Ensim expects to triple in size to meet Microsoft CSP program demands

Ensim expects to triple in size to meet Microsoft CSP program demands

MARCH 23 2016 BY WILLIAM FELLOWS

Microsoft's Cloud Solution Provider (CSP) partner program, particularly the Office 365 and Azure services, continues to be the core driver of new business for Ensim – so much so that the company expects to triple its headcount in the short term and crank up its marketing efforts to take advantage of the Microsoft program's momentum.

The 451 Take

Ensim is riding the success of Microsoft's CSP partner program. It plans to triple its headcount in the near term and crank up the marketing in order to better try to capture the enablement opportunity. This new business is coming because the opportunity to distribute Microsoft-hosted services via CSP adds new dimensions to the business of existing infrastructure-focused service providers, and is bringing new entrants into the service provider business. With new offerings come new demands around billing, provisioning, automation and bundling, and for the tools to do so.

Context

Ensim has served the service provider market for Internet infrastructure with automation and provisioning tools for more than a decade (and for five years with a revamped Java-based platform). In 2015, Ensim launched a CSP Quick Start product, aimed at new entrants to the program.

Ensim believes it's more tightly integrated with Active Directory than other approaches, which aligns with Microsoft's aim to have Azure be the central authentication and identification mechanism for the platform. As Ensim notes, if the CSP wants Azure to be the central authority (per Microsoft's desire) then it can facilitate that. Most don't, in Ensim's experience – even though it is a stated requirement of the CSP program that Azure must be used as such – and most won't.

Technology

Ensim's core technology is its Ensim Automation Suite, which provides quote-to-cash process, from initial order configuration, quote, approval process, notifications, deployment and usage tracking, to billing and payment software platform. The company claims to have added 60 new features to the suite in the past year. The suite is designed around the use case of telcos and other cloud and infrastructure service providers. To these, Ensim offers a suite of modules for operating marketplace and service catalog, subscription management, billing and invoicing, and provisioning. Because the company deals primarily with very large service providers, this modularity means these components can be deployed as needed by customers that may already have an in-house billing system, for instance.

With the recent addition of the Ensim SoftLayer IaaS Manager v2.1 service, providers looking to offer IaaS now have the option of deploying an on-premises virtual machine management platform (Microsoft, VMware or OpenStack) or leveraging SoftLayer's cloud-based IaaS platform. The suite is also the basis of Ensim's Microsoft CSP Manager offering, enabling Microsoft CSP 1-Tier and 2-Tier partners to automate the user and service onboarding process. Microsoft CSP partners can bundle products or services such as training, migration and hardware, with their Office 365, Azure and other Microsoft service offerings.

A large MSP with a managed cloud that needs to provide managed unified communications or storage to an enterprise or large government department is a typical use case. US federal employees need a purchase order before they can purchase services, so any supplier needs the kind of supplier market services Ensim can supply. Ensim expects to develop additional ticketing and workflow handling based on feature requests around enhanced CRM, however, it doesn't plan to compete with the likes of ServiceNow. It will add more out-of-the-box reporting via integration with Jaspersoft and greater internationalization on the screen layout, not just language support.

Business Model

Ensim was founded in 1998, and is primarily focused on delivering automation, billing and marketplace software to infrastructure and cloud service providers. At one time, the company offered an end-user control panel for Web-hosting providers. In 2007, it sold that business to SWsoft (which later rebranded as Parallels, and then Odin, which was acquired by Ingram Micro, then itself acquired by China's HNA Group). Ensim says 2015 was the best year in its existence, claiming 65% Y/Y revenue growth, including new beachhead deals at MSPs, government and network service providers. It claims it has been putting money in the bank since 2010. Many of its 2015 deals have turned into 2016's add-on deals and projects are typically $250,000 to $1m. Ensim's business, originally mostly European by revenue (80%) is now split 50-50% between the US and Europe. It has 120 developers among its 135 staff and plans to triple its headcount within a year or so. We estimate revenue to be $15m – it doesn't expect to triple revenue over the same period.

Competition

Ensim's key service provider automation competition – particularly when it comes to enabling Microsoft's CSP services – comes from Odin and AppDirect. In general brokerage-of-cloud services, it competes with IBM Gravitant, Jamcracker and ServiceNow, and in the broader billing and provisioning of service provider business, it may see competition from Ubersmith. However, Ensim says it now increasingly sees Aria Systems and Zuora as the key competitors as they seek to extend out from their core subscription and billing platforms and as Ensim seeks to replace their deployments. The company believes neither can support enterprise applications nor do provisioning and neither offers a storefront or channel enablement.

SWOT Analysis

  • Strengths

    Ensim continues to take advantage of the momentum in Microsoft's CSP program.

  • Weaknesses

    Ensim is planning to address what its arguably its key weakness in being able to take advantage of demand from CSPs – that relatively few know who or what it is. It plans to turn on new sales and marketing programs through 2016

  • Opportunities

    Microsoft has done a great job on creating demand for its products and services via the enhanced CSP cloud service provider program. Where most programs of this kind require services to be 'sold,' Microsoft's are invariably being 'bought.' Microsoft itself is driving this market and the key challenge is fulfillment, which is where Ensim enters the picture.

  • Threats

    The arrival of Aria, Zuora and others in the competitive crosshairs suggests the market will heat up as new entrants seek to take advantage of the Microsoft CSP program momentum.