Sunir Shah, Cloud Software Association President and AppBind CEO shares valuable tips for SaaS Vendors and Agencies when building new partnering relationships.
Sunir Shah, Cloud Software Association President and AppBind CEO shares valuable tips for SaaS Vendors and Agencies when building new partnering relationships.
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Direct Transcription of Podcast
Greetings everyone a very warm welcome to another edition of the HubDo podcast. This is where we talk with software vendors, subject matter specialists, and end users who share real stories of how to do more on HubSpot. I'm your host, Pete Nicholls. I'm coming to you from Copenhagen in Denmark, and I'm joined today by Sunir Shah. Sunir where are you?
I am currently visiting my parents, uh, in the Ottawa Valley. It's a town called Deep River, which is where I grew up. It is a surplus of nuclear reactors and Nobel prizes. So if you want me to pick up one of those two things I will happily do so, thanks for having me on.
You're very welcome. And it's great to catch up with you Sunir. I know we're gonna be face to face next week, and we'll talk a bit more about that in a second little bit of background for our listeners. If you don't know Sunir, Sunir has spent his career creating and selling software products to improve how the internet works. And I have a quote from you Sunir, which is in this age, nothing is more profitable than becoming a piece of the internet.
Yeah, that's true. I mean, that's really what it is. You're all trying to build infrastructure. That's funny. Yeah. Yeah. That's right.
Uh, and so these days, you're building winning markets through focused application of software development. You are the president of AppBind and you are the founder and president of the Cloud Software Association, the CSA. So let's get further into each of those, or maybe have a chat about AppBind first and then we'll get into the Cloud Software Association and the event that's on next week.
Yeah, they're all kind of related in my head. So, uh, AppBind we're a subscription manager for digital agencies. Uh, so for those of you who are trying to put together systems and solutions, Uh, you know, it's a pain getting subscriptions for clients, cuz you have to get them to sign up and it's like your plumber making you buy your own pipes and pumps, but AppBind lets you like a typical plumber put together a time and materials, invoice, buy all the software for them, take care of a client, install it, deal all the, I mean set it up, operate it. Uh, and then, but not pay for it on your own credit card. You could build a client through AppBind and it's a much more powerful way of being a digital agency.
We're excited to be working with AppBind in a number of ways to find opportunities, to just take the friction out of the way that agencies support their clients. And next week, we've got the Agency Connect event coming up. Now HubDo, we are a co-sponsor of that event because we believe it's an important gathering of vendors and agencies. You've run this multiple times, so let's talk about Agency Connect.
Yeah. So, HubSpot's Inbound first. I'm so excited that it's actually back in person, I miss people. It's like, what are you supposed to do to greet people? You just like, you just rub their faces. I don't even know what you're supposed to do anymore. uh, so, uh, this is the cocktail mixture we do there every year for agencies to connect with each other network, learn, partner with each other, and talk about the business of being an agency, which is actually, you know, as everyone knows, it's quite difficult.
Uh, we could talk about that we should this podcast, but the, the, uh, and then like, it's, it's also a place for those who are like HubSpot or, you know, you're talking about PandaDoc or whoever have partner programs with agencies to come to hang out and be a human being with agencies rather than just get to know each other on a relationship basis because we all have to work together.
And so it's, you know, we're all gonna be at Inbound and we have this party so we can connect with each other and figure out how to you, be better business partners understand each other at a human level, have some good times and you know, hopefully, move the ball forward. Last time we did it, uh, we had 600 RSVPs and I thought, oh, that's probably what you need. I capped it at 600. There was a line going out of the hotel. Uh, it's right next to, it's in the Western Hotel, right next to the conference center. We had a line wrapping around the whole hotel in fast seat, uh, past the stairs. And I was like, okay, maybe that was too many RSVPs, uh, yeah, it's a popular event. You should definitely sign up while I still have spots. Uh it's because there's nothing else really at Inbound where the, you know, agencies can really just let loose and talk agency stuff. I mean, that's what this party's for.
When it comes to vendors. And if they're just in their early stages of working with agencies, what do you think some of the common misconceptions are that they have, or, or the mistakes that they typically make?
Oh boy. Yeah. That is a big one. Uh, that's a loop. How many hours do you have? Uh!
I've got plenty of tape.
Oh, my God. Well, part of what AppBind does is provide a solution partner or reseller portal for SaaS companies. And so that that's, you know when you're, you can't just put the software in there, you have to solve all the problems, which are mostly human, um, to make a successful solution. So I've been cataloging, all the problems. It's pretty funny. So the biggest problem of course, is that SaaS companies think like SaaS companies, and agencies think like agencies and it's like Mars and Venus, you know? So SaaS companies, what they do is they basically just only care about revenue and they keep, all they care about is, Hey, I have my quarters coming to it and I have quoted a hit. One is, "give a sale, gimme a sale agency. Here. I'll give you. I'll give you, I'll give you $28 commission. Uh, gimme your client list". It's like the Agency is like, "No, I'm not selling you my client list". Uh, that's stupid. Uh, so that's the biggest mistake is where you're where a lot of the SaaS companies, I call it selling risk. You're not, you're basically asking the agency to take on all this risk for you without giving anything in return. The best channel programs historically do not have, almost no risk on the agency. They create opportunities for the agencies to grow their own services business, and they recognize who's closer to the customer. It's gonna be the agency, right? So this proper software vendor. Supports the agency in the agency selling to the customer and, you know, you're just a pipe, you know, the agency's the plumber, you know, the pipe manufacturer doesn't talk to the customers. The plumber is the one who actually goes in and does all the solutions put together the whole system, you know, takes care of the client. Your job is to take care of the plumber, uh, as a pipe manufacturer. And it's the same thing in software. Uh, so, and then the other thing is, is software companies think like, act like software companies. So they always think terms. MRR and, and selling transactional, like the upfront sale, but the agencies think in terms of being a good service company.
So they evaluate software companies based on the same attributes. They evaluate themselves. They, they, they want to see that you're reliable. You're trustworthy, you're an expert. Um, you know, you're gonna support them when they need you. You can be available. These are the kind of things that they want from the partner programs you are basically like a mini little agency around your products to help them out.
So. It's not really that hard once I explain it this way, but it's so amazing how, like it's like Mars and Venus, like, you know, it feels like space alien sometimes. So that's why we have the parties to like really humanize both sides and go, you know what? They are actually a real business too, you know? Or, oh, these people actually just don't know anything about your business. So they're here to support you. So just help them out. You know, there'll be better, better supports for you. It's it's funny.
These vendors, at the cocktail party. I'm just imagining, uh, for those who are attending it the first time themselves, the vendors they're at the HubSpot or next door to the HubSpot Inbound conference. So they probably have something to do with HubSpot, but the agencies that they're meeting may have, a complete focus on HubSpot, or maybe HubSpot's just one of the things that they do. So if the vendor is going into that cocktail party and they're looking through a lens and that lens is revenue and MRR transactional and that's what they're looking for, what agencies that are here that are gonna give me that, uh, what advice would you give to that vendor when they're first kicking off conversations and, uh, sort of things that they wanna ask the agencies that they meet?
Yeah, I mean, yeah. So SaaS companies just pitch the product straight on and then offer the commission only as an incentive to the Agency. That is a bizarre thing to do. Um, look, agencies don't, they don't make money from commissions. I mean, some do. Sure, but that it's not where they think about it. They think the customer is the customer, not the SaaS vendor. So the revenue comes from the, you know, the clients that they're serving.
So the first thing I would do is, it's a crazy idea, is to stop talking and start listening. What a weird idea. It's like, how do you build any relationship? To me, it's all dating, like going to a nightclub and you're like going around and hitting on all the people and saying, Hey, you wanna go home with me? It's basically the same pitch as like, Hey, I have some software, you want some commission? it's like, what? I don't even know you. What are you talking about? Uh, so ask questions about the agency. That's what everyone's interested in themselves, you know, who are your customers? What kind of services do you solve? You. Um, if you really wanna get to a solution partner referrals are fine. They show that as market demand, but you really want people bringing you into their own solutions, reselling you. That's the real, the real money is its AppBind, I guess. But the, uh, if you wanna ask them if they do that, they put together full, complete solutions. Have they started going to this path? Are we doing managed services? You can ask some like the question we do with Agency Connect and when, when we're not having in-person cocktail parties, we have these online ones and we talk about the scalability trap, which is actually what the, you know, agency.cocktails.com you come to join that community, uh, where we buy drinks, free virtually we'll ship bottles, and we talk about to get through the pain, that's what the alcohol's for. So much pain is in being the agency owner. But the scalability trap is when you're selling labor um, while the more, more revenue you have, the more payroll you must. Right to, to fulfill. And then the more payroll you have, you have a liability in your books, right? Because it turns over every month. And so you need to get more revenue, and how do you scale your way out of the risk of being, you know, an agency? Like where do you get your sustainable margins? What are you growing? What do you own when what is the actual business that you own in that situation or, or, or you just on a treadmill of hell and pain and suffering?
And I think a lot of agency owners like, stay up awake all, you know, at night, thinking about these problems and so, you know, the other thing you should be asking the agencies is, you know, just basic questions though. How do you, like how long you've been in business, you know, how do you manage this? You know, I'm just curious, you know, have you figured out a way beyond, are you, are you just selling projects and labor or are you looking for, have you figured it to margins?
Uh, almost always, the agencies are also looking for lead flow. That's the best thing to offer an agency is that if you have clients that need agency help, you can talk to 'em about how you can offer them clients rather than commissions. That's a much better, uh, offer and then you can just talk about the kind of agencies you're looking for. I wouldn't say, you know, just sign up, we will send you a client cause that's obviously crazy, but you can talk through like what's, who's been successful on your platform and give them an idea. That's not that hard, but you know, if you know the product and you've done some work with other clients will help you establish in your mind that you also think about the customer and the client experience. But there are opportunities there.
You know, it's, it's honestly, it's just like dating again. That's just what I think, you know, like the customer is, is, is, is like the child, you know, everyone to protect their children and they don't, you're trying to bring a third party into that relationship. They just wanna know that you think the same way that they think. So the more you show empathy to the other person's problems, the more likely they are to respond to you.
I'd love to ask you about this lead flow actually. Um, because if a software vendor is doing their marketing and they're generating these inquiries and it's leading maybe to a demo or whatever that is, uh, at what point does it make sense that that vendor is thinking, you know what, I'm not gen going to just progress this deal through and includes my software sale. I'm gonna send this lead to an agency. I. What makes that happen? And when, when does it make sense for the vendor, to send it to an agency instead of just taking it on through the sales process?
Yeah, that's a really, really, really good question. So one of the big insights I had the more recent times was I was trying to answer to, cause I run the cloud software association is all the SaaS partnership people. There's like, like 4,500 of us now in that. And, and the same questions come up over and over again, I'm kind of actually getting tired of the select treadmill that's the same questions. Like, I don't know, what are we supposed to use a partner? What's a partner? I'm like, okay, God help us. So, and I, I realized this like really. And this should help any SaaS vendor wrap their heads around partnerships. The customer goes through the same life cycle. You know, they, they, they, they, you know, they learn about your, your stuff. They come, that's the demand side. They come to your site, your brand somehow, uh, they make it, they have to close them, and then they have to do implementation onboarding.
Right. And then there's a post-sales success, like the renewals and then eventually referrals. Right. So, and there's product adoption in there. So as well, so that that's the kinda life cycle they're on. The difference between, uh, having a partner or not a partner involved is simply that the customer is, is the king or queen of their little world. And sometimes they just don't wanna do it themselves. They're gonna hire or use another company, uh, be to manage the situation for them because they just don't have enough bandwidth. If it's a service company, or if it's product integration, like a technical partnership, they just have another product that they're using.
And if you are arrogant enough to believe that you can do it all, inside your four walls. Uh, well, that's nice, but you're not listening to the market that customers just may want to have someone that they're using. So then, then the question is when does an agency fit into the customer life cycle? Well, pretty much anywhere the customer has to do labor or thinking, uh, along the process, they might just hire someone out.
So on the demand side, you know, agencies can come, but they're not actually marketing you. That's I think the biggest mistake SaaS companies have that agencies don't market you, they market themselves, right? That's why you have to position yourself as part of their solution, cuz they'll bring you into everything that the customer does.
So you have to fit, fit yourself into their sale. On the demand side, if you're gonna introduce an agency to one of your customers, it's gonna be probably around implementation. That's the biggest place or later down the life cycle around account success. So if they're flailing around on your platform, you may introduce an agency to them to help solve like one, what are the adoption metrics, the success metrics you have later in the funnel?
When, you know, for instance, at a HubSpot, you know, if someone who has a HubSpot account for two years may not have their inbound marketing or content from like sorted or they may not have social sorted. They may not have PPP PPC sorted. So they'll bring in an agency to help that part of the, of the, of the customer journey, um, succeed.
And so you, if you understand the customer's a SaaS company going through their own journey, be successful whenever the customer has to think or do work and they don't have the bandwidth, that's where you can introduce them to an agency.
Yeah, that's a great guideline. I think Sunir because I see that even with HubSpot, I know next week at inbound, it's all about, uh, HubSpot as the flagship conference. Uh, I know HubSpot themselves, they have over a thousand Apps now on their own App marketplace, and that's just growing really quickly. And there's a point where HubSpot themselves, their services team, they might be managing the wholesale with the end user is buying HubSpot, but the customer doesn't only have HubSpot, they have a tech stack, and so there's a bunch of other tools that need to then interact with HubSpot. There's a certain point where HubSpot staff are not allowed to put hand to keyboard beyond a certain point. And then you end up with this gap. Uh, so guidance for a vendor is, mind of the gap. I think of at that point where yes, the customer is having to fill that gap if you don't fill it for them, but maybe a, maybe an agency is the best fit in that gap where, um, the power of three, um, makes the whole thing work.
A hundred percent, a hundred percent.
Let's flip it, just real quick then for the agency side Sunir, so if you're an agency going to meet a room full of vendors and you know, those vendors, uh, they, they might put, uh, you know, a good, um, uh, game face on, but they're also got their little radar listening for that revenue and that MRR. If you're an agency and you're in a conversation with a vendor, What are the best things to say to that vendor that's gonna stop the vendor, from talking to you while checking out the other potential dates in the room? What should the agency share?
Yeah, it's so interesting. A lot of agencies actually, uh, rebuff the vendors again, it's all dating. So, who's uh, who's the one that who's the prey and who's the predator, I guess, is the idea. So they, but I don't think that's a wise strategy, because almost all the agencies I know that have scaled have found actually a sustainable lead flow. And one of the best sustainable lead flows is from software vendors who just picked their preferred agencies and send all their clients to them.
Like if you look at HubSpot alone, their Elite partners are basically making their money off HubSpot referrals, you know? So that's how they're growing. So don't, like open your mind. Nothing can hurt you in a business conversation. Right. So that's the first thing I would ask if you wanna, first, I don't think there's any software company that looks at an agency, uh, without like desperation so like, you're, you don't really need to convince them to talk to you.
But the real thing is to talk to them, uh, intelligently about how the relationship works, which I don't think a lot of people understand like both sides, cuz it's such a weird thing, and new. It's like we, no, we manage clients and what we, we, we build together solutions and the plumbing analogy is always great.
It's like, we're like a great plumber, you know, you know, no one wants to install their own, uh, toilet, you know, or, you know, but we handle that messy work. What will we look at you vendors as parts? And we don't think the clients should buy their own pipes and pumps. So we put together a whole solution, make sure the clients get a result, you know, and we've done this with other companies like this X, Y, and Z. We're pretty good at it, but I'm looking for, you know, I'm talking to you as a vendor. Uh, I'm gonna tell you the commissions are interesting and useful, but that's not what I'm interested in. I'm interested in how other agencies around you have succeeded in creating service revenue. That's a good question because if the SaaS company doesn't know, they have been talking to their partners, so they should have examples off the top of their head. That's the first question. And then the second question is, you know, do you have a program where you send, um, leads to agencies to help your customers be successful when they don't have, uh, they're not fully adopted on your system either after just after sales or later in the life cycle.
And, and that's pretty, it should be a yes for almost every company. And if the answer is no, uh, there might there be they're too early in the, in the process, maybe for you, if you're a great agency and if you are a very good agency, I mean, really, just to show, just explain if you just show that you have really great brands or, or high-value projects, I mean every SaaS company, cause they're just so dollar oriented, you know? Well, that's all you need to show them. It's like, yeah, we have a lot of revenue, you know, presumably the SaaS company thinks, yeah you could sell me something. Cause that's the unfortunate thing, like they only care cause SaaS companies, only care about one thing is sales quota. So if they talk to you like they understand what you get out of it, then you're gonna have a productive conversation cuz they can see that you're also competent. I will tell you what SaaS company's fear is that if they hand a customer to you, you're gonna mistreat the customer. Same as you. So if you show that you are a responsible professional agency, that you're gonna be like, oh my God, let's be best friends come to my wedding.
Thanks for sharing that Sunir, you've got a wealth of experience on both sides of, of that fence. I know from agency life and, uh, and vendor life with the thousands of vendors that you're working with. So this is a slightly different podcast episode in that it's timebound because on Wednesday, the 7th of September in Boston at HubSpot's inbound event, the agency connect meeting is taking place, but I think this episode is also more timeless than that in a way, cuz you've covered a lot of the fundamentals of what a software vendor needs to think about when you're talking to an agency and uh, and also for an agency of how to have the conversation with a software vendor to begin that value-based partnership. So, I know we're going to catch up at the show next week, Sunir, any final advice for those, uh, maybe coming to, to inbound and, and anything else that's happening next week that you think is, uh, important to know about?
Well, I think that in general, if you're not coming to Inbound, this community continues on, so agency.cocktails.com, uh, that's how you sign up for the Inbound party or in general for the cocktail club where we talk about this stuff. And then, uh, so please do that that's pretty basic stuff. And then the at Inbound next week, you know, I would be really, uh, paying attention inside the, you know, agency community, like how they're gonna, what people are facing right now in 2022, 2023. Cuz I don't know if we ever remember what 2020 was like, but it feels like you should be preparing yourself for something.
So just listen, ask questions about how, you know, how things are going with agencies. I don't think it's gonna be, you know, so wild, uh, change economically, but it's always good to ask what other agencies are experiencing. And so then you can adapt you'll we all get through it for sure. But I would be asking about that.
Great, great advice. All right. Well, I look forward to seeing you next week. Sunir I know, uh, I'm, uh, really expecting to get a lot of value out of, uh, just talking to people in those two hours. We launched this year, the HubDo Marketplace, and that's really just a one-stop shop for the software integrations that work with HubSpot as well as the people. So we have an unusual marketplace because it has logos and faces. And I think you've touched on a lot of points of why, uh, people need to make the technology and the people side work for, uh, for the customer to really have the long term success. So, uh, yeah, looking forward to, to next week, uh, to say. Sunir, it's a delight to have you on the show, and thanks so much for your time.
I'll see you next week.
Thank you. Thank you so much for having us and see you next week. We'll have a drink.
See you there. Thanks Sunir, Cheers.