Darya: Hi everyone, my name is Darya Wertheim and you’ve reached Startup for Startup, the podcast in which we, at Monday.com, openly share knowledge, experience and actionable insights amongst startups.
Darya: Two years ago we recorded an episode about the growth engine that we haven’t cracked yet, business partnerships. We talked about the challenges of starting to build business partnerships and understanding the value they provide us. Today channel partnerships is one of the biggest growth engines in the company with a hundred partners onboard and a team that tripled its size in one year. The value of working with partners is clear, but now there’s a whole new challenge, making sure our external partners are aligned with our brand and product just as every other employee at the company. So how do we create channel alignment? How can our internal work culture help us create better processes with our external business partners and what do the partners gain from all of it? To talk about these challenges we have Asaf Fradkin, Head of Partnerships and Business Development. Hi Asaf.
Asaf: Shalom everyone.
Darya: And Dror Spindel, Regional Channel Director for Latin America at Monday.com. Hi Dror.
Dror: Hey Darya. Great being here.
Darya: Asaf, you were the first person to join our partnerships department back in 2017. Can you tell us where we are today?
Asaf: So now we’re closer to forty (40), we’re thirty-eight (38) and we split into different teams; each team is in charge of either different type of partnerships. We have several types of partnerships; we have the channel management, the tech alliances, strategic alliances, the student and academic partnerships referral partnerships and we have two more teams that are in charge of more cross teams alignment, one of them is training and enablement and the other one is strategic consulting which does a lot of different things to help our partners succeed.
Darya: Crazy growth.
Asaf: Yeah, (00:02:23)
Darya: OK. We’ll talk about it soon. Dror, why don’t you tell us like when did you join the company, what are you doing in the channel team?
Dror: Sure, so I joined Monday two years ago, a few months after Asaf put together the team and launched the partners program. Back then we were three people in the team overseeing the entire world and so I was responsible for North and South America. Since our direct sales is focusing on English speaking countries, and especially in North America, I put the focus on developing Latin America, and as we’ve experienced a massive growth since then, tripling sales, number of partners and head count the operation grew a lot and we decided to separate North American and Latin America into two separated teams. So today we have a full channel team based in the U.S. and I lead the Latin American team with boots on the ground in the region.
Darya: OK, so let’s take a step back and talk about the role of a partner. So what does a partnership look like in Monday?
Dror: So for the context I would like to mention that Monday has three main growth engines. The company started with the no touch model which is an online acquisition marketing play and in late 2017 we started both the direct and the channel teams simultaneously to go up market and support touch sales. Basically channel partnerships is, you know, first and foremost a revenue generational (00:03:54) unit. Our goal is to support the company’s growth by driving sales in the regions that we are operating in, and I believe there is a limit to what a company can achieve by itself from geo, capacity and focus perspective and this is exactly where the partners can provide huge value to our customers, from providing localized experience, bridging the language and cultural gaps, meeting face to face with customers, providing on-site training and helping us to reach new audience sales in which without them we probably couldn’t get.
Asaf: Basically the way I see it partners, they have four purposes for us to have them and it all comes down to things that we don’t or we can’t do ourselves. So this is why having partners, because you don’t want to do something and you want someone else to do that for you or you can’t do that for some reason.
Darya: What do you mean by something you don’t want to do?
Asaf: So for example we are a product company; we don’t have as of now a professional services arm and we decided that we don’t want to provide professional services to our customers to integrate with their platforms, for example, or develop stuff specifically for them. We decided that we’re not going to do that, and if there is a need someone else needs to do that. So this is why having partners. So …
Darya: So they’re not only helping us like penetrate other markets, but they also provide extra services we don’t provide as a company.
Asaf: Yeah, exactly. So again if I go back to the four reasons of why having partners is one we talked about is having another revenue channel, this is one, the other one is going up market, so getting those bigger and bigger deals, number three is expanding the reach; so being able to have customers that up until that point we weren’t’ able to reach; that, I don’t know, veterinarian from north of, I don’t know, Hungary that is not using Facebook, for example, and he is buying his software from a local reseller in Hungary. So this is expanding the reach, and the last one is providing professional services, that is the fourth angle.
Dror: I believe that working with partners create a win win between Monday and its end customers. From Monday perspective we are able to reach new audiences that otherwise we couldn’t get and provide more services which is not on our focus and from the customers’ perspective I believe the overall experience that they are getting are much better. So it’s not just about the product, it’s about the added professional services that their partners can provide from training and custom development that the partners basically provide to the customers.
Darya: The advantages are clear, but managing an operation with over a hundred partners brings a lot of challenges; so let’s talk about that.
Asaf: OK, so there are like a million challenges in that operation. It’s like taking all the challenges that we have internally within Monday. Think about all the challenges that you can think of and just having like another dimension of complexity to it. So for example you, internally you want to keep employees motivated, right, so you need to keep partners motivated as well, it’s just that right now they are not sitting right next to you and you can see that they’re unmotivated or you can do a lot of stuff about that now they’re sitting in their hometowns, you know nothing about what’s going on in their personal professional lives and you need to keep them motivated. So this is just one.
Dror: Another challenge I can think of is the (00:08:25) conflict between the startup mentality that we have here at Monday compared to the stability partner usually look for.
Darya: What do you mean?
Dror: So you know if you think of the company’s profile of, you know, our partners actually look like, it could be from a few tens of employees up to couple of thousands of employees, they are based in a wide range of countries and might have different sets of values, and the fact that we at Monday we are rapidly changing the product, the pricing strategy, the marketing, the messaging, you know, we ab test everything here, all of this not necessarily resonates with the way our partners run their businesses, but we still need to find a common ground to work together as a team.
Darya: How many sales people we have in Monday in compared to our partners?
Asaf: So I believe that today we have around hundred and fifty (150) sales people, quota carriers and their managers, and within the channel ecosystem there is around two hundred (200).
Darya: Wait! So we have more people selling Monday externally than the people we have at our own sales department? How do we align them with our needs?
Dror: One of the tools we use in order to tackle the alignment challenges that we’ve experienced with our partners is actually leveraging our core values and the culture that we have here at Monday and implement it into the partners’ ecosystem.
Darya: What does it mean?
Dror: So actually what we found out is that the deeper context and understanding of how we operate as a company and that, you know, we share it with our partners, the more they feel part of the family, the more we have shared values with them we will have better collaboration and alignment with them, and, you know, we treat them that way; we see them as an extension arm to Monday, we see them part of the family and we don’t treat them as an external service provider, and this actually has a direct impact on the bottom line and how successful a partnership will be.
Darya: OK, so what do you mean by connecting them to our values? What does it mean in practice?
Asaf: I think what we wanted to do is to take our values within Monday and implement it across the partners’ ecosystem. So if here at Monday we talk about transparency a lot, and I’m sure there are more than one episode about specifically transparency within Monday …
Darya: Yeah, so pretty much every other episode we mentioned it, but let’s say it again. The entire office is filled with screens presenting data for all the employees, right, we believe that transparency and sharing as much knowledge as possible with company employees can make more impact.
Asaf: Right, but it’s not just that, it’s not just the screens, it’s also the way we handle ourselves and the way we give feedback and the way we handle conflicts here and the way we start new initiatives. Everything is being done very, in a very transparent way, and this is just one. Another thing can be the customer centric approach, how much we’re data driven, how much we’re impact driven. All of these stuff these are things that we knew that we needed to implement in our partners’ ecosystem in order for them to be both aligned and successful.
Darya: So how do you make a partner work in a transparent way for example?
Asaf: So I think first of all you need to be very transparent with them and we can share a couple of stories around that, but being transparent with them, I think, created a huge impact for our channel. Think about your ability to motivate them. If you tell them this month we have, we, the entire channel need to generate, I don’t know, a million dollars (US$1, 000 000-00), for example, and then you give them context about each one of their targets. So now they have a lot more context and they have a goal that they’re working towards, this is one, and also you can come by the end of the month, like two days before the end of the month, like today, and tell them we still have two hundred and fifty thousand dollars (US$250 000-00) that we need to generate; so they are very well connected to our goals. So this is just one thing. What we’ve also done is you share with them when you have a good month and you share with them whenever you have a not so good month.
Asaf: So it sounds very counterintuitive. Usually most companies don’t share that with employees, not to mention partners or investors or what have you, but for us it was critical, because first of all they can help you with that goal and when you have a bad month they can influence it. If they don’t know obviously they can’t do anything.
Darya: OK, let’s take another example. You said we are very customer centric at the company. What does it actually mean?
Asaf: So here internally, and there you can have a lot of discussions about that with the customer success and customer experience group, we want our customers and potential customers to be happy; happy with the way we treat them, the way we treat the product, the way we treat other customers. We want them to know that we’re not here to generate bunch of money and then that’s it, like we, we’ve made our fortune and like this is what’s important. When you talk to partners there are, it’s twofold, so first of all you need to make sure that they are treating the customers the same. Dror has a great story around that with one of his customer in Brazil, but you don’t want to have that partner that is just out there to be selling and he doesn’t care about the brand, he doesn’t care about the way we perceive our long term strategy, you want them to be as customer centric as we are.
Darya: So let’s give an example of how we do it in practice.
Dror: Yeah, so maybe just before the story, what does it mean, you know, in reality is that we give them full visibility to the data that we have internally, and what we mean by that is that, you know, if I want them to treat the customer well, not just, you know, with the Monday feel, but also really understand, you the usage and the engagement of the customer, you know, what features do they use where, you know, they can maybe do better, it means that we need to provide data accessibility to the partner, so basically any piece of data that we have internally about the engagement matrix, its something that we share with the partners, right, so they see the usage and they see the customer satisfaction and they see the customers tickets maybe if they send something to CX, like we basically empower them to really understand what’s going on with each customer from the data perspective, so you know once they jump on a call with them they understand, you know, the context and they know, you know, where they can provide more value to the customer. So this is a little bit both in terms of, you know, being data driven, because in the end, you know, this is one of our values and we really kind of want to extend it into the partner ecosystem as well as being customer centric and thinking about the customer and not just calling them, you know, when you wanna do up sale or expansion or sell more.
Darya: OK, so tell us about a time where visibility actually helped us work with a partner.
Dror: So we had a very interesting case in Brazil with our, one of our biggest customers over there. So about a year ago we closed the first deal with this customer, but actually during the past year they just kept adding more and more users into the account. So at some point together with the partner we decided to schedule a call with our champion to discuss the account growth.
Darya: Yeah, and just to explain, a champion is someone from their company who kind of represents the company in the talks with Monday, right?
Dror: Yeah. And of course, you know, for us and for the partner it was super exciting, because we saw huge potential to make the expansion possible and drive more revenue, but actually just before the call, and this is a practice that we have here at Monday, you know, we ran an account analysis and we look into the account engagement matrix and what we found out is that actually although they added a lot of users just half of them are actually active and using the product on a daily basis. So together with the partner we decided to turn the conversation completely with our champion and we thought that, you know, we’d rather reflect the account situation to the champion and, you know, discuss an engagement plan for them, you know, to improve the adoption and the value that they get from Monday rather than, you know, talking about the expansion and money.
Darya: Right, like instead of adding more and more users just making sure that the people who are registered to the platform actually use it.
Dror: Exactly, and so when we jumped on the call with the customer instead of talking about the money we were talking about how we can increase engagement, how we can drive more value to the users, and we basically suggested him to clean up the account from users who are not active. We discussed what we can do in order to grow the account in a healthier way, in a way that the organization will get impact out of the Monday, and, you know, for us maybe for the short term it was a loss of revenue, but, you know, we gained trust, we gained happy customer and, you know, we just built a very strong relationship for the long run with this customer since he saw that, you know, we are not there just to take his money, but rather to drive real value to his organization.
Darya: Yeah, and I’m sure that for the partner as well this was a pretty unique experience, because like a company comes and tells the partner we’re not here to just increase the number of accounts, we’re here to make sure the customer actually uses the platform.
Dror: Yeah, and this is exactly back to the point about alignment. Once you manage to create this alignment with the partners and they think the way we think here internally at Monday such conversation become very natural for them.
Darya: Right, and from now on they will know what to put the focus on like instead of putting the focus on increasing the number of accounts they will put the focus on actually the engagement.
Darya: OK, so from your examples I completely understand how it helps us as Monday. How does it help the partners? How connecting our values to the partners help them in what they do.
Asaf: So for them I think it’s more beneficial for them even than it is for us. I can tell you that we had a partners event here in Tel Aviv and they kept talking about how cool it is that we’re so transparent with them and they have no other vendor that is so transparent and close, in such a close relationship with them, and they admire that. They, most of the companies they work for or with might be more traditional and when they see how we treat them is amazing for them, and also, probably, one of the, one of things that I wanted to mention earlier was when we talked about how having customer centric approach is twofold, I think that we’re putting the partners in the centre as well, so for us it’s not only the customers is in the centre, is the partners are in the centre as well, and the way we handle that might be with, you know, always paying commissions on time, it’s like you can’t miss that, and if you did miss you need to treat it with the same respect that you would have done if it was your own money. You can’t take it lightly saying oh, OK, we’ll pay it next month. No, it’s like a big thing and I’m going to be tackling it right now with finance or with whoever.
Darya: That’s for sure a good way to make them happy.
Asaf: Yeah, exactly. So it’s not even about the more money they get, it’s about oh, he actually came to me without me telling them anything and he told me that I have more money left, so I can trust him. I can trust Monday.
Darya: I think also the, you mentioned the partners’ event and I think it’s something pretty unique, so let’s talk about it a bit more. Why did we do it? What was the event for?
Dror: Yeah, so, you know, partners’ events, it’s kind of a best practice in the industry, right, like once you have a big enough partner ecosystem so usually like once a year, you know, they come together , but I think what’s interesting it’s, you know, usually it will be probably in Las Vegas, right, because, you know, you make a fun event out of it and we actually hear, when we did like prayer Corona times, the first partner summit we decided to do it here in Israel in our headquarters.
Darya: We decided not to do it fun, we decided to do it in Israel.
Dror: [Laughs] Actually it was much more fun, Israel is not, you know, Tel Aviv is, some will claim, better than Las Vegas, but actually the idea behind it was that, again, like we want to connect them to the company. It was important for us to bring them here to the office to meet the other people, right, so they’re interacting on day to day with marketing, with CS, with sales. We wanted, again, to connect them as much as we can in order to create this alignment, and I think, you know, probably the best or the most exciting, you know, feedback I have ever got from a partner was, you know, the last day of the event one of the partners came to me and said look, you know, twenty-five years working as a reseller, right, for many other vendors, with us he’s for the past year or so, and he said he’s never experienced such a collaborative ecosystem, you know, when inclusion is important and, you know, transparency is important, it’s not just between us, the vendor to the partners, but also between the partners themselves; so we created a platform for them to better connect, to share knowledge and he told me look, you know, in one of the other vendors I used to work, you know, we, the partners, like we fight on deals, right, so you kind of play your card close to your chest and you don’t want to share knowledge and you don’t want to, the other partners maybe take advantage of you and it’s something that we just don’t have here. So the partners are actually helping each other, and then you know they created their WhatsApp groups between themself and they support each other and, you know, they answer to each other on the community. I felt like, you know, this is one of our biggest wins, right. We actually managed to bring this mentality and this culture from within Monday and extended it into the partner ecosystem.
Darya: Do we have a way to measure it, how it’s working, if it’s working?
Asaf: So the way it’s been measured is on a, several matrixes, it’s not one matrix that either we’re here or there. We measure customer success and how much our customers are happy with the partners’ performance, we measure how much partners are happy with us as a vendor and how much they’re happy with their prospective channel partner manager, we measure how much the community is vibrant and alive, how much partners are replying to one another and how many times we need to step in and deliver the answers, because other partners are not answering.
Dror: Maybe another angle, you know, to think about it is that we see that over time many of the partners actually expanding their resource allocation towards Monday business, right, so they’re growing the team, they’re hiring more people, they put more focus and mindshare versus others’, you know, product that they sell and I think this is another very good indication, by the way, very equivalent to the way we look at the product perspective, right, when a customer add more users and engage more with the product, we see it as a success, so it’s very similar also, you know, within the partner ecosystem.
Darya: When doesn’t it work? Do we ever have conflicts with partners in those areas?
Dror: Yes, so I think that one of the areas that we experience the conflict is around the pace Monday is moving versus the certainty or stability partners looking for, and, as we mentioned earlier, Monday is moving fast and we constantly add features and, you know, improve the product, optimize pricing, change messaging and, you know. I believe that moving fast and learning fast is important for us , but sometimes, you know, you pay price for it.
Darya: Right, but you’re talking about moving fast maybe product wise, but how does it affect our relationship with partners?
Dror: Yeah, so you know the partners program itself there is no different. In the end of the day we are quite young channel, right, like we run the program for the past three (3) years and we also optimize and change the program itself over time, so maybe if you look at more mature vendors that maybe, you know, set a strategy or set the partners model and they then, you know, they just run with it for the next five (5) years; for us we are working with much shorter cycles as of today.
Darya: Do you have an example for when we actually pay the price for it?
Dror: Yeah, so about a year into the partners program we decided to change and optimize the commission structure for the partners and, you know, we prepared a very solid communication plan and, you know, the transition period and so on, and, you know, we did assume that we would probably going to have some tough conversation with a few partners which we had, but still we believed that this is the right move to do in order to take the partners program to the next level. So one of our partners, after a long discussion about the change, the implications and, you know, the reasons behind it, decided to terminate. So, you know, for them the fact that Monday is an organization that changing things fast didn’t resonate with the way they worked and we actually lost a very good partner. You know, it was an unfortunate event for us, but at the end of the day we are willing to pay the price for keeping the benefits in the way we operate.
Darya: Were there any times that we did manage to bridge this gap? Dror:
Dror: Yeah, absolutely. So one of the partners we are working with is a more traditional company, so for them, since the beginning, it was a little bit tough to swallow the way we worked here at Monday, they didn’t want to share the personal targets with the different sales reps, they didn’t want me to add all the employees to the Monday’s community and, you know, in our weeklies we always talk numbers and show the bigger picture and they just, you know, the CEO just didn’t feel like working with them the same way, and, you know, he wanted to keep better control of what’s going on in the company and who is seeing what. So basically what we did in this case is, you know, we sat with the CEO of the company and we first of all asked him, you know, to share what he’s afraid of, right, you know, what is the reason, you know, they operate the way they operate, so, you know, listening to them and really understanding their concerns, and again it’s part of building close relationship. Building this trust was super important for us and I must say that, you know, he had fair points, right, like I’m not saying that our way is the only way to run companies. I can it, you know, from my side I was trying to show the value, right, in working in such an environment and, you know, what he could potentially gain if he will connect his employees to the bigger picture if they will be part of the community, if they will see the, you know, the numbers from Monday perspective and for the company perspective and, you know, we believe that the more you’re connected to the bigger picture and you have visibility into the data the better you perform over time and actually we did manage, you know, to run, to drive a change in this company, so I can’t say that, you know, right now they’re like Monday, but I can tell that, you know, they added all their employees to the community and, you know, every month like we’re sharing the monthly goal for the entire team and, you know, their visibility into what other people from their team is doing and performing and I think that, you know, since then we see a tremendous improvement also in terms of the performance, so for us it is a nice win.
Darya: What haven’t we cracked yet?
Dror: Yeah, I think one of the points that, you know, we haven’t cracked yet, and it’s a challenge, it’s a new challenge that we experience these days, is how to make it work at scale, right. Like many other things at Monday we started, I believe, with a smaller operation, right, we made it work, and right now once we approve it to be successful we want to go big. So if now we have hundred partners we wanna be in a year time or two year’s time in a much better place and that means that, you know, what works for us in hundred partners not necessarily will work in five hundred or thousand partners. So this is definitely something that, you know, we put thoughts into these days and we need to see, you know, how we evolve the culture or the way we communicate the culture to our new partners.
Asaf: In addition to that I would say that not only scaling the channel partners organization and the culture there, we still need to understand how we do that towards different types of partners, so how we implement the same culture with Microsoft, for example, who are now our partners, or Adobe; would we be able to implement the same culture in our teams there? Same goes to our strategic alliances; would we be able to implement the culture inside Deloitte or Accenture or Capgemini? It’s still a question.
Darya: So if someone wants to start focusing on creating alignment with their partner what are the most important things they should focus on at the beginning?
Asaf: So I would focus on two things; first of all I would start by creating a community and in that community to start delivering all those messages that you want in order to align everyone. So for example when we started the community we started celebrating new deals, obviously not all of them, but the big ones, and people were genuinely happy with, with those celebrations. Then when people asked, were asking questions about how to do this, how to do that we would tell them go to the community and put it there, and that created more discussions and enabled everyone to collaborate with one another. So having a, an open community, where sharing all of those stuff is super important, and one of the things that I’m most proud of at our ecosystem. Another thing that I would do, it’s a little bit softer, is to try to think how you, how you wanted to, the vendors to treat you should you were the partner yourself. So you wanted them to be as transparent with you as possible about your performance, about how you are perceived as a partner, you wanted them to be very fair with, with whatever, with money and commissions and whatever they need to pay you, you wanted them to be there for you when you have some problems in your business or anything like that, so that partner centric approach would come, would come from that.
Dror: Another important thing to focus on from the very beginning is communication. I’m sure that you’re going to experience lots of changes in the company, in the product, in the partners program and if you’ll be able to build an honest relationship and open line of communication with the partners and really explaining them the reasoning behind the changes you will see that it will drive success and just treat them as part of the family. I believe this is the key. Don’t look at them as external service providers, but rather as an extension arm to your company and treat them the same way you treat your own employees.
Darya: Yeah, and you know one of the most important things that I learned from this conversation is that it all comes down to building long-lasting relationships with your partners and in order to do that you really need to look at them as an extension of your company, as you said, and, you know, every company has its own culture; we brought a few examples that worked for us, but I think that for other companies as well once you change that mindset and you look at them as a part of your company you will find the ways to create that alignment.
Dror: Couldn’t agree more, Darya.
Darya: OK, so that was my first episode. Thank you, Asaf.
Asaf: Thank you very much.
Darya: Thank you, Dror, and thank you all for listening.