The cloud marketplace vendor has snapped up the Microsoft CSP Indirect Provider. Here’s what it means for partners.
Resello, based in the Netherlands, distributes cloud services through Microsoft, cyber protection through Acronis and email security through Vade. With the addition of Resello, Pax8 – and its channel partners – get access to more than 40 European countries.
“Digital transformation has never been more urgent, and we are helping partners realize the benefits, value and impact to businesses,” said John Street, CEO at Pax8. “The acquisition enables us to continue to expand our presence into international markets, add localized support, and accelerate and scale cloud adoption worldwide.”
Buying Resello also gives Pax8 global Microsoft authorization, said Nick Heddy, chief revenue officer at Pax8. That means Microsoft’s premier support agreements now extend to all Pax8 subsidiaries in every region it covers. Furthermore, all partners may earn worldwide incentives.
“The big advantage is partners in North America now have reach into all of Europe, and partners in Europe can take advantage of Pax8 resources,” Heddy told Channel Futures.
Resello further brings a range of new capabilities to Pax8. Harald Nuij is Resello’s managing director.
“We have a sales and support team in Europe with 15 native languages,” Nuij told Channel Futures. “We share the vision that cloud services is a local affair. You want to be close to your partners, with optimum support.”
Resello actually approached Pax8 about working together. The Microsoft CSP Indirect Provider was evaluating various platform as a service companies “because we felt we were doing something successfully here in Europe,” Nuij said.
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Those conversations led to unexpected discussions about M&A — a “‘When Harry Met Sally’ story,” Heddy said.
As talks among executives unfolded, Pax8 leaders identified “a lot of synergy” between the two vendors.
“We’re both very partner- and customer-obsessed, and focused on cloud only and helping partners who to lean in and transform their businesses and make a profit,” he said.
That, along with the attraction of Resello’s Microsoft credentials, ended up bringing the two companies together.
63% of U.S. Business Going Through Cloud Marketplaces
The timing is significant. Various research shows that end users want a marketplace approach for buying cloud services. To that point, Forrester, as one example, last year found that one-third of all business in just the United States now flows through e-commerce. Nearly two-thirds (63%) of that counts as a cloud marketplace, Forrester said. But the opportunity doesn’t end with a marketplace sale.
“The average cloud deal creates a 5x multiplier for partners — where every dollar that is collected by the vendor for the product, around $5 goes to the ecosystem for services and add-on hardware and software,” Forrester principal analyst Jay McBain wrote in 2020.
To McBain’s point, channel partners want to provision branded self-service resources for their customers. Not only do they benefit by keeping their company names in front of clients, but they also get the chance to handle more projects for those customers.
Pax8 aims to meet both those requirements. And for partners who perhaps have waited to jump into offering cloud, “it’s an excellent time to start, and if they call us, we will not tell them it’s too late,” Nuij said.
The Resello acquisition (whose terms Pax8 did not disclose) marks Pax8’s third since receiving $96 million in new funding late last year. The company also now owns Sea-Level Operations and Wirehive (which goes by Pax8 UK). Pax8 has brought over Resello’s 33 employees, who work in the Netherlands and Germany.
“The whole team here is super excited to represent the Pax8 brand,” Nuij said.