Nutanix CEO Rajiv Ramaswami Wants A Deal-Driving Channel, Partners Need Sales Support

“We want you to participate in the renewals as a partner. And at the same time drive expansion, because renewals is also a good time to expand the business. So that is the flywheel of the subscription business. And we really want to build that flywheel with our partners,” Nutanix CEO Rajiv Ramaswami told CRN.

Nutanix CEO Rajiv Ramaswami’s vision for the channel is to have partners find deals, close them, then renew contracts with those customers - with some new subscriptions added-in - and all of it done independent of involvement from the parent company.

“Where I‘d like to get to with the channel is there’s going to be a set of accounts, or maybe some segments or regions that are driven entirely by the channel without even having any of our reps,” he told CRN in an interview. “I mean, that is a logical end to where we can take partner autonomy. You know, first we help the partners do more, but then that gets to a point where the partner can do the whole thing.”

It starts, however with renewals, and bringing channel partners along for more of the journey with Nutanix products, from that first installation to selling the customer through the stack, he said, and partners must be involved in each phase.

“What we‘d love for partners to do is to be part of the entire life cycle with us. We have transitioned to a subscription business. We want our partners to be able to go drive that and bring that business in autonomously,” he told CRN. “We want you to participate in the renewals as a partner. And at the same time drive expansion, because renewals is also a good time to expand the business. So that is the flywheel of the subscription business. And we really want to build that flywheel with our partners.”

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Channel partners applauded Ramaswami’s statements, but said to reach that Promised Land, they need Nutanix sales reps to stay on the job, adding the “churn” in its sales organization can get in the way of closing deals.

“The one thing I would say to him, ‘Please enable some stability in your sales organization,’” said Tim Joyce, president and CEO of Roundstone Solutions, a Nutanix partner in Orinda, Calif. “Nutanix’s sales organization has had so much churn. They have gone through so many people. If they would get stability they’d sell a lot more because the product is so good.”

Another partner in a different time zone said that while Nutanix engineers never seem to leave and appear to be happy, the sales reps cycle through every six-months, a problem that predates Ramaswami.

“If they could get their act together, they would be dominating,” the partner said. “They’re the best thing on the market. They just can’t execute.”

When asked about the sales department, Ramaswami said it works best when it works “hand in hand” with partners.

“We’ve built out our sales team. We built out our sales reps. We continue to build them out. We continue to hire people,” he said. “We continue to focus on our sales reps’ productivity as well, and how they can be more productive. But I think part of the equation here is these two work together. They’re not independent entities. The sales reps are here. The channel is here. But the two are working hand in hand. The best accounts are where our sales reps work hand in hand with channel partner to go together. And that‘s true for a good chunk of the accounts.”

Nutanix has put resources behind giving partners more freedom to win deals, said Rick Gouin, chief technology officer at Nutanix channel champion Winslow Technology Group, based in Waltham, Mass. He said they offer partners a curriculum of training and enablement to do just that. He said however the goal is not just to land more business, but to expand that sale at renewal.

“It’s almost like what [Ramaswami] is doing is how you have to run a subscription business,” Gouin said. “Some of those other providers, they used to only have goals for us with revenue. Now its revenue and your renewal percentages. They want upgrades and they want our numbers to be over 100 percent.”

Vendors, in addition to tracking Winslow Technology Group’s sales, also look at the percentage of sales that get upgraded, and by how much over the previous contract. But Gouin said VARs will be better off for adopting this revenue model, owing to the predictability of the pipeline, which underpins the valuation of their business.

“Ultimately, that’s where we’re going to see everyone going. Now everything I sell is a subscription. Now I’m tracking everything I do as recurring revenue … What it has done is it makes me think a lot harder about bringing on a new partner,” he said of vendors he works with. “The days of selling a one off, that’s over. I have to commit to these guys: Nutanix is my jam and I’m going to work with them.”