Ivanti Alerts Partners It Will Shift to Direct Sales and License Renewals

Ivanti will start selling more of its software directly to customers in the coming months as the provider of security, patch management and IT service management software shifts a core chunk of its business away from the channel.

Partners and distributors have started receiving notifications from Ivanti that the company intends to sell licenses directly, including all renewals. The changes, which take effect April 1, include renewals of licenses that partners originally sold. As part of a new partner program Ivanti is rolling out, the company will offer referral incentives.

While Ivanti said partners are still a key part of its go-to-market strategy, the company is only putting its emphasis around the small portion of platinum partners, and those in its expert solution provider (ESP) program, which drive the vast majority of its indirect sales. The company will continue to incentivize partners who sell and/or deliver services. Mitch Rowe, Ivanti’s EVP of global sales, said 450 of Ivanti’s 4,000 partners generate more than 80% of its channel-based sales.

Ivanti’s Mitch Rowe

“Make no mistake partners are very, very strategic to our go forward business,” Rowe told Channel Futures. “We’ve had those hangers-on, laggards, opportunistic partners that we weren’t necessarily relevant to anymore. More importantly, in our focus around customers, we want to make sure that our partner programs and go-to-market strategy and how we interact with our customers, both directly as well as indirectly with partners, is strategic and relevant for the well-being of the Ivanti customers.”

Ivanti’s new program will award provide platinum partners a percentage of points through two-party gross (2PG) contracts, by which they receive market development funds based on their tiering. The pivot to direct sales comes on the heels of a sweeping overhaul of Ivanti’s top executive team. Longtime CEO Steve Daly has retired, though he remains on the company’s board. Other key execs that have recently departed include CMO Steve Morton and channel chief Reza Parsia.

Taking over as CEO is Jim Shaper, founder and former CEO of ERP provider Infor. Shaper has brought over several Infor veterans to fill out his team, including Jeff Abbott, who is now Ivanti’s president; Mary Trick, who takes over as EVP and chief customer officer; and CMO Angie Gunter. Michael McClellan also took over as EVP and CFO — he’s from Clearlake Capital, the private equity firm that created Ivanti three years ago upon acquiring LANdesk.

Clearlake apparently is looking to get a better return out if its investment in Ivanti, several observers surmised about the complete overhaul of its executive team and go-to-market strategy.

“Well, they have a new CEO and financially they’re trying to engineer as much margin as they can,” said one person who is familiar with the company but didn’t want to be identified because of existing relationships.

Ivanti’s Rowe didn’t dispute that part of the shift is part of a margin play. Noting that half of Ivanti’s revenues are now recurring, either in the form of maintenance or subscription SaaS renewals, historically 90% of those renewals have gone through partners on their paper.

“That has a cost associated with it in the form of margin,” Rowe said.

But he insisted it isn’t about …