CloudGenix CEO Blasts Cisco's Viptela SD-WAN Acquisition, Talks 'Game Day' Channel Engagement

Ramachandran On SD-WAN

Cisco's acquisition of Viptela won't boost the networking giant's position in the fast growing software-defined WAN market, according to Kumar Ramachandran, founder and CEO of SD-WAN startup CloudGenix.

"The Cisco acquisition of Viptela does two things simultaneously. One is, it gives great clarity to the market. And two, it confuses the heck out of Cisco customers," said Ramachandran, in an interview with CRN. "Clearly Cisco [Intelligent] WAN is a failure, that's why they bought Viptela."

Ramachandran also talks to CRN about the vendor's Game Day channel initiative that pits CloudGenix's reps working alongside partners to close deals with new customers. "The partner walks out of the room literally with anywhere between 10 to 20 new deals in hand," he said.

What does Cisco's acquisition of Viptela mean for the SD-WAN market?

This clarifies in the market is that there are two approaches to SD-WAN. One is the packet routing approach from Cisco and the various investments Cisco has made. Cisco has been pretty active investing in VeloCloud, Glue Networks, [Intelligent] WAN and Meraki – all of which were various solutions and approaches to try and solve the SD-WAN problem using packet routing. The problem with that is that packet routing is really well-suited for an old MPLS WAN connecting the branch to a data center. The challenge customers face with packet routing for the new WAN is that it doesn't handle cloud applications well at all … The Cisco acquisition of Viptela does two things simultaneously. One is, it gives great clarity to the market. And two, it confused the heck out of Cisco customers.

Why does Viptela make it confusing for Cisco customers?

We've been talking to several Cisco customers already. The questions they have been telling us, and they've been going back to Cisco saying, 'Should I buy [Cisco's] ISR [routers] right now? My routing is coming to an end. We were going to upgrade to ISR in the hopes of getting iWAN working. Should I even buy it because you just got Viptela?'

Clearly Cisco iWAN is a failure, that's why they bought Viptela. So why should they buy the ISR? Should Cisco customers and partners wait for the Viptela hardware? But the Viptela hardware doesn't have any of the modules or the interfaces that the ISR's has. So is that going to be an integration of the two? … and how long is the integration going to take? I think there's confusion for Cisco customers.

Do you think Viptela will change Cisco's SD-WAN approach?

I know Cisco is trying to market [Viptela] as cloud-first, but the reality is that all their solutions need, not just the device at the branch, but also a device at either in the point-of-presence, in a cloud, or somewhere else, to load balance traffic that is destined to the cloud across multiple paths. If you have a SaaS (Software-as-a-Service) location, [Microsoft] Office 365, Workday or any of these things, it's painful to go put a box in that SaaS providers network. So what they're trying to do is put in an appliance or a box at a location close enough to that SaaS provider. That's just complex and challenging. With the packet routing method, what you're stuck with trying to do is duel-ended every time.

What makes CloudGenix's SD-WAN approach different then packet routing?

If you do what we call the application fabric from us, what happens is that with the device in the branch, we can load balance your Office 365 across all available paths – whether it's broadband, MPLS, or everything else – measuring all the application performance and providing deep visibility into what's happening in Office 365.

We've already hung our hat in being able eliminate the complexity of packet routing and really replace it with the application fabric. The application fabric is powered by a deep understanding of applications, application performance, application policy and what we're adding further to it now is capabilities using machine learning.

What do you see as another challenge with Cisco's packet routing method?

It's really the complexity, where you still have to set up and configure your routing protocols … You still have to be a deep networking CCIE expert. Either you understand the Viptela (Border Gateway Protocol) BGP or the Cisco version of BGP and set up configure and manage all of those.

If you want the packet routing approach, sure, go look at Cisco's five or six products. If you want the application fabric approach, you go with CloudGenix.

You mentioned Cisco has already launched several different SD-WAN products in the market. Do you think Viptela is replacing any of them?

Cisco is trying for the sixth or seventh time here with Viptela. The reality is no company can keep that many products alive. They will have to end-of-life several of those products. There's going to be some customers left holding the short end of the stick for Cisco.

CloudGenix reported 10X year-over-year revenue growth in 2016. How is 2017 revenue growth looking so far?

We are seeing even faster growth this year even though it's on a larger number. Calling this market red-hot or white-hot is an understatement. There's a huge pent-up demand. Eighty to 90 percent of the branch networking infrastructure out there is either in end-of-life or end-of-sales by Cisco and these customers don't have an answer there, so they do have to move ahead. At the same time, we have customers deploying either Office 365 or AWS or Azure and they just need a solution that brings the cloud to the branch with performance and security.

What's your go-to-market strategy?

From a go-to-market perspective, we go very aggressively with our channel partners. We've been having huge success on that front.

We've been hosting these 'Game Day' sessions with our channel partners where our business development team and channel reps all get into a room together for hours and do joint prospecting. Our goal is to get deep engagement with our channel partners across the country.

Can you explain a typical Game Day session?

We grab a few of our business development team, inside sales rep and fly [partners] along with our channel rep – either we'll fly them along with the channel rep or we fly to the partners. It all happens in the same room together.

We come in with a prospect sheet, sometimes a partner tells us, 'Here's some customers that we've been trying to call on and we haven't been able to break through.' … Together we go at it, calling these customers. It's a two hour, very intense event. It's about a half of day including prep work. It just opens up so many opportunities.

Who gets to register those deals and how many deals are we talking about during a typical Game Day session?

Those deals are registered for that partner. The partner walks out of the room literally with anywhere between 10 to 20 new deals in hand.

That is just huge for them. They get to sell CloudGenix and SD-WAN, but are also getting these new customers from a channel perspective. Then the partner is free to go sell a whole suite of products whether its security or storage to their new customer. So the CloudGenix Game Day is driving very, very deep engagement with channel partners.

How profitable is it for partners to sell CloudGenix solutions?

Everyone of our channel partners make significantly higher margins than they made with Cisco. More importantly what happens is that if you're trying a Cisco iWAN implementation or sale, the amount of time your sales team, SE's and post sales team have to invest is just a huge bottom-line drag. That's not the case at CloudGenix … For the partner, the effort and the cost of resource allocation is dramatically lower.

Is there anything new you recently launched to help CloudGenix partners?

We just launched a brand new partner portal based on some of the feedback from partners. It's got some very compelling features. We're building a community of partner experts.

What’s coming down the pipeline in 2017 and 2018?

From a product perspective, you'll see a whole slew of investments that we're making in data science and machine learning. We treat the network as a database, where all the information about the network is being stored in centralized databases. So some of our routers are producing tremendous results … We're able to apply machine learning techniques to tell you what the real-time capacity of your network is.

You'll see a huge number of capabilities coming now that relates to automating, troubleshooting, creating self-healing models for the network -- so lots of exciting things.