

It's all part of our flywheel as we talked about.

44:18

Yeah.

44:19

Well, you know, hey, that's great. Like, we'll continue to cover it geek out on

44:22

it. And I just wanted to say thank you, Pete, for aligning us and joining us

44:26

for this wonderful combo. I had a blast.

44:29

To Pete's parents, your son did a great job. I mean, if you read the book, you

44:32

make me a book.

44:33

I do.

44:34

So, I said, I think I missed that.

44:36

What's that?

44:37

I said to Pete's parents, if they read the nearby book, maybe they'll see this.

44:42

I just want to say you raised a great son.

44:46

We sat in the snippet. I don't think they're going to want to listen to the

44:50

little podcast.

44:52

No, no, our parents have no idea what we do. But Pete, thank you so much. All

44:56

right, nearbound. We'll see you around until next time on the nearbound podcast

45:01

[Music]

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