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Master the new Microsoft Marketplace ecosystem.
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Discover the tectonic shifts happening within the Microsoft ecosystem as Cyril Belikoff and Jon Yoo dive deep into the unification of the Microsoft Marketplace and the explosive rise of AI-driven commerce. This comprehensive discussion explores how the marketplace is transitioning from an incubation island to the mainland of Microsoft’s go-to-market strategy, allowing partners to tap into massive Azure consumption commitments. Learn how product-led growth, AI agents, and optimized digital flows are replacing traditional sales motions, making cloud marketplaces the default engine for scaling revenue in 2026 and beyond.
Key Takeaways
- Microsoft unified its various marketplaces into a single digital flywheel for customers to discover, try, and buy applications.
- Applications, such as Copilot certified agents, are contextually surfaced directly within Microsoft products to meet users in their flow of work.
- Customers are making massive Azure commitments, and purchasing full software stacks through the marketplace retires those commitments entirely.
- Cloud marketplaces have evolved from a secondary channel into the default go-to-market engine with triple-digit revenue growth.
- Partners must shift from deal-led transactions to product-led growth by optimizing their digital marketplace listings for AI and search engines.
- The future of software procurement will increasingly involve AI agents acting on behalf of organizations to seamlessly integrate multiple smaller applications.
If you’re ready to lead through change, elevate your business, and achieve extraordinary outcomes through the power of partnership—this is your community.
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Key Tags:
Microsoft Marketplace, Azure commitments, AI agents, Frontier transformation, M365 Copilot, Foundry, digital flywheel, co-selling, product-led growth, ecosystem shift, SaaS distribution, REO, resale enabled offer, listing optimization, search engine optimization, agentic commerce, cloud go-to-market, revenue recognition, multi-party private offers, Hyperscalers
Transcript:
Cyril Belikoff and Jon Yoo Audio Podcast
[00:00:00] Cyril Belikoff: Why do you have to outsource this or create this vi? Just edit the video right there yourself. Like why do you have to just go do the, as a marketer you want to create a beautiful piece of content, just go and create it. ’cause it can create it for you. Now
[00:00:13] Jon Yoo: you can feel it happening. The ecosystem is shifting beneath us, the way Hyperscalers are partnering.
[00:00:19] Jon Yoo: How AI is remaking the channel and what it means to win in 2026.
[00:00:25] Vince Menzione: Welcome to The Ultimate Partner Podcast. I’m Vince Manzione, your host.
[00:00:30] Jon Yoo: We just wrapped up two days in Bellevue with some of the sharpest partner leaders in the business, and what we heard wasn’t incremental, it was tectonic. In this series, we’re going deeper into these conversations, the insights, the frameworks, the real movement we’re seeing in this market right now, because being in the room changes everything and we’re bringing that room to you.
[00:00:55] Vince Menzione: And I am thrilled actually for this next one. Uh, I’ve had this opportunity to spend a little bit of time with this gentleman before, and welcoming him back is a pleasure and an honor. Cyril Beov, the vice president. I’m gonna botch up your title ’cause I always say marketplaces, but it’s much more than that.
[00:01:14] Vince Menzione: So come on up, zero. And we’re gonna have a conversation and Cyril is amongst other things at Microsoft. Good to see you, sir. Yeah,
[00:01:24] Cyril Belikoff: you too,
[00:01:25] Vince Menzione: uh, is responsible for the, the Microsoft marketplace.
[00:01:29] Cyril Belikoff: Are these your notes here?
[00:01:30] Vince Menzione: These are, um, what is that? Yeah, these is gonna be our, our questions, so we, yeah, I, I need help sometimes so prompting, but, uh, so great to have you.
[00:01:38] Vince Menzione: So just for purposes of title and context, ’cause your role is much bigger than just marketplace. Yeah. And we’re, we’re gonna sit down and John, is this me? Yes. And then John’s gonna join us.
[00:01:47] Cyril Belikoff: Okay. Great.
[00:01:48] Joe,
[00:01:48] Vince Menzione: well, we’re gonna get started and start having a conversation. And we’ve, we’ve done some of these things before.
[00:01:53] Vince Menzione: I’ve, I’ve had, you had me on your stage Yes. In your event at Alyssa Taylor’s event.
[00:01:57] Cyril Belikoff: Yes.
[00:01:58] Vince Menzione: And then, uh, we’ve, we’ve done some nice things together on stage, both at, at our event in Redmond last year. Yes. Then at our big, uh, ignite breakfast back
[00:02:07] Cyril Belikoff: and forth, we had Vince come to our wider org and sort of, uh, I got to do the reverse.
[00:02:13] Cyril Belikoff: And so interview him in front of a bunch of, uh, 500 marketers on what do we have to think about for partners. And so he gave us sort of the what’s going on in the partner ecosystem, how to think about it as we think about it, our marketing.
[00:02:26] Vince Menzione: And I tried to be candid and represent this group.
[00:02:28] Cyril Belikoff: Yeah, that’s great.
[00:02:29] Yeah.
[00:02:30] Vince Menzione: Was wonderful. Thank you for doing that.
[00:02:31] Cyril Belikoff: Yeah.
[00:02:32] Vince Menzione: You, you work, you work in an amazing organization. Um, I’ve known Alyssa for many years as well, and you’re an incredible leader. And I just, I wanna frame this maybe with a conversation about, ’cause we’re gonna talk about what’s changed, but, but I think it’s still important for everybody in the room to understand what you did and what your team orchestrated around market.
[00:02:52] Cyril Belikoff: Yeah,
[00:02:52] Vince Menzione: because it was fragmented, it was in different organizations, it felt very dis disorganized, I guess. Yeah. For lack of a better word.
[00:02:59] Cyril Belikoff: Yeah. Thank you. Um, essentially we took it from incubation Island to the mainland Microsoft. I love it. Uh, GTM
[00:03:07] Vince Menzione: Yeah.
[00:03:07] Cyril Belikoff: Is the simplest way to think about it. Um, and, uh, come September last year now, uh, we unified the, the, the, the many marketplaces.
[00:03:19] Cyril Belikoff: Uh, whether it was an Azure marketplace or AppSource and others, and we created the new Microsoft marketplace. Yeah. So one single place for customers to come, discover, try, buy, and for partners, software companies and other NSIs to put their wares up. And, uh, it was the first step in a vision for us to create this digital flywheel for us to bring our customers and our partners together in a more, you know, automated way.
[00:03:47] Vince Menzione: Which it, it sounds crazy when you think about it, right? Microsoft has always been like the partnership leader, the leader in the technology, and to have fragmented marketplaces before, right? Yeah. And so what clarity to bring that all together.
[00:04:00] Cyril Belikoff: Yeah. It was a big, it was a big step for us and I think what we realized is that customers and partners were saying, Hey, uh, it’s all one place.
[00:04:07] Cyril Belikoff: If I’m looking for a SaaS application or an agent or, and plug into teams or whatever it is. I just want to get it all in one spot. Uh, and, uh, and then we need you to connect us to your channel.
[00:04:21] Vince Menzione: Yes.
[00:04:21] Cyril Belikoff: Uh, and your partners and, uh, can you build out, you know, partner capabilities for that Connects channel to software companies, to, to customers in a digital flywheel way.
[00:04:30] Cyril Belikoff: Um, one of the things we actually also announced at that time was this concept of what we call. The marketplace framework. So it’s not just the fact that we have this digital experience or web experience, but that, um, applications that go into the marketplace, depending on the type of applications they get contextually surfaced within Microsoft products.
[00:04:53] Vince Menzione: Okay.
[00:04:53] Cyril Belikoff: And so if you’re,
[00:04:54] Vince Menzione: explain that for this Yeah. For me and for this crap.
[00:04:57] Cyril Belikoff: Yeah. So if you are a, um, if you’re a co-pilot certified agent. M 365 copilot agent, you’ll be in the marketplace, but you’ll also be automatically surfaced inside the M 365 copilot, um, product.
[00:05:11] Vince Menzione: Nice.
[00:05:12] Cyril Belikoff: Same for, uh, large language models in foundry, add-ins in teams, those sort of things.
[00:05:18] Cyril Belikoff: ’cause it’s one thing to be where people go to discover Tribu, but users also go into these stores, whether it’s a developer user or an end user. They go in the flow of their work and they want to move quickly. Yes. And so, uh, so they have access. We think that’s very attractive. And the feedback was, Hey, that’s quite differentiated.
[00:05:35] Cyril Belikoff: ’cause we have, uh, hundreds of millions of customers in these products every day.
[00:05:39] Vince Menzione: Yes.
[00:05:39] Cyril Belikoff: And so giving our customers access, our partners access to it and improving their customer experience, um, has worked out well.
[00:05:47] Vince Menzione: And something else you did too, because at one point, you know, we were talking about co-selling and single-threaded.
[00:05:53] Vince Menzione: And Microsoft has this incredible ecosystem and channel.
[00:05:57] Cyril Belikoff: Yes.
[00:05:58] Vince Menzione: And it, it was totally disconnected from the whole marketplace strategy, right? Yes. Yeah.
[00:06:03] Cyril Belikoff: Yeah. So we, uh, um, we launched, I think in, uh, sorry. At that time in September, we launched five of our largest distributors who were also federating the Microsoft marketplace into their marketplaces.
[00:06:16] Cyril Belikoff: And then in the November timeframe at Microsoft Ignite, we launched resale enabled offer
[00:06:23] Vince Menzione: RO,
[00:06:23] Cyril Belikoff: which is REO, which is a new capability that is proven extremely popular, that connects the software company and the reseller, you know, um, to go and do more deals at scale faster. So
[00:06:36] Vince Menzione: we have, we have four of the Es in the room,
[00:06:38] Cyril Belikoff: right?
[00:06:38] Vince Menzione: Some of the four at the top. Five or six. And then also one of your largest resellers software, one is here as well.
[00:06:45] Cyril Belikoff: Yeah. Great.
[00:06:46] Vince Menzione: Yeah.
[00:06:47] Cyril Belikoff: Great. So it’s, uh, we’ve been busy.
[00:06:48] Vince Menzione: Yeah.
[00:06:49] Cyril Belikoff: Yeah. Like I said, um, uh, much more work to do. But we are moving from like this incubation project to mainland get it integrated into our core customer, go to market, uh, so that our, uh, software companies and partners have access to those customers.
[00:07:03] Cyril Belikoff: And then integration, uh, with the channel. So
[00:07:06] Vince Menzione: it’s been a lot happening these last 12 months. Uh. Then Frontier, let’s talk about Frontier. That’s another piece of this.
[00:07:14] Cyril Belikoff: Yeah. I’m sure Steven touched on, uh, frontier Transformational or becoming Frontier or Frontier Firm. So probably not helpful to me rehash that.
[00:07:23] Cyril Belikoff: I think in general. If you go to a Microsoft discussion or session and you don’t hear about frontier or Frontier transformation, please like, raise your hand and give feedback because that is, um,
[00:07:34] Vince Menzione: I kept away from the word frontier with Steve. We were talking about it, but we weren’t using the term frontier.
[00:07:38] Vince Menzione: Yeah. ’cause I feel like it gets overused. It’s,
[00:07:40] Cyril Belikoff: yeah, it does. It’s, it’s sort of, um, what we try to do with it is articulate it in a way that it’s not just about AI for AI’s sake.
[00:07:48] Vince Menzione: Yeah.
[00:07:48] Cyril Belikoff: But it’s AI based on what the customer outcome is trying to, what the customer is trying to achieve on their outcome. Um, and so as part of that, of course, you know, agents, AI applications is a big part of what’s driving customers’ capability of, uh, to become frontier.
[00:08:05] Cyril Belikoff: And, uh, the marketplace is part of that. ’cause they can either custom build that. Uh, or they can, you know, buy off the shelf, right? Uh, or, and actually in Combin they do mostly they do both, right? And so, um, in order to accelerate their ability to become more frontier, we have these, uh, partners that build, uh, third party solutions through a marketplace.
[00:08:27] Cyril Belikoff: And then, uh, uh, those same partners or others that build bespoke solutions around that. So, um, a lot of momentum around, uh, AI apps and agencies, as you can imagine. Um, we have, I think, 5,000 plus AI apps and agents.
[00:08:43] Vince Menzione: I was gonna ask you what you’re focused on now, but you, I think you’re tying into this now already.
[00:08:47] Cyril Belikoff: Yeah. Um, so of course that’s important.
[00:08:50] Vince Menzione: Yeah.
[00:08:50] Cyril Belikoff: But really for us it’s about doubling down on driving customer, customer demand. How do we merchandise the right things that customers are looking for? How do we, uh, accelerate any of our flows? Like we will spend hours just looking at like the flow of one scenario.
[00:09:07] Cyril Belikoff: Where is it getting stuck? How do we improve it? Um, and then how do we connect it to the channel? And, and what, what more things can we do like EO or multi-party private offers and the like, and we have. Probably an announcement a month in the next three or four months.
[00:09:24] Vince Menzione: Oh, come on. Let’s,
[00:09:24] Cyril Belikoff: that will,
[00:09:25] Vince Menzione: I know, I know it’s early.
[00:09:26] Vince Menzione: I know it’s early, but you, you’ve got some, I know you’ve got some things. Think
[00:09:29] Cyril Belikoff: about the customer experience. Think about the channel integration and dream about
[00:09:33] Vince Menzione: what maybe more of a global scale with some of the offerings, maybe, maybe. Um, so, you know, I, so I, the earnings, we talked about the earnings with Steven, but I thought that there was a very compelling number around the commitment number.
[00:09:46] Vince Menzione: Yes. You and you run your Azure as part of your remit. We didn’t go through your entire remit.
[00:09:50] Cyril Belikoff: Yep.
[00:09:51] Vince Menzione: It’s not just marketplace. You also, you also own the Azure number.
[00:09:53] Cyril Belikoff: Yep.
[00:09:54] Vince Menzione: Let’s talk about that.
[00:09:55] Cyril Belikoff: Yeah. Um. You know, it’s, it’s exciting times for customers. They want to do things not only with us, but with everyone in the room.
[00:10:04] Cyril Belikoff: Um, and they are making very large commitments, huge commitments over the next two to three years to spend on Azure. Um, and so it’s now our joint jobs to go and help them identify the right business outcome and go and, you know, consume that commitment. It is just a commitment. It’s not actual. Consumption.
[00:10:27] Cyril Belikoff: Yes. And so it’s all of our jobs to take advantage of that. The, the customers are saying, Hey, we have line of sight to the types of things we want to go do over the next two to three years. Uh, probably not everything is, you know, i’s dotted and t’s across, but they have line of sight to most of it. Um, and how do we go help them drive that?
[00:10:46] Cyril Belikoff: Um, and so from an Azure perspective, obviously that’s very encouraging for us. It, it allows us to. Invest in more data centers and more capacity that we are doing as fast as we can. Um, and then, um, and then of course on marketplace, the marketplace can retire.
[00:11:04] Vince Menzione: That’s
[00:11:04] Cyril Belikoff: that Azure commitment. That’s,
[00:11:05] Vince Menzione: I wanted to make sure
[00:11:06] Cyril Belikoff: people understand that the, in fact, not only the Azure component from the marketplace, but the full software stack from the partner, uh, the software company retires the Azure commitment.
[00:11:17] Cyril Belikoff: So if it’s. Uh, I’ll make it up if it’s, uh, a hundred bucks and it’s 50 50, it’s not 50 50, but, um, I won’t disclose any percentages, but let’s say it’s 50 50, it’s much more for the software company, by the way. Um, if it’s 50 50, it’s not just like the $50 for Azure that gets retired. It’s the entire a hundred dollars that gets retired on the customer commitment, commitment, which is great for the software company.
[00:11:39] Cyril Belikoff: It’s also great for the customer that they can, you know. Bring that through, uh, to, uh, to their Azure commitment. And we do the same thing with our sellers. So the marketplace sales retire our sellers compensation. So we’re like checking every box so that there’s no friction in the system. So that, so the partner, the customer, our sellers, they’re all juiced to go and.
[00:12:03] Cyril Belikoff: Deals with marketplace.
[00:12:04] Vince Menzione: I, I hope everybody un understand. I mean, I understand this. I hope everybody else understand this too. ’cause I, I was, watch, you know, I, I, I watched LinkedIn and I see people post things and somebody made a comment about how difficult it was to use Microsoft Portal. And I was thinking to myself, do you realize that there’s, I’ll say 150 billion, but it’s probably a bigger number than that.
[00:12:22] Vince Menzione: That’s a total addressable market available to you if you’re a Microsoft partner. You can access these customer commitments.
[00:12:30] Cyril Belikoff: Oh yes.
[00:12:30] Vince Menzione: If you bring your product on Mark over 400 now
[00:12:32] Cyril Belikoff: Yeah.
[00:12:33] Vince Menzione: You bring your product into the marketplace, you have access and the customer can retire that commitment.
[00:12:38] Cyril Belikoff: Yeah.
[00:12:39] Vince Menzione: Without having to justify a new cost justification.
[00:12:41] Cyril Belikoff: Yeah. They don’t have to go to procurement. They don’t have to. Yeah.
[00:12:44] Vince Menzione: Yeah. I mean, it’s a huge opportunity.
[00:12:46] Cyril Belikoff: Yeah.
[00:12:46] Vince Menzione: So, um, so you’ve been focused on quite a bit. We wanted to invite John on stage.
[00:12:53] Cyril Belikoff: Great.
[00:12:53] Vince Menzione: John, you from Sugar is here. Where’s John? Is John in the house? Where’s John?
[00:12:57] Cyril Belikoff: There he is.
[00:12:58] Vince Menzione: Who’s also an expert in Marketplace.
[00:13:00] Vince Menzione: A great friend of Ultimate Partner. Great. Hey, how’s it going? He’s a great partner of Ultimate Partner. Great to see you, sir. All the way from San Fran. Oh, actually we’re on your side of the coast, so, uh, it’s long. He looks
[00:13:12] Jon Yoo: cooler than us
[00:13:12] Vince Menzione: though. He, he always looks cool. I said that about time.
[00:13:15] Jon Yoo: You know, I gotta be comfortable.
[00:13:16] Jon Yoo: I gotta be comfortable.
[00:13:18] Vince Menzione: So John, good to, good to have you. You’re thanks for having us. You guys are like, every time I see a post from you, you’re moving into a new office space ’cause you’ve outgrown your office space.
[00:13:26] Jon Yoo: Yeah, we’re, we’re really excited about the new office. We have hvac, which is a, a big, big, uh, it’s a big thing.
[00:13:31] Jon Yoo: Improvements, high ceilings, you know, the whole works h help
[00:13:36] Cyril Belikoff: sometimes. Yeah,
[00:13:37] Jon Yoo: yeah, yeah, yeah. We, we have our, uh, office opening party if anyone’s an SF on Ally first.
[00:13:41] Vince Menzione: Nice. Nice. Yeah. May, may, May 21st. May 21st. That’s right. Well, so, so you’ve been, you’ve had like a front row seat to all of this. I would love to get your perspective on what you’re seeing across partners and what’s changed over the last 12 months.
[00:13:55] Jon Yoo: Yeah, so, uh, for those that don’t know, um, sugar is a, uh, a revenue platform for cloud marketplaces and co-selling. Um, so we partner very closely with Microsoft as well as either hyperscalers and other marketplaces like Snowflake, Alibaba, et cetera. And what we, what, what I’m seeing is a couple things. One marketplace is becoming a default to go to market engine.
[00:14:17] Jon Yoo: So, you know, I think a lot of people see the stats about how the, the GMV, so, you know, the, the throughput through these marketplaces have been doubling. We’re seeing that in our data as well. So we’re seeing triple digit revenue growth from marketplaces. We’re seeing companies who, you know, maybe the earlier end of marketplaces were infra platform layer of software that used to really adopt it.
[00:14:37] Jon Yoo: Now you’re seeing. You know, explosion in a business application layer of companies as well. And so that’s super exciting. I’d say the second piece is channel players are getting more and more involved. Um, I think, you know, I’m the Silicon Valley SaaS bubble, uh, or the AI bubble, so to speak. And I didn’t know as much about the channel world and even these big AI companies.
[00:14:59] Jon Yoo: I mean, you’re seeing unprecedented, unprecedented demand, uh, for these, you know, LMS or these AI biz apps. And despite that, they are really working with a partner ecosystem because you’re realizing that most of the world do not really know how to adopt ai. Yeah. And they’re really leaning on expertise.
[00:15:18] Jon Yoo: And these AI companies, AI native companies, are looking to channel partners who have these. You know, relationships with their end buyers on how to deliver change managements, how to deliver enablement, not just a system integration site.
[00:15:32] Vince Menzione: And they’re also looking to the platform or platforms in the case, Microsoft here also.
[00:15:36] Vince Menzione: Right. Which, because like what, where am I gonna do just go out and buy philanthropic or Claude or whatever? I need that to be integrated into my enterprise as well. Right, exactly.
[00:15:46] Jon Yoo: So we’re definitely seeing like more adoption of Microsoft Foundry, for example, as people think about security and governance and whatnot.
[00:15:52] Vince Menzione: Yeah. Very cool. Any comments on, on?
[00:15:55] Cyril Belikoff: Yeah, that makes absolute sense. It’s, uh, um, you know, lots of layers to AI from data. The a, the AI layer itself, the application layer, uh, and innovations happening at all of those pieces of the stack. Um, and so when a software company is trying to, you know, uh, modernize their thought process or build new.
[00:16:19] Cyril Belikoff: They ha they have to think about all of those components. Foundry obviously is the AI layer and it provides them with capability to be agile and move quickly and do compliance and, and snap into an organization’s, um, architecture. But it’s the same applies to data, like how it’s fine to have AI but doesn’t, doesn’t do anything without data.
[00:16:40] Vince Menzione: Right.
[00:16:40] Cyril Belikoff: And so then how do they get data in the cloud? Um, uh,
[00:16:44] Vince Menzione: and then how do you security
[00:16:45] Cyril Belikoff: govern and govern, right? And how you secure govern, you know, all those sort of things. So obviously we have first party experiences, but they have partners with, um, their own solutions. They’re built on top of,
[00:16:53] Vince Menzione: yeah.
[00:16:53] Cyril Belikoff: Those Microsoft layers. And, uh, you know, like John says, lots of momentum.
[00:16:58] Vince Menzione: So let’s talk about the maturity curve. Like walk us through it. Where do you see partners in this room sitting today? And what does it take to move for them to move to the next stage? Like, what would be your guidance for, for this group?
[00:17:11] Jon Yoo: So, you know, we, we work across the entire spectrum of companies. You know, we work with the, the largest enterprises who’ve done billions through these marketplaces like Snowflake, workday, to leading AI companies like Glean or OpenAI, uh, to earlier stage startups who are completely new to marketplaces and really look for, for guidance around what do I do in my first 90 days?
[00:17:33] Jon Yoo: How do I get the attention of Microsoft sellers, or how do I. Optimize my marketplace operations so that we can be discovered, uh, really easily on Microsoft Marketplace and others. And the, the way that I think about it is companies first come on, because it is buyer driven oftentimes. So, I mean, that’s just the truth of the nature of you have these big enterprises that want to, you know, burn down their Mac agreements, for example, and that’s how they get started.
[00:17:59] Jon Yoo: And or a, a as like this whole space maturing, you’re seeing. A new CRO come in and they’ve done this at X, Y, Z companies and they want to bring that playbook over. But then as they start to do a couple deals through these marketplaces, they think, and this is start of the the flywheel, right? Hey, what do I need for co-selling?
[00:18:19] Jon Yoo: And there are systems, you know, integrations and playbooks that need to be done well. Once you do have co-selling figured out, how do I now know which opportunities to co-sell? So we have things like intense signals to be able to. Help them, you know, help overlay a cloud, go to market lens over your existing pipeline.
[00:18:36] Jon Yoo: And then now it becomes less of a partnership initiative and actually elevates up to the CRO initiative. And across each of those, um, layers, uh, you have different automation needs because once you actually start to get the flywheel going, it becomes. Holy crap. Now I’m doing 10, 20, 30, 50% of my revenue through these market, you know, through, through marketplace.
[00:18:58] Jon Yoo: And it’s creating different data pipelines of work to be done. And now I have to figure out my finance angle of how do I do revenue recognition through these indirect channels. And so that, that, that is kind of the maturity covers. I think about it when you try to retrofit like, uh, all the automation up front, it doesn’t go as well.
[00:19:16] Jon Yoo: You have to do a crawl, walk, run approach so that you can also build and bring the rest of the organization with you. So if I look at ’em to the, you know, there’s some familiar faces, some folks that probably are wondering some new faces
[00:19:28] Vince Menzione: as well.
[00:19:29] Jon Yoo: Yeah. What, what Microsoft marketplace or what marketplace even is.
[00:19:33] Jon Yoo: I’d probably say people are in that transformation bucket of, Hey, I’ve done a couple of deals, we’re in this early stages of co-selling. Now I, now I gotta figure out how to supercharge it because this is kind of the future, you know, we can talk more about agenta commerce and whatnot, but, um, I think a lot of people are figuring it out than looking for.
[00:19:51] Jon Yoo: For guidance here,
[00:19:53] Vince Menzione: zero.
[00:19:55] Cyril Belikoff: Yeah. You know, I would say, um, I’ll get what I call tactical yet strategic.
[00:20:01] Vince Menzione: Okay.
[00:20:01] Cyril Belikoff: Which just think about product-led growth. Yeah. Just think about, uh, similar to the consumer world, if you wanna sell something, you need search engine optimization. If you are thinking about these marketplaces and Microsoft marketplace being one, how are you optimizing your listing so that when a user goes into like the search bar, it’s optimized to bring back the results that make sense to you?
[00:20:29] Cyril Belikoff: I think historically we’ve had scenarios where some partners have used the marketplace primarily as like a transaction thing. They’ve done the deal, but then they’re transacted on the marketplace ’cause they wanna retire the the Azure commitment. And that is changing to be sort of product led and marketplace led, uh, versus deal led.
[00:20:49] Cyril Belikoff: Uh, but you cannot have a generic one line sentence in your listing. You will not be surfaced unless the customer literally knows your name and will search for you. You’ll not be surfaced if they search for a particular category healthcare app that does something right. And if that’s your thing, you should have the right keywords, you have the right images, have the right videos, and we believed in it so much.
[00:21:14] Cyril Belikoff: We actually built a listing optimization AI tool that will auto look at your listing. And based on our best practices, and we know what our search engine is doing, we will make recommendations to you on how to improve. Listing. And so it’s not like a read a document as a best practice. It actually will be an ai, uh, customized tool for your particular listing.
[00:21:37] Cyril Belikoff: So lean into those types of things, you know, to, as John says, says, think about the digital flow. This over time will become much more of your, of your business. So make sure you’re thinking about, you know, if someone’s on the marketplace and they decide to trial something for you, how, how are you following up?
[00:21:56] Cyril Belikoff: Like, how do you take the next steps? Um, maybe you, maybe you working with a reseller and you don’t have your own sellers, but how do you wiring that into your resellers so your resellers are following up? Or if you have your own sellers, you know, your own sellers are doing it. So you have to sort of digitize your thinking on sales and marketing in this new market, commercial marketplace world, versus in the same way we would’ve done in like the consumer marketplace on Amazon or, you know, um, as you search something on Google.
[00:22:26] Cyril Belikoff: Maybe bing. Um, so, um, yeah, yeah. This
[00:22:29] Vince Menzione: size. B Come on, come on.
[00:22:31] Cyril Belikoff: I
[00:22:31] Vince Menzione: had bing.
[00:22:32] Cyril Belikoff: Um,
[00:22:33] Jon Yoo: I do wanna double click on that, which is when, when we, you know, I talk about like, hey, a lot of it’s buyer driven. A lot of people think about private offers, but then the marketplace offers. But the reality actually, when we look at the data is that there’s a lot more self-service
[00:22:46] Vince Menzione: correct
[00:22:47] Jon Yoo: offers than there are what they call private offers.
[00:22:50] Jon Yoo: So where there’s deal led and that, that, that, that shift. It’s super exciting to see where now these marketplaces are becoming where buyers or users go to discover new products. Let alone, you know, in the future where let’s say there’s an AI agent that has some reward seeking function, and in order to do its job, it needs to go purchase a tool marketplace might be the channel where this happens, which is all the reason why that your listing does need to be optimized.
[00:23:16] Jon Yoo: So that one, the agent knows exactly what your tool does and it can match against. Reward. And then second, you have to win the a EO race, right? Yeah. Of, of how you show up in these AI engines. So just wanted to double click on how important that is. Yeah.
[00:23:31] Cyril Belikoff: Makes, makes total sense. And we’re, we’re seeing that shift from private office to having a public listed price and a, a public offer as well.
[00:23:39] Cyril Belikoff: And so we’re, we’re ourselves investing in our own marketing demand generation. Just in the last three to four months because we’ve seen that taking off and as soon as we saw the signal, we’re like, oh, we should pour fuel on that fire. Because if, if we see organically customers don’t do it, we should, you know, we should go after that and help them understand that we’re here.
[00:23:58] Cyril Belikoff: And, uh, if it’s working for some that are doing it by themselves, it’ll work for others and we’re seeing really, really good results. Um, so yeah, get your listing optimized. Think about your digital flows. As John says, the flows of the future are probably agentic wise, maybe not even a human coming to the Microsoft marketplace.
[00:24:17] Cyril Belikoff: So you gotta be thinking, not now, it’s okay. You have time. Um, but in the future, you know, six months from now, that quite easily is a scenario. So you really have to start thinking about those, uh, those, uh, digital flows.
[00:24:29] Vince Menzione: Yeah. It’s so insightful. Well, it’s what you call product led growth, basically. Yes. And agent led growth.
[00:24:35] Vince Menzione: Yes. Right. In some respects. So this is where like we need to think about that. The future model where the agent comes in and actually does the purchasing. We’re not there yet, are we?
[00:24:45] Jon Yoo: No. With some products, you know, um, especially, especially if it’s like developer tools. We’re starting to see some of that, but, uh, no one’s gonna buy a cybersecurity solution.
[00:24:55] Jon Yoo: Um, that’s seven figures or an agent’s not gonna do that. Right. But the eng the, the search functions are a little bit changing.
[00:25:03] Vince Menzione: Yeah. So a lot of ai, you know, we had Steven Boyle on earlier, we were talking about ai, AI natives, you know, that’s Jason Grey’s organization does a lot of work in that area. How do these organizations need to think and act and how do they leverage the cloud marketplaces?
[00:25:17] Vince Menzione: Or how do le how do marketplaces fit into the equation? ’cause most of them are coming from a different like paradigm or mindset.
[00:25:24] Jon Yoo: I mean, uh, it’s like the number one question, you know, I’ll give a little personal story of like, I get a lot of parking tickets, uh, and I don’t know how to pay off my late fees.
[00:25:34] Jon Yoo: So we set up a little open claw that will actually go and ask me questions, and it actually pays off my parking tickets on my behalf. Um, so, so, so, you know, on the other hand, like there, there’s layers to it, right? It could be like layer one, I ask ai, Hey, how do I pay off my parking tickets? Layer two could be.
[00:25:52] Jon Yoo: Hey, you know, what’s the best way for me to structure my cadence to pay off the parking tickets? And then layer three is like, Hey, AI, proactively check if I have parking tickets and go pay it on my behalf. Here’s my credit card information, you know, stored in a secure vault. So, uh, what, what I mean by a native as a company bring that analogy is, uh, bringing it at its core.
[00:26:12] Jon Yoo: So like a little for, for sugar. We’ve spent the past six months optimizing around our entire, like company brain where we are storing all the context. To a singular, singular place that is queryable, that there’s no coordination tax between teams. Our entire product development process actually is automated where we have multiple agents debating one another, PRDs to code generation, code review, uh, you know, security, qa, et cetera, et cetera.
[00:26:40] Jon Yoo: And then there’s humans in the loop across the process. So I would actually think about when we, when we fit that into, into marketplaces, it’s not just thinking about who’s going to send the offers or who’s gonna do the co-sell, or who’s gonna X, Y, Z, but how do you bring all that together so that your sales reps and your partnership person and Microsoft all has to share context in a given deal and it’s done automatically without, you know, back office folks having to update what partner led or partner influence means and reporting things in a, in an old way.
[00:27:11] Jon Yoo: So it’s almost re-imagining. Entire workflow, given everyone should have open context of what’s going on in a given deal. So let’s say maybe a hand wavy way of answering that question. Yeah. But it does mean that we should be re-imagining, uh, what the job to be done is, uh, very fundamentally
[00:27:28] Vince Menzione: cy, how are you thinking about it since you’re building the, the, the toolkit at Microsoft?
[00:27:32] Cyril Belikoff: Yeah. Um, yeah. Well, John says absolutely is right, particularly around marketplace and how that sort of flow and ecosystem will work. Um, in addition to that, it’s. Not only about how marketplace or about developers ’cause the developer, uh, scenario or persona was the first globally to see the value of AI and agents in the flow of their work.
[00:27:55] Cyril Belikoff: It was the first to like, oh, one developer can now do much more. I can be empowered, I can build agents to work on my behalf. I can, uh, I can be an architect instead of a hands-on coder. Right. It’s changed the profile of what developers do exactly what. Uh, John mentioned what he’s doing himself. That’s just one profile of a user.
[00:28:17] Cyril Belikoff: Th there are many other profiles. A sales person, a marketer, a uh, CFO team, hr. Each of these are literally going through the same transformation. They’re one beat behind developers because developers, you know, was really tech enabled and tech stack driven, and the, and the opportunity was, was obvious quite quickly.
[00:28:39] Cyril Belikoff: These are coming really quickly. This is not like the internet adoption cycle that took many multiple years. This is like, we’re talking months. So, and even inside Microsoft, we have our own, what we call, uh, frontier Marketing Internal Initiative to re, um, rewire marketers and how they go about their daily job and stop doing it this way and do it this way.
[00:29:04] Cyril Belikoff: Just pick up M 365 copilot with. Coworking Claude, uh, embedded and just go do the work. Why do you have to outsource this or create this? Just edit the video right there yourself. Like, why do you have to just go do the, as a marketer you want to create a beautiful piece of content, just go and create it.
[00:29:21] Cyril Belikoff: ’cause it can create it for you now.
[00:29:22] Vince Menzione: Yeah,
[00:29:23] Cyril Belikoff: three months ago, literally three months ago, it couldn’t do that. And so what is it gonna be in two months for a marketer or a salesperson or finance person? I mean, just co-pilot in Excel. What that is doing to the financial business is in, like if you, any financial person will tell you they live and breathe through in Excel, like it’s just, it’s their equivalent of, it runs
[00:29:44] Vince Menzione: most businesses
[00:29:44] Cyril Belikoff: their dev tool, right?
[00:29:45] Cyril Belikoff: It’s their thing. It’s really
[00:29:46] Vince Menzione: is.
[00:29:47] Cyril Belikoff: So this is happening over and over again. Again, if you can package those things up and package a package, that piece of IP on a marketplace is, is not only gonna be a big system, it could be a very, very small piece of. Functionality in a flow for a marketer or a salesperson that is so valuable that can be solved many times on a marketplace.
[00:30:08] Cyril Belikoff: And in many cases, everyone’s a software company at this point. Everybody can go and package something up. And so I would be stunned if we don’t see cross pollination from system integrators to channel partners, all just publishing on marketplaces based on, oh, I’ve done this thing four times. I cannot do it 400 times.
[00:30:26] Cyril Belikoff: Let me just package it up and put it on a marketplace. So. Yeah, I’m sure you know, John alluded to that. It’s, there’s a lot of exciting times.
[00:30:33] Vince Menzione: No, the future
[00:30:33] Jon Yoo: is
[00:30:33] Vince Menzione: great. What do you
[00:30:34] Jon Yoo: totally, I mean, it’s, it’s a case of like, how do, what does being marketplace native also mean?
[00:30:38] Cyril Belikoff: Yes.
[00:30:38] Jon Yoo: You know, and not, I feel like I’ve seen so many people just use it as a, Hey, we’re opportunistically there and if we get some leads out of it, great.
[00:30:45] Jon Yoo: Or if there’s some deals, great, but they’re not really leaning in and being marketplace native the way, you know, and right now there’s, this might be uncomfortable, but there’s no excuses. You know, like creating a partner marketing content with your brand guidelines. It should not take so many time. Or it’s a 10 minute exercise.
[00:31:02] Jon Yoo: Exactly. Exactly. Three
[00:31:03] Cyril Belikoff: prompts.
[00:31:05] Vince Menzione: It used to be that ops used to get involved because, oh, we, we know that they have a commitment. Let’s go run it through the marketplace. Right now, what you both have been suggesting here is it becomes a discoverable process. It becomes part of your normal go to market strategy, and you’re, you’re driving pr, product led growth and SEO and all the things you need to do running a a corporation and modern corporation today.
[00:31:26] Cyril Belikoff: Yeah,
[00:31:26] Vince Menzione: exactly. So, what’s the future like? Where, where do we go in 12 months with this? What do you think? What do you predict? We, we get out a Ouija board or a crystal ball here. What, what, what do we think?
[00:31:38] Cyril Belikoff: I think more broadly in the industry, you’re gonna, some of the scenarios that John alluded to, agent to agent interactions, uh, many agents acting on behalf of humans and on behalf of organizations, uh, and doing.
[00:31:55] Cyril Belikoff: Simple things and quite complex things. Uh, and those need to be, uh, managed carefully, uh, with, uh, the right, uh, engagements and built carefully. And in, in many cases, customers will look to partners that are quote unquote certified on, uh, uh, HyperCloud platform. Uh, as a way to get going quickly, but also get the, the quality that they need.
[00:32:21] Cyril Belikoff: Um, and I think instead of buying this monolithic, massive application, I think we will see lots more of smaller applications being built that have cleaner open, uh, you know, MC, you know, MCP type agent interfaces that can just work together, uh, without, you know. More complicated integration work,
[00:32:42] Vince Menzione: cobbled together your own solutions as opposed to big
[00:32:45] Cyril Belikoff: monolithic
[00:32:45] Vince Menzione: applications.
[00:32:46] Cyril Belikoff: Yeah, there’ll be a much more agile,
[00:32:48] Vince Menzione: yeah.
[00:32:48] Cyril Belikoff: Uh, personalization. I mean, a lot of people saying SaaS is dead. It’s not quite dead. But I think that SaaS will get significantly more agile, more custom and more personal, uh, for, uh, for customers.
[00:33:03] Jon Yoo: I, I would agree with that. Um, I mean, I’m biased, but I think marketplace are gonna be even more relevant than ever.
[00:33:08] Jon Yoo: I mean, it’s already highly relevant, but, uh, as you, you know, I think in the past the, the narrative was, well, there’s a new generation of buyers and they’re millennials. They, they wanted, you know, uh, I always talk about consumer experience to B2B sales, you know, and, and now it’s like agents that’s that on steroids.
[00:33:24] Jon Yoo: Um, but what I, you know, beyond that, I think, uh, there, there’s a lot of talk of like SAS apocalypse or software companies getting. Destroyed by, you know, the, the, the AI labs or SaaS is dead or whatever. I think SaaS is gonna, I mean, there’s gonna be way more software companies because the cost to build is a lot easier.
[00:33:46] Jon Yoo: That means that competition will be. Even more fierce than ever. And you have all these AI native companies that are coming out with a quicker time to market, quicker time to value, and they have some recursive loops that makes the product even that much better. Um, so what that means for everyone is like, one, you gotta go back to the, the core differentiations.
[00:34:06] Jon Yoo: Or like in the past, maybe the, the time to build was the differentiation, but today it’s, or you know, there’s some other, obviously the core elements, but then there’s. Distribution. Yeah. So how do you partner with Microsoft, for example? How do you have your own self-improving like distribution model? That makes sense.
[00:34:22] Jon Yoo: Marketplace being a huge component of that. Two is obviously there, there’s a piece of like network and data. That’s what we think about of hey, what makes our product better as more, more people use it. Um, because yeah, competition is crazy fierce and it finally goes into times deployment. That’s why you see these companies like.
[00:34:41] Jon Yoo: Open AI anthropic that are competing for their enterprise, uh, pie. And instead of doing it themselves, they’re, I mean, I think OpenAI just did a joint venture of like $4.1 billion into the deployment company. Anthropics doing the same, they’re surrounding themselves with the ecosystem and channel is going to be more relevant than than ever, as long as you know how to enable AI services and know how to deliver on this technology to the, to the broader world.
[00:35:07] Jon Yoo: And so. Channel awesome. Marketplace, awesome. You know, competition’s gonna be fierce. Success is not going anywhere.
[00:35:16] Vince Menzione: Good conversation, gentlemen.
[00:35:18] Jon Yoo: Awesome.
[00:35:18] Vince Menzione: I’ve been told we’re over time. I wanted to open it up to questions. Um, but I do feel like we, yeah, I’ll get, I’ll get yelled at. But this was incredible. Um, some great, I mean, the, the pa it, it’s terrific to see.
[00:35:36] Vince Menzione: How far we’ve come in, so shorter period of time, and it’s only gonna continue to get better. I think the one question I’ll have is like, what, what would hold any of these companies back at this point? It feels like it’s such a compelling reason we need to move forward. Is there, is there anything, like why would, why would we hold back?
[00:35:54] Cyril Belikoff: Um, you know, some of the discussions we have, um, is about how to balance today’s world with tomorrow’s world a little bit.
[00:36:01] Vince Menzione: Yeah.
[00:36:02] Cyril Belikoff: Today’s business model with tomorrow’s business model, today’s financial results with tomorrow’s financial results. Um, and there are very different approaches to all of this.
[00:36:13] Cyril Belikoff: Those AI natives, they’re like, there is no yesterday. There’s only tomorrow. Um, there those companies that realize they’re being threatened by AI natives and so they have to move quickly. Um, and, uh. Figure out a, a, a business model and then someone else who wants to do a bit of both and bridge into it.
[00:36:32] Vince Menzione: Yeah.
[00:36:32] Cyril Belikoff: Um, and just within that frame there are different ways to tackle it, whether it’s create two teams, one’s the future team, one’s the current team, and, you know, may the best team win, um, makes sense with the customer and that, uh, or, uh, give the, give the customer the choice and have the teams going together.
[00:36:49] Cyril Belikoff: So there are lots of different approaches.
[00:36:51] Vince Menzione: Right. So great to have you. Did you have some, did you have a comment to make on that?
[00:36:55] Jon Yoo: Uh, no. Just, uh, unwillingness to lean in and learn something new. Yeah.
[00:36:59] Vince Menzione: Yeah.
[00:37:00] Jon Yoo: I’m, I’m, I’m much more in the burn all boats buckets. Yeah,
[00:37:03] Vince Menzione: I know. Me too.
[00:37:03] Jon Yoo: Of, uh, no, no old team and new team.
[00:37:05] Jon Yoo: Just new team and you know, that’s just push forward.
[00:37:07] Vince Menzione: Well, great to have two amazing leaders on stage with
[00:37:10] Cyril Belikoff: us. Thanks
[00:37:10] Vince Menzione: so
[00:37:10] Cyril Belikoff: much.
[00:37:10] Vince Menzione: So thank you
[00:37:11] Jon Yoo: so much. Yeah, thank
[00:37:11] Vince Menzione: you
[00:37:15] Jon Yoo: so much.
[00:37:16] Vince Menzione: Don’t forget. Ultimate Partner Live is coming soon, October 26th through October 28th in Reston, Virginia. I hope to see you there.
[00:37:28] I.