SaaStr Soundbite: Why Partnerships Matter with Karen Appleton Page and Aaron Levie of Box

Kind of kicking things off directly in the panel, I guess first question to Karen, I guess, would be like, how did you think about driving partnerships at Box post the enterprise pivot? What was the role of partners? Why did we do it? What was it all about?

I mean, the first thing that we thought about was, you know, how do we make ourselves look bigger? You know, we were small, we hadn't proven ourselves in the market.

Box crushed this. If nothing else, Box crushed. So talk about this, keep going, but talk about with partnerships.

We did, we stood up tall.

You guys got an A+, right?

Yeah, we did. We always looked like we were everywhere. And I think that, you know, for me what that meant was, you know, personally we had to create a really good strong strategy. And the strategy was based on, you know, market penetration, how do we accelerate growth, and foundationally how do you create credibility, awareness, with the expectation that that will lead to revenue. And sometimes we did deals just for the credibility or just for the awareness, and always we had to kind of figure out, you know, what was going to be our path to revenue on that. And that was, that was the more disciplined sort of a piece of it. But we identified a strategy and we went after it.

How much, um, how much do you think, uh, if you— I don't know if this could be broken up into percentage, but how much do you think we did for technology differentiation and integration to make our product better versus as a growth driver to be able to get either reseller channels or, or sort of distribution?

Right. Well, we, we clearly had an approach that, that was like, okay, so everybody's got, you know, these siloed applications and all of them needed some sort of a backend that would store people's information and data. And we used that as an approach that worked really well with, with NetSuite, for example, they had a, a, a pro— a piece of their product that was meant to store all this data. They weren't going to update it. They weren't investing in it. And we came in and we did a fantastic partnership with ZAC that kind of solved two business problems and gave us new access to a channel. So that was certainly an integration that was based on technology.

Let's dig into that a little bit because I remember that even from the old days. We were on— we were an early NetSuite integration platform too. But you guys crushed it on that. Whether you did in the real world, you certainly did at a perceptive level, at all levels from the C-suite, from ZAC across. What were the tricks here that you could share? Did NetSuite really need Box as an application that bad in 2008? Yeah. I mean, of course it did, but you became their showpiece next-generation partner, right? And it wasn't just that Aaron was the wonder CEO. It was much more than that. And what were the tricks? How did you make that happen?

I think one of the tricks was that we strongly invested in the people piece of it. So we made sure—

Yeah, people get this wrong, right?

Absolutely. I actually think it's important—

They sit in front of their computers, they do a little integration, and they wait for the customers to come through the API, right?

Right.

But we made sure that our salespeople got together. We, we had, we have kind of an operational checklist of all the things to do. And it was attend each other's SKOs, make sure we were at each other's conferences and events, do thought leadership events together, bring the salespeople together, and then make sure that everybody knows exactly what to say, how to say it, and what to do when, you know, interest was sparked. And I think we did a really good job at that.

And on the sales side, you know, sometimes that revenue doesn't come the next week. How do you get them to do those SKOs and do, how do you get 'em to take it seriously versus, is when HP comes in as a flagship customer for Box, how do you do that?

Well, the thing I would say is, back to the point previously, is this is why you fundamentally need a Karen within your organization.

You have to. You have to.

My preferred approach would just be, don't talk to anybody. APIs are there. Just watch the calls come in. The technology just works, and just integrate these things. And the reality is, though, each of our organizations have a tremendous amount of change management. We have a tremendous amount of inertia. We have a tremendous amount of, of work to do within the field organizations, within the sales organization. So unless you dedicate the time, resources, people, and energy to making these partnerships work, they're, they just won't work. Now, if you're a developer platform, so we have Intercom behind us, then, then it's fine. Then, then just plug in the API into my application and, and everything will be fine. But for, for deep partnerships, if you don't invest in the people component, then there's no way you're gonna see a successful outcome. And so having people like Karen, but then ultimately the team that she built under her, that was what fundamentally drove our success. So I don't know if you wanna talk about like what we did early on to be able to drive that, but that's like, the technology was probably 1/10 of what you had to do to get it right.

[Speaker] Well, I think just to add on before I answer your question, it was critically important for us that we had senior relationships at all of these companies.

[Speaker:JASON M. LEMKIN] Multiple levels. [Speaker:KATIE KAAPCKE] Multiple.

Like, Zach and I were— we were buddies. And I built great relationships with all of the senior executives that were running things, and then made sure that all the salespeople knew each other, and all that kind of stuff. So fundamentally, it was about making sure we were connected at the execution level and at the decision-making level. So that was super, super important. And then in terms of building the team, certainly, everybody knows you've got to hire the best people you can find. But we broke our business development team into two parts. We had the hunters and we had the farmers. And the expertise here was all about how do you nurture those relationships and make sure everything from the content and the product and, you know, that we had all of the right folks doing the right things. And that was critically important. And that's an incredibly different skillset from the folks that are going out and hunting and finding the product.

[Speaker:BRAD_STONE] Let's dig in on that, because it's not as obvious as it sounds. —when you did the NetSuite deal, or pick another deal, was Box under 100 employees back then?

Probably 100 or 200 employees. But 100 is not a lot.

You can't afford to have 20 people on the BD team. What do hunters and farmers really mean when you're trying to add $10 million, $20 million AR the next year? What does that even mean? We get what hunters and farmers sort of mean in sales, but what does that really mean?

Oh, that's a great question in terms of the size and how you divide the resources. We had just had a lot of people doing a lot of things. We tried to make it as— templated as possible so that with every partnership that came over, that jumped over the fence from the hunting side, I mean, from the farm, if the hunting side to the farming side, we had an operational checklist. You know, here are the 10 things that we need to do with every single partner. And we also had tiers of partnerships so that we knew that, you know, type 1 partnerships got these 10 things and type 3 partnerships just got, you know, maybe a tweet or a blog post or something like that. But we had to be really clear and I think that, It just comes right back to the point of you have to be clear on the strategy you're executing against to make sure that you're managing those resources.

Yeah, I think Erin asked, I think this is a good reminder for me. I think doing these sorts of deals, if you don't have Karen, is impossible. Yep. If CEOs, even if we like to sit in front of a computer, CEOs have a little bit of a superpower in that CEOs will meet with CEOs. If you wanna hustle and Zach Nelson is interested in what you're doing, you can probably get that first meeting and you may even get the second one, but you will never be able to penetrate the organization without a leader to own it. It's impossible. And as CEOs, we make these mistakes. We build the relationships, and then we lose the energy because we can't be the project manager of it.

Right. That's for sure. And this is why I think that partnerships generally have a mixed rap within Silicon Valley and beyond, which is that you see a lot of announcements that then fizzle pretty quickly. And it's because it's really easy to do a press release. It's really easy to do the technology integration— not really easy, but resources kind of dependent. You can do the integration. It's really, really hard day in and day out in the hundreds of sellers or tens of sellers you have in the field and across your two or multiple organizations every single day to show up in front of the customer and be presenting your solutions in an integrated way for that customer over and over again. That's the really hard part, 'cause that's people, that's change, that's evolving your culture, that's getting people to recognize that we're gonna be better at selling our software when We have partnerships, and we have other people that are working on our behalf, and we're working on their behalf. And so, so that's the part that takes a really, really long time, and that's the part that requires a lot of change. I think the thing that strikes me right now in particular in this category, in this market, is we collectively as an industry have made it really hard for our customers because of a lack of deep partnerships and deep integration. We're one of the only industries where you sort of take all of this technology, and you throw it at your customer, and you say, okay, Hey, you get to now be the system integrator of all of these solutions and all of this technology. And that would be like buying a car with all the parts coming separately, and the customer, and me as the consumer, I have to now go put the car together. But that's what we're doing as a software industry. So we think that partnerships are fundamental if we're gonna actually be able to drive the transformation that's necessary within IT, which means that we collectively as an industry are gonna have to find as many ways to be able to work together and present cohesive experiences in front of our customers. And that's gonna be both technology as well as the people side.