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Peeyush Tandon, Head, Global Channel and Alliances , ideaForge
What is your channel partner strength currently in terms of numbers and in terms of geographical spread in metro and non-metro locations?
Currently, we have approximately 150 Value Added Resellers (VARs) operating in India. Majority of them, comprising approximately 70%, are concentrated in metro areas. Our non-metro partners are spread across state capitals and tier 1 cities. This distribution aligns with the nature of our business as a substantial portion of our revenue stems from Government and Public Sector Undertakings (PSUs). Thus, it's essential for us to have partners in areas where the decision-making takes place.
Internationally, we have expanded our presence with approximately 18 VARs across regions such as the US, West Asia and North Africa, Sub-Saharan Africa and South Asia. Majority of them are located in the US, reflecting our investment focus in that market due to heavy adoption of UAV technology in the region and also their supportive stance towards India.
What is your channel partner strategy to help them grow in business and in terms of expanding your partner network?
We have a qualification funnel for VARs. Each prospective VAR has to go through that and only those who qualify are then onboarded. Their qualification depends on the customer base they are handling, their technology absorption and adoption capability, their skill sets, their alignment with our value system and most importantly their attitude. Sales cycles can be long in our business so we need partners with a “never give up” attitude. The process is similar to hiring employees and may involve multiple rounds of interviews. Once onboarded, VARs become part of our family and we won’t let them fail. We train them and handhold them wherein we encourage them to take us along for initial few customer meetings where we do sales pitching for them. We even close deals for them initially. We generate leads on our own and pass them on to VARs to keep them motivated. Our marketing team works with them to run collaborative marketing programs. We have structured our Channel Partner Programs in a way that VARs are encouraged to invest in self-development. We provide technical training to them so that they become self-sufficient in pre-sales, product demonstrations, customer training and even day two support.
Expanding our partner network involves learning from other industries and adapting to market changes. As a market leader it is our duty to get best practices prevalent across various industries into the UAV Industry. Six years ago, when we started developing a partner ecosystem we did not have any shining example in the industry to follow. I’ve worked in an IT industry that has a robust partner ecosystem. It took us around a year to onboard our first channel partner as we were trying to crack the most fundamental question viz., “Who can be the right channel partner for us?” We tried signing up large System Integrators, but we failed. The market was too small for them to be lured. So we decided to tone down our expectations in terms of size, but ensured that the basic value match was there and VARs who liked to dream big just like us, were onboarded into our channel partner programme. We scouted for firms that were embedded in adjacent markets, if not in UAVs. We even took leads from our end customers, ran digital marketing campaigns. As of now our major source of partners is our distributors. We have three pan India distributors namely Ingram Micro, Savex and PV Lumens. They understand our business and share partner leads with us. Yet, it is not easy to become ideaForge partner. We have created a scorecard method to evaluate every prospective VAR that we come across.
What challenges do partners face in this segment currently and how do you help them resolve it?
Regulatory framework compliance has come up as the biggest challenge. Majority of our models come under the Small UAV category that need Type Certification for civil use which is a hard nut to crack. It takes several months for any UAV model to get Type Certified. Out of 10 different UAV models that we have, 8 need Type Certificate and only 3 of them have been certified so far. We are collaborating with Drone Federation of India and working out an industry wide solution to streamline and fast track this process. It may take some time for things to take shape. Another challenge is the proliferation of Chinese drones in India. Import of drones is restricted in India, especially from countries that share land borders with India. Yet there are traders that smuggle drones from China and sell to unsuspecting buyers and bring client’s data acquisition strategy under jeopardy.
We work closely with Government E-marketplace to apprise and educate our customers of the potential cyber security risk. Another challenge that our partners face is asymmetry of information vis-à-vis competitive offerings in the market. What we mean is that most OEMs (often startups) in this business often over promise and under deliver, this at times compromises their position in the short term, though we see such customers coming back to our partners for adoption of saleable technology and day two support, which few of our selected partners offer. Another challenge that our partners routinely face is the way GFR rules and DPIIT has formed this entire Class I, II supplier classification under Make in India initiative, which puts them at a disadvantage, especially when they are competing against startups, wherein the start-ups get a price preference even if they are doing minimal value addition in terms of technology stack. It puts customers under risk of adopting sub-par technology and directly affects their operations. We are working with customers and DPIIT to get these rules rectified.
What incentives do the partners have to join your channel network?
As most of our VARs come from the IT products industry, they are witnessing a downturn in business due to the shift in consumption models towards XaaS (X as a Service) models. Many are experiencing a decline in revenue as fulfilment under these subscription models happens directly through OEMs. Recognizing this challenge, partners are seeking alternative technologies to de-risk their businesses and ideaForge provides one such alternative. Our VARs now understand that this disruptive technology is the future. Also, we are finding that our VARs are building on top of the solutions that ideaForge provides and creating another revenue stream for themselves. We encourage them to do this, as we cannot move at the speed which is desired by our customers, especially around niche solutions. For instance, some of them have built analytical models over the data captured by ideaForge UAVs to address specific customer requirements. Another fast emerging avenue is ideaForge opening up its platform for partners to build niche payloads. The pace at which our customers are demanding solutions from ideaForge is unprecedented and to address those demands we encourage our partners to create payloads and integrate with our platforms, e.g a partner created multispectral payload for one of our platforms which is being used by research institutes for predictive agriculture. Our partners love this approach wherein we make them a stakeholder in this exciting and fast growing industry and de risk them from their traditional businesses. It’s a very collaborative thinking and implementation of our core value of “Fly Together”.
Even after that there can be motivations beyond revenue. That’s where we have annual awards and recognition programs wherein we recognise VARs that have done significant contribution to our and their business. We do it in Ekyam which is our annual channel partner meet. VARs are and will always be an extended family for us and our channel organisation is like a team within ideaForge, which while is on the payroll of ideaForge but it is consistently working for our partner ecosystem, an approach that is much appreciated by our partner community.