Monday, January 31, 2011

The CSP (Cloud Services Provider) Technology Vendors GTMP

Here they come in droves, the newly (and typically very well) funded CSP Technology Vendors looking to grab land. First, what is a CSP Technology Vendor? They are akin to the MSP (Managed Services Provider)  Technology Vendor starting 10 years ago that developed software  platforms (i.e. RMM)  for a VAR to become an MSP to deliver their managed services. The CSP Technology Vendor is a software company developing a platform for the MSP (now called CSP?) to deliver their cloud services. Make sense? Good, because there is no doubt in my mind that it’s going to be huge. In fact I believe it already is. So what’s the challenge? These CSP Technology Vendors need to find and create CSPs. Actually better said find an MSP that wants to be a good CSP. No problem? Think again. It’s a similar (but larger) challenge that the MSP Technology Vendors have been struggling with for over 10 years now (only recently being hugely successful), finding good VARs that will be good MSPs. There are an estimated 100,000 VARs in N. America (another 100,000 outside N. America?) ranging in size to IBM GS to your next door neighbor and his dog. And there are an estimated 10,000+ MSPs in N. America (again approx. the same number or less outside N. America) ranging in about the same size. The CSP Technology Vendor needs to troll through the 1,000’s of MSPs, find the good (i.e. successful) ones, sell them the proverbial starter kit and then “make them a successful CSP” so they buy more than the $10k starter kit. Why not the VAR vs. the MSP? The VAR has yet to transition their business model to recurring revenue. The CSP technology Vendor doesn’t want to get caught up in that. So, how’s it work? The good old fashioned way, national/international and regional trade shows, industry association events, partnerships, PPK, advertising, inside sales cold calling, webinars etc. Actually webinars seem to be very much in vogue for finding good MSPs these days. Most of the top RMM players (including the big dog) have used educational based webinars to attract good MSPs into their net. Develop an interesting educational title and content targeted at your DNA MSP, outreach to 1,000’s of prospects via an industry association database, have several hundred attend each webinar and do the sales math. So now you have a newly signed MSP to be a CSP (with $10k in your pocket) now what? Immediately provide them with a business building on-boarding program. Why (other than the obvious)? First, going backwards a bit, telling your MSP/CSP prospect in the sales/recruiting process that you have a comprehensive and professional business building on-boarding program once they sign bolsters your value prop tremendously by showing them that you are not just a software company trying to shove software down their throat, but will help them build a business. These MSPs aren’t great sales and marketing folks, sorry they just aren’t (and most of them know that). For you to get past the $10k starter kit you’ll need to teach them how to develop their cloud services vale prop, pricing/packaging, identify target markets, how to find leads, develop a sales process and the tools needed to execute on it etc. etc. etc. Remember, the CSP is now the vendor responsible for creating, marketing and selling “their” (SaaS, IaaS, etc.) solution. They’ve never had to do that before to this extent. The most successful MSP RMM technology vendors have done the on-boarding very well and are now enjoying a healthy add-on business from their MSPs. The CSP Technology Vendor must follow suit.

No comments:

Post a Comment