Storage vendor X-IO to go all-channel in new, highly-differentiated partner program

The program offers tiers for exclusive and non-exclusive partners, an Exclusivity Program rather than deal registration, and high margins. Their Canadian partners have not been very active in the recent past, but a drive in Canada to change that and expand the channel is forthcoming.

Photo: Rob Matthews. 3.3.2009 Sun Microsystems. London.

Gavin McLaughlin, X-IO’s VP of Strategy and Communications

Colorado Springs-based X-IO Technologies has launched its new eXcellence Partner Program, which pretty much entirely reworks the philosophy that had been in place in their previous program. The new program contains some highly differentiated features, such as opportunity exclusivity rather than deal registration, and exclusive and non-exclusive partner status rather than traditional tiering. The program also offers high margins, and a commitment to 100 per cent channel go-to-market for all new accounts.

X-IO is a long-time player in the high performance, highly transactional storage market, which has been in business for 15 years.

“We sell to customers who want a highly reliable and available, and high-performance solution, particularly in high-write environments,” said Gavin McLaughlin, X-IO’s VP of Strategy and Communications. “We have also increased our product line over the last year with the iglu SAN solution.” Iglu focuses on the software-defined storage stack, and bridges between that and traditional storage architectures.

“When we get in a fight we usually win it, but I’d like to be in more fights,” McLaughlin said. “We win where people want to see proof of claim, especially on maintenance and durability. Customers are often wary of startups and we’ve been around for 15 years. Our biggest challenge is we don’t have the funding of some of the startups, but we think that growing our reseller network will help us get our name out there a bit more.”

McLaughlin said that growing that channel with the right kind of partners is a key task of Mark Zeller, who joined X-IO as VP of Worldwide Sales in February.

Zeller, who spent 20 years with EMC then did a stint with 100 per cent channel-focused Varonis, said that a key objective was to rework X-IO’s previous hybrid go-to-market model into a purely channel one.

Zeller, Mark

Mark Zeller, X-IO’s VP of Worldwide Sales

“When I joined the company in February, we had a channel program and some good partners, but not enough of them and not geographically dispersed like we want,” Zeller said. “I learned in my past roles that you can’t go half way in the channel and be successful, so a key part of this program is to show that commitment. All new accounts will be 100 per cent channel no matter what. The legacy ones which are direct we are encouraging to move to the channel.”

Zeller said that when he arrived, the channel program itself was not a weakness, but it also didn’t stand out.

“I thought it was pretty good,” he said. “It had three tiers and certifications and registration. But we had to consider whether we just wanted to copy everyone else’s program. X-IO’s tagline is Better by Design. That refers to our product, but we decided we wanted to do the same for the channel program, so we set out to differentiate it.”

Zeller said that one thing people buy X-IO product for is simplicity, and they decided to make the channel program the same way.

“We have made it easy to join, and with no quarterly business review,” he said. “Obviously, it’s better to be educated and we have enablement programs to help partners there, but ultimately it’s storage, and some people with deep storage practices don’t want that.”

X-IO is also introducing an Exclusivity Program which goes beyond the parameters of traditional deal registration.

“We wanted to provide an opportunity for an evangelical sell,” Zeller said. “If someone wants to go in and evangelize a customer, we will work with them and protect them with exclusivity. We think this is unique.” In addition, if the partner does an event like a webinar or lunch and learn and gets people to show up, X-IO will provide the same exclusivity, protecting the names on the list for 30 days so the partner can decide if they are good prospects who they want to register.

Zeller acknowledged with such a system, there is a risk of a partner squatting on every possible prospect in sight, but indicated that getting their own field teams involved was the best way to verify that the partner is trying to work on a deal, and not just reserving customers for themselves.

“The first time you register a partner, you get 120 days to work on a deal,” he said. “We hope they will work with our territorial sales rep, and if the rep sees progress we re-up for another 120 days. Getting the field teams involved like this is the only way to verify.”

X-IO has also replaced their old three tiers with a new type of system that offers two levels of registration – for partners who are exclusive with X-IO, and those who are non-exclusive partners, with the former getting better pricing.

“This way the partner gets to opt in to the tier they want to be in,” Zeller said. “If we can get it to a 50-50 balance, that would be great. We are shooting for a 40 per cent gross margin based on our assessment of street price for exclusive partners, and 20 per cent for non-exclusive, which we think are pretty rich margins.”

Zeller said the go-to-market strategy is to cover about 40 big markets in North America, which have a strong correlation with the big TV markets. They would like to get two to three partners in each of these markets. They also just started recruiting in Europe with the same philosophy last month, and are seeing good results.

“We are especially looking for different types of partners to minimize channel conflict,” Zeller said. “Many of our partners today are traditional builders, and we would like more around iglu with the software defined storage stack.” They work with SYNNEX and Comstor for partners who want to avail themselves of distribution.

While X-IO has a few Canadian partners, and a specific strategy for expanding in Canada has been worked out, a major push in Canada will follow the one in the U.S.

“We are prioritizing the U.S. market first, and will soon become very active in Canada as well,” said Gilles Esposito, regional channel manager of North America, who has been involved in developing strategy for Canada.

X-IO has had three partners in Canada, OnX, Softchoice and Zentra (which is now the Herjavec Group), but Esposito indicated they had not been very active.

“We are hoping to ignite more activity with these partners, and part of our Canadian strategy is to re-engage very actively with them within the next quarter,” he said. “We also have a U.S. partner (Atlantic Data Security) which we recently signed because of their Canadian representation and are already working on some engagements together.”

Esposito indicated that more partners in Toronto and Ottawa, with the latter focused on federal government business, are a top priority.

“We do have a target list of prospective partners throughout Canada, and I have started to engage with some of them, but we want to make sure we can properly address some of the differences pertaining to the environment in Canada such as incentives and NMSO before deploying our full recruitment and enablement efforts.” Esposito said this is being worked on, and to expect some activity in Canada before the end of the year.