Building A Vibrant Partner Ecosystem: Taking A Page From The Salesforce Playbook

Companies looking to grow and succeed in today’s hypercompetitive enterprise cloud market need more than a great product and a compelling value proposition. They need a partner ecosystem. 

This isn’t new news. Companies like Microsoft, Oracle and SAP have spent billions over the years building out their channel programs and partner ecosystems, relying on consultancies, integrators and VARs to drive their products deeper into the enterprise and create customer stickiness. Microsoft even took it a step further in 2000 and built a joint venture with AccentureAvanade to help clients derive more value from their products. Avanade now has more than $2 billion in sales, and has grown 20 percent on average year over year.

While some B2B cloud vendors have followed this playbook (some better than others), a number of the vendors driving the cloud’s third wave have taken a more product-driven, bottoms-up approach to customer success. Companies like Atlassian, Twilio, HashiCorp and Snowflake focused their efforts on creating products that are easy to use, easy to adopt and spread into the organization at the user level. 

partner ecosystem success model chart

That approach works incredibly well initially for driving awareness, growth and brand loyalty, and has been a big driver of growth for many companies. However, as many of the more mature cloud platform players like Google, Salesforce and ServiceNow can attest, as a vendor moves further up in the enterprise and becomes a more critical component of the IT “stack,” a service partner ecosystem becomes more important. 

The fact is, larger enterprises have more complicated wants and needs, especially multinational or regulated companies. When it comes to enterprises, even the most intuitive products have to fit into a broader IT landscape, and topics like architecture, integration, security, compliance, governance and change management become bigger issues. Even subscription-based cloud products. 

Customer success becomes even more important in cloud ecosystems. When a vendor has to earn a customer’s business month after month and year after year, having trusted partners to guide those customers in the right direction and provide technical expertise and ongoing support — combined with the right technology — will invariably lead to a better outcome. 

While software might be eating the world, it’s the people who make that software work inside an ever-changing business environment that add the most value. That’s why we’re seeing more and more emerging vendors prioritizing investment in their partner ecosystems to complement and optimize the value of their cloud-based solutions.


The Salesforce playbook

Salesforce* is a great example of this playbook in action. The company began grabbing market share from Siebel and Oracle in the early 2000s by going around IT and targeting sales reps and sales leaders directly — most of whom had a deep love/hate relationship with CRM tools. Salesforce made it incredibly easy to buy and start using the product immediately. All it took was a credit card, which most salespeople are not afraid to use. 

Enterprise IT organizations soon found themselves with thousands of licenses spread across the business with little insight, coordination or control. It turns out when it comes to large deployments affecting hundreds of users and company revenue, IT and business leaders, not surprisingly, want some control. 

I experienced this personally as the CIO of Borland Software many years ago. We were one of Salesforce’s first enterprise deployments, giving everyone in the company a license (and shutting down hundreds of servers along the way). I knew the impact Salesforce could have on our business, but the technical and change management skills required to make it work in a complex, global 25-year-old business with entrenched systems required support from a partner. That’s why I co-founded Appirio less than a year later. 

In the last 20 years, Salesforce has built one of the largest and most engaged ecosystems in the cloud computing space. IDC predicts that by 2024 the Salesforce ecosystem will generate $1.2 trillion of new business revenues and 4.2 million new jobs, and predicts that ecosystem revenues will grow almost 6x larger than Salesforce itself by 2024. Professional services firms make up the vast majority of this ecosystem, sourcing nearly two-thirds, or 64 percent of Salesforce ecosystem earnings in 2019. 

ecosystem building blocks pie chart

When I started Appirio in 2006, we were one of only a handful of service providers building a consulting business focused entirely on Salesforce. When Wipro acquired Appirio 10 years later, there were hundreds of service providers in the ecosystem and every major systems integrator was doubling down on building a thriving Salesforce practice. Today, there are more than 1,600 consultancies listed on AppExchange.

According to 10K’s 2020 Salesforce Talent Ecosystem Report, the Salesforce consulting ranks grew nearly 30 percent year over year between 2019 and 2020. Accenture alone employs more than 25,000 Salesforce-skilled people. With Salesforce projecting to reach $50 billion in revenue by FY26, it’s no wonder that the partner ecosystem is thriving! 

But it’s about more than size. The Salesforce partner ecosystem is one of the most engaged, innovative and globally diverse communities out there. Partners play a huge role in the company’s flywheel of growth — from sourcing and selling deals, to the implementation and integration services that set customers up for success, to the training and managed services that keep them happy and coming back for more. 

Partners are also responsible for increasing the value of the Salesforce platform, creating apps that both use and extend Salesforce, especially into specific vertical markets that the ISV can’t address fully. Vlocity, an industry-focused CRM vendor built natively on the Salesforce platform, is a great example of this. Early on, it filled some big holes in the Salesforce platform, and was eventually acquired by Salesforce for $1.3 billion. 

Service providers are getting into the game too, building accelerators and “Industry Jump Starts” that help customers move faster and give Salesforce deeper reach into subverticals. 

Partners also help Salesforce make a bigger impact on topics like sustainability, diversity and social justice; issues that are not only top of mind for Salesforce, but partners and customers alike. When COVID hit, it was amazing to see how the partner community jumped in alongside Salesforce to create vaccine distribution solutions or help people get back to work safely

But it didn’t happen overnight. 


A partner ecosystem built purposefully 

To call Marc Benioff and the team of partner leaders he’s hired over the last 20 years “visionary” would be an understatement. There’s a reason why he and Salesforce have topped Forbes’ most innovative company lists year after year. 

Here are just a few of the moves that Salesforce made early on to drive such a vibrant ecosystem. It’s a playbook that many other vendors are following, especially as former Salesforce executives spread out across other cloud vendors, bringing Salesforce’s customer- and partner-focused DNA into these new companies. 

Create a platform that lures developers

Salesforce certainly wasn’t the first company to build a platform for developers, but was the first cloud platform that allowed third-party developers to take advantage of a proven, multitenant, shared architecture. Which meant it was faster, cheaper, easier and safer to get apps up and running. But it wasn’t just the platform, it was also how Salesforce empowered customers and partners to use the platform. ServiceNow, with its “Platform of Platforms” strategy is seeing incredible growth from this same play.

Create a marketplace to feed the ecosystem

Salesforce launched AppExchange in 2005 as a way for third-party developers to market their own applications and it quickly expanded into a way to find service providers and consultants. AppExchange is now at the heart of Salesforce’s partner ecosystem, a marketplace where customers can easily access apps, solutions and service partners that are vetted, reviewed and marketed by practically any criteria a customer could want. The AWS marketplace followed in 2012 and now has more than 10,000 different listings to extend the AWS platform.  

Give early access to products

Salesforce also makes it a point to bring partners in early on new product developments to prime the market. This helps ensure a smooth implementation at the onset, and helps galvanize the broader customer base. This one isn’t unique to Salesforce — many other companies offer early access to select partners — but given Salesforce’s pace of innovation and acquisitive nature, it’s taken early access programs (and the processes around them) to a whole new level. 

Invest in and celebrate the people

People are the heart and soul of any business, but especially in professional services. Salesforce gets this and has been a pioneer in training, certification and workforce development. The launch of its Trailblazer program was revolutionary at the time — and focused entirely on uplifting and upskilling people to become experts on the product and to increase their own earning potential. Not a bad move when it comes to creating a loyal talent ecosystem.

The company is also great at fostering an engaged and passionate community by celebrating the people in it. Whether customers, partners, employees or independent contractors, Salesforce’s “Trailblazers” are the company’s biggest brand advocates. Salesforce’s MVP program, which celebrates users who mirror the company’s values and who help share their knowledge and time with the community, has also been a huge success. In fact many of these MVPs have gone on to create their own Salesforce apps and consultancies. 

Tableau is another ISV that does this exceptionally well — even prior to its acquisition by Salesforce. Tableau’s Ambassadors are one of the most engaged groups out there and huge advocates for the platform both inside companies and outside.

Provide companies capital to grow (and to drive competition)

Salesforce Ventures launched in 2009 with a commitment to invest in companies that partner with Salesforce to extend the features and functionality of the platform. It prioritized products (and still does), but it also provides capital to consulting partners.

Appirio’s first corporate investor, Salesforce Ventures gave us the capital and credibility to expand and secure future capital from the likes of Sequoia, GGV and General Atlantic, but it also helped stoke a little competition in the services ecosystem, which was pretty nascent at the time. Salesforce has invested in around 70 service partners over the years, including Model Metrics and Acumen, two investments Salesforce later acquired to build out its own professional services business. The capital investments aren’t good for just the businesses they fund; Salesforce reported a $2.17 billion gain on investments in 2020.

Many other cloud ISVs have taken note and launched their own venture arms to prime their ecosystems. Some launched their programs to spur innovation in a particular area, like Workday Ventures did in 2012 around machine learning, and then expand. Others like Snowflake or Okta focus more broadly. Most still specialize in product investments, but a growing number understand the value of services within their ecosystem and are investing alongside firms like Tercera the way Twilio has done with our latest investment Terazo, a software development and managed services firm specializing in the API economy. 


An opportunity for everyone

My mother always said “it takes a village to raise a child.“ That mantra holds true when that “baby” is a company’s product or platform. A thriving cloud ecosystem is always greater than the sum of its parts — especially for emerging cloud vendors. As cloud deployments and digital initiatives escalate, and deployments increase in complexity, having a robust partner ecosystem is an imperative. The rising tech skills gap, which is now even larger than it was pre-pandemic, is making this even more important.

The cloud vendors that get it right will not only leap past the competition when it comes to momentum and scale, they’ll also create a competitive moat as the war for talent rages and support a new generation of entrepreneurs. And that’s good for everyone.

*Disclaimer: Salesforce is an investor in Crunchbase.

Chris Barbin is the founder and CEO of Tercera. He brings more than 25 years of technology and professional services experience, and is a proven entrepreneur, CEO, senior executive and board member. His most notable entrepreneurial journey was founding Appirio, one of the first professional services companies hyper-focused on the first wave of enterprise cloud computing. He and the founding team grew Appirio to more than 1,500 employees around the world, and eventually sold to Wipro for $500 million-plus. Barbin is also the founder of SipTequila, a board member at Bates College, and a contributor on the Forbes Technology Council.

  • Originally published August 9, 2021, updated August 10, 2021