New Axcient Channel Compensation Model

Axcient, Inc., in cloud-based Recovery-as-a-Service (RaaS), unveiled a program that makes it easier and more advantageous for channel partners to implement its business recovery cloud platform.

Axcient’s program represents a departure from how Software as a Service (SaaS) vendors typically compensate channel partners, as well as how SaaS solutions are sold and deployed.

The new program will offer to compensate channel partners up front for the sale, delivery and support of its business recovery cloud solution. This makes it easier and more lucrative for VARs to grow their business in the SaaS model versus the traditional licensing and procurement methods for on-premise software and hardware.

The up-front compensation is reflected in the program’s name, SaaS:FLO, which stands for Software as a Service: Front Loaded Option.

SaaS:FLO will be financed as part of $25 million in funding that Axcient also announced. Silver Lake Partners, with $23 billion in combined assets under management, provided debt financing facility in the round, which was led by industry ventures, with participation from existing investors Allegis Capital, Peninsula Ventures, Scale Venture Partners and Thomvest Ventures.

The program aims to reverse the conventional wisdom that VARs don’t play a valuable role in the SaaS ecosystem because VARs’ specialized skills and project management aren’t needed as much as with on-premise software. In addition, SaaS:FLO’s upfront compensation model addresses a key issue for VARs that have not found selling SaaS solutions attractive because profit margins have been low. Axcient believes VARs play a crucial role in ensuring the quality of SaaS deployments, and SaaS:FLO aligns the SaaS compensation model with VARs existing business model so that VARs are incentivized to deploy cloud services.

“Together with our channel partners, Axcient is disrupting an enormous and growing market by providing a single Business Recovery Cloud that eliminates data loss and application downtime for businesses,” said Justin Moore, CEO. “SaaS:FLO helps VARs benefit from this strong growth opportunity and helps ensure the successful deployment of the Axcient Business Recovery cloud for customers. Under this new program, VARs make their margin day one as opposed to over time, enabling them to successfully deploy SaaS, make significant margin upfront, and compensate their sales reps without having to change their business model. We think this is an innovative approach that will have a ripple effect across the larger SaaS sector. I expect we’ll see more companies look to private equity underwriters to finance a similar program in the coming years.“