The Power of Partnerships
The Power of Partnerships
Bruce Cleveland
We used our partners to help us achieve the goal of creating the Enterprise AI category and establishing C3.ai as the global market leader, culminating in a successful IPO in December 2020 (NYSE: AI).
With each strategic partner, we developed contractually committed business and go-to-market plans that included joint revenue targets, millions in market development funds, and comprehensive sales and technical training for our teams. Tom Siebel, CEO of C3.ai, and our executive team met quarterly with senior executives from our partners to evaluate progress, address shortfalls, and implement corrective actions.
Our dedicated alliance team managed these partnerships daily, tracking joint sales and marketing opportunities while coordinating with partner counterparts. Each alliance manager was measured and compensated based on achieving partner agreement objectives. These principles of partnership, first established during our tenure at Siebel Systems over two decades ago, remain foundational.
Lessons from Siebel Systems
Founded in 1992, Siebel Systems pioneered the category now known as Customer Relationship Management (CRM). In just over five years, Siebel went from a private startup to a public company and the market leader in CRM, valued at nearly $30 billion. Deloitte recognized Siebel Systems as the fastest-growing company in U.S. history, with revenues increasing from $8 million in 1996 to $1.8 billion by the end of 2000.
The driving force behind this growth? Partnerships.
In 1996, I joined Siebel Systems as VP of Marketing, tasked with creating a scalable partner program. Launched in 1997, the Siebel Alliance Program grew from three to over 700 partners in less than three years, generating more than $1 billion annually in indirect and direct revenue. The program's success earned recognition in a Harvard Business Case study and an award from Forbes for innovation.
The State of Partnering Today
As companies seek to enhance market share and profitability, partnerships have become critical. A 2022 HubSpot report highlights that 77.6% of organizations, including 92.6% of enterprise companies, have partner programs. Canalys’ "Channels Ecosystem Landscape" further emphasizes the "decade of the ecosystem," forecasting the partner technology landscape to grow from $5.3 billion in 2022 to $11.8 billion by 2028.
Despite these investments, many partnerships fail due to misaligned objectives and ROI expectations. HubSpot’s survey identifies the lack of sophisticated partner operations as a primary reason. While CRM, PRM, billing, and ERP systems address specific operational needs, they often fall short in supporting the complexity of partner revenue operations.
Addressing Operational Challenges with PRO
A new category of software, Partner Revenue Operations (PRO), has emerged to address these challenges. PRO solutions:
Track & Manage Partner Obligations: Enforce contractual terms and eliminate manual processing of forms.
Operationalize Partner Obligations: Automate and streamline complex processes, including fee reconciliation and loyalty management.
Provide a Holistic View: Deliver a unified view of partner-based commerce and real-time cash flows.
PRO systems significantly reduce the cost and complexity of partner transactions, ensuring compliance and efficiency.
Building a Winning Partner Program
For a successful partner program, consider the following principles:
Executive Sponsorship: Strategic partnerships should be supported by the CEO or a senior executive with authority over budgets and revenue.
Dedicated Resources: Assign accountable personnel for each partnership, with clear objectives documented.
Joint Business Plans: Develop and approve plans detailing objectives, revenue targets, and joint activities, revisiting them annually.
Upfront Investments: Contractually commit to co-marketing efforts to drive brand awareness and demand.
Regular Reviews: Conduct quarterly and annual meetings to assess progress and resolve issues.
Implement PRO Systems: Optimize back-office transactions and enhance partnership efficiency.
About Bruce Cleveland
Bruce Cleveland has held senior executive roles at Apple, C3.ai, Oracle, and Siebel Systems, specializing in engineering, marketing, and business development. As Chief Marketing Officer at C3.ai, he successfully created the Enterprise AI category and led the company’s IPO.
Bruce is also a venture investor, author of Traversing the Traction Gap, and a guest lecturer at Stanford and Columbia. Learn more at tractiongap.criya.ai or contact him at bruce@forzagroup.com.
