New Zscaler Channel Chief: We’re ‘In Build Mode Right Now’

‘Zscaler is in build mode right now,’ Karl Soderlund tells CRN in an interview.

About three months after an executive shuffle at Palo Alto Networks, former channel chief Karl Soderlund has left for security rival Zscaler.

Soderlund told CRN in an interview that his departure from Santa Clara, Calif.-based Palo Alto Networks did not have one motivating factor, but rather he was attracted by the opportunity to grow San Jose, Calif.-based Zscaler’s ecosystem and deliver more value to partners.

“Zscaler is in build mode right now,” Soderlund said. “They’re crossing the chasm when it comes to their partner strategy. They’ve always been partner-first, but now they’re looking to continue to really invest and grow. We’re going to look at how we can evolve the partner program to be more beneficial and profitable for our partner community. I’m excited to leverage my 30 years of experience to lead this evolutionary transformation.”

Palo Alto Loses Channel Executive To Zscaler

A spokesperson for Palo Alto Networks told CRN in a statement, “We thank him [Soderlund] for his contributions throughout the past six years and wish him well in his future endeavors.”

Alan Mayer, senior vice president of partners and alliances at Denver-based Optiv—No. 25 on CRN’s 2022 Solution Provider 500 and a company whose 450-plus vendor partners include Zscaler and Palo Alto Networks—told CRN that Soderlund’s transparency and ability to align vendor success with partner success are some of the skills that have made him an effective channel chief.

“It has been balancing the requirements of both entities, understanding the broader market dynamics and having mutual respect and strong communication so that we can arrive at our shared goals,” Mayer said.

Zscaler is a smaller company with a smaller channel partner program compared to Palo Alto Networks.

Zscaler has about 200 employees in its channel organization, based on information supplied for CRN’s 2023 Channel Chiefs list – although the company announced earlier this month that it would lay off about 3 percent of its total workforce, about 177 employees.

It has about 2,000 channel partners worldwide, about 930 of them in North America.

Palo Alto Networks has about 300 channel organization employees, based on information supplied for CRN’s 2023 Channel Chiefs list. It has about 10,000 worldwide channel partners, about 1,200 of them in North America.

Zscaler has a market capitalization of about $17 billion. Palo Alto Networks has a market capitalization of about $57 billion.

Although Zscaler’s ecosystem is smaller, “it’s no less important,” Soderlund said.

Here’s what else Soderlund had to say to CRN.

Why did you leave Palo Alto Networks for Zscaler?

I’ve always admired Zscaler as a company. The way I look at it, they’re solving customer challenges that are at the intersection of mobility, security and the cloud. And when you think about it, these are three of the highest IT priorities today in any organization around the world.

So I’m really excited to be joining a company that’s focused on solving these complex challenges and having companies increase their security posture. … Zscaler has had a vision of scale and growth with partners at the very center of that vision from the start. And that really excites me.

And then also Zscaler is in build mode right now. They’re crossing the chasm when it comes to their partner strategy. They’ve always been partner-first, but now they’re looking to continue to really invest and grow. We’re going to look at how we can evolve the partner program to be more beneficial and profitable for our partner community. I’m excited to leverage my 30 years of experience to lead this evolutionary transformation. … I’ve been very proud to represent Palo Alto Networks for the last six years.

It’s an amazing company. We’ve had a great run together. I’ve learned a lot. And I’ll have friends for life. There was no compelling event for me to leave Palo Alto. It is just a great opportunity and time to join Zscaler.

What are some of your first steps as Zscaler channel chief?

I plan on going on a worldwide listening tour to really understand what’s working, what can be improved and what the vision and future should look like between the ecosystem partner and Zscaler.

Because in my past 30 years, it’s really been my badge of honor that I listen first and act second. Going into a new role like this, I’m really excited to sit down with these partner executives and really understand what they’re seeing in the marketplace and how we can be the best partner possible. … I’m going to deeply inspect the enablement opportunity for our partners.

I’m a big believer that before you can ask for pipeline or bookings, there has to be the capabilities and skillset both on the technical and sales side.

And that starts with enablement. It’s almost the first leading indicator of the health of the business is how our partner is taking advantage of the enablement and what we can do better to enable them.

How big is the security opportunity for services-led partners?

The opportunity for partners will be greater in the next five years than they have in the last 25 years. And if we look at why that is, there is a global IT shortage of cybersecurity professionals.

There is a lot of transition within companies right now with folks leaving and that demand for talent.

And so the partners have an opportunity to provide these services, to provide consulting, to provide lifecycle management to these customers. And more so than ever before.

And now with the recent economic headwinds, they need that help. They can’t just go out and hire a redundant amount of resources. They need to maximize the return on what their investments are.

And partners are so good at evaluating what the needs are in the infrastructure, in the community and really produce the best results. So it’s perfect sense and why we lean in so much.

Have IT budgets for security wavered with all this economic uncertainty?

I have not seen it as of yet. The threat of cybersecurity attacks are at an all time high. The nation-state attacks are at an all time high.

And the need for companies that really have top technology is at an all time high. And Zscaler fits that model.

Are customers looking to consolidate around a single security vendor?

There is always going to be a need for multiple vendors, just based on how innovation moves and the rate that it moves that today.

When you speak about the managed service providers (MSPs), they are going to be looking for a technology that’s built from the ground up to support their needs, multi-tenancy and have the technology that really delivers what they can wrap their services around to provide for their (customers).

Because again, when you think about managed services, they are solving the customer problem of really allowing them to outsource some of their challenges. I use that term lifecycle management – they really want to be fully accountable for securing that environment. So they’re going to pick the best technology to ensure that they can provide that. And I believe Zscaler provides that.

How important are partners for Zscaler?

Ninety-nine percent of their business touches an ecosystem partner. And that commitment to that strategy means a lot because so often in the IT industry with different manufacturers the go-to-market strategy changes quite often with how they’re going to support the partners.

And Zscaler has had an amazing commitment from the beginning of its business to stay committed to the partners. And now they’re looking to say, ‘We want to invest more. We want to scale. We want to get greater leverage. And we want to give partners an opportunity to increase their profitability with Zscaler.’

If you look at the space right now and who is addressing the customer needs for cybersecurity, it’s becoming a very focused group of partners.

There is overlap there. But candidly, I don’t see that as a problem. The reality is there are so many cybercriminals out there. At the end of the day, there’s plenty of business for all of us, and we all need to be successful. The goal is to stop the bad guys.

If you look at the size of the ecosystem, Zscaler is a smaller company than Palo Alto Networks. So the ecosystem is smaller, but it’s no less important.

I’ve been very impressed with my conversations about the knowledge and awareness of the importance and leverage of the ecosystem for the future vision. When I started talking about go-to-market strategy and sales vision, the ecosystem was at the center of every conversation within Zscaler. So the commitments are at an all time high.