This week on The CoSell Show we are delighted to have Matt Irving, Global Partner Operations Manager at WP Engine.
Topics Covered:
- Are you chasing a goal or an outcome?
- Why you should “maniacally” focus on your customer
- How partnerships have evolved in the past decade and what is on the horizon in 2020
Have more questions for Matt? Find him on:
Read Matt’s “Are You Chasing a Goal or An Outcome” article here.
Brought to you by our host: Taylor Baker (Podcast Producer and Head of Content at CoSell.io)
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Follow along with the podcast transcript is below:
Taylor Baker:
Hello listeners, and welcome back to The CoSell Show. I’m your host, Taylor Baker, and today we are going to break down the question, are you chasing a goal or an outcome? We will also tackle the topics of maniacally focusing on your customers and how partnerships have evolved and what we have to look forward to in the future of partnership ecosystems. We get into all of this and more with our guest Matt Irving, the global partner operations manager at WP Engine. Welcome, Matt.
Matt Irving:
Hey, hey. Thank you for having me, Taylor.
Taylor Baker:
Of course, happy to have you here. To kick things off, can you tell our listeners a little bit about your background and your current role at WP Engine?
Matt Irving:
Absolutely. I am originally from Lubbock, Texas, grew up in the panhandle, and went to the Harvard of the Southwest, Texas Tech University. I got my career started out as a developer and really throughout my career I’ve had a fascination with technology and relationships. I have a really curious mind for how businesses grow. And so in experiences of being a developer and running my own ad agency I really fell in love with the ability and capabilities of technology. And so I’ve been in technology, business development, and partnerships over the last 10 plus years. Today I serve as the global partner operations manager for WP Engine.
We are the largest host and provider of managed services for WordPress and really powering digital experiences for all types of different brands, and customers, and all types of folks. And primarily working with ad agencies, freelancers, systems integrators, you name it, people that are wildly curious and creative on telling brand stories. So that’s what I do in my day to day job, at night and in my off time, have a wonderful family here in Austin, two little girls, and then do a little bit of consulting on the side. And so yeah, that’s a little bit about me, what I do, and where I’m coming from.
Taylor Baker:
Wow. Thank you for sharing that. I love that you went to the Harvard of the Southwest. So in addition to, I mean, you mentioned you have a really extensive history working in partnerships and that you have after-hours you have your family, but what is something fun about you that our listeners cannot find on your LinkedIn profile?
Matt Irving:
Yeah, so when I was in college and I was learning how to code, I was also playing drums in Texas country bands, in cover bands, and so have a big passion for music. And I feel for most people in Austin, there’s some kind of connection between technologists and musicians. And so, I also do a little bit of session drumming on the side, playing for singer songwriters, or the church that we go to, or different types of hired gun stuff that comes my way. So that’s probably one of my other kind of side passions in addition to being outside, exploring down here in central Texas with my little girls and doing some hiking, and just enjoying time with my family.
Taylor Baker:
Wow. That’s becoming actually a theme here at The CoSell Show. One of our very first guests, a fellow Matt actually, he is also here in Austin and he has his partnership job, but he’s also in a band called The Dad Bods-
Matt Irving:
Oh, nice.
Taylor Baker:
… and they perform locally at family gatherings and whatnot. And then another one of my guests, she was on more of the accounting sides of things and she was telling me how she’s in choir and how like those skills between music and technology overlap a lot. And being a musician helps flex your creative muscles, both musically but then also like it makes you a better business person and more tactful with how you make your decisions on the day side of your job.
Matt Irving:
Yeah, I can definitely see that.
Taylor Baker:
Absolutely. So wow, welcome to the Fellow Music Lovers of CoSell Group. As much as I could talk about drumming, and Austin, and music and all of those things forever, we are here at The CoSell Show, so we do want to scoot on over to partnerships. And I wanted to lead with, you wrote a really amazing article on LinkedIn called Are You Chasing A Goal or an Outcome? And I just kind of wanted you to explain a little bit what the difference between those two things is and which one you think that better serves a company as a focus.
Matt Irving:
Yeah. Well, I appreciate you highlighting that. I’ve spent some time in private equity and spent a lot of time in startups, and then companies of all different sizes. I think one of the things that I noticed, no matter the type of company, there’s often this proclivity between, a difference between a goal and an outcome. And often that line gets blurred the earlier a company is. And so, you think about it from a founder’s perspective. I want to build something, I want to go change the world, and I want to go make that happen, that’s an outcome. In order to do that, I’m going to need to acquire X amount of users, and charge them X in recurring revenue, and I need to get the evaluations that I’m going to need, I’m going to need to grow by X percent, and so my goal on an annual basis for this month is going to be hitting these targets so I can go reach that outcome.
And I think that clarity is really important even the earlier that you start out. And so, part of the article really just came from, I was having a meeting with a founder, we were talking around what is the current company focused on, and a lot of things just kind of came up in the conversation. One of them was there was a lot of confusion around different businesses or different lines of the business that we’re really trying to work together. And so marketing was really trying to go drive a bunch of events to go accomplish a task that the sales arm was trying to do another product, just really trying to go figure out what products they were trying to build. And so you have a lot of departments all going in different directions and they were all chasing basically just a number, and the number was helpful, but in terms of like a North Star, but it was very difficult to find out how do you actually get to that North Star.
And so, I think one of the things I often bring up in advising sessions is, “What’s the difference between the what of the business and the how are you going to get there? The what being your outcome and then how are going to be your goals. And how are you going to know that you’re along the way towards that North Star?” And so one of the best analogies I can think of is, think if you’re on a boat, and you’re out on the lake, and you’re trying to basically go back to port. And because you don’t have friction, because you’re not on a road, every turn isn’t a linear line back to port, essentially you’re trying to point the boat back at port, but you may drift a little bit because of waves, you may come out of course for different obstacles, whatever it might be, but the goal is to really just be pointed at that outcome.
And so I think that’s one of the ways that you really have to think about from a business perspective around like you know your goals are going to be milestones and key markers of how you’re making progress towards a certain end, but being really clear of your what and your how are not the same thing. And so what does it look like for you to align your business around those ways? And so, be it from a sales organization, what is the overall business looking to accomplish? Where do you really tie into that? How do your unit economics support it? How do you know that you’re on the way in terms of overall pacing? What’s a big miss versus a small miss? These are ways that you can distill an outcome from a goal and that was essentially the Genesis, or kind of the main idea of really the importance of separating out those two things.
Taylor Baker:
Absolutely. I think it’s really easy to get lost in the similarities, but the differences, there’s a lot of nuance between a goal and an outcome, but it really makes a huge difference defining what is really driving you and how you’re actually making those choices. So it’s great that you’re consulting people to focus on that in the proper order.
Matt Irving:
Yeah. Yeah. And I think, especially for partnerships, that’s a massive thing. I often think of the best partnerships are often motivated by kind of that shared mission. What are you trying to accomplish together? Or another way of asking like where are you better together than working independently? What are the outcomes that you’re driving towards? And then for your goals, what are the things that are going to continue to tie you together? What’s the revenue that you’re going to share back and forth to keep each other motivated? What are the different, maybe even leads sort of from a distribution perspective that are going to keep both parties interested?
And so even as wildly important as it is to know your goals now comes as a company, it’s even more critically important you even know that in your partnerships. And so that’s kind of been an operating principle as I even think about partnerships of not only what we do here at WP Engine, but also even in talking to other partner leaders around town. What are the things that align partnerships, what makes them stick? What’s that balance of relationship forgives and gets that are going to keep a partnership motivated, and moving, and productive?
Taylor Baker:
Absolutely, that’s a big theme that we have pretty consistent with most of my guests here at The CoSell Show, we’re always kind of checking in and talking to new guests about, “How does this work? How would we make sure that it’s not just a take, take, take, but you’re balancing the give and take relationship of a partnership? That’s a pretty heavy, heavy topic that everyone kind of has a different opinion on because it’s not always the case.
Matt Irving:
And I think it changes over time. I mean, what might’ve brought you together might not be the thing that keeps you connected. I had a role in an eCommerce where we had developed a product and we were connected into a larger ecosystem of a larger player. And throughout the experience, one of the things that we had kept looking at was, are we trying to position ourselves for an acquisition? Are we trying to be a compliment? Like what does this really look like? And really we found ourselves as the little guide really trying to partner with the big guy. And I think like one of the key learnings that we really saw in it was, what’s the end motivation for the big guy to partner with us?
And the clarifying point that we really kind of came into from an outcome perspective was we really see ourselves as a feature that the big guy was not going to be able to develop. They didn’t really have the expertise, they didn’t really have the time. They didn’t want to do any investment capital from an investor perspective like they would have been seen off course building this capability. But it is something that is adjacent to their core structural revenue driver, it was definitely an adjacent service that drove the business. Just something that they couldn’t build themselves. And so, building that around the outcome was really interesting around how could we help accelerate their sales teams? How can we give them better alignment in a marketing world?
And that really led to a very, very tight partnership that I think, had we just thought about it in terms of, “You have more customers than we do. We’re this little person. Can we just come in and go acquire all these customers, get really big, and then get sold?” While it would have been nice, it would’ve been only motivated for ourselves and would have had really little to no rationale from the larger player in it. So I think that’s one thing that you always have to think about from the perspective of who are you trying to partner with? Why are you trying to partner with them? Why would they partner with you? What would you gain by working together? And why wouldn’t you just do this on your own?
Taylor Baker:
Definitely, so we’re still sort of talking about goals versus outcomes but, and you had mentioned this before, that companies in your article was laser-focused on meeting this revenue goal and everybody was sort of like anybody at a drop of a hat could tell you what that number was, but no one was really clear on the actual process of meeting that goal. So what specific advice would you give to companies about, not only collaborating to achieve these goals, but breaking them down into short-term tangible actions?
Matt Irving:
I think a really common way that most companies kind of go about it is really the five why’s. So you start out with an outcome and you say, “Why? Why is that important?” And then being able to really drill down into more of a root cause like, “What’s the unsaid implication or assumption that is really driving out to that outcome?” So take a number for example like, “We need to hit $50 million together.” “Okay, well why is $50 million important?” “Well, investors are paying 10 X multiples on on my category and I really want to make our investors happy.” “Why is that important?” “Well, you know, it would allow us to invest in other products and really be able to build this thing out.” “Why would we go about this, and why haven’t you already done this?” “Well, we really haven’t had the time or the focus.” And then, “Why haven’t you had the focus?” “Well, we wanted to [inaudible 00:11:58] our core business.”
Just being able to be, really, having the intellectual rigor, I think to distill outcomes really help you get into some really meaningful points, versus like, “$50 million, awesome. Signing up for it. Let’s go.” It might be a smaller player trying to really kind of make a name for themselves and so they hear a big number, they think about it from an aspirational perspective, and it’s, “Yes, signing up for it, challenge accepted. I’m ready to go. I’ll go figure out how to do it.” And I think that’s where many of these partnerships really struggle. If you didn’t really come up with a very coherent step-by-step way that you’re going to go to market together, that you’re going to go delight customers together, that you’re going to go make an impact, and then all of those things in summation lead to the outcome that you’ve talked about.
Taylor Baker:
Absolutely. I mean, who doesn’t want $50 million, but you got to actually figure out the process on how to make that happen.
Matt Irving:
Yeah, yeah.
Taylor Baker:
The sort of reference is, people want to go to college and get a degree. Great, that’s a great goal. But you have to go to class, you have to do the homework, you have to write your papers to make that happen. You can’t just have this great goal and it just appears, poof, out of nowhere. So it’s great advice on how to break that down.
Matt Irving:
I have high aspirations of getting rid of my dad bod, but if I don’t go out and run, that’s probably not going to happen.
Taylor Baker:
Fair enough. Fair enough. And you mentioned, sort of the last note on the goals versus outcomes, you mentioned at the end of the article that companies should structure their goals with their customer in mind. How can companies continually foster a customer centered focus?
Matt Irving:
I get really passionate about this because, I mean, there’s so much good research out there, the cost of acquiring a new customer is 10 times the cost of building out a current customer sale. Everyone is concerned about customer acquisition costs versus lifetime value, and so you have to look at the lifetime value of delighting your customer. What does that explicitly mean in revenue? What’s the risk of losing someone? What’s the value of them referring you into another business unit or even another customer? Like there are a lot of really good implications on really being maniacally focused on your customer. And I read a great quote by Elon Musk a few weeks ago that you’re paid directly proportional to the level of challenges that you’re solving. And I think that’s true, even as a business as you think about your customers, the value of your MRR, or ARR, or your license fee, or your payment-
Taylor Baker:
The business dictionary called and we are happy to answer. If you are new to The CoSell Show, welcome to our micro-segment where we demystify notable business vernacular. Today we have MRR and ARR, MRR is monthly recurring revenue, and ARR is, you guessed it, annual recurring revenue. Now back to your regularly scheduled programming.
Matt Irving:
… whatever the nature of the transaction is, that is multiplied by the amount of pain or the amount of value that you’re delivering back to that customer. And so I think it becomes more about how do you delight and really go address that overall customer pain point, and being able to do that from partnerships, really kind of even using that as a guide is very helpful, of the two products, or is this partnership going to delight the partner in the same use case and way? Or is this kind of solving two different things, and it could be kind of confusing for the customer. Like maybe I’m solving an IT issue and my partner is trying to solve a finance issue, and maybe those two things aren’t really connected. So it’s great from a strategic alliance that we want to make it easier for your people to buy from us, but it’s not really going to be a direct go to market type of partnership.
So I think that those are great ways as companies think about your partnerships, and how you’re going to be connected, and what your overall terms of service are going to look like. What’s the delta between the value that you’re delivering to a customer and your core offering that you’re going to market? If those are very far apart, be aligned together, go make it easier for customers to buy from you, but if it’s a really tight partnership, go increase the value, go make that message super strong because that’ll lead to a great go to market, and lead to revenue as a byproduct.
Taylor Baker:
Definitely. I really love what you were saying sort of in vain with the customer focusness, I find that with business relationships there’s a really thin line really between a business relationship and how you would treat a relationship in your personal life.
Matt Irving:
Yeah, I think it’s a really good way of thinking of it, of alliances equate more to acquaintances and partnerships really are those ride or die relationships. It’s a tighter bond and affinity. I had a mentor kind of explain relationships are the currency of partnerships, and if you think about it in terms of a financial ledger, you have credits and debits. So what are the investments that you’re making into the relationship that are going to build the trust credit that you’ll draw from as you go and make hard bets, as you go try new things, as you try to work with your product teams to go build something that you’ve never really done before, that does come at a cost and it comes out of a cost of the relationship. And I think a lot of relationships are kind of predicated on take, take, take.
And so you end up in debt in terms of a relationship that you really can’t manage. There’s not really a lot of trust there. You’ve already burned the relationship and at some point it’s in repairable, you just kind of have to write off the relationship. Those are really tough conversations if you may have a great product, you may have a great offering, you may even have great customers, but you’ve over-indexed on ask in terms of the relationship, and [inaudible 00:17:33] credibility that would really make that partnership really work in scale. So in a lot of ways, I think that’s another miss in terms of where partnerships can really kind of go sideways as you over-consume on the relationship and you under-invest on the relationship and therefore that partnership really never takes off as it really could have.
Taylor Baker:
Again, so true for personal relationships as well. I love how much these actually intertwined. So sort of switching focus a little bit, you had mentioned you’ve been working in partnerships for now 10 plus years and I’d really like to kind of dive into some of your insights you have there. How have you seen partnerships evolve over the past 10 years?
Matt Irving:
I think about the genesis of the majority of channel people think of [inaudible 00:18:12] over time, or really at the beginning, many of those relationships were very sales driven. So it was about relationships, it was about golf and more of a relational business development, very personally related. And I think over time more technology has been introduced into it of like how do you get clear about what demand you’re generating, how do you get clear about the overall unit economics, and partner referral systems, and [inaudible 00:18:38] track, and being able to really have good benchmarks that are beyond what was on the back of a napkin. And so I think you’ve seen an evolution of relationships and technology both go together, and it’s more of how do you do personalization at scale? Meaning that relationships supported by technology actually lead to better partnerships because you are getting insight and credibility from the technology that supports the personal relationship side.
So you actually have to be good at both. You have to have clear metrics around what the partnership is going to deliver and you’ve got to have relational credibility that you’re going to be able to deliver it. And so I think that’s been a unique point of where people go back and forth on over relational or over to technology. It’s really a both and, and both of those have to be constant and positively correlated with each other. So I think that’s probably been my biggest insight, either seeing that in the venture capital space when I was at Abel, seeing that in the technology space that I’m in right now, and also in the commerce, or even in a lot of conversations that I have with tech founders through the Cloud Software Association. Technology plus personalization is a great recipe for a great partnership, but both of those have to be really strong.
Taylor Baker:
So sort of looking into the future as we move ever closer to 2020, what do you predict is on the horizon in the world of partnerships, or even maybe something that you see lacking currently that you hope comes about in 2020?
Matt Irving:
I would think of this in kind of a couple of categories. If I think of demand generation types of partnerships, so we’re going to go build a bigger and better market, or a bigger and more qualified market rather. I think that you’ll see a lot of players add on artificial intelligence, machine learning, this is going into every industry. And what does it look like to use great data science to really go support customer profiles, look like audiences that exist? And so, one application in that would be account mapping. What does it look like for company A and company B to basically look at what are the different customers that we’re trying to sell for, and what makes for a better value for that customer? In terms of technology, microservices are such a great use case on being able to create technology partnerships.
And so it’s getting easier and easier for larger companies and smaller companies to be able to partner together with very little tech effort. And if you think about in SAS in particular for partnerships, that’s often one of the biggest barriers in terms of how do you justify technical roadmap on maybe a bet that these two companies partnered together could [inaudible 00:21:10] more accelerated revenue or, customer acquisition, or maybe then customer success. And so I think those would probably be my two takeaways.
What does it look like to see better account mapping in terms of the customers that you’d be able to identify? And then micro services like really being able to have deep technology [inaudible 00:21:26] with very little effort, and really being able to build some really interesting products. I mean, the idea behind being able to connect services between Salesforce, and different CRMs, and marketing automation systems, and being able to pair those together, I think that’s something I can see in a company like this of where you’re seeing a future, and what you’re building your product roadmap towards makes a lot of sense for where the technology landscape is going.
Taylor Baker:
Amazing. It’s like looking into a crystal ball. Thank you for sharing your future insights. So Matt, you have been so wonderful and I am just curious do you have anything exciting coming up, either at WP Engine, or with your drumming, or with your two beautiful daughters?
Matt Irving:
Yeah, always. I mean we’re growing one of the largest WordPress ecosystems of makers and creators, designers, and developers. And so wildly excited about that. I also lead the Austin chapter for the Cloud Software Association, so if you’re in Austin or the central Texas area, hit me up on LinkedIn or Twitter @raiderdesign. I would love to connect. Then also, just in general, I mean, there’s so much exciting things happening in channel and so excited for 2020 as we go into a new year.
Taylor Baker:
Here we come 2020, get ready. Well Matt, thank you so much and listeners do not worry. I will link to the Austin Cloud Software Association as well as Matt’s LinkedIn. Maybe if we can scrape up some videos of him drumming I might throw those in there for fun-
Matt Irving:
Oh, nice.
Taylor Baker:
… but we will link all of that for you in the show notes here. And in the meantime, Matt, thank you so much for taking the time. It was a real pleasure to have you.
Matt Irving:
Yeah, thank you so much. Have a great day.
Taylor Baker:
And to all of our listeners out there, thank you for listening and be sure to tune in next week for even more exciting co-selling content. Now go get your partnership on.
