D&H Relaunches Cloud Marketplace With European IT Distributor

“Our goal is to centralize all those back-end operations on our ALSO platform. I think that takes a lot of the chaos out of it. We give them, not hundreds of choices, but the right choices in every category,” D&H Distributing co-president Michael Schwab told CRN.

D&H Distributing said it is answering the call of its partners by launching a new cloud platform that allows them to build comprehensive cloud solutions for their customers, add-on hardware and their own services, and consolidate the billing through a single portal.

It is part of the distributor’s mantra of offering “everything-as-a-service” and giving MSP and VAR partners the ability to scale their products and services to meet customer needs, the company said.

Using the new Cloud Solutions Marketplace – powered by European cloud distributor ALSO -- solution providers can provision bundles of products to meet users’ needs such as hosted servers, storage, backup, cybersecurity, email archiving, hosted CRM, and a portfolio of SMB-oriented applications that are integrated with Microsoft Office 365.

[Related: D&H Distributing Hits $4B In Sales, Focuses On Vendors With ‘Channel Integrity’]

“If the VAR had to go out and create all these individual relationships with all these software and hardware solutions and services that go along with it, to make them more successful, it would be total chaos,” D&H Distributing co-president Michael Schwab told CRN. “They’d have to hire five more people just to manage the back-end operations. Our goal is to centralize all those back-end operations on our ALSO platform. I think that takes a lot of the chaos out of it. We give them, not hundreds of choices, but the right choices in every category.”

D&H has made cloud a top priority, hiring Jason Bystrak for the newly created position of vice president of cloud, to oversee the development of this program as well as handle the company’s overall cloud portfolio. Bystrak has been on the job since January, listening to partners and assembling a team to give SMB-focused solution providers an edge.

“We had a platform in place a couple years ago,” Bystrak told CRN. “We’re actually a distributor that made a fairly early investment compared to some of the others out there, but it didn’t quite meet the business needs we had.”

He said after listening to partner feedback about features and function, D&H came up with a list of 194 selection points, which it used to vet potential cloud platform providers before they eventually settled on ALSO.

“We came out with ALSO being the best-in-class one to work with,” Bystrak said. “Microsoft was very complimentary of that decision as well. They’re a big Microsoft distributor in Europe. They actually wrote their own IP, their own platform, and they said ‘This is great. Everyone loves it. We’re not going to move beyond Europe with our distribution business, but what if we let other distributors use it?’ “

ALSO is a Swiss IT distributor with 4,000 employees that generates about $10.3 billion in annual revenue. Bystrak said D&H is the exclusive user of ALSO’s cloud platform in North America, but that partnership ties them in with users around the world who are constantly upgrading the platform to enhance features and performance.

“It’s very accommodative to someone sitting down in front of the portal and wants to jump right in,” Schwab said. “The good thing is because we’re on this platform in the United States, other users are on it globally, there’s constant innovation. Constant improvement to the platform. It’s a living breathing platform.”

Added Bystrak, “There’s a distributor in the U.K. One in Latin America. D&H is the exclusive distributor for North America that runs their software. One integration with a vendor now, whether it’s Microsoft or Dropbox, gets you - potentially - all those other distributors. So it really is kind of a powerful ecosystem.”

For cloud vendors, this means once they are integrated with ALSO through D&H, they will have already completed the tasks necessary to interface with ALSO systems across the globe.

Bystrak said D&H just started to onboard new customers to ALSO June 4 and it hopes to migrate all of its partners to the new platform by June 23. He said partners wanted the ability to brand the platform with their own logos and let that flow down to the end users, a capability ALSO provides. The platform allows MSPs to deliver hosted services and hardware through a “streamlined, simple to execute” transaction system.

He said partners can also choose which of those products end users can see.

“Let’s say we have 20 different solutions on the platform, you can say, ‘OK. I want to expose these five to my customers,’ ” Bystrak said. “You can pick and choose. And you can have a different, custom catalog for different end users, if you want to get really crazy with it.”

Partners, additionally asked for the ability to add homegrown solutions into the cloud catalog, which the platform allows them to do.

“The partners are excited about the ability to offer their own services with that,” he said. “We’re offering manual services or hardware, talking about the DaaS program, things like that. All you have to do is, you go in and you create a product offer, what’s the price, what’s the description, is it billed monthly or up front, then you have an offer on the marketplace.”

Since many of D&H partners are MSPs who perform contract management and invoicing via PSA tools, the platform has an app that allows integrations with ConnectWise and Autotask, so billing is reconciled to the PSA, he said.

But if this is all sounding familiar to another cloud platform, you’re not alone in thinking that way.

“When they talked about it earlier today it seems like it is a platform that is doing just what Pax8 is doing,” said David Sizer, chief operating officer of 3rd Element Consulting, an MSP in Pennsylvania. He said he is a long time D&H partner and wants to see the company act more aggressively to “keep up” with other distributors.

“We’ve been buying Pax8 for years,” Sizer said. “We were buying from D&H, then moved to Pax8 because it was so easy to work with. D&H invited me to come take a look at (ALSO), so I’m going to take a look at it. So it will be interesting to see if they have enough pull to win that business back.”

Schwab said the D&H offering does have some things in common with the Colorado Springs, Colo.-based, born-in-the-cloud distributor.

“Yes. Similar in some ways, differentiated in others,” Schwab said. “Similar in that you need to make it user friendly. You need to make it always available. You need to be able to make the opportunity to provision downstream opportunities as efficient as possible. So I think from that perspective, probably not too dissimilar to other distributors that have a platform that they have designed or are working on.”

He said the difference lies in the legacy business that D&H can bring to bear on the marketplace, specifically in hardware.

“Its not just software as a service. Because we’re so relevant with Lenovo and HP and Cisco, and all the other technology companies,” he said. “It’s a different go-to-market strategy than a software-only solution provider in the world of as-a-service.”

For their part Pax8, took the move as a compliment to what they have been working towards.

"We are sincerely flattered that others are taking notice of what Pax8 is doing well,” said Chief Revenue Officer Nick Heddy. “Most importantly, we are excited that Pax8 has been able to fill a long time gap in the market by truly enabling MSPs and simplifying their buying journey. We understand that MSPs don't want another distributor. They need a Wingman who offers pre- and post-sales support, curated cloud offerings to drive digitization, and a marketplace that is easy to use with the agility to change as the market evolves."

However, Schwab said he doesn’t see this as a share-taking, winner-take-all move against Pax8. He said there is plenty of room for everyone to eat at the cloud buffet, such as it is.

“When you talk to Microsoft and others, they think the penetration rate is so low that the goal isn’t to take share because we can offer a better price,” he said. “Our go-to-market strategy has always been to offer a complete service and then help the resellers and the SMB reseller succeed. So if the penetration rate in SMB for cloud solutions is less than 30 percent, there’s huge upside for everybody in this opportunity.”