Thought Leaders in Artificial Intelligence: Martin Neale, CEO of ICS (Part 4)

Martin Neale: From our perspective, we understand that the Microsoft sellers provide a specialized service. They typically will be happy to talk to you if you have gone through some of the activities required. You are a Microsoft partner. You have signed up through their co-selling program. If you do those things and your proposition aligns, then that is the time where regular communications happen.

Sramana Mitra: The kind of price point you’re talking about, that’s not necessarily very large deals. But you’re saying that the direct sales force still works with that kind of deal size. 

Martin Neale: For an enterprise seller for Microsoft, the threshold is $5,000. That is the entry level. It’s not about the size of revenue that we are generating; it’s the size of pull-through of Microsoft’s revenue. It might be that it’s going to be working with Microsoft Teams or Azure. These are things that Microsoft is interested in. They’re interested in making sure that people consume their platform. If you sell things that consume their platform, the numbers don’t need to be stratospheric.

Sramana Mitra: What percentage of your revenue are you paying to Microsoft as platform fee?

Martin Neale: They don’t operate that way. We don’t pay any percentage nor do we sell their licenses. There is a certain category of Microsoft Partner who sell licenses. All they need to know is that our technology is responsible for a given amount of Azure. To be a Microsoft Partner, there’s a fee. It ranges from not very much up to £4,000 a year. It gives you the ability to use all of Microsoft’s licenses across your business.

Sramana Mitra: The revenue that Microsoft is making out of this is not in tandem with your revenue growing.

Martin Neale: No, it isn’t.

Sramana Mitra: That’s interesting. If you look at the Salesforce model, the people who are building on top of Salesforce are paying 30% platform fee to be in that marketplace.

Martin Neale: Even though they have direct sellers, those direct sellers aren’t even transacting the fees. All the sales they make get transacted by their partner channels. 

Sramana Mitra: From where you sit, what are some open problems that you see out there that you would encourage a new entrepreneur to go start a company to solve?

Martin Neale: My focus has always been on solving tomorrow’s problems. The next emerging problems are the consequences of these things. What is the workforce like when it’s entirely remote? How do you help an organization understand how effective they are being? Most of our clients are not buying this technology to replace staff directly.

We do not position our technology as replacing jobs. What we’re looking to do is introduce technology in the way the workforces work. You’ve got a constant evolution. All of that presents opportunities. What does the workforce look like? How do you retrain? How do you cope with the consequences of these changes? Each spawns an industry alongside it.

Sramana Mitra: Thank you for your time.

This segment is part 4 in the series : Thought Leaders in Artificial Intelligence: Martin Neale, CEO of ICS
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