Transcript

Scott Mann (introduction):    The giants out there have the one way of doing it and the big players in the industry are going to follow that. We need to differentiate ourselves not only with our product but also with our program. And that was the path that we kind of went down.

Announcer:      Welcome to the software channel partner podcast where you’ll hear leaders of partner programs talk about their greatest challenges and most successful solutions. And now your host, Louis Gudema, the President of revenue & associates.

Louis Gudema:  Welcome to the Software Channel Partner Podcast where we talk with leaders in software partner programs to learn about what’s working today. I’m Louis Gudema, the President of revenue & associates, where we help companies grow faster by helping their channel partners grow faster.

Today I’m talking with Scott Mann, director of the North American channel at Scale Computing. Scott’s been named a 2019, 50 most influential channel chief by CRN. Scott’s based in Toronto and before his current position, Scott was the country manager for Canada for Scale Computing. Before Scale, Scott held several positions at WinMagic, an encryption and data security tool company. Scott, welcome to the podcast.

Scott:   Thank you for having me Louis. Pleasure to be here.

Louis:   So have you come down yet from the high of the Raptors winning the NBA Championship?

Scott:   I can safely say I still wear my Raptors jersey on about a daily basis at this point, but soon that will die down once everything’s settled with free agency.

Louis:   Yeh. When all the business stuff comes into play, that can change things. But I know, I’m in Boston and we had that wonderful world series championship in 2004 after 86 years and it can really put a smile on a lot of people in a city when a moment like that happens.

Scott:   Sure can, and a lot of people in a country at this point. It’s a team for the country.

Louis:   Yeh. Yeah. That’s great. I was noticing they had those North jerseys, which were terrific.

Scott:   Yes, yes. A very neat spin on it.

Louis:   So please tell me about your career path and what brought you to where you are today at Scale Computing.

Scott:   As I imagine for most people in this industry, it’s not necessarily where you think this is exactly where you’re going to land when you’re going through your college and your schooling career. I started out in the accounting world, though. I got my degree in accounting and I pictured that being the road I was going to take. I’ve been working in software encryptions, software security sales for the entire four years of my undergrad. And I kind of landed a position that I couldn’t pass up and it was in the sales world at that point. And I thought this is something that I want to give it a go, give it a run, and everybody always told me I was a much better fit in the sales world. So hey, I figured why not, why not give it a try.

And when I initially landed with WinMagic, it was what you typically see from a sales organization of that size targeting more on the enterprise side. But I ended up moving my way up the ranks and I took over a patch that was pretty large and it was not necessarily a hundred percent channel organization at that time. So I knew if I wanted to be successful at all and be able to manage everything that we had coming in and the workload that it all entailed, I needed to build up my sales force without doubling, tripling my headcount on the team.

So I did just that through the channel and that was kind of the first road into the channel. So I built the channel for a large region within Canada and part of the U.S. as well. And that’s kind of what got me as a foot into the door here through connections. It was looking for someone to join the team in Canada at the time, and we were in a very similar position with Scale Computing in Canada, we didn’t quite have a full channel built out yet because it was still very early stages in the technology landscape. So there wasn’t quite the full market there yet. Partners hadn’t fully heard of us at this point. And I came in and it was 100% channel-focused, but we just didn’t have that partner landscape. So it was really, we wanted to be successful. I knew we had to build out that channel. And that’s how we did it in Canada when I was a country manager. I took the territory to being the top territory in Scale at the time. And that was all through building out a channel and building my brand within that channel.

And then leading me to this point was we already had our partner, our programs and everything. But that brand that I’d created in Canada was — and I guess using Canada as the ideal profile of what we wanted to create in the rest of North America. We used that as a base point to say, Hey, let’s do this exact same thing. Let’s do it across all of North America. And it’s been a wild experience to this point, but we definitely improved leaps and bounds over the last few years that I’ve been in this position. And that really all stems back from it’s a top/bottom: it’s a belief from your executives in the channel and in the ability for us to be able to do this everything through the channel and be able to build this all out. And if you don’t have their buy-in you know it’s not going to be successful at all. So my success and our success in the channel is all, comes from the very top, from the founders downwards, and same thing with the culture and everything that we’ve created in the channel.

Louis:   But you’re not a 100% channel company are you. You have direct sales also?

Scott:   No, we’re 100% channel.

Louis:   Oh you are?

Scott:   Yes, yes.

Louis:   Oh, okay. All right. I did not understand that. So tell me, you know, and the listeners about what Scale does?

Scott:   So Scale is, I guess it’s not your quintessential software company. We are definitely a software company under the hood of it all, but we’re an appliance model. So it’s a hyper-converged market, which I’m sure many listeners if they’re not fully familiar with it, they’ve heard the term at this point. It’s a very popular buzz term in the technology world. So we designed a platform and we created a solution about 10 years ago that was laser-focused on revolutionizing the virtual infrastructure world and really focusing on the small to medium-sized businesses, which we felt that there wasn’t a solution that was necessarily catered towards those sizes. It’s typically in the SMB space, you get kind of the leftovers or a light version of the enterprise, which still has all the licensing fees associated with it.

So we wanted to disrupt that. We created a solution that includes the harbor platform. So the server, the storage as well as the software, the virtualization and using our software, it ties it all together into an appliance that is the perfect fit for any small to medium size, to the mid-market space. We’ve also kind of grew into distributed enterprises and that eventually came into the MSP space as well, because an MSP essentially is a distributed enterprise, but the organizations that they’re supporting aren’t all under one umbrella.

Louis:   So for someone who’s not familiar with it, I was listening to someone recently who was saying, you know, if you can describe it to a 10-year-old, you can explain anything. But if someone’s not familiar with that whole arena, how would you describe what Scale Computing is and what your device is doing? And who would use it? What would be the use case?

Scott:   It would be of course, the IT department at any organization. Typically an IT department they’re IT generalists, the smaller IT departments was what the initial target was towards. Because they’re jack of all trades and they’re managing a ton of different platforms. They’re managing the networking, the security side of things, the infrastructure, sometimes the help desk and they constantly do a lot of different juggling. What we’re doing is we’re condensing a bunch of those different functionalities that those different practices that they have to manage into one single platform.

So being the server infrastructure, the storage, the virtualization, putting that all into one, and including some backup and disaster recovery capabilities, as well. So it’s simplifying their life. At the end of the day it’s like the, my analogy that I don’t know how well this will resonate but, you think of an infrastructure in a building, you walk into a room, you want to flick the light switch on and the lights come on, you don’t want to have to go down to the breaker and play around with a bunch of the breaker switches. Same thing with the infrastructure. You want to be able to walk into your office on Monday morning and pull up your laptop, open up whatever application, whether it’s email or your ERP system and be able to access that, not have to go to IT and say, Hey, what’s wrong? Something’s down with the server. That’s the solution that we built so that you can automate that process. It’s self-healing and you can remove the reactive methodology around managing an infrastructure like that. So that it kind of self maintains itself.

It’s a physical on-prem solution. It’s a private cloud if you want to simplify it that way with a lot more automation and everything under the hood of it. So as a service provider, this is something that they could leverage as their own infrastructure as a service or DR as a service platform. As well as an on-prem solution for their customers that need it. You know, in today’s world it’s all the common term is hybrid cloud now. I would say that back in the 2010s is really the era of like, this everything is going, everything’s going to the cloud. Now the reality is not everything is going to the cloud. Some things make sense to live in the cloud. Other things make sense to live on-prem. And it’s being able to manage those two seamlessly. But what’s appropriately to be in the cloud from a productivity perspective and an efficiency perspective and then keep everything else on-prem, maybe in a smaller footprint. So being able to manage that as a service provider, these go on-prem, this can be in the cloud, and make it a more profitable solution for them as well.

Louis:   So let’s get to the channel program then. It looks like Scale is growing pretty rapidly these days.

Scott:   Yeh, it’s been a very exciting year for us. It’s a very exciting last 12 months or so, 18 months. Very rapid growth. Sustainable growth, though. Nothing that is anything too crazy. But we had a good round of funding last October, which has kind of been the catalyst for all of this. And it’s been a very exciting start to this year so far, meeting and exceeding any expectations that we have as well as the growth side of headcount and adding a lot more to the team.

Louis:   You launched the MSP partner program about a year ago?

Scott:   Yes.

Louis:   So what was Scales indirect program before that? How were you selling through the channel before MSPs?

Scott:   I would say the MSP is kind of an addendum to our existing partner program. So we have our Scale Computing partner community, which has, you know, we won five stars with CRN on that for I think about three years running. And that’s been really a focus on traditional resell model. So the basis of it is a percentage of MSRP which is the discount that they get. It’s based off of margin. So this would be really targeted to working together to find clients that would have an IT department to support that, manage it themselves.

But we found that with us playing in the small to medium size to mid-market, a lot of the partners that we serve are MSPs or what I like to say is they’re kind of hybrid MSPs. And a lot of the time we were servicing 10% of their customers, 20% of their customers. but for them were in the larger space because SMB to an MSP might be very different than what it is to us as a vendor at the S of SMB is more of like a hundred seats and below. But they might have a couple of customers that are 250 seats, 300 or something around that range that still fit into our SMB capacity of what we would define as SMB. And what we’re finding is that we had a lot of our partners saying like, hey this is fantastic. The architecture that you built, it fits my smaller customers, but your pricing model really doesn’t fit it. And we know that there’s a really a very different business model around managed service providers being more of a monthly recurring model, right?

So a traditional resell program didn’t really service them very well because they’re going to over-leverage themselves. They’re going to have to buy all the hardware upfront. And if they wanted to buy a hosted cluster, that’s a lot to take on from especially smaller MSP that might not be able to leverage themselves to that extent. So the MSP program was built to be able to service these partners that were literally asking us for it, coming to us and saying, Hey if you can come up with a monthly recurring I can use this for the rest of my customers. And it won’t only be more cost-effective for my customers. It’ll be more profitable for me because I don’t need to have my tier three, tier four technician running out to go fix something. I know that everything’s going to work with Scale and if something does go wrong, I can send one of my junior admins to go fix that. And it’s not as big of a hit to my bottom line.

Louis:   So what would have been a partner that’s not an MSP? What kind of company that had the resale model?

Scott:   It’s across the board. Any regional or local VAR that would sell, maybe I would call it not fully outsourced IT. So they might outsource a portion of their IT to a customer. Maybe they’re even managing the infrastructure for them. But the customer has a large enough sized IT department to be able to support the rest of those operations. So they’re basically outsourcing a portion of their specialty to be maybe the data center or something like that. Where a regional or local reseller is managing that on a day to day, and then the customers procuring it for them on that more CapEx model. So it’s just more of a pass-through from the customer to the partner to distribution to us. And that’s on Net 30 terms. As opposed to the MSP model, which is they’re not using the, it’s not under a CapEx model. It’s much more under an OpEx model where they’re paying them on a monthly basis. And the Scale platform is just part of the overall solution that the managed service provider is providing to that customer because they’re probably also doing tier-one help desk, tier three support and everything in between for the customers. They’re essentially their outsourced IT department.

Louis:   Yeh. So it makes a lot of sense as using the MSPs as a channel to really penetrate that SMB market. So that’s really what you’re especially heavily focused on now is the MSPs and the SMB market and really expanding that part of your channel program?

Scott:   Yep. Yes. I’d say there’s kind of three sides of it. There’s MSPs, anybody that’s focused on the SMB mid-market. And I would define that — it’s a very subjective term of what SMB really means. It’s really kind of like 1500 seats and below, which to an MSP that’s probably more like an enterprise size. So a reseller that would cater towards that size. And then it’s also distributed enterprises. If you’ve heard of this new term edge computing it’s kind of, it’s a really fascinating trend that’s happening in the industry because it’s kind of a business use case that’s driving it, it’s not just the technology refresh. But we have a great play in there as well.

And it’s kind of interesting because everything that’s happening in the enterprise right now with edge computing, it’s just benefiting all the SMB in the MSP space, because in the hardware world, it’s kind of a race for the bottom right now. It’s a race to get smaller and smaller on your footprint. And the irony to what we created is that our architecture is substantially more efficient than anything else that was already out there. So we ironically got pulled into this new space and as these trends happen, we were already a perfect fit for it. So we kind of future-proofed our solution with what we had originally designed.

Louis:   Yeh, I understand what you’re saying about different definitions of SMBs. And a lot of times I think in people’s minds, SMB, they focus more on the S side of it. But that mid-market size company, those can be pretty substantial companies, as you were saying.

Scott:   And they have the exact same problems across the board: they’re trying to do a lot more with less. And sometimes it makes sense to outsource a portion of it. Especially in the IT world right now it’s interesting because it’s not the same as it was maybe 10 years ago where there’s so many new technologies coming out there and the IT department is responsible for having to manage all of these different technologies. And they might not be experts in all those different technologies. So outsourcing a portion of that where they can go put their expertise in an area that’s revenue-generating for the business, that’s a great way to get in there as a reseller or an MSP to be able to position it that way. You’re not replacing somebody’s job, the job that’s managing this on a day-to-day basis. This should be able to just run and you should be able to use your internal resources to do things that are either revenue generating or increasing productivity within their sales force.

Louis:   How many MSPs are in the program now and what goal do you have?

Scott:   We have around a thousand right now, and probably doubling that in the next 12 months. Not to say that all of them are necessarily doing, I think the golden rule of 80/20 probably applies there. But increasing the footprint and the one thing with us is we’re not an overly distributed solution. So the value add that we add to these partners is that we’re disruptive and we’re a differentiator when they’re positioning themselves against any competition locally, because we’re not the exact same solution that every other shop around them is positioning. We’re something that’s different. We can add value to their service levels that they’re offering. And we can also add value to the end-user and the uptime that they’re going to be requesting.

Louis:   So if you’re adding a thousand partners in the next year, how are you going about recruiting them?

Scott:   There’s tons of different ways to get the partner side of it. It’s a, you know, there’s tons of shows that we go to. We do a lot of channel marketing through distribution especially. We have some new OEM partnerships, which you might’ve seen with that last round of funding when you’re doing some research. So Lenovo’s a big investor in us, so there’s a whole pool of new potential partners in that space. All of the industry trade shows.  I saw that you had Rob Rae on the show. We were at DattoCon last week. So making sure that we’re getting our name out in that MSP space. And it’s also just a matter of changing your marketing to make it more specific and targeted towards that audience that probably wouldn’t have run across us before because the messaging just wasn’t a perfect fit for them.

Louis:   Yeh. Well DattoCon would be a perfect place for you. Rob was saying that they’re 100% channel company also. I would say most of the companies that I’ve talked to on the podcast are not 100%. They may be a majority or they may have aspirations to be 80% or whatever. But it isn’t still that many companies that are 100% channel.

Scott:   If you think about it from what we’re targeting after when you say, I actually I listened to the Jay McBain podcast as well. I love everything that he, all the content that he comes out with and I always try to, if I’m at any shows, make sure I sit on whatever keynotes he has. And one of the things I thought was interesting was that there’s going to be a decline in the amount of, or the percentage of technology sales that go through the channel. And I think when you look at the space that we’re targeting though, that’s probably not the case. And maybe across the entire industry that might be the case. But in the MSP world, the MSP’s our customer at the end of the day. The MSP is the one that’s providing all the services to the end client. They are the ones that the outsourced, the VCIOs as many people call it, the virtual CIO. They’re the outsourced IT department. So when we’re selling our solution, we’re selling it to the MSP who’s bundling that into their overall solution, which is their solution offering their service offering to those customers that they serve.

The go-to-market strategy isn’t to go target after those end customers. It’s to find the partners that we have a great fit within their solution and we can increase profitability for them and maybe create new revenue streams along the way as well with DR as a service, infrastructure as a service, desktop as a service those types of offerings. And then find out how we can build out their market. So they probably have a specific use case they’re going after. So it’s: how can we help build it out with them? And it’s more on the focus of who are they going after, what markets do they serve best into?

Louis:   Yeh. I was surprised too that Jay was saying that the percentage of tech going through the channel was going to decline. But I think he still was saying it was going to be a solid majority. And as you were saying in some particular areas like yours, it really is going to be quite a lot more.

So you’re onboarding something like a hundred new partners a month now. So what have you had to do, what have you had to scale, to be able to onboard them and train them and provide tech support? What have you had to do at Scale Computing?

Scott:   So obviously a lot more automation needs to happen. And that was the key thing is having a platform, and that’s something that we’re launching actually in two weeks we’re officially launching our new partner portal that will have just to be able to automate a lot of the different partner experiences. Partners can consume things like the training content and everything that they need from a presales, post-sales, as true seller’s perspective, as they want it.

Me, myself as a consumer it’s tough to find time during the day to sit on a webinar or something, so by having kind of on-demand content in there so that people can onboard themselves throughout the process. And then when they’re ready for that, that’s when they engage with us. And having everything like the through-channel marketing and all those different materials available for them in there so that they can access it when they’re ready for it, when they’re ready to grow with us. It’s definitely a key to making sure this is successful.

Louis:   Others have talked about the importance of the portal too, so in terms of being able to get quick pricing and being able to do deals and so forth, is that an important part of your portal?

Scott:   Yeh, and also the marketing side of it. There’s the onboarding and enablement side of it where they can go and get the training. Also the marketing as well, building up that pipeline together and what’s available to them. Whether it’s just co-branded content or anything that they want to do within their area. Webinars, some things that are a little less invasive. Or something like a ‘Lunch and Learn’ that they want to make available to themselves. Having all that content available so that we can be kind of an extension of their marketing team. I think it’s very important for a lot of these partners so that we can keep this process as simple as possible for all of us because we’re onboarding a lot of partners

And at the end of the day it’s about finding the right partners, about finding those strategic partners that we want to grow together with. And it’s not always going to be the right time with every partner. So that’s why it’s important to onboard. It’s important to recruit a lot of partners, but it’s just like with customers, customers aren’t always ready for the solution that you would like to talk to them about. Same thing with the partner. Partner might not be ready for that. Hopefully someday that does happen. But until that time happens, it’s good that they know the information and they’re getting some of that information to consume it when they’re ready to consume it.

Louis:   So are you providing partners with MDF or SPIFs or other type of financial incentives to encourage them or to help them build marketing programs?

Scott:   Yeh, absolutely. We have, part of our partner program is we have an MDF, an incentive program. To be honest, to stay competitive because when you think of who we’re really competing against, it’s the big guys in the industry. It’s the big names on the hardware side of things, the virtualization side of things. So for us to stay competitive, we know we have to make it a more profitable solution at the end of the day, if it’s incentivizing their sales team, if it’s putting some sort of investment into some co-marketing materials or regionalized events that we can do. We know we have to stay competitive from that landscape. So that’s all built into our partner program.

Louis:   So in terms of marketing, which is an area that I work in, do you see a marketing skills gap between Scale and your partners, and if you do what’s the impact on that?

Scott:   I don’t necessarily say there’s a skills gap. I would say it’s a bandwidth gap, especially with a lot of, some partners have a full marketing team that is ready to do this and they already have the content and they just need X and Y and Z from us. That’s easy enough for us to provide. A lot of the other partners though, they don’t necessarily have a marketing team that they’re utilizing. So we have a fantastic marketing team that we’ve built, though. We have a ton of tools, our marketing stack is fantastic.

The purpose of our marketing stack is to serve our partners because that’s going to be our number one way to growth is with our partners. It costs a lot more to grow as an organization on its own. There’s a lot more marketing dollars that need to go into that, which equals a lot higher price point for your products. When we’re serving the SMB, we need to be a lot more efficient, which is why it’s so important to enable from a marketing perspective, our partners so that they can leverage the resources and tools that we have, and our team to go to market and build out that whatever market is that they’re trying to target together.

Louis:   So you’re doing a lot of marketing for the partners or you’re doing co-marketing, you’re helping them develop materials and they’re going to use them and distribute them?

Scott:   We have a lot of those kind of predefined materials, a campaign in a box-type things. So it’s really, it’s a conversation with the partner of what works in your territory and everybody has a different territory that they’re servicing, sometimes you’re outside of a main downtown area and ‘Lunch and Learns and things do a lot better. They have a lot more of a higher success rate. Then if you’re downtown LA or something where they happen a lot more frequently. So it really depends on what services, what works best for the partner and trying out different things to see where we can get that traction in and leveraging the campaigns and everything that we have already built. So I wouldn’t say it’s doing it for them. I’d say we have some things that are setups that we can do it with them.

Louis:   Yeh, I know what you’re talking about in terms of depending on what market they’re in, you’re going to have different opportunities. I know some companies use what they call a secondary market strategy where they plan to do events in places like Nashville or Omaha, not in Chicago or LA because, they know they can get a lot better attendance in cities that don’t have a ton of things happening every day.

Scott:   Yeh, exactly.

Louis:   I’m going to ask you two questions that I’ve often asked when I’m hiring someone, and kind of relate them to the channel. So what’s a channel program that you’ve done that you think has been especially successful?

Scott:   Well, definitely our MSP program. And that’s probably, we’ve already spent some time talking about that, but that’s been a huge success for us is coming out with more of a monthly recurring model on a hardware platform. And if you think of who we’re really competing against in the space of the virtualization space and the big names in the industry, the big four when it comes to the hardware platforms and the servers and storage providers. They all have channel programs that are really built on the tiered model that service very well to the folks that are entering into that enterprise space. And from us, from our go-to-market strategy, we’re not the enterprise targeted companies, right? So we had to very much differentiate ourselves from these giants in the industry. And we differentiated ourselves based on our program. Coming up with a program that services to the partners that are servicing to the customers that we’re targeting after.

So I think we give a lot more attention to the partners that might not be the, you know, titanium status or platinum status, whatever the highest tier statuses are that our competitors go against. And we give an extra level of support that isn’t, Hey go find that all yourself. It’s we’re an extension of our partners just as much as our partners are an extension of us. And everybody that we have regionally in the field is there to support them. Whether they want that white-glove approach or the automated approach where they can just go in and go onto the online portal and get what they want when they need it.

So I think it’s the level of, I guess to summarize that it’s the level of support that we’ve built into this and which really is just part of the brand of Scale Computing, and goes back to the core of I guess the DNA of Scale and what are founder set out to build. We’re an engineering company and we knew we’re going against these big names in the industry and we couldn’t just throw a lot of money at it to create a new brand. We couldn’t just go sponsoring all the Super Bowl ads. We differentiated ourselves with the support, the support to our customers, the support to our product. The end userspace, if you go look at us, we’re a very highly rated and highly reviewed across all the different peer review sites. And that’s not because we’re the most, we’re the best-known name in the industry compared to some of the other ones out there. That’s because of the foundation, the DNA that we created Scale around and that seeps into our partner program as well. Which is why a lot of partners, once they see the product they’re very intrigued by the product, but what they love most and what you see in a lot of the reviews that you see is the team that they have there to support them was one of the best experiences that they’ve had and that’s a lot of the reason why they choose to go Scale.

Louis:   Let me ask you the opposite then, the other side of the coin of that question, which is, what’s a tactic or something that you tried that wasn’t successful? And it could be, you know, before Scale also in the channel. Something that you learned from didn’t perform as well as you had hoped or expected. Maybe it was the wrong time, wrong place, or maybe it was just, yeah, that’s something that just doesn’t work and we shouldn’t try that again?

Scott:   Yeh, that’s a great question. I think the one thing that we tried to do at one point was, A) assume that the channel is just going to take off. And it’s something that if you just, if you provide to the channel when it comes to, you know leads, opportunities, that it’ll just, it’ll take off. And that’s definitely not the approach that you need to take to the channel. It needs to be a well-oiled machine, and there’s a lot of different extra stages to the sales process when you’re working with the channel.

And the other big thing that we, not necessarily big mistake that we had, it was trying to just match whatever the big names in the industry did from a programmatic perspective. And trying to just replicate what they’re doing because we’re not going to be able to match that. We have to provide a different type of experience than what they can provide. It’s just like all these retail organizations right now, they’re competing against the likes of Amazon and the online experience that they provide, and the convenience that Amazon provides is unmatched. You can’t do that within the retail space. Someone that has to go to a grocery store to buy stuff. So they got to change that experience to make it, you know, more cost-effective to go to that grocery store, a better experience when they’re at the grocery store. So they want to keep returning to it.

And that’s kind of the mindset that I think of. And I don’t know if that’s a great analogy and if that resonates well with you, but the giants out there have the one way of doing it and the big players in the industry are going to follow that. We need to differentiate ourselves not only with our product but also with our program. And that was the path that we kind of went down, especially with this MSP program, putting a heavy focus on MSPs. Whenever we’re at any of these shows, like a DattoCon, we’re the very unique to be at one of those shows. IT Nation and everything that’s coming up later. We’re a very unique vendor to be at those shows, because a lot of the other vendors that are there I don’t want to, I want to use this word lightly, but they’re the middleware side of things, they’re the, they’re all competing against each others. The software pieces that are part of the solution. But when we’re going to a show within this MSP space, we’re going to the MSPs and we’re saying, hey here, here’s not just the solution that you add to your line card. It’s not just something that you’re going to sell to your customers. It’s a business model that you’re creating around us. It’s a new revenue stream that you’re creating around us, and that we’re creating alongside of you. And we’re just as invested in their successes because we want them to be successful. The more that they grow, the more that we’re going to grow together. So it’s a mutually beneficial relationship.

Louis:   Yeh, I think that’s a great point. You can’t just be a small version of an enterprise channel program. You have to really have your own identity, create your own program, and what I’m hearing from you is have the kind of experience and relationships with the partners that really make it special for them.

Scott:   Absolutely.

Louis:   So what should I have asked you that I didn’t? What keeps you up at night?

Scott:   What keeps me up at night? I don’t know. There’s a lot of things that keep me up at night. I don’t know. I’ve gone through everything hyper-convergence and really what we are. I haven’t really gone into the edge computing stuff and I probably meant the, edge computing is one of those buzz terms in the industry right now that might be a new term. So it could be interesting to walk through what this trend is in the industry and really how it’s benefiting the MSPs and SMB, the SMB customers, as I mentioned earlier.

Louis:   If you want to give the nickel version of edge computing and again, what kind of use cases or where it might fit into somebody’s business?

Scott:   So if you really think of edge computing isn’t something that’s brand new to the industry by any means. Edge computing I would define as distributed enterprises and remote branch offices. But edge computing has been driven by a new trend in the industry, which is IoT. And I’m sure everybody’s more familiar with IoT. But technology that lives outside of the data center that’s gathering a lot of data. And it’s using a lot more compute resources and these compute resources exist outside of the data center.

If you think of a grocery store, for instance, all the different grocery stores that you walk into they don’t have a massive data center in the back office. Or you think of a gas station. The gas station doesn’t have a massive data center or anything sitting in the back office. It might be running just a few, a POS system and a couple of simple applications on a beefy laptop or a single server with no redundancy. But now with IoT, it’s driving this new need for computing resources at these edge sites. So edge meaning outside of the core data center. So these new resources that are being required, obviously they don’t want to spend $50,000 on the infrastructure. So us as vendors, we’re trying to decrease the size of the footprint to be able to service a solution that would fit into a data center-like environment that doesn’t actually have a data center. It could be oil and gas and it’s on a rig where it’s going to hit 100 degree temperatures or sand, the sand could be blasting past it, and they have to sustain their day-to-day business systems with all of these conditions.

And if you think of what we’re doing is we’re becoming smaller and smaller on the footprint so we can run a hyper-converged architecture starting out at MSRP to the customer like $5,500 for a single node with a smaller quad-core processor, 32 gigs of RAM, something a little bit more nimble from that perspective. And now this is something where we can talk about a price point that actually fits these remote sites. And SMBs and MSPs, now they’re getting a truly enterprise-ready solution that is at a price point that they can actually afford. So if you think of, being able to provide hyper-convergence in a customer with 75 seats, though that would have been ludicrous six months ago.

Now we have a solution out there that can fit into the smaller size customer because they are an edge computing use case, minus the technology side of it, they don’t necessarily have the IoT requirements that’s increasing it, but they still have the need for reliability. They still have the need for it to be on because downtime equals dollars to whatever — if it’s a dentist office, if it’s a law firm — downtimes equals dollars to them as well. And the partner has SLAs that they need to maintain, that if they have a system that is, can keep up through automation, keep the systems online and selfheal from any kind of, absorb any failures, then it’s going to decrease operational costs, which is going to increase their profitability as well. So they’re benefiting from this trend that’s happening in the industry because the footprint of the hardware is getting smaller and smaller. And the technology that is surrounding all of that is just now becoming available for them to be able to leverage not just to their customers but within their business model.

Louis:   Yeh, it is amazing how technology, you know, it starts with the enterprises and starts with the, you know, the big boys, but because of companies like Scale it works down into the mid-market and even to the small companies. And allows them to compete in a way that just wasn’t possible before, which is just very exciting for those that are ready to take advantage of it.

Scott:   Exactly.

Louis:   Scott, the business world is changing very rapidly. Obviously, even just what you’ve been describing about edge computing and some of the other things that Scale is doing are new advancements. How do you keep up with the channel? Any particular podcasts, blogs, websites, publications, events, or other ways that are especially important for you for keeping up?

Scott:   Yeh. Well, I have to say I’ve listened to a handful of the podcasts here. You have some great, some iconic speakers in the channel industry that, between Rob Rae and Jay McBain on there, there have been some great listens while I’ve had a couple of flights over the last couple of weeks.

Louis:   Oh, thank you.

Scott:   Now it’s also, and hopefully I’m one of those for somebody who’s a future listener.

Louis:   Yeh, I’m sure you will be.

Scott:   And then there’s the usual media sources. I think, my homepage is crn.com and you get a lot of great updates on anything cutting edge or any latest news in the industry, and what the competitors are doing as well. Everybody launches a new partner program and they want to make sure that everybody in the industry knows about that. So there’s a lot of press around that. And it’s good to know that the things that they’re doing are like, okay, this is already something that we’ve been progressing and this is something that we’re kind of ahead of the eight ball on. So it’s good to stay on top of the industry trends that way.

I mentioned Jay McBain earlier, analyst, Forrester has some great research that they do. And I try to keep up with some of the documents that they have coming out. Because as a vendor they have fantastic insights and they do a lot of great analysis in the channel as a whole. And then they narrow it down and they make it MSP specific and what’s happening within the MSP landscape. Which helps us adapt our, any of our programs or anything within our MSP program to any of the changes that we’re expecting to come up or Hey, I didn’t really think of that. Maybe we should think about including this into our next version coming out in the next six months. At events I mentioned this earlier, as well, watching any of the keynotes are pretty important.

And I think the biggest takeaway of all though is to talk to your partners. We have a cadence where we have our product management team, especially the ones focused on the MSP program. We’ll get with all of our partners and help us understand what’s working within our partner program and what isn’t working, what we could be improving, so that we can make any of those changes to the program. And like I said, our MSP program was because we did that. Our MSP program was because we spoke with our partners, and our partners told us you need this, you need this, you need this. And then all of a sudden we came out with it and then we see this huge uptick in the amount of business that we’re doing and that the relationship that we have with some of these partners that we just didn’t see before.

Louis:   Yeh, that’s critical. I mean in a sense your partners are your, to some degree your customers and talking to the customers and talking to the partners is always job one. So how can people contact you?

Scott:   I’m always available if anybody wants to send me a direct email, I’m more than happy to take that. My emails smann at scalecomputing.com. We also have a soon-to-be-updated website with our partner portal will be on it. But if anybody wants information on our partner program, they can go to scalecomputing.com/partners and fill out a partner request or enquire for any information or you just want some general information. You can email our general alias channel at scalecomputing.com and either myself or somebody on the team would be happy to get back to you with whatever they’re looking for.

Louis:   Okay. And are you on LinkedIn or Twitter or any of those?

Scott:   I’m on LinkedIn and I try to be pretty ritual with the amount of things I post and not just make it relevant to new information and new technology out there. So yeah, Scott Mann on LinkedIn. Feel free to add me.

Louis:   Okay. And I’ll put links to all of this in the show notes at revenueassociates.biz. So thank you for joining us today, Scott.

Scott:   Yeh, thank you very much for having us. It’s been excellent.

Louis:   I’ll be sending you a copy of my Bullseye Marketing book as I do all guests in appreciation.

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