Iterate.ai CEO On Betting Big On The Channel: ‘It’s Core To Our Strategy’

‘A small company can emerge overnight and disrupt an entire category. That’s why the channel is so powerful for us. With the right partners, we can build multiple $100 million revenue streams far faster than we ever could alone,’ says CEO Jon Nordmark.

AI software developer Iterate.ai is in the middle of a sweeping pivot to a channel-first model, one that co-founder and CEO Jon Nordmark said will fundamentally change the company’s growth trajectory. Today, roughly 20 percent of Iterate.ai’s revenue flows through partners. By 2027, Nordmark expects that figure to reach 95 percent. “Maybe even sooner,” he told CRN.

As enterprises race to operationalize AI, a growing number of companies are discovering that shared, public clouds aren’t always the right destination for their most sensitive data. Privacy mandates, data sovereignty concerns and cost controls are pushing AI closer to where data already lives: behind the firewall, on-premises and increasingly at the edge. That shift is creating new opportunity for channel partners and prompting vendors like Iterate.ai to rethink how they go to market.

“Over the past two to three years, we’ve spent more than 40 percent of our revenue on R&D, and virtually all of that was aimed at building technology that works through the channel,” Nordmark said. “Three years ago, we weren’t even looking at the channel. Today, it’s core to our strategy.”

For partners, the timing may be ideal. While customer interest in AI remains intense, many MSPs and solution providers are struggling to keep up with the pace of change and to translate hype into billable services.

“The biggest pain point is simply keeping up,” Nordmark said. “AI is changing so fast that even sales teams and technical teams can struggle to understand what’s possible and what’s practical.”

The San Jose, Calif.-based company is betting that its focus on private, governed AI will resonate. Iterate.ai builds enterprise-grade AI designed to run in private environments including on-premises, in private clouds, on storage systems and at the edge.

That positioning is also shaping the company’s road map and its partner message. Over the next 12 to 18 months, Iterate.ai plans to double down on its Interplay platform, which the CEO said can cut AI runtime costs by up to 95 percent, and expand its Generate platform for private AI agents. Those agents are already being used to automate work that once took humans days, or recover revenue once thought lost.

CRN spoke further with Nordmark about the company’s AI strategy and how it is shifting almost all of its business to the channel.

How much of Iterate.ai’s business currently runs through the channel?

Right now, it’s probably about 20 percent. But what we expect is for that number to move to 95 percent by 2027, maybe even sooner.

What’s driving that change to grow your channel business?

Over the past two to three years, we’ve spent more than 40 percent of our revenue on R&D, and virtually all of that was aimed at building technology that works through the channel. That investment led to breakthroughs in running AI on Intel and Qualcomm chips, including edge devices and environments that weren’t originally designed to run language models. Those breakthroughs resulted in strong partnerships with companies like Intel and Qualcomm, and ultimately, those partners introduced us to their ecosystems and channel partners. Three years ago, we weren’t even looking at the channel. Today, it’s core to our strategy.

When you talk to MSPs and solution providers, what are their biggest pain points around AI?

The biggest one is simply keeping up. AI is changing so fast that even sales teams and technical teams can struggle to understand what’s possible and what’s practical. Our job is to explain what we do in plain language, provide training and make it easy for partners to deploy our software, especially on infrastructure that customers already own.

Another key issue is monetization. Partners want to know how they can earn, how easy it is to deploy and how quickly they can deliver value to customers.

What’s your biggest challenge right now?

The pace of change. Earlier in my career, change happened maybe once every six months. Today, it can happen every day, and it can be big. A small company can emerge overnight and disrupt an entire category. That’s why the channel is so powerful for us. With the right partners, we can build multiple $100 million revenue streams far faster than we ever could alone.

So how does Iterate.ai differentiate itself in a crowded AI market?

Most of what people read about is public, shared AI, which is massive language models running in shared cloud environments. We build enterprise-grade AI for private environments. That means behind firewalls, on-prem, in private clouds, on storage systems and even on edge devices with no internet connectivity. We’re focused on privacy, governance and data sovereignty, and we’re vendor-agnostic. Customers aren’t locked into one model, one cloud or one chip architecture.

What are your top strategic priorities over the next 12 to 18 months?

Two things stand out. First, continuing to optimize our Interplay platform, which reduces AI runtime costs dramatically, sometimes by as much as 95 percent, and enables AI to run on smaller chips and at the edge. Second, expanding our Generate platform, which is all about AI agents in private environments. We’re seeing agents do things that were previously humanly impossible, like recovering millions of dollars in unpaid hospital insurance claims or compressing 30 hours of work into minutes.

How do you balance rapid innovation with responsible AI development?

Responsible AI isn’t optional, and we focus on sustainability and ethics. Because we can run AI on smaller footprints and private infrastructure, our solutions consume far less energy than many shared-cloud AI systems. We also use intelligent model routing, choosing smaller models when full-scale models aren’t needed.

What’s your message to partners as you push toward a channel-first future?

We’re building platforms, Interplay and Generate, that allow partners to create, demonstrate and deploy private AI solutions at scale. Whether it’s activating cold storage with generative AI, deploying agents in regulated industries, or running AI at the edge, our goal is to help partners show customers what’s possible and turn that into real, repeatable revenue.