I have been a MicroCorp partner since 2002. I was on the Board for quite a few years. It is a fantastic group of people there – and one of the industry’s best channel managers (Cynthia Briggs) works there.
2020 pummeled the channel. Yes, some partners did well in 2020; but a good portion did not. Just like the rest of the economy, if you were heavy in hospitality or travel or restaurants, you had a hard hard year.
Without in-person events, we discovered that many folks can’t sell or recruit or manage partners. That isn’t good. It made for extensive musical chairs in an industry that is famous for musical chairs.
Yet companies didn’t train their people. A few companies did … thank you! But most did not. But expect results anyway. Huh?
Virtual events… they just suck. Period. Maybe they will get better, but likely not since a major reason to attend in-person events is not just free food and drink, but camaraderie. Meet peers and friends, sharing, laughing and learning from one another. No one has virtualized that yet.
These things take a toll on the Channel.
In 2020, the big got bigger – Amazon and Walmart. There were over 500 M&A transactions in the channel in 2020. The driving factor is to get bigger. Sure, some of that is to fill in holes in the portfolio (for contact center and cybersec firms) but it was by and large to get large.
In the channel, 2020 saw both Ingram and Tech Data get bought by private equity. Telarus took a private equity partner.
The channel is aging. Some partners – MSPs, brokers, VARs and others – called it quits in 2020. I spoke to a couple who were going to ride into the sunset. They just didn’t have it in themselves to do it once more. Dot com days, 9/11, recession, financial disaster and now pandemic. Nope.
I spoke with partners writing down six figures in clawbacks. I also spoke with several partners doing well – seeing opportunity and capitalizing on it. It can be done if you have the team, the ability, the execution and you see it. A few pivoted.
Letting employees go is the roughest thing an entrepreneur has to do. There was too much of that in 2020. Add in isolation, maybe a health crisis in the family or with friends, income shrinkage, a declined PPP loan – a lot hurdles this year. Tough for everyone.
Now the largest master agency in the Southeast and one of the Top 10 in the US goes to AppSmart. Maybe that is a smart move. Go Big for financial strength, contract leverage, etc. Bigger has never meant better in telecom. Ask Lumen or Zayo or Charter or AT&T or Birch/Fusion or Frontier. I know those are mostly telcos.
I know the future of the channel as the prophecy says is Software. Maybe, but I don’t see many people paying the mortgage from Office365 sales. I do see mortgage payments from fiber though.
Let me point out that not many companies made bank on WFH. Zoom, Microsoft and Slack did. Big Time! RingCentral, 8×8 and Vonage — your S1 filings do not tell that story. Maybe a 10% bump, but nothing suggesting that you won in 2020. Nextiva says they crushed it – whatever that means for a company that doesn’t release numbers. Every carrier said they were crushing it — but phone calls and emails on the 28th of each month tell me that might not be the case. #justsaying
Looking Ahead! I think 2021 will be a mess. I think MDF will be off because the ROI was funky with MDF in 2020. I think in-person events don’t start until at least June. I think too many companies have Hope as a Strategy as it is. They need to get back to basics in sales and marketing – not hope that a bourbon tasting is going to hit quota.
I wish the fine folks at MicroCorp well as they integrate into AppSmart. I just don’t see how all these leaders from WTG, Telegration, CSNG and now Microcorp fit into one org. That’s a lot of entrepreneurs and different cultures to meld into one unified agency that mainly wants partners to self-serve through the portal. (And they still haven’t assimilated CSNG yet because, well, CSNG has a funky corporate structure, which just adds to it.)
A new master agency will fill the void. Every partner uses 5 masters. Every partner spreads it around in case. We have all been burned.
Hope everyone has a healthy and happy holiday season!