A strong relationship with midrange distributor Arrow helped Tom Lewis, president of Vertical VAR, get his company off the ground.
Lewis left IBM to start the Atlanta-based solution provider through a partnership with McKesson, a San Francisco-based health-care services company. The solution provider works with McKesson to evaluate hardware needs for its clients,a unique arrangement that allowed Vertical VAR to secure several major customers before it even opened its doors.
As a brand-new company, Vertical VAR required extraordinary amounts of credit, marketing and other support to jump-start its business model, but Arrow was flexible, Lewis said.
"They're helping us execute a model that's new. It took Arrow a while to understand us," he said. "They had some generic programs to penetrate their IBM base that don't really work for us. Initially, they wanted us to fit in with what they do with other VARs. But they worked to figure us out and execute customer programs for us."
For example, Arrow's Support Net division helped Vertical VAR with a marketing campaign that customized everything from copy to envelopes.
"We went to 200 customers in a very precise way," Lewis said. "We've got over 15 very solid leads out of that mailer. That's a high hit rate for us, and we anticipate more coming in. That's because Support Net is thinking differently with us."
Vertical VAR made $10 million in revenue its first year and expects to double that this year, Lewis said.
"It was a big bet for Arrow. The one thing we told them was we needed credit and discounts as well. We needed them to pretend we had a long history [with them and take us to a high discount level."
Support Net dedicated an account manager to Vertical VAR, which made a big difference in the solution provider's success, Lewis noted.
"They helped us grow pretty dramatically, and we're starting to see some targeted efforts from them," he said. "Instead of saying, 'Here's a new program, why don't you join like everyone else?', they come to us and say, 'We thought this applies to you guys.' "