Overview
The combined cloud and on-premises storage software provider is a leader in the multi-million-dollar unstructured data management market. Qumulo’s subscription-based solutions support thousands of end users as they navigate their digital transformation journey and improve efficiency in capturing, storing, protecting, analyzing, and managing unstructured data.
Qumulo has been on a journey to evolve its business and focus on creating an infrastructure-agnostic operating system. The company’s vision from inception was to be a software business. However, initially offering hardware was essential to the early development of the business. Now that Qumulo’s software offering is mature and entirely hardware agnostic, exiting the hardware side was the final step in delivering on the vision, which they achieved success with support from Arrow Electronics.
Scale without compromise
The collaboration between Qumulo and Arrow began when Qumulo needed to continue to grow its business without being too capital-intensive. In the search to help scale, Qumulo engaged various organizations but found gaps in what they could offer, specifically in logistics, supply chain, and high-quality hardware integration.
Arrow first teamed with Qumulo to rework existing inventory and then to handle import responsibilities in Europe. The relationship grew further when Arrow began providing complete integration services for the entire lineup of Qumulo storage devices.
When Qumulo decided to exit the hardware portion of their business, Arrow was the logical choice to help them transition to a software-only business model. This decision meant Qumulo would no longer manage and sell its own hardware. However, they still needed a trusted advisor to deliver their customers a high-quality, storage-optimized industry-standard hardware solution to go along with the Qumulo software.
A successful switch
In the view of Matthew Frey, Qumulo CFO, the company had great confidence in the Arrow team after working through many product iterations and growing the business consistently year after year. Qumulo believed Arrow was in the best position to help transition the company to focus purely on software.
The result?
By working with Arrow, Qumulo was able to transition to a complete software-focused business model and increase its gross margin by 20%.
It has been extremely successful. There was a tremendous amount of work done by both parties to help ensure that we had validated business processes to sell the product throughout Europe, the Middle East, Africa, and Asia-Pacific markets, as well as North America. It’s been a tremendously successful relationship for us.
Different by design
Arrow also worked with Qumulo to design products that suit customers’ requirements and create forecasts and supply chains to help ensure hardware availability. Qumulo noticed a significant difference between Arrow and other suppliers, who tend to focus on building to order and, even then, could not fulfill such commitments on time. Timely delivery and flexible capacity planning were critical to Qumulo’s end customers and essential to the success of their business.
“Arrow has been a big part of keeping our supply chain and delivery time scales rational and reliable in a challenging supply chain constrained pandemic and post-market,” commented Frey.
Qumulo is continuing to focus on growing its business further and looking at how it can leverage its relationship with Arrow to expand into markets beyond those it serves today.
A business transition of this magnitude is a significant investment, and changing course midstream could be exceptionally challenging. Qumulo’s advice for other businesses looking to shift to a software model is to first and foremost, do detailed diligence that includes a thorough plan to evaluate the true capabilities of potential collaborators. This step is critical to understanding and operating in the markets you currently serve and those you plan to fill. According to Qumulo, working with a company willing to invest the time and effort it takes to do dry runs of every process is vital. It contributes significantly to a successful implementation and creates a much better end-customer experience.
Arrow has extensive experience supporting organizations wanting to transition to a software-centric model. To find out more or to join, visit Arrow’s ISV Appliance Program.
Related Resources
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