Hey channel insiders, I'm your host Katie Baboso and welcome to this episode of Partner POV brought to you by 1111 Systems. Broadcom's restructuring of VMware's cloud service provider program has sent shock waves through the partner ecosystem, leaving many MSPs and customers uncertain about the future of their VMware environments. But one provider, 11-11 Systems, says it can offer a bridge, a way for displaced partners and their customers to continue leveraging VMware technology without disruption.
Joining me now to explain is Dante Orsini, chief revenue officer of 1111 Systems. Welcome Dante, great to have you. >> Hi Katie, thanks for having me. >> Thank you so much for being here. Let's first get to know 11-11 Systems. You're a managed infrastructure solution provider and Broadcom, VMware's largest privately held pinnacle partner in the world. What else makes 111 Systems stand out from the competition in the crowded space of cloud services? >> Well, Katie, we've been partnered with VMware since before they had a cloud provider program.
We started working with them in 2008. I think we're the last standing original member of their cloud advisory board, but to your point, we're a global service provider, right? So, we've been working with them for a very long time and we've also built a very long-term strategic relationship on the go forward plan with Broadcom. Um, so we're excited to to work with folks. You know, I know it's a tough time for so many people here, but I think from our perspective, one of the biggest differentiators for us is what we've built on the platform.
We're really well known for delivering an integrated platform. So it doesn't matter what a customer or partner is trying to do, whether it's deliver production, backup, DR, security services, connectivity, it's all delivered via the same single integrated platform. >> Thank you so much for that explanation, Dante. Let's move on because as I was talking about in the beginning in my introduction, Broadcom's VMware strategy has created a lot of uncertainty in the partner ecosystem.
But how is 11-1ven systems positioning itself to bring stability and clarity to both customers as well as displaced partners right now? >> Yeah, I think a lot of folks have been through, you know, a challenging time, right? And if I look, let's start with the customer side from from our perspective. We've been working very hard with customers to help them understand they've got a lot of different opportunities, right? I think when people are faced with any, you know, disruption, they've got to look at their applications, you know, what it means to the business, what it's going to take to continue to operate.
From our perspective, that's been a very easy transition. Leveraging a VMwarebased platform were usually the quickest path for these folks uh to find a way out of the data center business. But let's face it, everybody's looking at, you know, hybrid cloud strategies and you know, replatforming for a customer. Very very difficult, right? And that's why we've seen very little of it. We do think that, you know, modern organizations are looking at every available platform they possibly can.
Typically, it's going to be a combination of a VMwarebased cloud uh as well as, you know, possibly a hyperscaler or two, right? Um on the provider side, much different scenario because so many organizations have built their backbone on VMware for so long and clearly, you know, Broadcom's strategy is to continue to consolidate the space and really focus on a small group of partners, which has left a lot of partners in a difficult position. So this started as you know a couple years ago and we've worked with hundreds of providers to help them continue to operate uh through the first phase of that.
Now you know when we look forward past November of this year it's becoming you know increasingly harder for them. So couple things that we've been able to do. One is to ensure that they continue to drive you know opportunities and grow their business. Um there's creative ways that we do this couple different options. Some folks are leveraging our platform from a wholesale perspective where they're literally deploying services on our platform, reselling it, if you will, and continuing to manage their customers and deliver managed services on the platform.
That's the easiest way for them to continue to operate you as far as, you know, addressing a new customer. And then we look longer term, you know, what are we able to do to help people continue to operate uh their existing infrastructure. And by working with Broadcom, we've created some, you know, unique opportunities there as well. Uh we're working on an operational lease for some folks that have made significant investments and they want to have the ability to continue to drive services in their own data center.
In those scenarios, you know, we're working with them to make sure that we can administer those environments and manage those environments to make sure that we're both in compliance with Broadcom. And then we have other folks that are literally they've looked at this and they're a point in their career or you know the the journey of the company where they're looking at other options. They're looking to actually exit the business. So whether we're helping people resell our platform, whether we're operationally, you know, allowing them to continue to drive on on their own infrastructure, you know, through an operational lease, or if we're actually acquiring those companies, those are typically the three things that we're discussing these days. >> Well, Dante, I also mentioned in my opening for the audience that 11-11 offers a bridge, so to speak, for partners who lost VMware authorization.
In practical terms, how does that bridge work and how quickly can a partner or customer transition under it? >> Yeah, great question. So, let's start with the partner side. We're really seeing three paths there. The the number one thing we've heard from partners when this news came out was what do I do with my existing, you know, forecast, right? The funnel of business I'm trying to grow because, you know, effectively these partners don't have the ability to acquire additional cores uh past October of this year.
I think the quickest path we've seen there is to help folks actually leverage our platform uh again global in nature uh and giving them the ability to actually resell and deliver managed services on our platform. That's the quickest way to address that. Second side we've seen is that you know organizations that have again made significant capital investments they've got a lot of runway left on their infrastructure. They're looking for ways that they can you know obviously you continue to deliver services on that platform.
Right? So this is where we've gotten creative uh in working with Broadcom to you know work with a on an operational lease perspective. Um this allows us to go in lease that equipment from the provider uh provide you know administrative access to that infrastructure and then at that point that provider is able to continue to operate uh and drive services. And then again the third opportunity that we've seen is folks that are lit literally trying to exit the business. we've built this company on the back of M&A.
But I think when I look at all three of those, you know, lines of business, if you will, or opportunities for those partners, we have hundreds of folks that already, you know, deliver services on top of our platform to their end users, right? So, it's a natural fit for a lot of folks. It's typically the easiest path for them to continue to grow. Now, on the customer side, I think there's less disruption there, right? And when when I look at customers, sure, some folks were using just the hypervisor.
So when Broadcom came out, consolidated the actual stack, you know, a lot of people saw a price increase on that. And I think that when you look at the ecosystem and all the integration of everything that's been built into that platform, it's very difficult for partners to just shift on a dime. We've seen folks that are actually, you know, the timing of uh the increase in Broadcom licensing may align with their timing on having to refresh their equipment.
So that's the perfect opportunity where we work with partners to have that discussion because at that point if if we can migrate them to our platform they can continue to leverage all the resources they have you know all the other systems that tie into that platform right but think about the headcount right the people that run these businesses I mean we've seen some crazy things happen where large organizations were upset about the price increase you know they were trying to push on a replatforming and the entire engineering team is like hey we've been running platform for 15 years.
If you think we're going to replatform, you know, we're going to walk out of here, right? So, again, difficult for a customer. However, what we found is that by leveraging our platform, we can drive down their costs because we're operating at such scale while they can continue to preserve their investment in the technology and the people, right, that understand the technology. >> Absolutely. It sounds like a really practical opportunity to be able to keep going forward.
But I'd also like to dig into what other opportunities this does present or could present for partners more specifically who just lost their ability to sell or support VMware solutions. What new revenue opportunities exist by aligning with 11-11 systems if any? >> Yeah, great question. It really comes down to understanding that partner's business, where do they operate today? What types of customers? What types of services do they deliver? Right.
So from our perspective, we're a managed infrastructure services provider, right? We are not providing enduser managed services per se unless it's associated with the infrastructure. So that leaves a lot of latitude for partners to continue to drive value. And I think the other piece too is that when you look at the size, scale, you know, that we operate, you know, when you look at running a cloud services business, it's capital intensive. And a lot of MSPs, right, they're going to be people intensive.
It's very difficult from a valuation perspective to be both capex intensive as well as people intensive. So this is really providing a unique opportunity for folks because if they can get out of the data center business from a capex perspective, right, and focus further up the stack, sure gross margins may go down a bit, but when you don't have the capital outlay, right, we're seeing people are a actually able to, you know, drive a better return by leveraging our platform.
And I think to your point earlier, knowing that we're global, in many cases, this opens up the opportunity for these folks to, you know, work in in different markets. Also I think at if you look at the number of services that we deliver on our platform in many cases we're offering additional services uh whether it be connectivity object storage security services right that that creates an additional revenue opportunity for those partners. >> I think that question could honestly be an answer to the next one I'm going to ask but I think this one is still really important to pose.
Why is this a better option than transitioning to a VMware alternative? Because as you've seen, I'm sure there are a lot of competitors in the same market space actively looking to recruit the partners and customers that were left behind, so to speak, in the Broadcom ecosystem reductions. Why should they stick around and perhaps give 11-11's bridge a shot? >> It's a great question. I think this really comes down to again to a partner by partner, you know, again, what type of customers are they working with today?
What types of SLAs do they have in the infrastructure? you know to the extent of of all the other ancillary services that they deliver remember you know it's been 15 years that most people have been leveraging this platform and when you look at trying to just lift and shift it to another platform when you look at all the levels of integration it's very very difficult. So what we're seeing is that folks are taking stock of their customer base and what types of integrations they have to determine the path forward for at least a portion of their base, right?
And I think that when they do this, sure, it it's not a an issue to try to look at an alternative, but I think number one is stabilizing their customer base, making sure they can continue to maintain those customers, uh, and also continue to sell into the market based on the services they've delivered in the past while they're exploring the tradeoffs of another opportunity. >> Let's move on to some more questions around your involvement here. How does 11-11 ensure compliance, support, and long-term license portability for customers using VMware through your platform?
Especially given Broadcom's tighter rules and frequent cuts to the VMware partner program in the last 2 years. Essentially, what I'm asking there is how can you ensure longevity when Broadcom itself has not been able to do that over the last few years? >> Well, I think what you're going to see is you're going to see some messaging change coming out of Broadcom, right? when I look at, you know, their leadership, uh, they're going to be very focused on stability >> and they know it's been tumultuous for the last two years, uh, and I think that from our perspective, you know, we realize size and scale matter to Broadcom and the focus.
So, I think from our perspective, we're the only provider that's global in scale that's 100% focused on this platform, right? So, we have a very strategic long-term relationship with them. So they are committed to helping us grow this business and I think that you know people need to hear that and they need to continue to hear it uh considering all the challenges that have happened over the last two years but I also you know will caution folks that again scale matters right so when people are looking to make decisions you know I I still feel that you know Broadcom's not done consolidating this business so you really need to consider you know who you're speaking to what's the size and scale of their relationship with Broadcom uh so you can make your own assessment of what their actual longevity is going to be in the program. >> A very succinct answer right there and something that I think definitely gives a lot of credibility and confidence to those who are looking into this option.
Well Dante, something that you mentioned, you talked about scale and that encourages me to ask who's eligible. So, can smaller MSPs or regional providers effectively operate under 11-1ven's umbrella to continue serving their VMware customers, or is this program tailored for larger scale partners only? >> Katie, great question. We're actually working with both. As I mentioned before, you know, over the years, we've built up hundreds of of MSPs that have actually been reselling our platform.
We also, you know, based on these latest challenges with Broadcom and then resizing the partner community, we're working with a lot of larger providers as well, uh, that may be more than regional. Again, we're very focused on how do we continue to help these organizations continue to operate, stabilize their customer base, and continue to get back on the growth path. I think that's the key. >> So, as we know, something that MSPs and their customers both don't like is downtime.
So, from a customer perspective, what does continuity look like with 11-11? Can workloads and environments truly migrate without disruption or rearchitecture? >> 100%. And this is an area where we've got a tremendous amount of experience, right? We've one, we've grown the business through acquisition, you know, over the last several years. We also are a leader in delivering disaster recovery as a service and cyber recovery as a service. So, we are very akin to how do you deliver, you know, a non-disruptive migration.
It's something we do absolutely every single day. And by the way, that's one of the main benefits of leveraging a VMwarebased platform. >> Fantastic, Dante. So, do you see this moment as a short-term opportunity to capture market share or just the beginning of a longer term shift toward multicloud and modernization under the 11-11 brand? >> It's actually a little bit of both, right? I think that, you know, last year we saw an opportunity with, you know, the first, let's call it, you know, reduction of of partners at at Broadcom.
That's something we took very serious. We we worked with hundreds of folks to help them continue to operate um through that first change and now we're aggressively working with partners today based on the most recent guidance from Broadcom. But to your point, it's 100% a longer term shift and you know our commitment to that platform is critical and I think that from our perspective you know modernization is the name of the game and and we realize that every customer we talk to they're all in various different stages of a multi cloud journey and we want to be there to help support them. regardless of where they are today or where they need to be in the next two, three, five years. >> Well, Dante, if you were advising a partner or CIO today who's suddenly been cut from the VMware ecosystem, what's one step you tell them to take this week to safeguard their business and their customers? >> Great question.
I think the number one thing is to assess, you know, what you're going to do to maintain a VMwarebased platform for at least a portion of your business, right? And I think that's the number one thing. We've been in this space for a long time. We've got a lot of great friends that we built that are peers of ours in this space. And you know, we see various different ways that people are attacking this, but that's the one constant, right? What can you do to stabilize that existing platform and continue to grow it?
Here's why I say that. Think about the challenge, right? When this this is very disruptive. So if you've built your business off the back of this immediately you have to be able to answer to your board your investors right your employees and your customers on you know what your future direction looks like and stability is the name of the game for everybody there right so while a lot of people have been you know highly motivated to look at other platforms I think now we're starting to see people realizing how difficult it is to replplatform and I'm not suggesting people are not replplatforming I'm just suggesting It's very difficult and at the same time you you need to make sure that you have a stable you know platform to continue to operate at least the workloads or the customers that you believe need to continue to leverage VMware uh for you know integration purposes and everything else right so that's the number one step uh if if you you know could ask anybody uh that would be the number one bit of advice we'd provide >> excellent advice Dante thank you so much well my last question for you would just be for those who are listening or watching today and want to learn more about 11-11 Systems and the exciting opportunity that we just discussed, where can they go to do so? >> Thanks, Katie.
You can go to 11-1vensystems.com. We're all over this message. We we're meeting with people every single day. So, feel free to reach out to me as well uh on LinkedIn. Katie, we really appreciate the time and the opportunity. >> Thank you so much for your time today, Dante. And thanks to you at home for joining us. For more episodes of PartnerPls.com. Once again, I'm Katie Bavoso and I'll see you next time. >>
This transcript was generated automatically from the
video's captions and may contain errors.
