May 22, 2007 AppExchange Partner Program Terms Overview.
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Transcript of May 22, 2007 AppExchange Partner Program Terms Overview.
May 22, 2007
AppExchange Partner Program Terms Overview
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Safe Harbor Statement“Safe harbor” statement under the Private Securities Litigation Reform Act of 1995: This presentation and the oral remarks that accompany it contain forward-looking statements the achievement of which involves risks, uncertainties and assumptions. If any such risks or uncertainties materialize or if any of the assumptions proves incorrect, our results could differ materially from the results expressed or implied by the forward-looking statements we make. All statements other than statements of historical fact could be deemed forward-looking, including any statements concerning new, planned or upgraded services or technology developments, any projections of subscriber growth, earnings, revenues or other financial items and any statements regarding strategies or plans of management for future operations, statements of belief and statements about future customer contracts or future customer use of our services.
The risks and uncertainties referred to above include - but are not limited to - interruptions or delays in our service or our Web hosting; our ability to complete and successfully release new and improved versions of our on-demand platform and development environment; our new business model; problems integrating, launching or operating services based on newly acquired businesses or technologies, breach of our security measures; possible fluctuations in our operating results and rate of growth; the emerging market in which we operate; our relatively limited operating history; our ability to hire, retain and motivate our employees and manage our growth; competition; our ability to continue to release and gain customer acceptance of new and improved versions of our CRM service; unanticipated changes in our effective tax rate; fluctuations in the number of shares outstanding; the price of such shares; foreign currency exchange rates and interest rates.
Further information on these and other factors that could affect our financial results is included in the reports on Forms 10-K, 10-Q and 8-K and in other filings we make with the Securities and Exchange Commission from time to time, including our Form 10-Q for the fiscal quarter ended April 30, 2007. These documents are available on the SEC Filings section of the Investor Information section of our website at www.salesforce.com/investor.
Any unreleased services or features referenced in this or other press releases or public statements are not currently available and may not be delivered on time or at all. Customers who purchase our services should make purchase decisions based upon features that are currently available. Salesforce.com, inc. assumes no obligation and does not intend to update these forward-looking statements, except as required by law.
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Developing The Next Generation Of Salesforce.com’s
4 4
The Circle of On-Demand Success
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Growing the AppExchange in 2007Platform & Go-to-Market Breakthroughs
2006
AppExchange 1.0
CRM-centric Apps
Early US SMB Adopters
Smaller ISV Partners
Ad-hoc Partnerships
Apex & AppStore
Verticals & Beyond CRM Apps
Global Enterprise Adoption
Full ISV Spectrum
Formal Partner Programs
2007
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Fueling Partner Success in 2007Fully Integrating Partners to the Ecosystem
Awareness & Education
Joint Sales & Go-to-Market
Partners
TargetedDemand
Generation
GeneralMarketing
29,000+ Customers
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Different Ways to Achieve Same Goal Join the Ecosystem to Leverage Economies of Scale
Immediate Access to Largest Global Market of On-Demand Customers
Ongoing Technology Guidance & Support
Level Playing field based on Customer Success
Leverage Proven Marketing Methods
Low-cost/High Quality Lead Generation
AppExchange DIY
Faster Sales CyclesWhat
would be your cost?
Immediate On-Demand Credibility (Customers, VC, etc.)
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What a Difference a Year MakesUnique programs to drive demand to your apps
Dedicated Category Leader
Success Story Participation
Targeted Email Marketing & Webinars to SFDC Customer base
Sales Education Roadshows
“Top Partner” Matrix eligibility for SFDC Sales teams
Access to Pre-Release Apps
This Year Last Year
N/A
N/A
N/A
N/A
N/A
N/A
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AppExchange Basic
AppExchange Standard
AppExchange Premium1
Basic set of services to get started on the
AppExchange
Enhanced services to grow your business on
the AppExchange
Full suite of programs and tools to support an on-demand business on
the AppExchange
ELIGIBILITY
Customer Deployments 0 0100 Corporate or 10
Field
Customer Ratings 0 03.8 of 5
(Min 20 ratings)
Customer Interviews 0 0 3
Partner Program Levels & EligibilityDemocratizing ISV Success
1. Scheduled availability in Q3 CY07
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BASIC STANDARD PREMIUM
BUSINESS & TECHNICAL SUPPORT
Business Planning & Acct Mgt Initial Review by PSM Annual Review by PSMQuarterly Review by PSM
or Category Leader
Developer Edition & API Access Application Design ADN + Review TAC Named TAC + PM
GO-TO-MARKET PROGRAMS
AppExchange.com leads Event marketing eligibility Sponsored category listing Preferred directory placement Incubator eligibility Joint PR activities Targeted demand generation Salesforce.com Awareness Salesforce.com Engagement
Partner Program Benefits Programs & Tools for Developer/ISV Success
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BASIC STANDARD PREMIUM
Partner Referral Fee1 0% 10% 25%2
Annual Application Certification Required Required Required
AppLabs Training Seats 0 1 2
Developer Support Packs $ Required Required
Annual Min MDF Commitment3 $0 $20K $50K
Salesforce.com Lead Referrals per Year
0 3 Corporate or 1 Field 6 Corporate or 2 Field
Partner Program Requirements Aligned for Partner Success
1) Referral fee % applies to annual committed net revenue for all transactions that occur within 12 months of customer acquisition.
2) Premium Partners must meet certain eligibility requirements including but not limited to minimum number of successful customer deployments.
3) Annual Market Development Funds (MDF) consist of salesforce.com events and sponsorship activities per calendar year
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Complete Set of Programs for ISV SuccessPay-for-Performance Referral Fee Model
Partner Program Level % First-Year Revenue1
% First-Year & Ongoing Revenue
Basic 0%
Standard (Available Now) 10%
Premium2 (Scheduled availability in Q3 CY07) 25%
Optional Add-On Services
AppStore Checkout (Scheduled availability in Q4 CY07)
Orders, Renewals, Invoicing, Collection, Analysis 20%
1) Referral fee % applies to annual contract value for all transactions that occur within 12 months of customer acquisition.
2) Premium Partners must meet certain eligibility requirements including but not limited to minimum number of successful customer deployments.
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Introducing AppExchange Category LeadersConnecting customers and employees with the right app &
partner
Judy LoehrSales & Marketing
Matt PanningSSS & PSA
Darren CunninghamAnalytics & Data Management
Jeff YoshimuraFinancial Svcs & Verticals
Steve WhiteGEM Accts & Field
Raghu GnanasekaranBeyond CRM
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Introducing the AppExchange Partner Matrix
Only Standard Partners apply
Must meet unique Category Leader criteria by segment
EXAMPLE ONLY
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Marketing Opportunities for Standard Partners*
Preferred AppExchange.com placement for standard
partner applications
Targeted email marketing campaigns and webinars– 6 partner-focused webinars planned for Q2
Main stage participation at Salesforce events– Of course, it must be a great app!
* Timing and scope still being determined
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WHAT deals do I pay Referral Fees on?Standard Partner Program began 2/1/2007
Any deal(s) or prospects
originated from Salesforce.com
via the AppExchange, campaign,
event, sales referral or any
employee. Referrals effective for
12 months.
Agreement Effective Date
Includes any deals referred pre-agreement date
% of Annual Contract Value of any referred opportunity for 12 months beginning with 1st customer purchase.
Pay on any referred deals closing after Effective Date
REFERRALREFERRAL FEE
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WHAT ISN’T a Referral?No referral if oppty is already in your pipeline within past 60 days
March 1
Partner cold calls customer contact &
establishes pipeline oppty
April 1
Customer visits AppExchange.com and
submits lead info
April 25
Customer makes purchase
March 1
Customer contact attends partner
webinar. No oppty.
June 15
Customer visits AppExchange.com &
submits lead info
July 1
Customer makes purchase
TRIGGERS REFERRAL FEE
NO REFERRAL FEE
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HOW long are Referrals active?Referrals can become “live” opportunities for 12 months
Any deal(s) or prospects passed
from Salesforce.com via the
AppExchange, campaign, event,
sales referral or any employee.
Referrals effective for 12 months.
REFERRALIf customer purchases on….
January 15, 2007 – FEE APPLIES
February 15, 2007 – NO FEE
February 1, 2006 January 31, 2007
Referral is LIVE for 12 months
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HOW do Referrals become Customers?
Date of 1st Referred Customer Purchase
1ST Customer Purchase from referral triggers
“live” Opportunity
Referral with past 12 months
Customer Opportunity is now “live” for 12 months – Referral fee applies during
this period
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Scenario 1:Customer signs to one year contract
Feb 1
Customer Signs Contract for 1 year and pays you $120
March 31 May 15
Pay $12 to SFDC (Net 45)End of Quarter
• In this example the Customer signs a one year contract and you are paid up front for the entire year- a total of $120
• You are responsible only for one $12 payment to SFDC for the quarter the contract was signed
$120 paid up front * 10% referral= $12
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Scenario 2:Customer signs to one Year contract w/ Monthly payments
Feb 1
Customer Signs Contract for 1
year and pays you $10 (for Feb)
March 31 April 30
Pay $12 to SFDC (Net 45) for total
ACVCustomer pays
you $10
• Your customer signs a ONE YEAR Contract and agrees to pay you on a monthly basis
• The contract is still for a one year term and you will pay SFDC only one payment of $12 for the Quarter the deal was closed
$10 per month= $120 * 10% = $12
May 15
Customer pays you $10
Customer pays you $10
May 31
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Scenario 3:Customer signs to one Quarter contract w/ Quarterly Payments
Q1
Customer Signs contract for Q1
and pays you $30
Q2
Customer Signs new contract for One year starting Q3 and pays you
$120
Pay $3 to SFDC (Net 45)
for total Q1 ACV
• The customer initially signs a contract for a term of one quarter. They then extend your service for another quarter and finally renew for an entire year.
• The opportunity is alive for one year after signing the initial contract. This means that any renewal contracts are paid in the quarter they are renewed.
• The payment is always attributed to the quarter the contract is signed.
• In this example, the contract is renewed for one year but the opportunity is only alive for 6 more months. You would pay SFDC only half of the contract value for the six months remaining in the live opportunity.
Q1 + 45
Customer Signs new
contract for Q2 and pays you
$30
Pay $3 to SFDC (Net 45)
for total Q2 ACV
Q2 + 45 Q3 Q3 + 45
Pay $6 to SFDC (Net 45)
for total Q3 ACV
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Scenario 4:Pay as you go
Q2 + 45
• The application uses a pay as you go model for example an email marketing application where you pay per email sent
• The customer pays you X per quarter and you pay SFDC 10% of X for that quarter
• Payments will always be made a quarterly basis for all customers who paid you during that quarter
Q2 Q2 + 45 Q3 Q3 + 45
Pay $7 to SFDC (Net 45)
for total Q3 ACV
Q1
Customer pays you $30 for application
Pay $3 to SFDC (Net 45)
for total Q1 ACV
Customer pays you $50 for Application
Pay $5 to SFDC (Net 45)
for total Q2 ACV
Customer pays you $70 for Application
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WHAT about renewals within 1st 12 months?Pay referral fee up until 12 months for new customer renewals
February 1, 2006
New Deal Renewal
Renewal Deal
January 31, 2007
Opportunity is LIVE for 12 months from 1st purchase
REFERRAL FEES APPLY DURING 12 MON PERIOD
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WHAT about add-on deals for new referred customers?Only on NEW and ADD-ON business during 12 month period
February 1, 2006
New Deal Add-on Deal (Up-sell/Cross-sell)
Prof Svc Deal
Renewal Deal
January 31, 2007
Opportunity is LIVE for 12 months from 1st purchase
REFERRAL FEES APPLY DURING 12 MON PERIOD
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WHAT about referred add-on at existing customers?Only on business sourced by salesforce.com
Feb 1, 1995
ExistingCustomer
Add-on Deal (Salesforce.com
Sourced)
Add-on Deal (You Source)
Mar 31 , 2008
REFERRAL FEES APPLY DURING 12 MON PERIOD
Apr 1, 2007
SignPartner
Agreement
Add-on Deal (You Source)
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WHAT if I OEM/Resell another product?Pay only on your gross margin for OEM products
$1,000
OEM Royalty Cost$600
Total Revenue from Customer
$400 Gross Margin on OEM
Pay Referral Fee on this
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Do I pay fees on multi-year contracts?Pay only on 1st Year Contract Value
March 1, 2006 March 1, 2007 March 1, 2008
Pay Referral Fee onlyon 1st Year Revenue
2-year Contract
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WHEN do I pay referral fees?Pay only on deals closed during the quarter
Feb 15
Referred Deal X closes 3/1
March 15 May 15
Referral fees due (Net 45)
Referred Deal Y closes 3/15
March 31
End of Quarter
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What if a Customer cancels?Credit back pro-rated fee against future fee payments
Jan 1
1-Year Referred Deal X closes 1/1
June 30
Customer X cancels 6/30
Pay Referral Fee for pre-cancellation period
Dec 31
Customer X contract expires
12/31
Credit Referral Fee for post-cancellation period against other fee payments in future quarters
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WHEN do I pay Referral Fees?Self-generated Quarterly reports & Payments
Calendar Quarter Customer Purchase DatePayment Due Date to
Salesforce.com
Q1 February 1 – March 31 May 15, 2007
Q2 April 1 – June 30 August 14, 2007
Q3 July 1 – September 30 November 14, 2007
Q4 October 1 – December 31 February 14, 2008
Send referral report (download report off the AppExchange) with payment to [email protected]. Report and payment is due 45 days after the calendar quarter end.
Payment Methods accepted: Credit Card or Wire Transfer
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COMPARING EBAY & APPEXCHANGE
eBay AppExchange
Initial Listing Fee Certification Fee
Transaction Fee Upon Close Referral Fee Upon Close
Ad Format Fees Sponsoring Marketing Events
SEM/Affiliate Advertising Fees Sponsoring Sales Awareness/Education
Listing Upgrade Fees AppExchange Sponsored Listing
Picture Services Fees Premium Listing
Seller Tools monthly Fees Developer Support Packs
eBay Store monthly fee Premium Partner Tier (25% referral)
eBay University Incubator