08 January 2015

Channel Pro says "When insight picks up where data left off…"

Adam Davison urges the channel to look beyond data, instead focusing on industry insight

I had a fantastic day at the races at the weekend. I went with a friend, who it turns out, has an unnerving ability to pick a winner. After three consecutive losses, I was beginning to get frustrated with his ability to beat the bookies and asked him if it was sheer luck, or whether there was some method to his madness.

“I do my research,” he explained with a knowing wink. He went on to explain that he knew a couple of trainers who had given him some insight on the runners and he offered to pass some of that information on to me. Lo and behold, his insight proved the recipe for success and, one race later; it was me feeling smug as I collected my winnings!

The whole experience made me think about our business. A large part of the value of Cloud Distribution is our ability to spot a potential disruptive technology and introduce it successfully to the UK market. In a way, we’re talent spotters.

So, with 2015 just around the corner and everyone’s attention turning to technology predictions, what do we see as the key determinants that are likely to create commercial success for next generation vendors in 2015?

Rather like my experience of relying on information from a racecard to make an informed decision; speaking to potential vendors, or looking at their websites is a good place to start but this is just data. What you need is industry insight.

True entrepreneurs should spend their time looking for business ‘pain points’ or problems that need solving rather than coming up with technical features in isolation and then retrospectively trying to think of an application and market for those features. The most successful businesses are those that offer a solution to a very real business or life problem. People often think the most difficult part of creating a business is finding the right team and sourcing financial backing, but it's actually identifying the business issue that needs solving in the first place that’s the hard part.

So how can industry insight help this?

Our job in identifying the next big thing in new technologies is to look beyond the vendor data and gather insight from three key parties.  Firstly, the market; the end users.  People like you and me who are identifying the problems that a new technology might overcome. Our conversations often contain statements such as “Wouldn’t it be great if you could…” Or “I wish you could…”

Secondly, once we have our wish list, our next port of call is the VC community. Which fledgling companies are they talking to who could offer solutions to these problems? We talk, we marry problems to solutions and, ultimately, we end up with a pretty clear idea of which companies to back.

To complete the picture, we spend time with our resellers. What gaps do they have in their existing portfolio?  How can we help them get ahead by offering additional revenue stream opportunities? One of the key determinants of commercial success for the channel today is higher risk, higher margin products which enable resellers to differentiate themselves in the market. I say higher risk, but if you’ve gathered your insight, then it’s a calculated risk.

Resellers need to differentiate themselves and we strive to offer our partners high margin products within our strategic solution stacks for which the due diligence into customer demand has been done. In the financial sector, for example, where speed is crucial, we have products that offer customers an extra millisecond of latency and advanced compliance, or additional PCI security for customers in the retail sector; these are all features that enable our partners to differentiate themselves to their customers, sell at a higher margin and, with the additional training and certification services available; derive a healthy, sustainable recurring revenue stream in the process.

That’s the hard part over, now you can have fun taking these companies to market! But know that this requires some additional skills: the courage of conviction and the ability to take calculated risks.

So, my predictions for 2015? They are rather like my day at the races; look beyond the data, do your due diligence, gather your insight and you can win big!


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