VMware veteran Josh Leslie’s goal at his new
employer, Coraid, is to take sales of the storage technology vendor 100 percent
through the channel.

Coraid provides a less expensive storage solution called EtherDrive—Leslie said
it can be one-tenth of the price of competitive products—that appeals to all
sizes of business but especially makes virtualization more financially
palatable for small and medium-sized businesses. And the price to buy the new
solution can even be less than some companies are paying for their storage
maintenance fees.

“This is an incredible opportunity, and I believe Coraid is a very disruptive
technology,” he told Channel Insider of his recent move to the Redwood City,
Calif.-based company. “After working at VMware for six years, one of the things
you see all the time is how expensive storage is and how much overlap there is
in features in the storage layer and virtualization layer. Customers don’t want
to pay that much for storage or pay two vendors for the same technology.”

Coraid has upped its game in the last few months by hiring Leslie, who joined
in December to build the channel program and a new executive management staff
after having raised $10 million in venture funding, announced in January. Among
the investors is former Cisco executive Charles Giancarlo, who has also joined
the advisory board of the company. Kevin Brown is CEO, and venture investors
include Allegis Capital and Azure Capital Partners.

Why are these heavyweights piling on Coraid? And why should IT solution
providers be interested? Storage can make up 40 percent of the bill of
materials in a server virtualization project, according to Leslie. Using
Coraid’s solution can reduce that percentage to 10 to 15 percent, which can
create incremental margin opportunities for the channel partner or provide the
chance for sale of additional technology. And it opens up deals that wouldn’t
have been open otherwise, Leslie said.

Coraid’s EtherDrive SR series appliances accept 3.5-inch SATA disk drives and
come in four- and eight-disk models, both supporting access speeds of greater
than 200MB/s, starting at $2,475. The EtherDrive SRX series appliance comes in
three models supporting SAS/SATA disks starting at 16 and going up to 24 and provides
access speeds of greater than 500MB/s, the company said.

Coraid’s EtherDrive architecture is designed for virtualization, said Leslie,
and runs on Layer 2 of the networking stack, compared with iSCSI, which has
become very popular but runs on Layer 3 of the stack.

“TCP/IP provides some level of value, but it’s not written as a storage
protocol,” Leslie said. “People are not necessarily sending storage over the Internet,
so that’s where the inefficiency comes in.”

The technology originally supported SATA drives but has since added other types
of storage including SSD. Coraid began in 2000 through the development of the AoE (ATA over
Ethernet) protocol and began selling storage solutions using the protocol to
Linux shops in 2005. The company grew to 1,100 customers and 200 channel
partners by word of mouth.

Since Leslie has joined the company, he has winnowed down the 200 channel
partners to about 35, looking to create a high-quality channel program. Coraid
is offering two tiers—gold and silver. Gold partners must meet a minimum
revenue requirement of $25,000. All partners are required to purchase an
evaluation model and complete sales and technology training (2 hours and 4
hours, respectively), which is available in person or online. The training and
the evaluation model are included in the $1,500 program fee.

The program includes lead generation, deal registration and co-marketing,
Leslie said. Coraid is setting up a professional partner portal to facilitate
deal registration and provide access to marketing materials.

“We are looking for quality over quantity in terms of partners,” Leslie said.
“We think the ideal partners for us are VMware and Citrix enterprise or gold

Coraid hasn’t set a number of partners it wants, but Leslie said the goal is to
do as close to 100 percent of the business indirect as possible.

“There’s a profound level of disruption that we bring to economics of storage,”
Leslie said. “We have a compelling proposition to resellers. And we can change
the economics of projects.”