AppViewX is shifting all of its direct accounts to channel partners as the application-centric network specialist launches its first-ever formal partner program. The program is called Partner+ and AppViewX has hired former F5 Networks channel chief Keith McManigal to lead the way.
"We're taking our direct accounts and mapping them to our partners," said McManigal, vice president of channel sales at AppViewX, in an interview with CRN. "We did about 60 percent of our business through partners and, next year, it's going to be 100 percent. That's the way we're going from our CEO all the way through the entire organization."
Key components of Partner+ includes a guaranteed margin program, access to a dedicated inside channel team for demand generation, upfront market development funds (MDF) based on revenue, a partner portal, rebates, product training and technical support.
The Seattle-based data center provider takes a vendor-agnostic and annual subscription approach to its solutions with a focus around services. Protecting partner margin is central to AppViewX's new program, according to McManigal.
He said vendors typically take top line revenue from a solution providers deal, which can significantly hinder a partner's ability to become profitable.
"A lot of other vendors will go, 'Alright, we'll just take $10,000 off. Hey partners, take $10,000 off [the deal].' Well that's $10,000 of profit to the partner which is a big deal," said McManigal. "What we've done is say, 'Hey if we're going to give discounts, we're still going to protect our partners from a margin perspective.' The margin they earn is variable based on the value that they add to the sale … So we want to make it so that the partners know that if they invest, they're going to make 'X' dollars of margin and it's to their benefit to try to keep the price as high as possible so they can get the most dollars in."
Mike Wintrode, chief technology officer at Baltimore, M.d.-based solution provider ReliaSource, who partners with AppViewX, said everything inside Partner+ is clearly defined and the margin guarantee will boost partner's ability to map out profitability which is "refreshing."
"You know that your margins are not going to get eroded," said Wintrode. "We've all been part of different sales where there're negotiations that you may or may not be privy to as a partner that is going into the pricing and then basically they're chomping your margin off – then you kind of have to take what's left. Where [Partner+] is defined, it's structured."
Wintrode said AppViewX's program is on the leading edge when it comes to enabling channel partners to capture recurring revenues and high margins, while selling vendor-agnostic solutions.
"The margins are defined in a way to encourage you to stay engaged with an account and to grow it – it's not a one-and-done sale," said Wintrode. "They're filling in a niche that hasn't really been filled because they have a vendor agnostic-approach that is different from a lot of other providers out there … Everybody's got their point solutions that are vendor-specific, whereas AppViewX comes in and delivers a vendor-agnostic, management and automation platform. It's a massive opportunity for them."