Realizing the Business Impact of Partnerships with Box

Please welcome Aaron Levy, chief executive officer, co founder and chairman of Box. Karen Appleton Page executive and investor and Jason Lemkin, founder of Saster. We wanted to do, I wanted to mix a few things up this year and had folks that worked together for a long time. We had Michael Pryor and Michael Cannon Brooks from Atlassian earlier. That was pretty funny. When you had a direct report interviewing his boss. He said this is the exact opposite of a staff meeting. This one's pretty interesting. This one's even better. Karen and Aaron worked together for probably more than a better part of a decade. Probably for a decade, right? Or longer. Karen was a single digit employee. When it was box.net, it was probably in some weird office in Palo Alto.

It was sort of like weird office in Palo Alto. Part residential, part office thing. It's not clear why Karen joined us.

Not clear why you joined us. You convinced her to be the first experienced person probably to join the company at all. And then among other things, drove all the global partnerships for Box. And we wanted to talk, use the session to talk about partnerships in general, but also maybe talking backstage about other early learnings from there. So I know that Aaron's going to ask Karen some stuff. I'll jump in and if we have time at the end we'll use. We haven't done this, so roll with us. But we'll use a hashtag askbox because it doesn't look like it's been used since 2008. So hashtag askbox.

That's offensive.

It wasn't part of the Boxworks thing. Maybe it was. We're going to have Ask Aaron and Aaron, but I thought there was some chance people would mistype that on the Twitter. So anyone's do askbox and we'll try to try to get those toward the.

End and make sure to keep us on track because I could go anywhere and we could end up wandering into politics for all I know. So maybe just to kick things off. And it's funny, so this is actually kind of interesting because we haven't done a one on one in probably a year and a half or two years.

Yeah, it's about that long.

We'll pick up some old habits on that. But maybe just to kick things off. So paint the picture. You joined as employee, I think eight, seven or eight at Box. Why in God's name would you join an eight person startup that had no business model? And we were actually at the time focused on consumers. And so this was before we were in the enterprise. And I believe if I'm not mistaken. You were consulting for PayPal or working on some projects there or is that confidential? No.

Ok.

So how'd you decide to join Box? What was that experience? Were the first executive we brought on?

Yeah. No, I tried to go work for PayPal and you said I couldn't.

Right.

And so then I was like, well.

Wait, I was not familiar with employment law in 07, so I thought that I could just prevent you from doing that.

I did try to listen to my inner voice that was saying, this is crazy. However, my inner voice was completely shut off and cut down by your louder indoor voice that said, said, no, you're not Karen, you're going to join this company and it's going to be great.

And how many conversations did it take just to help? We all think we have this superpower as founders that you can recruit anybody. All I just need to do is meet Karen and she will Definitely join my six person startup with that weird office I saw in TechCrunch. How many meetings does it take? And how did Erin, what's the real trick?

Well, we never really met in the office. The first time I went to the office, I was in a script and heels, as you would think that you might wear as a professional going into a meeting and I opened the door and I had like six heads spin around and look at me like, what are you doing here? It was really funny. So that was our first meeting, but after that we met at Starbucks. That was our office, out of an office. And we started talking about and it being a consumer business at the time. We started talking about how do you engage with other companies, other businesses so that you can grow and extend the reach that you have. Which was the foundation of why I started. When I asked Aaron later though, why he hired me, he told me he didn't think he had a choice either. So we're both kind of in this together. You told me that Josh referred me and therefore you had no choice. So we both, neither one of us thought we had any other choice but.

To not listen to your VCs. Right.

Actually it was here.

It worked out though, right?

It was a very fortuitous intro. We actually didn't really know what we were looking for at the time. It was seven or eight people. And what we knew was we needed some experienced talent to come in and actually help us grow the business, find new growth vectors. I don't know, did we have even a role for business development or was.

That was what you told me. Now, whether or not that was just Kind of what you said at the moment, because it made the most sense, who knows? But it was fascinating because at this point, it was April of 07, there was no such thing as cloud, really. It wasn't a term of art the way that it is today. It was Enterprise 2.0, 2.0. And we actually were just beginning to think about what the business model ought to be and should we pivot. And we made that tough decision that summer, which was also the summer that Dylan decided to go back to school to get a degree, because we thought every good student.

I didn't hear this story. I didn't actually know this. He went back to school to get a degree.

Yeah. So we only actually had three dropouts ultimately in the founding team. So Dylan actually has an accredited degree to his name, which is.

You have to have someone on the management team when you IPO from the founding team that has one.

Right. Ideally, it's your cfo.

So, yeah, we thought that was a good choice. And it was also when the markets just started to crumble, and so we sort of scurried to figure out how we were going to both do this pivot, successfully begin an enterprise business and have enough capital to successfully engage the way that we needed to.

Yeah, I remember. So we'll lead this into partnerships, but. So when Karen first joined, we were 100% focused on the consumer market. And that was really the kind of founding story of box. We were just trying to solve our own personal problems for file sharing, collaboration. So Karen came on board, and the original partnerships, you're going to hear a name that you haven't heard in probably two decades. But one of our first partnerships was with rca. They had a camera that we wanted to automatically back up into the cloud. And so that was literally like one of our.

They were probably in the digital camera market at that point.

I don't even know if they were.

There was a digital camera market. There was no iPhone, you know, so iPhone didn't exist yet.

So those are the kind of partnerships we were doing. And what we realized was there was going to be no business model in the consumer space for what we were doing. So we pivoted into the enterprise, and we must have had maybe 15 or 20 employees max at the point. And Karen and I were. We were the two people that went out to go do fundraising. And it was incredibly difficult because we were fundraising in the midst of a pivot. So. Which is like, absolutely the worst lesson that we could ever have is never fundraise while you don't Actually know your future business model because it's just like very unattractive to investors. So Karen and I, we just, it was great. We got just. We certainly built up a lot of tolerance for a high volume of rejections. So I remember we would just be like sitting in a car after VC pitches, just like crying about all the rejections we were getting. And then.

Was it more than 30?

Probably you could round up to 30. Round to 30. I think it was. It must have been at least 20, right?

At least. And dozens and dozens of meetings. And we would always end the day at McDonald's. We'd always end the day at the drive through at McDonald's. And that was just, I think just.

To like those pitches were brutal. Then if you had to go straight for the comfort food, brutal.

I mean, that was just my diet also. But I probably told you it was out of. Out of recovery. But that was just all aid.

So then we got lucky enough to meet Mamun Hamid, who is just an absolute believer and race.

Yep, the best of the best. He's here this year.

Has he spoken yet or is that tomorrow?

That's a great question. The mobile app struggles to load. It should be built on the box platform. So I will try to find out while we're here.

Next time you should ask him why he invested in us. That would be good to get that story because I don't know the answer, but. But basically we got really lucky. He funded the company and then we fully pivoted to the enterprise. And that was, I think when we really started to hone and craft the kind of role of partnerships in our strategy.

You made me say no.

You want to just one quick learning on that. And I want to talk about partners. I met Mamun through you. So I met Aaron. I was in Aaron's office right when he crossed 500 employees and we were talking about, so you got to meet this one VC Mamoon Hamid, who is the best. And I met him and I asked him and a bunch of reasons he invested. But one learning for founders is he believed in Aaron. He believed in the vision. And here's my meta learning. He didn't have scar tissue. If you think back, so many folks thought, when was this? 0708. So many folks thought, whatever we're calling cloud now was played out. All the vendors had done. The market was small. Like no one would really like run their computer or something in the cloud. Everyone was the world was going to be exchanged forever and people thought it was dumb. And sometimes both executives and Investors, you need folks that don't have that scar tissue and you need both because you need experience, right? Which we can chat about with partnerships, but you need a mix because that scar tissue just can weigh down innovation. And it just hurts, right? Even all three of us have scar tissue, don't we? We probably wouldn't do things now that we should be doing. Right? We didn't see slack come out of nowhere and then boom, right? Everyone's using slack.

So actually on that and leading into partners, I think that actually helped us in the strategy because we had the opportunity to sort of invent our partnership approach from scratch. So kind of kick things off directly in the panel, I guess. First question to Karen, I guess would be, 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 how do we make ourselves look bigger? We were small, we hadn't proven ourselves in the market.

Box crush this. If nothing else, box crushed. So talk about this, keep going. But talk about with partnerships.

We stood up in a.

Right.

Yeah, we did. We always looked like. Like we were everywhere. And I think that, for me, what that meant was, personally, we had to create a really good, strong strategy. And the strategy was based on 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 what was going to be our path to revenue on that. And that was the more disciplined sort of a piece of it. But we identified a strategy and we went after it.

How much do you think? 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 sort of distribution.

Right? Well, we clearly had an approach that was like, okay, so everybody's got these sort of 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 NetSuite, for example, they had 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 Zach that kind of solved two business problems and Gave us a 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 an early NetSuite integration platform too. But you guys crushed it on that. Whether you did in the real world, you certainly did it at a perceptive level at all levels. From the C suite, from Zach across, what were the tricks here that you could show? Did NetSuite really need Box as an application that bad in 2008 or 2000? Of course it did. But you became their show, their showpiece next generation partner. 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 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 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 event 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 interest was sparked. And I think we did a really good job at that.

And on the sales side, sometimes that revenue doesn't come the next week. How do you get them to do those skos and how do you get them to take it seriously versus 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 kind of point previously is this is why you fundamentally need a Karen within your organization.

You have to.

My preferred approach would just be don't talk to anybody. APIs are there, just watch 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 work to do within the field organizations, within the sales organizations. So unless you dedicate the time, resources, people and energy to making these partnerships work, they just won't work. Now, if you're a developer platform, so we have Intercom behind us, then it's fine. Then just plug in the API into my application and everything will be fine. But for deep partnerships if you don't invest in the people component, then there's no way you're going to 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 want to talk about what we did early on to be able to drive that, but that's like the technology was probably one tenth of what you had to do to get it right.

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 these companies.

Multiple levels.

Multiple.

Zach and I were, we were buddies and, and, you know, 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, you know, everybody knows you gotta 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 that we had all of the right folks doing the right things, and that was critically important. And that's an incredibly different skill set from the folks that are going out and hunting and finding the correct.

Let's dig in on that because it's not as obvious as it sounds. When you did the NetSuite dealer pick another deal, was box under 100 employees back then?

Probably 100 or 200 employees.

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 100 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, from the farm, if the hunting side, to the farming side, we had an operational checklist. 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 type one partnerships got these 10 things and type three partnerships just got 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, Aaron, 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 want to 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'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 this.

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, because that's people that's changed, that's evolving your culture, that's getting people to recognize that we're going to 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 that's the part that takes a really, really long time. And that's the part that requires a lot of. 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, 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 going to actually be able to drive the transformation that's necessary within it. Which means that we collectively as an industry, are going to have to find as many ways to be able to work together and present cohesive experiences in front of our customers. And that's going to be both technology as well as the people side.

That's interesting. Can we chat about that? I had stopped kind of going to CIO panels and sessions until recently, and then I did more and more. A lot of things I learned getting re engaged. But one is just so much CIO fatigue for multiple vendors. It's the flip side of what you're saying, no one wants, great, I've got Octa or whatever. It's not enough. Like, forget about even security. I want. And so how do you leverage partnerships so that it feels like I have fewer vendors? Is it just getting on boxes, paper? Is it more than that? How can I take what Aaron's saying and make it easier for the enterprise buyer and the cio?

Often the approach that we took was around that was how do we create a switch suite of services, how do we partner with others that are in that ecosystem so that we help alleviate some of that, the burden of all of those integrations. It doesn't always work that way, but you can certainly try. I mean, sometimes we were dragged into deals as a result of a super tiny small partner. In the case of a huge hospital system, they had decided to use a piece of software for security. And the only reason we were sort of brought in was because we, we had already had a deal with that.

Yeah, the integration.

Yeah, we had already had that integration. It was kind of backward because it was a teeny, tiny little company. But hey, they brought us into a great deal and I think that created some opportunities for us. We also certainly tried to do deals like, for example, with carriers where they already owned the customer. So reaching a partnership with an AT&T or a Deutsche Telecom gave us access to, to a huge array of SMB customers. And then we would let the partner help us construct the suite of services that they had on their list of companies that they were working with. And the only challenges around those sort of things is making sure that when you're engaging in an army of sellers that those sellers understand the pros and cons benefits of your product. Otherwise the engagement isn't going to occur and you're just going to churn. So you have to be thinking it through. Through not only from the perspective of engaging or creating a suite of services, but also in how do you create adoption that sticks?

Well, let me just ask a question and let me let Aaron drive it. But related to that, if you work with someone like a carrier back in the day or huge companies today and driving that alignment, how do you learn what their financial incentives. We like to think we can spiff their reps, but that never really works, does it? I mean it works once in a while. But even if you can't, even if you're allowed to spiff their reps and take them to the ball games, it's never really their core goal for quota. Right. This is something we read on the Internet to spiff their reps. How do you align their goals with your organization?

Well, this is where the rubber hits the road. The minute the ink is on the paper is the minute that you flip over to the launch phase of the deal. And that's where the KPIs are agreed upon. The business plan is more formalized and all of those types of pipeline calls and quarterly business and agreeing on what the numbers are, that's when that happens. One time I did a deal with a big SI and after the deal was signed, the person they assigned to the deal was a program manager, which is wonderful. All the kind of shit is going to get done, but you don't have somebody who is strategic and senior enough to make sure that all of the pieces of the puzzle are going to come together. And so that's the first thing you have to make sure you get the right people playing on your team in order to make those two sides of the story come together. But if you have agreed upon KPIs and business and dollars that you want to try to achieve and you're going to get together on a weekly basis and figure out if you're on track or not on track and what you're going to do if you're not, you've got a lot larger chance of hitting a successful deal.

And I think the so you have a massive amount of operationalization to be able to make this work. And spiffs is 1/100th of the things that necessary. But ultimately the great thing about whether it's partnerships or just even building product in general is it always comes down to the customer. And so nobody is going to sell your software if it doesn't make the customer have a better experience or make their sales process easier. So what we basically discovered is the partnerships that worked were the ones where the seller on the other side had a better experience being able to work with their customers. They were able to have a more seamless process selling their solution and the customer was getting more value because of that partnership. And if that didn't happen, there's no amount of artificial incentives and ways of sort of forcing it through the system that at least would work on a sustainable basis. You might be able to get a small pop, but if the customer value proposition is not stronger because of your two solutions or multiple solutions working together, the customer doesn't care. Which means that no spiff in the world is going to be able to solve the problem. And that's, I think when we look back, the impactful partnerships are the ones where our partner was able to deliver more value for their customer. And it wasn't just a distribution channel. It wasn't just being able to get more feet on the ground trying to sell our solutions, it was actually delivering a better experience to customers. And the challenge is you can't always know in advance going in on the partnership which ones are actually going to click and which ones aren't.

That's the big companies especially lean in early with the big ones. Right?

Especially the big ones. And they're constantly reorgang and one day you do a partnership with one team and then all of a sudden, three.

Weeks later you find out every year it's a new team. Every company, every year would be great.

What about every three months? So these are the kind of things that you're just dealing with constantly on the partnership side. But you stick with it because the opportunity is so profound.

If you can get it right, it's a good. Another reason you need to find your Karen is because of this turnover. You think as a startup, you think startups turnover. I'm looking at this team that was together for 10 years, but at your partners, you've probably seen 10 VP, probably not CEO, but 10 VPs at these levels. And the turnover at big companies is. It's exhausting. And if you don't have a manager, the CEO's relationship below the CEO, it's gonna die during a calendar year, isn't it?

Yeah, absolutely.

Just to make it awkward for Karen to say a compliment, I think the what makes Karen so unique, but also the job so unique. The kind of person. You need the persistence and the relentlessness that you need because you're just. Because it's like it's hard enough to change your own organization, but now imagine trying to change other organizations. You have to be fighting that every single day and be willing to basically get rejected 90% of the time and be able to go, okay, only 80, okay, sorry to round up. So the sheer persistence that you need to be able to. Have to be able to. To be fine every single time one of these changes happens is unbelievable. And that's why the role of business development and partnership is, I think, such a unique, idiosyncratic role within a startup. It's sort of like sales, but magnified because there's product components, there's technology components. You're dealing with a whole bunch of other constituents. And so you just have to be able to deal with all of the ups and downs on that.

And that goes right back to the point of. One of the most important things is making sure you have the right relationships at every part of the company. And I used to.

And you graph it out. You got to graph. This is what people don't do. This is when you see, you know, someone's doing it. Is. You walk in and there's a chart, often on pen and paper, pasted the wall, and it's some matrix, and every person at that partner is on that. You've got to do some version of that to win, don't you?

Yeah. And I was.

And then liquid paper put white strips over the quarterly changes on the chart.

But I was always the one at the conference who was waiting for the speaker to come off the stage to be like, hey, you really need to know more about what we're doing right now. We should talk.

They'd be like, oh, let's chat about that. That works. Where did we go? That worked.

Sure.

Yeah.

What was the start?

It's not something most people would think to do that you could have your head of partnerships jump at a conference and ambush Zach Nelson or Mark Benioff and talk to them about the box platform. But if you don't try, it's not going to happen. Right.

How else are you going to meet them? I mean, you have to figure out. And I would definitely scan, you know, where are they going to be and how can I not awkwardly or weirdly try to find them? I certainly not.

Well, awkward and weird are different. I think awkward's okay. You just have to be careful not to cross the line to go weird.

I think any of our jobs looks A lot less elegant and glamorous when you actually like reveal what we actually do day in and day out.

Right. But we had a great approach around that. I mean I think we did a lot of dividing and conquering with. We used a lot of our networks to do so. Andreessen was one of our investors and they often had.

They were great at that. That was the real way they could help enterprise companies.

Right. And then you just follow up like crazy and make sure that you're doing so in a way that is relaying the value proposition and the reason for either buying the product or partnering to extend.

Can we dig into something that Aaron get your thoughts, Karen? And something that Aaron said about. Because I've experienced and it's great for founders, that little partner that actually delivers a lot of business. Right. You're probably gonna sign the deal with HP or Salesforce, even if you're not sure the revenue's gonna. You gotta do that deal. But then even when you get then this little vendor you never heard of in healthcare or something, four guys or people in Idaho bring you a big deal. For folks that wanna be that Idaho thing, how do you leverage that? Like you gotta bring them one. You can't get Box's attention if you're four people today without bringing a customer. But how do you get them to believe that one's 100 or who did you see? What did you see where you would lean in and help someone that didn't deliver 100 customers? What's the secret there?

Do you remember Xrog?

No. No, not that one. No, not that one.

That was kind of funny though. Oh, gosh.

Well, you can generalize the tips if there's some sense in. Of stories.

Yeah, no, no, no. I don't know that we. I mean we always try to get the big customers we like, but did.

You have any small partners that brought you the big deal?

Maybe the thing. The thing I would at least kick off is so part.

Yeah, the one that I was mentioning, this little security guy brought us huge hospital.

I think the thing is as a partner and we have to do this when we go partner out. And so thus vice versa. If you're a partner trying to partner with us, you have to do the same thing. You have to deeply understand what's the strategy of the company you're partnering with and what is the sort of wedge. What is the area that that partner has to uniquely needs your solution for. And if that doesn't exist or if it's overlapping too much or it's Just going to create complication for the customer, then there's no partnership to be had. But by finding the sort of complimentary areas where two solutions truly does begin to impact the customer in a very different way, that's what we've found to always work. And so when we look at maybe a company that might be smaller than us, it's not necessarily do they have a distribution channel or do they have lots of customers, it is, are they doing something incredibly unique that is going to offer a lot of value to our customers that is not in a space that we would expect to get into. And it's really important for the partner to understand those things going into the conversation. And so the worst pitches that we will get and the worst pitches that we will do are the ones that just make no sense. It's just like, hey, please distribute us because we need growth. Nobody cares about your problems, so all we care about is our strategy and what the customer is trying to do. And when that can align, then there's a way to make it work.

Right.

And that's why we built the platform that had the APIs that everybody could get connect into. And so we became less of a decision maker or, you know, a gatekeeper. But we let other people build on the platform so that they could do with the product and the service what they wanted to do for their business. And we just weren't as active in those.

Did you ever think about sort of what you might call pre and post sale partners, Folks that bring you into the deals, folks that don't help you at all with the customer, but make box better after the deal, but don't help the sales rep or the sales team one iota. Do you, did you think about, do you distinguish those and how do you manage them internally? How do you get people focused? They have different values, different stakeholders, don't they?

Right. I mean, when I think about that, I think about some of the large deals that we did that really were kind of on the marketing side. They helped us with exposure, they helped us with credibility and awareness. But they were less designed to in some cases. Like the 50 gig deal that we did for the very first time was really, really more about getting end users on the platform and creating awareness so that businesses would know that we existed. That was the big plan, see you on the phone. And it didn't necessarily have the dollar amount that we didn't have any intentions of getting huge money out of them, but we did them anyway because they were so critical to things that we just didn't have the reach to do at that point?

Yeah, I think it's probably, I look back and I don't think we ever made that distinction. Although probably ultimately things went into those buckets like after the partnership launch where some just didn't help us in a pre sales process but were incredibly important in terms of the customer's experience with our technology. And then some, like we did a partnership with AT&T where honestly you may have had a way bigger vision around it, but to me it was just like, ah, this could be cool, like we'll be partnering with a carrier, we'll see what happens. And it ended up being one of our strongest partnerships because it turned out that if you are selling mobility solutions to enterprises and you work at, AT and T, you need killer apps to go along with your mobility solutions. And in our product case, we happen to be a killer app for moving lots and lots of bits of information onto mobile devices. And so for a seller within the AT&T world, we ended up being very valuable to them to be able to go show more value to their customers. I didn't necessarily think all that through when we were doing the partnership, but it ended up being an incredibly powerful driver. So. So one of the biggest lessons that I think we learned is you have to find partners that have the same sort of macro tailwinds as the ones that you're trying to ride on top of. And so if there's not a big macro movement that is sort of propelling you that also the partner shares, then there's just too much friction. And so to be able to align to this. So if you're a data analytics company, then obviously you should be probably partnering with other, other solutions that would naturally grow in a big data and analytics world, as an example. And so by making sure that you are the same frictions that you're going to deal with, your partners are dealing with. And so you want to make sure that you have as much of the tailwind behind you as possible with those partnerships.

And I think that as we matured, as we started to think about going public and to the point where we were public, one of the areas that I worked on was the industry team. And one of the important things, things about that was being the being able to speak the language of your customers by industry. And when we did those, we started thinking about partnerships again in a different way. We wanted to put box in with particular companies that worked in a particular industry. So we were going kind of back down to smaller companies to do these deals and we would put together kind of the idea of a group of companies that would benefit a retailer or a hospital or financial services. And then we would take them to market via our sales organization, which of course required the proper communication and alignment through a we needed product and everybody else involved. And then we would also take that out through our other channel partners at that time, which included SIS and other carriers and IBM and other large businesses. So I think you kind of have to be nimble and be willing to move depending on, on the stage of the company and the goals or the outcomes that you're looking for.

Yeah, you want to dig a little? I'll let Aaron guide it. But thinking back on time, when you talked about looking big and going big, how especially on the enterprise side of boxing back then how did all these partnerships help you competitively? Because it certainly as a box partner, but also a student, it certainly gave a lot of gravitas, that's clear. But in the real world, how much did that help and how it almost felt like it created a mini moat. I mean, it's not a perfect moat, it is a competitive space, but it felt like in the enterprise it created at least a shallow moat that was hard for other people to cross.

I'll set up the sort of core philosophical context and then I'd be curious to Karen on actually how we went about doing it. But from a pure philosophy standpoint, we kind of determined that we are either going to win or lose based on the power of being a neutral player in our market. Because if you wanted the full integrated sort of stack of services, then you could easily just go to Microsoft and they're going to have everything that's integrated and it's all going to work together. And so our only strategy was what is the power of having an open neutral platform that works across all of the technology in your environment? So by definition, partnerships and our core strategy were one and the same. Like there was no, there was no doing box without a core partner ecosystem or application ecosystem. So that kind of meant that we actually had to do very deep partnerships in a broad way if we were going to be successful and if we were going to actually build out this value proposition in the enterprise. And then I think from there it was really just okay, how do you go programatize it and what are the different types of partners that end up driving that versus being neutral to it?

Well, I was also programmed pretty well incented to go after particular deals, you and I and anybody else on the various teams. We set it up, we knew exactly who we wanted to partner with. That wasn't like left to chance. We didn't just sit back and wait for the phone to ring. We were like, These are our 10 premier companies that we need. These are the channel partners that we want. And we executed relentlessly to get those. And that meant everything that we've said so far. How are we going to meet the right people? You know, what might they want to do? What could we build? What could we, you know, how far will we not go to do the things that we want to do? And that was really an important piece of. It is just we were relentless on that.

And when you want to be open, you have to be the most open, right? You have to have everyone. I always stressed about this. When you've got Salesforce and then Oracle wants to be on your platform and you're open, but how do you be equal, open with everybody? When everyone is an equal, they're not equal. I mean with Mark Benioff want your help, you kind of got to go up to his extra house on Nob Hill, the one that's just the office and have the sit down, don't you? But then when Larry Ellison, but he's retired so how do you. But it is a little bit stressful, isn't it? Even if you're open, the partners do not have equal gravitas, do they? Any insights on how to manage that? You just smile and do it carefully.

Yeah, carefully. And do your best. And I think that there's.

Send a bigger plate of cookies or what's the answer?

There's some obligation for some transparency like you know, we did.

Transparency helps, right?

That's absolutely. And when you can get the partner to understand your situation, then they have enough empathy to know that. Okay, like the value proposition that you have to your customers is as an open platform, which by definition means you probably also have to partner with our competitors. And I think what we try to do is be up front with partners which is like we'd love to do as much co marketing, co selling with you as possible. That's not going to preclude us or prevent us from partnering with other companies that might be in your space because fundamentally we can't go to customers and say we have preferential treatment from a technology standpoint of one vendor or another or else our entire strategy gets blown up. And so that might be awkward every time there's a big press release, but that's just where Karen has to get on the phone and sort of do.

A little pre brief.

Right?

Yeah. Do a little pre brief and you give them a heads up and you say, hey, you're going to see this thing in the news. And. But we obviously are very committed to our partnership and we'd love to keep doing more. And that's just the standard relationship management that I think you have to do in this.

Sometimes it worked to our advantage because sometimes it helped the other partner see that, oh, gosh, we gotta work a little harder, we gotta do a little more. What can we do? And that led to sometimes some pretty cool outcomes as well.

I think you need your Karen because the CEO, it's tough. It's tough when you get those CEO, those CEO sort of, you know, hand burns or whatever you've got. You need someone. You need someone to manage to juggle that for you, don't you?

Yeah.

Did you take a bunch of those for Aaron?

Oh, God.

Did you take a few hits for the. From.

And by design, I mean, maybe we weren't quite that smart in the beginning, but yeah, we didn't have, you know, if somebody wanted to deal with Aaron all the time, we had to change that up because we needed Aaron to be able to come in when we really needed them, when there was a big problem or when we were at an impasse. You need to have somebody who can come.

I think it's a little bit revisionist. You probably were shielding me so I didn't blow up the partnership. So I think I mostly probably complicated things as opposed to was valuable.

There are definitely times I can recall you complicating things.

Yes. I may be misremembering some of my box history, but I have studied it for a while. I think you went through an evolution of how to monetize the platform. Right. And I think it probably took you close to a decade to directly monetize Box as a platform. Right. But I bet you guys thought about it in 2008, right? So how do you think about when it's too early? When do you discourage development, but when do you actually have to make a few nickels off the $300 million that have gone in probably to building Box?

I think for us it was our struggle was. Was basically we are deep believers in openness and you should be able to use our APIs for literally anything that you want to be able to add value onto our product.

You don't want to charge initially. You don't want to charge.

I still don't want to charge. And so we want. And especially if it's your data, then you should be able to do whatever you want with it. At the same time, we started to see customers having use cases, in particular customers. So not ISVs, customers having use cases where we were really kind of being white labeled into another application, doing something completely different from standard integrations. And at that point it kind of crossed a threshold where we said, okay, maybe there's another business model here where we say the technology that we're using to deliver our core services to you as a customer, you can also leverage yourself. And we will just have a sort of AWS like pricing model that's more resource based. And that was a struggle because again, we were starting to charge for something that theoretically we could, could have made for free, but it was really delivering a completely different value proposition and we had to kind of have that line of demarcation. And I think it was also difficult on the biz dev side because we had to decide, ok, how do you now treat partners in this category and how do we still have a really, really strong open platform in the process?

Somehow we blew through all of our 40 minutes. Any last fun story from Karen you want to bring up from the partnership days or otherwise, or vice versa. Karen, you got a good story for Aaron that's appropriate for this stage. Oh, thanks so much. I'll let either of you go first for one last good story that at least superficially is related to the topic.

I think the one thing that we probably didn't talk enough about or actually at all, but is also, I think just like an elephant in the room on this is on the product side. This is really where it's difficult is prioritization and then creating the right kind of sort of swim lanes for what a partner can work off of versus what you're going to build yourself. So there's a whole sort of philosophical issue that you have to start to be very clear on around the principles of what are we going to build? What should a partner build? How much time should we be dedicating our resources into developing these partnerships? Because I think that the worst thing you can do is thrash your internal engineering and product management just based on all of the externalities. And this is something that we had to get really good at is making sure that this was a very finessed part of our product strategy.

Right. Because my philosophy was say yes until you build everything.

That's the tension. All right, let's thank Karen and Aaron for this session. It's terrific.