Artisan: The Only IaaS Cloud With A Pure MSP Partner Model?

Artisan: The Only IaaS Cloud With A Pure MSP Partner Model?

Artisan Infrastructure competes in the fiercely competitive IaaS (infrastructure as a service) market, hoping to build a pure channel-centric alternative to Rackspace, Amazon Web Services and other cloud titans. Artisan claims that it never -- ever -- sells directly to end customers. Instead, Artisan empowers third-party MSPs and emerging services providers to build and deploy self-selected SaaS applications on Artisan's infrastructure. So is the strategy working?

Artisan is privately held so it's difficult for MSPmentor to pinpoint all the key financial metrics. But Artisan CEO Brian Hierholzer (pictured) said the company is profitable, and experiencing 20 percent compound monthly growth. The company has about 20 employees, and expects to double headcount to 40 people in 2012, with a stretch goal of perhaps 60 employees on the horizon.

Responsible IaaS Growth

Artisan has no need for venture capital or private equity, Hierholzer said. Each time Artisan purchase new server or network hardware, there's already revenue attached to that purchase to ensure responsible growth, Hierholzer said. It sounds like roughly 250 MSPs are running services on Artisan's infrastructure.

Instead of selecting SaaS applications on its own, Artisan defers the entire process to MSPs and emerging service providers.
  • The MSPs decide which applications to license from a specific ISV.
  • The MSP can then take the SaaS application and deploy it on Artisan's platform, using the ISV's service provider licensing guidelines.
  • Artisan, meantime, works with a range of ISVs -- including Asigra, StorageCraft and CA Technologies -- to make sure the apps are well-suited for MSPs to deploy on Artisan's infrastructure.
The strategy didn't emerge overnight. Hierholzer initially targeted the telcom market around 2001, then shifted to VoIP in 2004. By 2010, Hierholzer and his team had an ah-hah moment. "Nobody was providing IaaS in a way that allowed emerging service providers to build, manage and run a service as if it was their own," he recalled.

Direct Cloud Sales?

So will Artisan ever offer hosted SaaS applications that MSPs can white label or end-customers can purchase on their own? "That would go against everything we stand for," said Hierholzer. "Our customers -- the service providers -- have a direct relationship with the ISV." Artisan, meanwhile, can help the MSP to facilitate an architecture design or solution with the ISV.

Hierholzer concedes that it could be challenging for Artisan to work with a long list of ISVs. "That is going to be a challenge. It’s an extremely cumbersome, challenging approach where we do the heavy lifting," he said.

Still, Artisan benefits from the fact that so many software companies are launching their own clouds and selling SaaS directly to end-customers. "The [software] vendors are becoming competitors," he said. "There is more IT competition coming downstream to the SMB market because services are now delivered over the web."

In stark contrast, Hierholzer said, Artisan's ISV partners are channel-centric.

Generally speaking, I can't think of another IaaS provider that is 100 percent channel- and service provider focused.
  • Is that a sign of brilliance?
  • Or a sign of a niche market that will be difficult to build?
So far, Hierholzer and his team have delivered profitable growth... so perhaps Artisan is onto something.
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