A change will do you good

 

I haven’t been very active on this blog recently for lots of reasons.

First, in October 2013, my family welcomed a bouncing baby girl. She’s grown fast and is already walking and talking and seemingly way ahead of where we thought she would be. She is a climber, ferocious when she wants to be, fiery, affectionate, funny, and beautiful. She’s a strong red head and brought yet another dimension to our lives.

She also has taken the remaining moments of my energy and spare time!

Then in June/July of 2014, I switched roles at New Relic. I was asked/given the opportunity to leave business development and enter the fledgling but fascinating world of Customer Success. I jumped at the chance to take on a more customer facing, operational, and larger remit role. I believe strongly it moves my career ahead giving me amazing opportunity to learn, grow, and define the role at not just New Relic but also the Customer Success industry generally. I’m having a ball running support, services, education, account management, measurement, and renewals.

So I suspect there will be a change to this blog, starting with its name. Cloudy with a chance of BD seems a bit antiquated at this point, doesn’t it? So…name pending we move rapidly forward, a little older, perhaps a bit wiser, but with some amazing times to come.

A very simplistic approach to “OEM” negotiation

One of New Relic’s big advantages early on was the tight integration delivery of our product with our PaaS (Platform as a Service) partners.  We’d add our product to a customer’s app with a single button press through the partners’ platform.  Automatic account creation, license deliver, agent deployment, and Single Sign On integration rounded out the frictionless application of APM.  In seconds the customer had a New Relic working as part of the console they used to run their application.

The negotiation of these agreements wasn’t isn’t easy.  Many times the partner would ask for this level of tight integration with a SaaS product delivered in a way that removed the New Relic branding.  Yet they wouldn’t offer us money to do it (our standard integration described above is at no charge).

Getting both sides on the same page about how an OEM deal works is often a challenge.  I’ve found the following four quadrant chart invaluable to help set the stage for the negotiations with the partner and my own fellow executives.

Keep in mind, this is purposefully simplistic.  It’s designed to be a leaping off point for discussion in a negotiation where dollars vs. brand is a critical sticking point (it almost always is in OEM deals in my opinion).

Screenshot 11:24:13, 2:27 PM

The two axes are the trade-off.  The more money paid to the vendor, the less attribution (branding) can be expected.  So, if there is no brand visibility — white labeled — upper left of our chart — the vendor should expect to get a significant amount of money.  Why?

In this scenario, there is no brand awareness. In lieu of that, the vendor has achieved “maximum penetration” of the partner’s market with a minimum investment of time.

The opposite scenario is where New Relic made its living.  For New Relic, brand awareness was critical because there were ancillary benefits above and beyond penetration of a partner’s customer base.  In addition to strong usage of our product at our early partners, the word of mouth and credibility it created spread like wildfire, priming the pump for our direct marketing activities.  We gladly traded dollars for attribution.

A deal on our $$ vs Attribution chart will theoretically land on the diagonal representing the tradeoff between Revenue and Attribution.  New Relic usually negotiated for the lower right, and this often was the path of least resistance for the partner as well.

Keep in mind that usually you’ll monetize the market for the OEM much faster (instantly!) through a revenue focused OEM than you would selling into the same market with your direct sales team.  However, the ASP (Average Selling Price) per unit will likely be significantly lower than selling direct into that same market.  Ultimately it’s a tradeoff of Cost of  Sales vs Time.

For New Relic, our sales was so productive and efficient, it made sense to focus on Attribution — driving brand awareness — and convert free OEM customers to  paying customers at a significantly higher ASP.  Our freemium partner offer and well segmented product offering (driving upgrade activity) created broad usage and many leads for the sales team.  The revenue simply followed later as the sales team knocked down deal after deal.

 

 

 

 

Why should I partner? Let me count the ways

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So many reasons for partnering exist.  The ones above are examples from a short brainstorming session I had over email with a colleague who runs an Incubator in San Francisco.  His customers are all skeptical that Business Development and Partnerships are worth the time, energy, resources their fledgeling companies will have to pour into them, not just at the start of their company’s life, but at ANY TIME during their company’s life.  They all have experiences, first hand, second hand, internet rumor and innuendo, about partnerships that weren’t worth the paper the press release was printed on.

And I agree.  100%.

Most partnerships aren’t interesting, they aren’t effective, and they are resource drains at a time when a startup needs those resources most (frankly, that issue never goes away no matter how large the company gets).  Why?  I think it starts at the design phase of the partnership lifecycle.

Take a look at the above list of “reasons to partner” — let me count the ways.  Most of these seem viable.  Ok, the one about Golf was thrown in there to see if you were paying attention.  But the rest, yes indeed.  “My investors sent me this great company to work with”, “I want lots of blog posts”, “My competitors are doing it…I need to stay with them.”  But hidden in this chart are the five reasons that more often than not are the REAL drivers of successful partnerships.  Can you find them?  I’ll wait.

For those of you who read ahead without guessing, “for shame!”  For the rest of you, the five primary reasons to partner are:

Credibility, Awareness, Revenue, Defensibility, Utility

I’ll go into each of these in depth in future blog posts, but it’s important to understand that ultimately there are only 5 things that BD Organizations actually do and they boil down to:

  • Create an Aura of Credibility for a company – This could be for a new product, a new company, a new initiative.  It is often done by partnering with a larger, more credible company who, simply through the act of partnering, indicates to the market that they think your company is important to the space.
  • Build Awareness for your offering – This is also an early stage of building a Ubiquity Play in that those who are aware of your offering are more likely to try/use your offering.  Awareness building allows you to potentially significantly expand the reach to new markets and more existing customers in existing markets.
  • Create Revenue opportunities – Whether the BD team is doing the selling, the Channel is doing the selling through BD programs, or you are simply generating leads for your own Sales organization.
  • Build a Defensible position in the market and with your partners – At New Relic we call this “blocking the socket”.  There is always a favored partner in any space and regardless of how many like-partners there are, only one will get the lion’s share of the resources, thinking, and commitment from any given partner.  Building the best relationship puts you in a defensible position.
  • Enhance the Utility of your solution – At various stages, your own engineering organization may be “maxed” in their ability to support all the platforms, all the components, all the things that make up the world in which your solution lives.  In these situations, turning to partners to provide that utility, extending your solution through integration with others, is a viable option.

Too often, BD teams focus on the tactics and the opportunistic partnerships that present themselves.  There is nothing wrong with that effort in and of itself.  Partnering with someone willing to partner with you is certainly highly valuable.  But most BD organizations never truly align themselves with the needs of the company.

If your BD org can step back and think through the 5 areas that BD can significantly influence (above) and get the entire executive suite to agree on which single area is the priority, you will set your team up for success because they will be driving the top priority of the business.

It’s not me, it’s you…and that’s good for me.

Have you ever been at a point in your career where some project you’ve championed, bled for, cried over, donated a kidney to see it live and be successful finally launched…and exceed everyone’s wildest expectations? Remember how proud you were? And remember the feeling in the pit of your stomach when the accolades were handed out and everyone except you was on the list?

I’ve been there. There was a similar project, one in which I had a big hand in developing the early concepts and pushing for this product. For me, it was one of my employees who did the actual legwork and he who got the accolades. Honestly, he was fantastic and deserved every ounce of credit. He deserved every bit of praise.

That’s not precisely the point of this post.

While I was watching, listening to the the praise for the team and hearing the accolades passed around, I so wanted to be called out as “Critical” to the launch and success of this product it occurred to me that part of the role of management should be to let his team take the credit for the project. It’s not the manager’s job to execute on the project plan, to complete the hundreds of tasks necessary to make the launch happen. It’s not a manager’s job to do the work for his team. In fact, just the opposite. It’s the manager’s task to pave the way, remove the roadblocks, to help his team execute at the highest possible level.

This means however that the team must reap the benefits of the success, including receiving the accolades. It is the team that sweated and toiled. They must be rewarded for the hours and hours of work, the sheer effort, and the successful launch of the project.

The manager’s reward is seeing his team successful and knowing how much work it took to put his team in that position to succeed.

As a father I’ve realized that this same philosophy applies to rearing your child. Too many times I’ve seen parents (mothers and fathers) living their childhood over again through their children. Yelling and screaming during their kids’ ballgames, at coaches, and their own kids themselves, taking credit for academic success, sports victories, and social standing. It’s sad. Just as with management, I’ve come to believe that my real success is seeing my children grow, seeing them thrive, and doing what I can to move away the obstacles to that growth. I can’t do it for them and I shouldn’t be trying to do it.

It’s hard coming to the realization that I’m not longer the star of the show. I admit, I’m still working on becoming the producer, the one who removes roadblocks and let’s the actors win the awards. But when that final production comes together, whether it’s at work or in my family’s life, I’ll look and realize that ultimately their success is my success, and that is the true reward!

Making Business Development an effective driver of growth.

I attended a gathering of top Business Development execs in San Francisco the other day.  Companies big and small were represented.  This was a fantastic gathering because it gave all of us a chance to get to hear how other BD orgs are run and how their companies perceive and value the efforts of BD.  The meeting got me thinking about all the organizations in the software industry where Business Development is a mysterious group of people hidden in offices spending company money meeting with other Business Development people, playing golf, having fancy dinners, and creating “Barney” press releases that are all sound and fury but ultimately don’t go anywhere.

To me, this is BAD Business Development, and there are many bad Business Development professionals out there giving the role a bad name.

At its best, Business Development is a powerful point of leverage that can launch your company to heights not achievable when attacking the market by yourself.   Early stage or late stage, Business Development teams should augment the product, sales, and marketing organizations extending their reach in lead generation, revenue generation, awareness, utility, and more.  It should be an exponent on the growth of your business, and in that context is remarkably valuable.

I think of this as a gravitational slingshot.

Screenshot 9:22:13 3:31 PM

This is the technique that NASA uses to get satellites like Voyager I to the outer reaches of our solar system even though those spacecraft could not possibly carry enough fuel to get there themselves.   NASA flew Voyager I by Jupiter to slingshot it to the farthest reaches of the solar system.  If we think of a larger, more established company as Jupiter, and our small up and coming company as Voyager I, we can see the effect such a “partnership” can have.

Screenshot 9:22:13 3:51 PM

 

If done correctly, Business Development can be a highly valuable way of slingshotting your company past competition and into a highly defensible, lucrative, leadership position.

 

 

 

Swimming and Soccer: It’s Daddy time!

GOAL!

Since January, my son and I have been taking swimming lessons at Le Petite Baleen (the little whale, I assume…although I never took French).  I have to admit, it was daunting at first.  You see, I never had a good experience when learning to swim.  I panicked and physically turned green when it was time for swim lessons with Lynn Lake (who was wonderful) down at the over chlorinated YMCA pool.  My mother tells me that it was because years before when I was just an infant she took me to “Water Babies” and I got upset because all the other kids were screaming.  Maybe so, I’ve been told I can be “sensitive” to others.  It could also be that I have dense bones.  I’ve never broken anything…well ok, apparently a fractured Big Toe, but I didn’t even notice that till years later…and owe it all to having very dense bones.  Unfortunately that means that when other people float at the top of the water, I float about 2 feet beneath the surface.  Something about Archimedes’ principle — weight, density, displacement, you get the picture.  Not so good for learning to float, drown proofing, bobbing for apples.  It takes more energy to get to the top of the water than you save by floating in the pool.  I’ve thought about getting adult lessons but things are too busy at the moment.

So, when my son started swimming lessons, some of the old deep seated fears came out.  I was more nervous than he was.  Pushing his head underwater as I pushed him forward to the teacher (3 feet away or so) was physically difficult to me because of those emotions.  I was emotionally learning to swim again, and it made the mornings difficult and exhausting.  Not only that, but just getting our stuff together and out of the house on time to drive to lessons was a challenge (as my wife will tell you, I ALWAYS seem to leave something behind…last week it was the diaper bag…on the side of the road…15 minutes from our home).

What I’ve found however is that just being with my son, with one on one time, Daddy + Son in the water, is amazing.  I don’t get a lot of weekday time with him.  I get the 20 minutes in between my shower and when I have to be out the door to catch the 7:00 train.  I get the 45 minutes including bath time plus 2 story books when I get home as he’s almost headed to bed at that point.  The weekdays are a wash and there just isn’t a lot of time to be “Daddy”.  So the weekend is critical.  Most of the weekend is family time with all three (soon to be four) of us.  But that 30 minutes is my time with him.  And now, I treasure it!

Cut to 2 weeks from Saturday.  We’re starting Daddy and Me Soccer.  I can’t wait to see the little guy kicking a ball across the field and scoring goals.  Holden may not be able to play soccer as long as I did (on the high school varsity team for a year or two) since he has a bone deficiency that could cause fractures more often.  It’s no contact sports for him.  But he’s going to be better than me since he’s starting early and seems to love sport of any kind.  Cackling with glee as he kicks his soccer ball around our backyard already is a joy to watch.

Now I get two Daddy moments per weekend.  And this time, there are no deep seated fears to overcome.  Just some good old Soccer.  Gooooooaaaaaalllll!!!

And now I can feel.

Toddler with lab-made windpipe dies

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There was a time in my life when I could read an article like this with a relatively dispassionate approach.  Yes, I’d feel sorry and wonder “what could it possibly be like” to lose a 2 year old.  There were times too when, I’m afraid to admit, I thought to myself, “it’s bad, but hey, the kid was only around for 2 years…how much of an imprint could it have made on people”?

I chalk that up to two things.  First, I was young, with no plans for kids…in fact actively avoiding children who I thought were loud, difficult, uncontrollable, and a hindrance to my own self satisfaction with life.  I resonated well with all those people who said “I don’t want kids”.  I didn’t either.  Second, it was a great coping mechanism.  Finding a way to compartmentalize the tragedy, the sadness, when I had to be focused on me and my life.  It was very hard to find time to empathize with others.

But oh how having children of my own (one two year old, and one on the way) have made a change in my life and perspective.  There is something magical about raising children of your own.  The bond is incredibly strong and you live in some fear every day that somehow it will be taken away from you; when the child grows up, when they get married and have kids of their own, and in tragic times like the one above.

Now reading this article was extremely tough because I couldn’t help but substitute my son, Holden, for this little girl.  I couldn’t help but imagine what it would be like if my little boy were the one holding on to life…pinning all our hopes on a completely experimental procedure that probably wouldn’t work.  Even penning these words right now, I can feel a lump in my throat welling up.

My son Holden has a bone disease that makes him more susceptible to fractures.  We’ve been luck so far.  VERY lucky.  No fractures (knock on the biggest piece of wood I can find)!  He’s hearty and well formed.  Aside from a slightly exaggerated pronation in his feet, you wouldn’t have the foggiest notion that this kid wasn’t the healthiest child in the universe.  But we are lucky.  Not all the kids are like this.  And one day, he probably will fracture.  Whether that is today, or when he’s 16 and playing baseball (currently his favorite sport) at school.  It happens, it happens to kids without bone disorders.  It probably will happen to him.  And then, I’ll know first hand the worry and fret and pain of seeing your child suffer…in a way that can’t be fixed with words.

It doesn’t hold a candle to what the poor family suffers through in this article.  God Bless them, and God Bless their daughter…who clearly was loved in her short time.  But in a small way, I too can finally feel their pain.  I guess that’s what true love gives us.  The ability to love fully, and not compartment-ally.

 

Coffee is the new Martini

Coffee Martini Recipe - Food.com - 163967

 

There is a trend in San Francisco that I think is worth noting.  Coffee has become the new Martini.

Time was when businessmen did countless deals over Martinis.  It was the time of Mad Men, Madison Avenue, Don Draper, suits,  and lots and lots of alcohol.  In fact, if the TV Show Mad Men is to be believed, it was the time of cheap and plentiful replacement livers.  These guys drank so much every day meeting that it was no wonder they were well preserved into their 50s and later.

San Francisco has its share of bars that serve excellent classic drinks.  From Bourbon and Branch to the House of Shields, there are literally dozens of places to get a well made strong drink within walking distance of my office.  Yet, I don’t know anyone in BD that goes to those bars except to unwind.  What is the beverage of choice then for dealmaking and partnerships?  Coffee.

Americano, Latte, Double Half Caf Machiado extra slim extra hot with Stevia.  It just doesn’t matter.  A bevy of once hipster, now just barely mainstream coffee brands and shops have popped up over the past 5 years and it’s fantastic.  Blue Bottle, Ritual, Bicycle, Four Barrel.  The list goes on.  What’s more, these aren’t Starbucks like coffee shops…big commercial highly branded locations.  No, no, going to Starbucks is for your Mom.  It’s just not cool.  And who wants to do a partner deal with their Mom?  Not me, that’s for sure (sorry Mom)!

I want cool, I want hip, I want to be known as someone who knows the secrets to the cool life in town.  And that means kiosk and garage and street truck coffee.  Fortunately it’s great.  Hot.  And there’s plenty of it.

So, farewell Martini.  No more returning to the office three sheets to the wind.  It’s time to make the coffee, and gear up for a productive afternoon!

Document Document and then Document some more, for the love of Pete!

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Our company is growing. Growing rapidly. This means that the number of decisions that are made every single day are multiplying exponentially. And more importantly the number of people who have to understand the decisions and act on them are increasing even faster. Where once I could walk into my fellow VP’s offices and come out with a decision that I knew would be followed, now…it’s just not that easy.

There are agendas
There are distractions
There are complexities.

What is a guy to do?

The answer? Document.

The most frustrating thing I experience day by day is when decisions have been made, and people have forgotten not just what the decision was, that they have to follow that decision, but also why the decision was made. This has led to countless hours rehashing old arguments and circling around aimlessly as newer staff and employees bring up the same points that were thoroughly discussed and discarded months ago.  One of my employees is a master documenter. He writes everything down and posts it on a wiki. He’s king of Wiki organization. And the projects on which he works are far better for it.  So I started wondering why.  My conclusion?

If we all documented our decisions with Who made the decision, what the decision actually was, and why that decision was made, we would have an easy point of reference and there would be very little rehashing.  When a question was asked, we’d instill the right behavior by asking:  “Did you check the Wiki first”?

I’m making a concerted effort to document my thoughts, decisions, and the reasons why. I will strive to become proficient at this important (albeit time consuming) process so that in the long run, my organization and those with whom we interact will be able to build on what we’ve done…rather than rehash it.

My Son, iMovie and the Facebook Thought Police

The other day my wife took a great video of my son playing on his little electric keyboard. It’s one of those keyboards that when you hit the “playback” button, plays Polly Wolly Doodle and other classic American favorites designed to make the child squeal with glee, and make the parents rue the day that batteries were invented.

The video was particularly funny because Holden was not only jamming, but dancing, with his Scooter Helmet on his head. It was reminiscent of the Harlem Shake.

So what’s a Dad to do?

Minor copyright infringement apparently.

I went to iTunes and bought a copy of Harlem Shake and then added it to the video with a number of really cheesy video effects (since I don’t have hundreds of people in costume to do the second part of the shake). I laughed and laughed for hours while I tried to learn how to use iMovie. It’s not the easiest or most intuitive thing in the world. Still, I was happy with the results and after a few hours and late at night…I posted my creation to Facebook.

Within minutes it was deleted by the Facebook thought police. And soon after I got an email from them indicating that I was in violation of copyright…and that I best not do it again or they’d get really nasty with me.

Nevermind that the entire reason the Harlem Shake made it to number one was because people did what I did…and created a meme out of it, and never mind that apparently the creator of the Harlem Shake is actually being sued for copyright infringement for using unauthorized samples from other artists. My little video that would be seen by a handful of friends is contraband.

Too bad that they can’t stop me from posting it on my BLOG… and linking to facebook. So all you Facebook friends? Here it is. Without further Adieu…My son. The Harlem Shake DJ.