Discussing the Acquisition of CDI with AHEAD President

In this episode of Channel Insider: Partner POV — your source for untapped opportunities and unfiltered opinions in the IT channel — host Katie Bavoso sits with Rich Falcone, the president of AHEAD, a company that specializes in building and managing digital platforms for enterprise customers.

With a rich history in the IT sector, Falcone brings his extensive experience, having spent two decades in the industry, most recently as CEO and president at CDI before its acquisition by AHEAD in February 2024. Discussing the integration and prospects, Falcone shares his vision for how the consolidation will benefit customers and vendor partners.

Listen to the podcast:

Watch the video:

The mission and services of AHEAD

Falcone provides an in-depth explanation of what AHEAD offers to the market. He notes that digital transformation, hybrid cloud, and cybersecurity are critical areas where AHEAD excels. These services are increasingly relevant as businesses seek robust IT solutions regardless of size. “Whether you’re a seven-year-old or seventy-year-old, cybersecurity and digital transformation are now integral parts of daily life,” he asserts, emphasizing the ubiquitous nature of these technologies.

AHEAD distinguishes itself by providing comprehensive solutions that go beyond mere project execution. Falcone points out the frustration many customers feel with vendors who can only manage parts of a project. AHEAD and CDI’s combined service catalog offers a holistic approach, enabling customers to leverage multi-cloud environments, automation, and digital marketplaces without the hassle of coordinating multiple providers.

This integration ensures a seamless digital experience supported by expert engineers, professional account management, and a strong back-office culture.

Customer verticals insights

When Bavoso inquires about the verticals AHEAD and CDI serve, Falcone highlights their success across various sectors, including finance, healthcare, legal, manufacturing, and state and local government. He underscores the alignment between the two companies’ customer bases, particularly in finance and healthcare, which are dominant sectors for both. This merger allows for a more extensive service offering and depth in these key verticals.

The acquisition of CDI by AHEAD expanded the service catalog available to customers, filling gaps between the two companies. For instance, Falcone notes that CDI brings robust capabilities in security, such as ethical hacking and infrastructure management, while AHEAD enhances digital solutions, application transformation, and financial operations (FinOps). This complementary relationship allows both entities to offer their clients a more comprehensive and powerful solution, further solidifying their market position.

Benefits to IT vendors and strategic growth

Bavoso probes into how the merger makes AHEAD a more valuable partner for IT vendors. Falcone responds that scale is a critical factor in this industry. He explains that large vendors like ServiceNow and Dell benefit from partnering with a sizable, scalable company that can cover a broad range of services and modules. Smaller vendors also gain from AHEAD’s deep engineering expertise and the expansive reach of an extensive sales and marketing organization.

Falcone elaborates that AHEAD’s ability to offer niche expertise and broad-scale solutions makes it an attractive partner. This dual capability ensures that vendors can achieve technical precision and market velocity, which is often difficult to find. This synergy is particularly appealing to new and emerging vendors in the security space, as it allows them to leverage AHEAD’s infrastructure and reach without compromising on specialized support.

Future of M&A in the IT solution provider community

The conversation shifts to the broader trend of mergers and acquisitions (M&A) in the IT solution provider community. Falcone confidently predicts that M&A activity will continue to rise. He argues that consolidation is a natural and beneficial part of the industry’s evolution, driven by the need for companies to adapt quickly to technological advancements and customer demands.

“You can build it, or you can do a strategic combination. There’s no wrong answer,” he says, highlighting the strategic importance of M&A in filling value gaps and accelerating market readiness.

Falcone mentions that strategic combinations are often the most effective way to innovate and scale rapidly. He cites some examples of successful acquisitions in the tech industry, including significant moves by companies like VMware and Cisco, to illustrate that M&A is a cornerstone of growth and innovation. This perspective offers valuable insight for businesses considering their strategic paths.

Investing in customer relationships

Bavoso inquires about how Falcone addresses client challenges and communicates the value his team provides. Falcone emphasizes the importance of investing in the customer from the outset. He states, “We want to understand the customer’s program and what they’re trying to roll out in the next X amount of years, what good looks like in the end.” This approach highlights the significance of building long-term relationships rather than seeking quick wins.

This underscores a vital lesson for businesses: investing in understanding the customer’s long-term goals and needs can yield more sustainable and profitable relationships. Falcone’s strategy involves deploying resources, often at no cost initially, to gain a deep understanding of the customer’s objectives. This proactive investment builds trust and sets a foundation for more tailored and practical solutions.

Growth and strategic acquisitions

Looking to the future, Bavoso asks about AHEAD’s plans to grow from a $3.7 billion to a $6 billion company by 2026. Falcone stresses that acquisitions should bring additive value to their customer base. He remarks, “Anyone can buy revenue. So, I don’t think buying revenue is a metric of success.”

He recommends that acquisitions should be evaluated not just on financial metrics but on their potential to enhance the overall value proposition for customers. “If customers see more value in our services and therefore they expand their wallet share with us. Well, then that acquisition makes sense for everyone. For the employee, for the partner, and for the customer.”

Successful growth strategies involve thoughtful integration and leveraging acquired strengths to benefit existing clients and employees. This approach ensures that growth is sustainable and beneficial across the board.

Check out the video or podcast above for more from Katie Bavoso and AHEAD President Rich Falcone. Don’t forget to like and subscribe for future interviews with solution providers and thought leaders, plus special episodes and opportunities!

Want to know who else ranks in the HSP250? Explore the entire list now!

Featured Partners: Managed Service Provider (MSP) Software

Advertisement

Visit Website

Good For

Core Features

Integrations

Visit Website

Good For

Core Features

Integrations

Visit Website

Good For

Core Features

Integrations