11:11 Systems CEO On Buying IBM Cloud Customers For VMware Charge

11:11 Systems CEO Brett Diamond takes a deep dive with CRN on acquiring hundreds of IBM Cloud enterprise customers, his vision for VMware and VCF, as well as 11:11’s M&A plan.

11:11 Systems CEO Brett Diamond is bullish about his company’s acquisition of hundreds of IBM Cloud enterprise customers as the VMware all-star partner has huge expansion plans in store.

Fairfield, N.J.-based 11:11 Systems is a top VMware Cloud Service Provider and partner that has already acquired seven major VMware-based businesses over the past several years.

This includes the acquisition of iland Cloud, Green Cloud Defense, Unitas Global, Sungard Availability Services, Faction, Ntirety and Digital Sense—establishing an “unmatched” foundation of operational expertise and commercial insight, the CEO said.

The acquisition of select IBM VMware Cloud Service Provider enterprise customers will mark 11:11’s eighth purchase of a VMware CSP business and 11th acquisition overall.

[Related: VMware Star 11:11 Acquires ‘Hundreds’ Of IBM Customers In Blockbuster VCF Push]

Diamond takes a deep dive with CRN around the details of the IBM deal, 11:11’s plan for these enterprise customers, and M&A strategy ahead.

What exactly did you acquire here from IBM?

This is an acquisition of select VMware enterprise customers from IBM that we acquired. Something we’ve been working on for several months now with IBM.

We’re excited about the opportunity that it brings to these customers because, as the largest privately held provider of VMware services globally, we’re giving these clients that we are acquiring an opportunity to migrate over to our VCF platform.

The platform provides an incredible amount of features and benefits, and the 11:11 platform as a whole, that these clients will now have access to.

So we’re really excited about where this brings us.

It’s a global opportunity for us to not only expand existing locations, but to really bring on some new regions as well.

Did VMware or IBM come to 11:11 saying, ‘Hey IBM needs to unload some customers to a VMware Cloud Service provider with global capabilities?’ Basically, who facilitated this big handoff of customers?

IBM made it known publicly that they were no longer going to be supporting the VMware platform about a year ago when they were cut from the VCSP program.

The alignment that we have as the largest privately held provider of VMware services, we were the logical choice for IBM to go with when they were looking to potentially move this customer base over simply because of our scale and the types of clients that we work with.

Our background is predominantly mid to large enterprise, and that’s pretty much the book of business that IBM was supporting.

So they were thinking about it from a customer experience perspective, ‘Who was the logical choice to migrate these customers to VMware without having to go through a replatforming or talking to the customers about a different hypervisor?’

I think there was a very short list.

We’ve got a strong relationship with IBM. It just made sense to try to work something out together for the benefit of the customers.

Were there other interested parties out there?

Were there other buyers out there? I mean, you’d have to talk to IBM about that.

But from conversations we’ve had with them, they kind of knew from a technical expertise perspective and just global scale and geographies already covered—that it made sense to try to migrate them to 11:11.

Click through to read more about the 11:11 news and insight from CEO Diamond.

With this being a global acquisition, can you give me any ballpark numbers of the deal and the number of customers?

I can’t disclose costs or anything like that or what we paid. We’re a privately held business held by Tiger Infrastructure Partners, a private equity group out of New York.

But we’re talking hundreds of customers across the Americas, U.K. and EU, as well as all throughout APAC. These are very large enterprises, ranging from mid-large enterprise all the way through Fortune 100 customers.

So they have a wide range, but all on the larger side.

Where are these IBM customers coming from?

These are VMware customers that we will be acquiring that fall under the IBM Cloud.

So anything that’s VMware-related is what we acquired and will be migrating over to us, and that’s global in scale across the Americas, EMEA and APAC.

Think of it as like the Infrastructure-as-a-Service platform that’s running VMware workloads.

How is 11:11 going to handle this influx of IBM enterprise customers?

So today we’ve got over 6,000 customers worldwide. So when we talk about inheriting or acquiring hundreds of customers, while it is a lot, it is nothing compared to the size and scope and scale of what we manage today as a business in terms of just the amount of customers.

In most of these facilities and regions, we’ve already got infrastructure, employees and operations teams in these regions. So it’s really just about expanding existing locations that we already have.

Any expansion plans for 11:11?

With the acquisition, we’ll also be deploying new facilities throughout [Latin America], some in the EU and some locations in Asia that we don’t have today, which is great for us because it provides us with an additional point of presence to expand the 11:11 platform.

But our operations teams and our technology teams and our architecture teams, this is right down the fairway of what we do every single day.

So for us, we’re not really taking on anything new that we don’t operate today. So it’s right in our wheelhouse. It’s a very synergistic deal for us.

And because we’re migrating them from [older] VMware [platforms] to the new VCF platform—the features and benefits that this will provide the customers is unlike anything that they’ve ever had access to before.

Talk about 11:11’s M&A strategy this year and looking ahead to 2027?

This is our eighth acquisition of a VMware cloud partner.

This is our 11th or 12th acquisition overall.

Inorganic growth in M&A has always been at the core of what 11:11 is about.

Organic is even more important because you can’t simply continue to do M&A without having organic growth because at some point the opportunities for M&A are just going to dissipate, and there’s not going to be more opportunities for growth.

And you’ve got to make sure that you’ve got a fantastic team.

I believe that we, by far, have the best technical teams and operations teams, and sales teams in the world for what we do with VMware.

From our perspective, M&A is going to provide us across our three main core pillars— cloud, connectivity and security—with probably a good decade runway of more incremental M&A that we can do.

But on top of that, the sector as a whole—just modernization and cloud—is continuing to grow organically in double digits.

So we’re really excited about what both of those have, but again, you can’t have one without the other. Meaning, just M&A or just organic growth, especially in our space.

Because I think scale and competency and technical expertise are critical in this space.

Because you’ve got the very large players—[like] AWS, Azure—and then you have thousands of much smaller MISPs, managed infrastructure solutions providers. Think of them as like the legacy VMware folks. And then you’ve got us right in the middle as the largest privately held.

We’re going to continue to stay focused on growing dramatically through both of those areas.