Deltek has been a household name in the architecture and engineering market, but it has had very little impact on accounting firms and accounting software resellers. But that may change under CEO Kevin Parker, who has evolved a 25-year old organization that was once family run, taken it public and made it feel more like a startup in terms of new initiatives.
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In January, the company hired former Sage executive Taylor Macdonald as its vice president of sales and alliances. The plan is to take the channel from producing five percent of revenue to as much as 25 percent in a few years. The company has also enlisted accounting firms as resellers and consultants, both to reach the government consulting market served by its Premier product line, and the architectural and engineering line that uses the Visions applications.
Why develop a channel at all?
We could never hire enough direct sales people to get into every part of the market. The partner community enables us to expand our market into different markets, different geographies. The partner community brings a change management, project engineering, best practices, a lot additives that we aren’t going to be good at.
How many resellers does Deltek need?
We don’t want 10 or 15 resellers in one market. We are trying to find two, maybe three, in a larger geography. If we have 55 to 65 well-selected partners in the U.S. and Canada we will have the market covered.
Deltek has operations in the United Kingdom. Do you have plans to enter any other countries?
We need to add resellers in Europe. We have a very large available market. We have invested very significantly in the European market, starting with the U.K.
How will resellers and your direct sales force work together?
We tell the sales force, ‘You focus on x, the channel will focus on y.’ We have incentives to allow them to work together, so they are not competing. If you are an architecture and engineering firm with fewer than 100 employees that goes to the channel. That’s a good dividing line. We have experienced very little channel friction.
You recently added a product for the consulting market. Do you plan to move into any other areas, such as accounting?
We are engaged in a lot of dialog with customers about what they would see us do next. We have done about five acquisitions in the last two and a half year. We might continue to do that. Anything that’s not high-volume repetitive manufacturing tends to be more project-oriented. The consulting edition is a great new vertical for us, as it’s very project-oriented. Accountants tend to think ‘client’ first. We are actually in discussions with the accounting community to see how big a leap this is. I am an accountant by trade and by training.
Construction revolves around projects. Do you have any interest in that market?
We are a bit involved in the construction market. It’s through the engineer who is procuring things for a construction site. We are seeing that in the trailer, when you go on site in a lot construction projects. You imagine a trailer 20 years ago as full of blueprints and plans. Now, that trailer is full of electronics. I want to see how we can be a catalyst in taking our background in cost and build out the platform so we are not just a back-office provider.
How involved is your CPA Network in handling the premier line?
They are reselling the product. In the government contracting community, that’s the first person someone will call after I have a lawyer. I have to get an accountant. For example, Beers and Cutler [part of the CPA network] will do almost a government contractor chart in a box. They are using the product inside the customer and helping the customer from a business point of view. Some of the accounting firms have a lot of experience in government contracting.