Veeam Walks Fine Line Between Channel, OEM Resellers

VEEAMON 2019 – Veeam Software has had to navigate a delicate path over the past few years to ensure there’s no conflict in its channel as it’s grown the number of resale partnerships with tech companies like Hewlett Packard Enterprise, Cisco Systems, NetApp and, most recently, hyperconverged infrastructure software maker Nutanix.

Veeam’s James Mundle

Since its inception, Veeam has been a 100% channel business and now has more than 60,000 partners, according to James Mundle, vice president of worldwide channels for the fast-growing cloud data backup and recovery software maker. Since 2017, Veeam officials have grown the company’s ecosystem of storage technology partners that resell Veeam software in their products.

It started in the primary storage segment with companies like Hewlett Packard Enterprise and NetApp and has since grown to more than 20 vendors, including Dell EMC, Fujitsu, Cisco and Pure Storage. The effort is part of a larger push to expand the reach of its software suite into enterprises by enabling customers to buy hardware with the Veeam software pre-installed.

More recently, Veeam has turned its focus to the secondary storage market, announcing partnerships this month with Nutanix and ExaGrid. At the VeeamON 2019 user conference in Miami this week, Ratmir Timashev, the company’s co-founder and executive vice president for sales and marketing, introduced the “with Veeam” program designed to bring on even more storage technology partners in the secondary market over the coming years.

The idea is to create a broad ecosystem of such partners to give organizations multiple options for bringing Veeam into their environments.

Veeam’s Kevin Rooney

As company pursued the strategy of resale partnerships with OEMs and other vendors, officials also knew that they had to ensure that their array of channel partners were not hurt, according to Veeam channel executives. That came with a lot of questions that needed to be answered.

“How will this impact the partner?” Kevin Rooney, vice president of Americas partner sales at Veeam asked Channel Futures. “If we’re going to go down these reseller agreements with these large companies, how does the partner play in this? How do we make sure it’s still profitable? How do we make sure we don’t punish one over the other?”

What they came up with was a way that Veeam channel partners would be rewarded when an appliance with Veeam software on board from one of the reseller partners was sold, Rooney said. The is ensuring that the Veeam…

…partner will get credited equally whether the Veeam software was sold by the partner or by the technology reseller.

At other places that Rooney has worked, that wasn’t always the case, he said. In those scenarios, if an OEM like NetApp sold a SKU of the company’s software, the NetApp partner would get credit while the software vendor’s channel partner wouldn’t, which would create conflict.

“We want what’s best for the customer, so if the customer wants it as a NetApp SKU — and therefore as a NetApp build or a Cisco build or an HPE build or a Nutanix build — let them,” he said. “Everybody is equally compensated. The conflict typically happens when you change the rules and say, ‘When it’s sold this way, this team gets it, and when it’s sold that way, that team gets it.’”

A Veeam partner doesn’t get double the pay if the software is sold through NetApp, but the revenue made from the sale is applied to the Veeam partner’s status with Veeam.

“What we’ll do as Veeam is recognize that revenue as achievement in our [channel] program,” Rooney said. “It won’t be qualified for our stack of benefits, but it will be qualified to recognize them in their stature within our program. If we say, ‘You need to sell X amount of Veeam to maintain a status,’ we will recognize the revenue of that, even if it’s sold as HPE or Cisco or NetApp.”

Mundle noted that a channel partner needs to sell $100,000 in software to be in the Veeam Gold Partner program.

“You need relative parity; you need balance,” he said. “We’ve designed things such that we’re able to achieve that. … If $70,000 of that is direct Veeam SKUs that they’ve sold to customers, awesome. If $30,000 or $40,000 is HPE resale, we count the HPE resale toward their certification or revenue requirement.”

OffsiteDataSync’s Matt Chesterton

Matt Chesterton, CEO of OffsIteDataSync, an MSP that works closely with Veeam, told Channel Futures the software maker has done a good job finding a balance as it’s pursued these reseller deals.

“We’re partners with a lot of the same vendors, like Cisco and some other ones out there, so when they can package a solution together, in a lot of ways it does help us,” Chesterton said. “There would be some conflicts if we were to approach [a customer] and they sold through a vendor relationship,…

…so I think working through those is the biggest thing.”

He also applauded Veeam for looking to aggressively expand the market. Company officials have remained steadfastly hardware vendor-agnostic, with the idea that more companies that sell their software, the more it helps Veeam and its channel and technology partners.

“When you partner with one, then you will have one that will sell your product,” Chesterton said. “If you’re agnostic and you’re doing well, then everybody’s pretty comfortable saying ‘Great, let’s package it on top and sells more HPE’s, sell more Ciscos, sell more Exagrids.”

Still, enabling channel partners to benefit even if a sale is made through the OEM resellers makes sense.

“That’s important. In a channel model, you have to make sure everybody’s getting compensated and credited the way they need to be,” he said. “You can’t have somebody shortchanged. It won’t work. They’re smart about what they do. It’s everything, because if you misstep in some way or someone’s feeling cut out or is cut out, that ripples. You can’t do that.”