# Building an Effective Channel Partnership Strategy

> A NachoTuesday interview — the C-Suite Insights series from NachoNacho, the B2B SaaS and AI
> marketplace. In conversation with Andy Ranson, CEO, K1 Channel Consulting.

- **Page:** https://nachonacho.com/nachotuesday/video/Building-an-Effective-Channel-Partnership-Strategy
- **Guest:** Andy Ranson, CEO, K1 Channel Consulting
- **Guest on LinkedIn:** https://www.linkedin.com/in/ransonandrew/
- **Recorded:** 2024-03-12
- **Watch:** https://www.youtube.com/watch?v=5HJ3GDhr7ZQ

## Summary

In this NachoTuesday, Andy Karuza interviews Andy Ranson, CEO of K1 Channel Consulting In this interview, they discuss how to successfully set up a channel partner strategy. They also discuss how to structure and build a channel partnership relationship that's win-win.

## Full transcript

Good morning, everybody, and welcome to another Nacho Tuesday. Today, we have two Andys, so I hope you can handle it! We have Andy Branson here with K1 Channel Consulting. It’s good to see you again. Hi Andy, thanks for joining us for this Tuesday event. K1 Channel Consulting Overview Last time I saw you was in London, which was my first time there. It was great to meet the people you work with in person. For those who might be unfamiliar, could you give us a high-level overview of what K1 Channel Consulting does? Absolutely. K1 Channel Consulting is a pioneer in fractional partnerships. We support SaaS companies in the established and growth phases to drive partnership revenue. Essentially, we have developed a range of accelerators that cover channel sales strategy. We build partnership programs and are among the few to offer partner recruitment as a service. With over 60,000 partners in our network, we actively recruit both in global and international markets. Additionally, we provide fractional partnership resources and offer best-in-class solutions. The Importance of Channel Partnerships You're definitely a great connector. Andy has made many valuable introductions for us and has been excellent at connecting the dots between different partnerships. So, what led you down the partnership route? It's a great question. As you might tell from my accent, I grew up in New Zealand but was born in London. New Zealand served as a significant software test bed, with a lot of innovation in software. I got into partnerships in 2004 while working for a SaaS scale-up company specializing in big data and analytics on the Microsoft platform. We built a successful channel, partnering with ERP companies and Microsoft, becoming one of the top three ISVs in Microsoft's partner program. What we observed was how effective collaboration could be in growing revenue and expanding internationally. We replicated this model across New Zealand, Australia, and the U.S. Despite being a small team of about 50 people, it was a successful approach, and I naturally fell into it and continued from there. Partnerships as a Growth Strategy Partnership growth is a major initiative for many companies, especially given the high cost of customer acquisition for SaaS and other types of companies. What makes channel partnerships such a key strategy for business growth, and why is it so effective? Partnerships are crucial for several reasons. They provide access to other companies' resources, fueling innovation and helping develop industry verticals. They offer a fast way to accelerate revenue, with business partners endorsing your solutions to their customers in both local and international markets. This is a cost-effective way to expand your growth. Moreover, bringing multiple resources together often results in a stronger value proposition. Challenges of Developing a Partnership Strategy What are the challenges of developing a partnership strategy, especially in the early stages for a company, and how can companies be supported? For SaaS companies, there’s a lot to manage—building the product, achieving product-market fit, developing a direct sales team, and acquiring initial customers. When it comes to partnerships, especially from scratch, it’s tricky. Companies often lack the knowledge on how to build partnership programs. CEOs might come from a direct sales or development background, which is common. Common challenges include a lack of knowledge and resources. Partnership managers might be skilled but may lack extensive experience in setting up programs from scratch. Additionally, there’s a scarcity of fractional partnership consultancies designed to support the entire process. I’ve set up several partnership programs and realized there had to be a better way. Building a partner program involves creating assets, recruiting partners, and putting systems in place—often requiring multiple roles. This is incredibly challenging for a single person. Fractional Partnership Support Hence, the term “fractional.” Instead of hiring multiple roles, especially in the early stages of developing a partnership program, it’s beneficial to work with a company like yours. You effectively provide the expertise of multiple roles on a fractional basis, which helps shortcut the path to a successful partnership strategy. Exactly. The initial phase is often the hardest, covering roles like partnership director, partner program build, recruitment, onboarding, and selling with partners. It’s challenging for companies to manage all these aspects, and we recognize that. Once past this initial phase, the process becomes more manageable. Initial Phase and Resources Once you've got the structure in place and have onboarded your first 10 to 20 partners, driving revenue becomes significantly easier. Resources play a crucial role in this process. Having video content or other materials to support your partners in the sales process can be incredibly beneficial. In the early phase for SaaS companies, we focus on referral or co-sell motions. Once partners are onboarded, having a methodology for co-selling is effective. Many partners prefer co-selling over reselling. Your partnership program's growth involves clever execution strategies that can leverage existing commercial resources. From a fractional perspective, balancing the partner manager role with the partner sales manager role can facilitate execution, especially in the initial phase. Challenges in Partnership Strategy Given your extensive experience with these programs, what are some common challenges you hear from CEOs, CFOs, or sales leaders who are implementing a partnership strategy for the first time? A common challenge is the lack of resources or knowledge. This is extremely prevalent. Sometimes, companies attempt to drive partnerships but end up starting with the wrong partnership types. For example, a company might start with a reseller tier but lack a partnership program background. Another common issue is a lack of support. There are few companies in the market that can assist SaaS CEOs and revenue leaders not just with strategy formulation but also with execution and reducing complexity. Resources, support, and knowledge gaps are significant challenges. The Value of Fractional Support Resources also come into play when hiring an internal team. While they may have their own relationships, a company like yours, which has a vast network, can provide a multiplier effect. Absolutely. Our model is highly focused on partnerships. We have experienced executives with 20 to 30 years in partnership roles who can offer advisory and execution support. Additionally, we’re building a team of fractional resources for execution. This year, especially in the North American market, we are focusing on building relationships with other fractional companies, like CRO and CMO firms. This effort aims to bring additional resources to the ecosystem and add value to SaaS companies. There is indeed a simpler way to set up your partnerships program, and we're here to help make that happen. Key Roles in a Partnership Program You mentioned several key roles for an effective partnership program. Could you expand on these roles and what they entail, particularly those offered as bundled services? Certainly. For channel sales strategy or the partnership director role, we assist in setting up the strategy and developing the partner program. This involves a senior role that guides the development and establishment of the program. We also build partnership infrastructure from scratch. With our resources and assets, we can rapidly develop different stages of your partner program, whether it's referral, co-sell, reseller, or white label. One of our standout services is “Partner Recruitment as a Service.” With a network of 60,000 partners, we work with you to identify your ideal partner profile and value proposition. We recruit partners across various markets and verticals. Our data team supports this process by addressing nuances and ensuring effective recruitment. SaaS companies can choose to manage recruited partners themselves or use our fractional capabilities for onboarding and sales execution. The partner recruitment service is a game-changer in this space. Challenges in International Partner Recruitment When recruiting partners in international markets, there are several challenges, including language barriers. What other concerns or challenges should companies consider when expanding into international markets and building partnerships outside their own country? We generally start by focusing on English-speaking markets if the company is English-speaking. However, the beauty of our partner recruitment service is our extensive global network. For instance, a U.S. company looking to expand into Europe or APAC can benefit from our established network in those regions. Our service applies the same logic: identifying desired partners and their value propositions. The established network facilitates this process, making international expansion more manageable. Expanding Into Local and International Markets With our services, companies can expand into local or international markets to drive growth. For instance, if there's a demand for partners in LATAM, we can hire resources who speak the local language to facilitate this expansion. Emphasizing understanding the language, cultures, and business practices of the target country is crucial for establishing a strong footing. By working with local experts and utilizing companies like ours, you can effectively find and hire the right people. Often, it's not just about the language; it's also about cultural norms and established relationships. Having local expertise on the ground helps in building these essential connections. Challenges and Local Expertise Andy, your voice cut out for a moment, but it’s good to have you back. Over the last 12 months, we’ve been establishing partnerships and have resources in Europe providing channel sales as a service through a company called Channel Creator. This local knowledge is invaluable for U.S. companies looking to expand into Europe. Conversely, British companies seeking to enter North America can benefit from our network of CROs and CMOs who offer advisory and execution support. Having local market knowledge and resources is crucial for effective expansion, and the fractional approach works well in these instances. Industry Trends and New Initiatives Regarding industry trends, we’re seeing many companies looking to grow through partnerships. There’s a significant interest in rapid accelerators and international expansion, especially from companies based in London looking to enter North America. The fractional resource approach and outsourcing various functions are becoming more accepted. Companies are likely to invest in international expansion and partnerships, particularly if these initiatives are well-supported and simplified. Supporting Partnership Growth As a partnership grows, K1 Channel Consulting supports this development through various means. We have relationships with top PRM companies, such as MindMatrix and Klow. With our solution provider program, we can digitally build PRM solutions tailored to your needs. This capability allows us to structure your referral, co-sell, or reseller programs within the PRM system. We can build out the onboarding process, track deal registrations, and effectively manage your PRM solution from inception to full scale. Klow, specifically designed for SaaS startups and scale-ups, offers a cost-effective PRM solution. Benefits of PRM Systems Managing partnership relationships through PRMs is far superior to using Google Drive and spreadsheets. PRMs serve as CRM systems for partnerships, organizing and sharing resources effectively. They streamline the partnership strategy, making it much more efficient. PRMs are becoming increasingly user-friendly, enabling digital construction of partner recruitment, onboarding processes, and deal execution. This simplicity enhances overall partnership management and effectiveness. Partner Marketing and Communication We also work with a partner called Viewpoint, which specializes in partner marketing and communication. Viewpoint provides personalized content and marketing materials for companies, helping them effectively communicate with and support their partners. This service can be invaluable, whether you have an established partner ecosystem or are just starting out. Over time, the process of growing and scaling your partnership program will become simpler as you move through different phases. Recommended Reading Aside from business, are there any favorite books you’ve read this year or recommendations for other business leaders? One book I found intriguing is about Jon ALU, a famous All Black and cultural pioneer. His leadership extends beyond rugby and delves into Kiwi culture and leadership. This book aligns with the pioneering spirit we embrace at K1 and serves as an inspiration for our company's values. Resources for Building a Partnership Strategy For those looking to build a partnership strategy from scratch, there’s a wealth of content available online. We’re also planning to develop specific training courses for SaaS companies over the next 24 months. I recommend exploring online resources and reaching out to fractional companies specializing in this space. Having a conversation with experts can be incredibly beneficial, as they can provide guidance and support. E-learning is a growing trend, allowing you to productize knowledge into videos for onboarding and educating your team and partners. The Future of Partnership Training Currently, there’s a lack of formal training for partnerships, similar to what exists for sales, marketing, and finance. However, this gap is expected to close in the coming years, as more resources and training programs become available. Understanding partnerships is crucial; you can’t effectively promote or sell something you don’t comprehend. Why Choose K1 Channel Consulting When considering different channel consultants, it’s important to note that many focus primarily on the enterprise level. K1 Channel Consulting, however, specializes in working with SaaS startups and scale-ups across various verticals. Our methodology emphasizes not just advisory work but also the building and execution of partnership programs. We have a global network of highly experienced resources and a dedicated team passionate about supporting startups and scale-ups. Our fractional consulting approach helps you get from zero to a functioning partnership program quickly, leveraging our existing relationships and expertise. The Benefits of Fractional Consulting Fractional consultants are excellent for rapidly establishing partnership programs. Rather than hiring multiple individuals to start your partnership efforts, partnering with companies like K1 Channel Consulting can set you up for success from day one. This approach helps avoid the pitfalls of learning through trial and error. We’re always happy to help and offer consultations to understand your journey and where you are in the process. We’re proud to work with Nacho Nacho and support their customers. Final Thoughts It’s been great connecting with you again, Andy. I look forward to seeing you in London next time I visit. Andy has been a fantastic partner, referring business and growing our collaboration. I highly recommend his services. Check out K1 Channel Consulting in Nacho Nacho’s new Services Marketplace. Andy, thank you so much for coming on. I look forward to connecting with you again. Always a pleasure, and goodbye for now!

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