Intacct Seeks VARs 'On Demand'

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Intacct is revising its channel program once again, this time focusing on attracting more value-added resellers by throwing additional resources into specialized sales and marketing training. The private company, which provides Web-based financial management applications as well as project management, supply chain management and business intelligence products, has always put its stock in the channel, not even establishing a direct sales force until 2005-six years after its founding. It revised its channel program several times over the past few years, but now has divided the channel into three different partner categories: VARs, business process outsourcers and CPAs, providing each with the program perks that are most relevant to their line of work.

Value In VARs

VARs make up the highest value-added category, according to Mike Braun, who came on board as Intacct's CEO in January.

Partner Insights

"These are companies that add specific vertical functionality to Intacct and sell it as a single system," Braun says. Intacct prices it to them at wholesale with discounts ranging from 30 to 50 percent the first year based on volume and because Intacct is subscription-based, VARs receive a piece of the recurring revenue (15 to 30 percent based on customer satisfaction) for as long as the customer remains.

In May, Intacct launched a "Buy With Confidence" program, which includes service-level commitments on system availability, product and professional services quality, customer support response time, communication of future plans and billing accuracy. The program is backed with credits to customers if Intacct misses its commitments and all Intacct employees now have a portion of their compensation dependent on meeting these satisfaction goals.

In June, the company began surveying customers once a quarter. "In the reselling world, we're extending that notion that a piece of your compensation from us depends on customer satisfaction. And we pay them for referrals, happy customers that agree to be references," Braun says.

Intacct planned to announce several changes to its channel program-the majority of which address VARs-at its 2007 user conference in California last month.

"We have roughly 100 partners today and only about 15 are VARs (the remainder are divided among BPOs and CPAs). Our goal is to take that from 15 to 100 over the next 12 to 18 months," Braun says, adding that the number isn't as important as the quality and that Intacct is interested in attracting VARs with vertical interests and those who "get the on-demand model."

"We're not going to be going to the biggest Microsoft GP and Sage VARs and saying, 'Throw out your business and come with us,' because they're so entrenched with selling GP and MAS 90 and MAS 200 that those guys just don't see the train roaring at them," Braun says. "We're going to focus on the younger, newer people who get this model where we don't have to sell the model to them. This is a subset of what we think of as the VAR channel today and I firmly believe this is going to be a new distribution channel."

Intacct offers three core products, all of which run on the Web in a software-as-a-service, or "on-demand", environment. Intacct Xpress lets small businesses automate standard tasks like accounts payable and receivable and manage expenses, cash and order entries. Intacct Small Business provides financial management, supply chain management and business intelligence with the option of adding project management. Intacct Enterprise serves larger corporations and companies with multiple subsidiaries and international operations with an ERP suite that contains multi-entity management that helps consolidate each of the business unit's separate accounting structures.

Beyond recruitment efforts, program changes include a new set of terms and conditions, lead generation assistance and sales training, which some of the handful of Intacct's current resellers would like to see.

Mike Silver, partner at Buffalo Grove, Ill.-based Omnios, added Intacct to his reselling portfolio, which includes Microsoft Dynamics SL and Deltek, about a year ago but has yet to sell it.

"We're more of a traditional VAR and we're having a hard time fitting into [Intacct's channel] model. It's a very informal program as far as we've seen," Silver says. "I would like a formal program, training and certification. There's no reselling training, no joint marketing, generating leads and no clear delineation of what's a deal for them versus us."

Braun defends the last part of that comment, noting that Intacct double compensates its reps in order to limit channel conflict with its direct sales force, which now accounts for about 50 percent of the company's total sales, adding that if he finds the right VARs for the job, the balance eventually should shift in favor of the channel, and that he'll continue to build the direct sales force in the meantime. But he did outline plans for improvements.

Today most lead generation is done by partners, but Intacct is establishing provisions to fund a portion of any VAR-specific marketing program they want to do. VARs tend to know better than Intacct would about which types of business shows or Webinars best would attract prospects in their particular vertical industries, Braun reasons. So if they suggest an outlet, Intacct will cover a portion of those costs through its market development funds program.

Sales training is another priority. "This category of product is very deep, there's literally thousands of features in our product. The more educated your sales force is, the better they can represent you," Braun says. "We're making changes that will provide support in marketing/presales efforts for the first six months after authorization on every deal and all time for deals over a certain size."

VARs must now pay an annual $5,000 program fee and be authorized, which requires a minimum of two people to pass Intacct's certification exams including product competency, sales competency and installation knowledge.

What's in it for CPAs?

CPAs and accounting/financial outsourcers have different needs than VARs. CPAs are using the product to provide hourly accounting services to their clients and BPOs are providing CFO-level duties on behalf of their clients.

An online e-practice console allows these types of firms to run the system for their customers without having to go to their offices. Administrators can onboard new clients and granular levels of permission allow them to determine what information clients can and cannot access. They also can private-label their Web sites so that customers only see the partner's name without knowing that Intacct is working behind the scenes, which some channel members say they like because it prevents them from having to sell their clients on another vendor.

The console also provides access to brochures, slides, demonstrations and marketing materials. Users can register for live or recorded online training, with CPE credit for both partners and clients.

Kevin Krueger, managing director of Tampa, Fla.-based Krueger and Associates, joined Intacct's accounting outsourcer program about four years ago, when he was seeking a package for his CPA firm that integrated with CCH's ProSystem fx Tax software, that his employees could use from home and his clients could use anytime and one that stored the data somewhere other than Florida, where several businesses lost data due to hurricanes.

In addition to the flexible access and offsite storage, he appreciates the ability to scan and attach documents to individual transactions and to set up his clients with "view only" permissions and offer them a dashboard with "the quick and dirty numbers they are looking for."

He applauds the simple user interface and the helpful live tech support.

Pricing is such that it competes directly with QuickBooks but with no files passing back and forth, just live data, he adds. Costs start around $125 per month for one seat with the average customer paying about $1,000 monthly, including the product, hardware, infrastructure, security, maintenance and support, according to Braun.

"The product is all about life after QuickBooks. It helps make the transition from a system that most companies buy when they first form their company, but runs out of gas if you're a growing company," Braun says. "We solve [their] problems without having to hire people, buy equipment or buy software."

Alexandra DeFelice is Associate Editor of Accounting Technology and can be reached at alexandra.defelice@sourcemedia.com.

Intacct Snapshot

HQ: San Jose, Calif.

Number of offices: 2 (including India)

Phone number: (877) 437-7765

Web site: www.intacct.com

Employees: Under 80

Channel Members: 100

Founded: 1999

Key Products: Intacct Xpress, Intacct Small Business, Intacct Enterprise

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