Five years on from its first foray into cloud, Exeed – and its resellers – are reaping the returns of the early investment, with 50% per annum growth in the distributor’s cloud business.
Justin Tye, Exeed managing director, says while the 50% per annum growth comes off a zero base ‘by the time you get to year three, if you’re still growing at 50% I think you can conclude that the results we’re seeing are really good’.
He says cloud currently accounts for 2.5% of Exeed’s business and he’s expecting growth to continue on the same trajectory in the foreseeable future.
“That will mean more clients converting to Office 365, probably more virtualised instances of Sharepoint servers, more data being backed up online,” he says.
The distributor was an early adopter of cloud locally, launching its Mycloudstore five years ago as an aggregation platform for existing software-as-a-service applications.
The site, and its offerings, were designed to be a value-add proposition in the sale of hardware, such as laptops and desktops, enabling resellers to add offerings from the likes of Vend, Xero or Workflowmax to build an annuity income on top of the one-off margin made on the sale of hardware.
Tye says the SaaS approach was essentially a value add to a PC sale, and a way for resellers to make more from traditional hardware, where revenues were declining.
Come 2014, the distributor took the step into addressing infrastructure needs of a business with IaaS.
“It was an exploratory exercise, as much as anything else,” Tye says, of Exeed’s early cloud days. AWS and Azure had yet to make significant in-roads in New Zealand, while local infrastructure providers including SoftSource and CCL were starting to ‘really develop their business’.
“When these other companies were starting to get some momentum, that was about the time we shifted from a SaaS approach to what can we do around delivering infrastructure, as opposed to setting up, and investing in that, ourselves, which I think would have been counterproductive to what I think the local market was trying to achieve.
“It didn’t make sense for us to replicate something others were already doing a very good job of.”
That stance is, in part, behind the company’s recent deal with vGrid, the Waikato-based cloud services platform which provides a range of on-demand IaaS and SaaS solutions.
“We see their offering as pretty comprehensive, a really good home grown story and really interesting business to work with. They’re looking beyond the standard deliverables to a whole lot of things that can be added to the stack for vertical industries like agriculture and so on.”
Tye is enthusiastic about the potential presented by the vGrid which, along with Azure and Office 365 is a key focus for the company.
“It’s a great platform and opportunity for us all to enjoy some good growth out of that partnership,” he says.
Tye says demand for infrastructure and backup, PC backup they are the kind of services our reseller base has asked for most freqently as a service delivered from a distributor.
“Where a reseller in the past would have proposed an on-prem server to run SQL applications, store those files, backup their data, host Exchange and deliver that type of infrastructure service - that same service via the cloud, that’s probably the most common request.
“That and Azure which is a growing part of our Microsoft relationship, which we also consider to be a cloud delivered service because it’s a combination of that and Office 365 – those two are probably the largest contributor to our business.”
Tye says security via the cloud is also growing quickly, with the company offering Sophos and Webroot.
He says the company expects to flesh out its offering more in the coming months.
“There will always be this infrastructure focus, where you’ve got virtual servers and backup of those servers as primary offering.
“And then at a client end you’ve got the Office 365 services, which will continue to grow. We’ve got over the top services like BitTitan, SkyKick, FullSuite, RapidStart, so they all enhance the value or accelerate the onboarding of cloud delivered services.”
The distributor is also starting to see ISVs keen for help with distribution.
“Some of those have been coming through from discussions we’re having with Microsoft and others are just approaching us to ask if we’re interested in presenting their solutions to a broader market,” he says.
“Some are quite broad – Sharepoint based – and some are very vertical, looking at things like legal documents for companies that sell contracts and services into the cloud.”
Tye says he expects some of those ISVs to results in distribution relationships, where the ISV’s offering is fully integrated into Exeed’s distribution ecosystem, with the distie managing the sales, marketing and billing and to some extent support, on their behalf.
“There will be others who we might just have a more arms-length relationship with, where we’re happy to promote their service but don’t see a need for us to offer a full distribution relationship for them.
“But you’ll definitely see our offering continue to grow.”
However, Tye says Exeed’s key focus remains on getting the most it can out of its current platforms.
“In terms of infrastructure and client solutions the real focus for us is around vGrid, Azure and Office 365.”
Tye says education will be a continuing focus for Exeed in the coming months.
“We want to help resellers identify where it makes sense for companies to consider cloud, and where it doesn’t, and what are the options available to resellers.
“Whether that’s hybrid infrastructure or they want to use a multinational locally delivered solution or a global solution like Azure or something like a vGrid offering.
“There will be different components of what we offer that meet most resellers needs now.”
Part of that education includes the distributor hitting the road next month, along with Hewlett Packard Enterprise and Microsoft, for a four city hybrid IT roadshow, outlining Exeed’s cloud offerings, along with those from Microsoft, HPE and vGrid.
“It’s prudent for all resellers to at least know what their options are in this space, so if they find themselves in a competitive situation and are up against someone offering cloud, at least they can say they can do it too and that they know how to do it.
“Our job is to try and make it easy for them.”