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Peer 1 grows channel revenue by 400 per cent

CloudInfrastructure

Vancouver-based web infrastructure and cloud hosting provider Peer 1 is touting a successful year in the channel, reporting 400 per cent revenue growth from its channel business during its 2013 fiscal year.

It’s been a busy year for Peer 1, and Michael Mayer, Peer 1’s executive director of worldwide channel, attributed the success to the launch of its new strategic alliance program, its new enterprise-grade public cloud offering, the hiring of several new channel executives, and the enhancement of its Smart Partner channel program.

“We wanted to find a few strategic alliance partners that Peer 1 could work with to really go after the community,” said Mayer. “We announced two last year with Dell and Arrow. With Dell we partnered on the public cloud in Canada, and Arrow we’ve worked with from a reseller and referral perspective on ArrowSphere.”

In addition to the strategic alliances, Peer 1 launched its channel program last year, achieved a 38 per cent close rate with partners, and added 500 partners globally. Mayer said Peer 1 has had particular success in its Canadian home base, which remains the company’s fastest growing territory. Being a Canadian-owned and operated hosting provider is certainly a factor in that success, said Mayer, as data sovereignty is still a concern for companies.

Peer 1 has 19 data centres worldwide, including three in Canada – Vancouver, Toronto and Montreal. “Having all three of those makes a diference, as our public cloud in Toronto can fail over to Vancogver,” said Mayer. “That’s a tremendous advantage to have over even the largest competitors in the U.S.”

The company’s channel team accounted for 40 per cent of new acquisition sales in fiscal 2013. In the year ahead, Mayer said Peer 1 anticipates doubling its channel team and recording similar growth figures. It’s also looking to add up to eight new alliances with strategic partners, and really focus on its premiere partners.

“(We’re looking for partners) we can build products and solutions around as we diversify our portfolio,” said Mayer. “We recognize Peer 1 is part of the solution. A lot of people are looking for a reliable hosting service. It’s a good time for us. But we don’t want to expand to a point where we’re stretched and would lose some of the customer experience scores we’ve gained over the last few years. We want to find partners that share our goals.”

On the channel partner side, Mayer said over the next year Peer 1 will be growing beyond its traditional referral model to embrace the reseller channel model as well, particularly as it plans new offerings around e-commerce and cloud computing.

He said he sees two things when it comes to resellers: making margin off of a product or adding a service, and the support side of billing and supporting the end users.  There are different combinations there that can work, and Mayer said Peer 1 is looking to be flexible as it develops the reseller model that can provide the best customer service.

“It’s not our intent to just sign up everybody and anybody,” said Mayer. “We’ll expand our … but our primary focus will be on strategic alliances.”

Look for Peer 1 to announce another strategic alliance partner in the next 30 to 60 days, he added.