Cloud News

DigitalOcean Turns To The Channel For Next Stage Of Growth

Joseph Tsidulko

March 18, 2019, 03:50 PM EDT

As a number of niche public cloud providers have been swept away by a wave of industry consolidation, DigitalOcean has thrived, staying true to its founding vision of supporting web application developers.

The New York-based Infrastructure-as-a-Service provider has scaled its business in recent years, bucking the trend of independent clouds being snapped up or shut down. Now DigitalOcean is looking toward a new phase of growth led by vaunted CEO Mark Templeton, who is imparting a channel-focused strategy.

Templeton, former CEO of Citrix Systems, a software stalwart known for its strong channel focus, took the reins of DigitalOcean last July, and among his first priorities was implementing the company's first formal partner program.

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About three months ago, Templeton hired Jeff Giannetti to run DigitalOcean's go-to-market organization as chief customer officer, and charged the NetApp, Veeam and IBM veteran with crafting the program.

That work culminated a few weeks ago with the launch of the DigitalOcean Solutions Partner Program.

"We're going to support businesses that want to sell DigitalOcean to their client base," Giannetti said.

That means discounted pricing for partners, and a focus on enablement around solution-building and understanding use cases that have resonated with business customers.

Along with the channel program, DigitalOcean recently introduced its first online marketplace, which offers open-source solutions popular with developers that can be deployed with one click as integrated software and infrastructure stacks.

When DigitalOcean was founded seven years ago, the market was full of independent infrastructure services providers like Joyent, Virtustream, SoftLayer and GoGrid that have since been gobbled up by larger companies.

But DigitalOcean has remained independent and sprouted a community of 3.5 million developers working on its platform.

Templeton was a mentor to the two founders, brothers Ben and Moisey Uretsky, who eventually asked him to lead DigitalOcean by replacing Ben Uretsky as CEO.

The longtime Citrix leader saw a company that grew dramatically in a short period of time and had built a loyal base of customers, Giannetti told CRN.

But Templeton's experience at Citrix, and Giannetti's At NetApp, made them keenly aware that "if you're going to scale a business into the billions, you need multiple paths to market."

DigitalOcean set a target for incorporating between 60 and 100 partners in the first year of its nascent channel program.

The company's soft launch of the DigitalOcean Solutions Partner Program, with only a small team doing outreach to solution providers they had talked to in the past, made it clear it would blow through that target in the first quarter, Giannetti said.

"We're going to crush that target for acquisition by end of first year," Giannetti told CRN.

The first partners to join the channel include many smaller web and marketing agencies building and hosting websites that are looking to earn a reseller margin. DigitalOcean is also starting to field interest from MSPs running workloads in the hyper-scale clouds who see the provider as an alternative means of attacking the SMB market, he said.

"We may even make some big bets on more traditional VARs in the infrastructure space," Giannetti told CRN.

Among the unique base of DigitalOcean channel partners are companies like Engineer.ai, which resells the infrastructure as part of an integrated solution it offers customers.

"If you're a cloud provider, but you don't provide anything upstream, a way to build software, you're closing yourself from a massive audience," Sachin Duggal, CEO of Engineer.ai, told CRN.

The company, which combines a roster of human experts with artificial intelligence to spur software development projects, had previously worked with DigitalOcean, then re-engaged with the provider around the time Templeton took over leadership, Duggal said.

"They've changed their approach. It's almost like they're now completely partner-centric," he told CRN.

DigitalOcean was interested in exploring how Engineer.ai plans to engage with its customers, and how the provider can better align with its solution to go after those customers together.

"That's unlocked a lot of potential, a lot of ways you could do bundling," Duggal said. "That can only work when there is a strong partner model, giving the tools to build, not just the infrastructure."