After a year of establishing their SOC-as-a-Service through direct sales, Arctic Wolf has commenced on a strategy of shifting to a channel model.
Sunnyvale CA-based startup Arctic Wolf has been offering its turnkey Security Operations Center[SOC]-as-a-Service since early 2015. This year, it began to supplement its direct offering by building out a channel, and has been incrementally adding channel personnel and a channel program throughout the year.
While Arctic Wolf’s offices are in the valley, their roots are in Canada.
“We started the company in March 2012,” said Brian NeSmith, Arctic Wolf’s CEO and co-founder. “My co-founder, [Kim Tremblay, VP of Research and Development] is Canadian, and we made the decision early on to do all development in Canada.” Arctic Wolf’s R&D office is in Waterloo Ontario, Canada’s tech development hub.
“When we started the company, I was the only American employee!” NeSmith noted. While NeSmith is best known for his stint as CEO at Blue Coat, he also lived in Ottawa for several years while working at Newbridge Networks.
NeSmith said Arctic Wolf came into existence to serve the small and midsized companies who have all the security challenges of larger companies, but not the budget.
“We realized early on that we could change the economics and make it economic for a mid sized company to have a SOC,” NeSmith said. “We take full responsibility for the security actions of our customers.”
Arctic Wolf targets organizations that range from 200-2000 employees, with 400-800 being their true sweet spot.
“While there are competitors in this space, we differentiate ourselves by providing a full turnkey service,” NeSmith said. “We also don’t charge customers by number of logs, but on the number of employees, which makes costs very predictable.”
NeSmith said that Arctic Wolf first started to approach customers in 2014.
“We approached the market cautiously,” he stated. “It was early 2015 when we really started to ramp up and get more aggressive about selling. This was all direct sales, but NeSmith said that this was always intended to be a transitional stage.
“All along, we expected that the right business model was selling through partners,” he said. “Partners have additional services they can add on. We don’t do remediation, and partners do do that. We say how to fix issues, but we don’t actually provide that service ourselves.”
In January of this year, Arctic Wolf began selling through partners. Their Apex Partner program soon followed, although it was not formally announced until September. Nick Schneider was named head of sales to accelerate the company’s growth and bring more partners on board. Will Briggs followed as the channel manager.
“A lot of the channel infrastructure was built before Nick joined, although he brought on a full time channel manager and they modified the channel program and made it more scalable,” NeSmith said.
“We have a dozen partners now, and we are looking to expand that,” he stated. “We are looking for a few large national and international partners, but more than a couple is unwieldy. We want more partners that are more local. Regionally, we would like have no more than two in a specific geography – ideally two in every major location in North America. A year from now, we would like to have two to three national partners across the U.S. and Canada and 30-40 total across all the regions.”
Canada is still a fruitful ground for new partners. NeSmith said.
“We have some national partners with a presence in Canada,” he said. “We have no regional ones yet, but that will be resolved in the next couple of months.”