Infoblox, which recently filed a Form S-1 with the SEC in preparation for an initial public offering, has a new channel program in place to reward strategic partners focused on the growing business of network automation.
The Channel Invest & Profit (IP) program, which officially launched this week, includes traditional channel incentives such as tiered discounts, deal registration, sales and marketing training, certification and demo kits. As the company's products gain more attention thanks to increased customer interest in network and data center optimization and infrastructure trends such as the IPv6 transition come to the fore, Infoblox is looking to nurture specialized partners who can make big money helping customers remove layers of management hassle.
About 90 percent of Infoblox's sales go through solution providers, according to Tim Colby, vice president of worldwide channels. As it looked at its existing channel program last fall, Infoblox sought to identify its most strategic partners, whom it classified as Infoblox Elite partners under Channel IP.
"We want to get their blended margins up and get to where they can market Infoblox solutions to all of their customers. Our story, with all of these business drivers, relates well to virtually every type of customer they have over 1,000 employees," Colby said.
Colby joined Infoblox in August 2011 following nearly five years at Aruba Networks, where he was head of strategic partnerships and channels. As he dug into the channel relationships Infoblox had, it became clear Infoblox had to tighten its approach, he said.
"What I found out is that we are very wide with our channels," he said. "It was more a fulfillment way of going to market, and I thought the business was too dispersed. What I decided to do was focus the business on a very small set of partners who could [talk about] what are core networking services story is when you've got topics like virtualization and cloud and you have to figure out all that complexity."
For its Elite tier, Infoblox identified 50 partners -- 35 in the U.S. -- out of roughly 600 worldwide. Colby said the team was careful not to pick only VARs that do lots of Infoblox revenue, and also focused on smaller partners that had what he calls "key business drivers," such as a specialty virtualization practice or a strategic relationship with data center vendors like VMware or Citrix.
Infoblox will place more emphasis on partners selling professional services around its products, Colby said. Elite partners need a minimum of two professional services engineers focused on Infoblox deployments, as well as pre-sales engineering expertise.
"The program is designed to be aspirational," he said. "To become an Elite partner, you have to have rigor in the program and earn your way in with the right focus areas in different vertical markets that make sense."
Infoblox offers other channel incentives unique to Elite partners, including co-marketing and lead generation, and also what Colby described as "special access to competitive data." What that means is access to restricted customer intelligence and deep dive analyst data on market trends and competition, Colby said. Infoblox requires partners to sign non-disclosure agreements to have it.
The view from inside Infoblox is to strike while the iron is hot -- that is, get more channel partners excited about its opportunity in a market still very much emerging and isn't all that easily defined. Most analysts use the term DDI, or domain name system (DNS), dynamic host configuration protocol (DHCP), and IP address management solutions, to describe the opportunity. Infoblox sees its main competition not as one particular vendor but as freeware spreadsheets, open-source technologies designed to address pieces of the market, and similar tools such as the IP DHCP tools in Microsoft Windows.
"There are other companies building appliances, but we're the Cisco in this space by market share," said Steve Garrison, vice president of marketing. "Our direct competitors are about one quarter of our size."
In the S-1 filing, Infoblox said its revenue had more than doubled in the past two years: $61.7 million in 2009 to $132.8 million in 2011. In the year ended July 31, 2011, it posted a net loss of $5.3 million, a decline from the $7 million profit it had the previous year.
With more emphasis placed on data center optimization, cloud computing and IPv6 upgrades, Infoblox's technology will move quickly out of niche status, Garrison argued.
"Five years ago, it was a nice-to-have," he said. "But with cloud, mobility and things like IPv6 on the horizon, the spreadsheets and freeware are running out of gas. Timing is everything."