Breqwatr, which makes an easy-to-deploy private cloud appliance, and sells through an all-channel model, now has an OEM deal with Pure which is significantly expanding their addressable market.

SAN FRANCISCO — Toronto-based Breqwatr makes a private cloud-in-a-box offering, a cloud appliance which leverages both hyper-converged and OpenStack technologies to give customers a simple and quick way to put together private clouds. They brought their product to market in August 2014, and soon scored a distribution deal with Arrow Computing – an enviable and uncommon feat for a startup. Now on their 4.1 release, Breqwatr has broadened out its go-to-market strategy through its relationship with Pure Storage, which has become central in its expansion plans. They are exhibiting at Pure’s Accelerate conference here this week.

Breqwatr does not really emphasize either the OpenStack or the hyper-converged elements when defining its value proposition, keeping them more ‘under the hood’ in messaging geared around simplicity and ease of use.

“If OpenStack is not sold as an appliance, it becomes an integration project and there are multiple points of failure,” said John Kadianos, Breqwatr’s founder and CEO. “The easiest way to do things in IT is through an appliance, and for an OpenStack private cloud, Breqwatr is still the easiest of all.” It allows a private cloud to be set up in minutes, requires minimal technical knowledge, and unifies compute, storage, network & OpenStack in an integrated hardware and software solution.

While selling this kind of solution in Canada was always something of a challenge – Canada is typically in the rearguard rather than the vanguard when it comes to adopting new technologies – Kadianos said that even in Canada, the market has come around to their value proposition.

“The market really has changed,” he said. “Customers now are more prepared to have the discussion. When we started, we were a little ahead of the market in Canada, and buyers were kind of torn, not knowing what to do with the whole public and private cloud thing. Now the market gets it, and OpenStack has become the private cloud standard.”

Unusually for a startup, Breqwatr used a 100 per cent channel go-to-market strategy out of the gate. Even more unusually, they were immediately picked up by value-added distributor Arrow. Distributors are usually more inclined to wait until a vendor has more of a demonstrated track record before investing their resources in expanding their market presence. However, Howard Goldberg, Arrow’s president of North American enterprise computing solutions business, has been a strong champion of Breqwatr and made the deal happen.

“Arrow is still our distribution and that relationship has worked out very well for us,” Kadianos said.

Breqwatr also started offering a subscription model a year and a half ago.

“We now offer customers a choice of a CAPEX and OPEX models,” Kadianos said. “It’s a good way to derisk both OpenSource and Breqwatr by offering a pure OPEX model. Cloud is an OPEX, so it makes sense for many customers. Over half of new customers now opt for the OPEX model.”

The Pure Storage relationship is relatively recent for Breqwatr, but has become very strategically significant for them.

“We inked the deal in late November of last year, and the relationship really didn’t get underway until Pure’s sales kickoff in February,” Kadianos said. “It is effectively an OEM relationship as we sell it as a single SKU. It has given us access to Pure’s customer base, and we’ve been introduced to a lot of customers through them, especially in the U.S. Since they also just sell through the channel, their channel partners are a winner with this too.”

Kadianos said Breqwatr is looking to Pure to assist in their expansion into the U.S., by driving significant business for them there in 2017.

“By the end of the calendar year, we expect that Pure will be 20-25 per cent of our business,” he stated.