Independent software vendors (ISVs) that offer SaaS solutions need to provide their customers with a stable, secure, and responsive cloud environment. To speed time to market and focus on their solutions, it makes sense for these organizations to work with a third-party hosting provider. But choosing the right provider can have a significant impact on the ISV’s reputation in the market.
In this interview, we talk with William White, CTO and co-founder of Tensoft, about his experience with multiple hosting providers and how to make sure you choose one that has the capabilities you need.
Connectria: Thanks for taking the time to talk with us today. Let’s start at the beginning if that’s OK with you. When did you first launch your applications as a SaaS solution, and were you working with a hosting provider back then?
White: Bob Scarborough and I originally co-founded the business back in 1996. To understand our journey, you have to know a little bit about our business model.
We offer ERP and supply chain solutions for high-tech manufacturers and distributors. For example, one of our target markets is the fabless semiconductor industry. That probably sounds pretty niche to the majority of your audience, but these organizations have some very unique needs that our applications can handle, so it’s a good market for us. Also, instead of competing with other more well-established ERP solutions in the market, we integrate with them, so our customers don’t necessarily need to swap out what they already have.
That’s just one of the markets we serve. With IoT taking off, we also work with a wide variety of device and advanced electronics manufacturers. We even work with other SaaS solution providers like ourselves with our revenue recognition and contract management applications.
So, the point of all this is that we have a very diverse customer base. Many of these organizations are led by highly technical individuals who aren’t just going to take our word for it when we tell them their workloads will reside in a stable, secure environment. We really have to offer proof during our sales process.
We offered our first SaaS solution in 2006 and hosted it in our own data center where we purchased all the servers, all the networking equipment, security solutions, backup equipment…everything. We used tape for backups back then, which sounds crazy when you think about what’s available now. But managing a data center just wasn’t our core strength, and we knew it was only going to get more challenging as we grew.
Connectria: At that time, you decided to look for someone who could do the hosting for you, right? How did that go?
White: Right. There is a lot of expertise that goes into high-tech products like semiconductors, and the companies we work with contract with numerous suppliers and vendors to bring their products to market. We started thinking that approach might work for us too. Why not subcontract with someone whose business it was to manage cloud environments?
But to answer your question, it didn’t go so well. We learned pretty quickly that the provider we chose had oversold their capabilities. When we asked them if they had any experience with this technology or that technology, they assured us they did. In the end, it turned out to be one guy somewhere on the East Coast who supported everything. With so many technologies, his knowledge level wasn’t deep, and with so many customers, response time to our questions wasn’t great either.
Connectria: So, you switched providers?
White: We did. At the time, the majority of our customers were Microsoft Dynamics users, and this time we found a managed service provider that actually focused on that niche. In addition to providing a managed cloud environment, their team complemented our knowledge really well, and we’re still using them for many of our Dynamics GP customers today.
But as we grew, we started integrating to more ERP solutions and running across new technologies that our core provider had no experience with. As much as we liked working with them, we knew that partnership couldn’t address all of our needs, like the ability to be more ERP-agnostic.
In addition, we were already doing some work with AWS at the time, so it made sense to make that one of our primary cloud environments. We wanted someone who could manage that as well as a private hosted environment, so we could focus on developing great applications and being the subject matter experts in our space because that’s where we add the most value to our customers.
Connectria: Now you’re searching for your third managed service provider. Did you go about it differently this time?
White: Our first provider was a real learning experience. We learned what it takes to build out an infrastructure that can handle the kind of capacity and breadth of technology we needed and the kind of problems that crop up when you’re trying to work with a provider who overpromises and underdelivers. I went into our new selection process thinking, “I know exactly what questions I’m going to ask the next guy.”
At a high level, we wanted someone with genuine, broad technical experience who could also be very responsive. Of course, we also needed someone with deep hosting expertise, and we needed someone who understood multiple environments.
Connectria talked to us about their teams of people. They didn’t just have one support engineer who was an expert on twelve different things. We talked with engineers who very focused on their specialty, but they work closely with other experts in other areas to address any problems we have. It doesn’t matter what time of day or night it is, either. There’s always someone on the clock who can help us out.
So, their depth and breadth of knowledge was a good baseline, but one of the things that really stood out about Connectria was their ability to handle our customer’s security and compliance concerns. For us, that’s truly what differentiated Connectria from other hosting providers.
Our software doesn’t handle the Accounts Payable side of things, but the ERP solutions we integrate to do, so many of our customers need to be compliant with PCI. We don’t have customers with active HIPAA needs, but knowing that Connectria has that level of compliance service assures our customers that Connectria is highly capable in supporting our security and compliance requirements.
What’s most important to our customers more broadly is the SOC 2 Type 2 audit reports. Many of them are public companies, and before they sign on with us, they want to know that their data will be hosted in a controlled, secure infrastructure and that backups are being made and tested regularly. Connectria was able to show us the third-party audit reports for their data center environments.
This solved a huge headache for us. When our publicly held customers have their annual audits and the auditor requests the SOC 2 audit report, we can get the current one right from Connectria. It’s important to choose a provider who can provide an absolutely clean audit report because, if there are deficiencies that show up in that report, it creates a lot of nonbillable work for us and reduces overall customer satisfaction. We have to do things like coordinate meetings with people from the hosting provider and our customer’s IT staff and CFO. This usually requires several meetings, and it’s a lot of overhead for all parties.
We’ve had to do this several times with previous hosting providers because of simple things like a backup failure identified during the audit process. It gets even worse when that same provider has the same problem the next year. Not only is it even more lost time, but our reputation also starts to suffer.
With Connectria, annual audits have been so much easier. They have such solid practices and processes in place, and their third-party audit reports are so clean that we can give our customers the sense of confidence they’re looking for.
Connectria: With multiple clouds, are you using the TRiA Multi-Cloud Management Platform. And if so, can you tell us how it’s helped you?
White: We are using it, but we were just introduced to it back in the fall of 2018, so we haven’t been using it for all that long. The cost analysis is probably the detail that I look at most at this time. We use TRiA to review Security Compliance and AWS vulnerabilities details, which is information that other service providers could not provide direct access to. In the future, we’ll probably use more of the support ticketing features, and if I understand it correctly, there are some new capabilities being released in 2019, which we’re looking forward to using.
Connectria: To wrap up our discussion, what would you say are the main benefits you’ve seen from working with Connectria?
White: From a company standpoint, partnering with Connectria allows us to move faster and be more responsive to our customers, which increases our customer’s satisfaction. With our previous provider, if we wanted to add more capacity to our infrastructure, it might take a week to get a response from them and then another four weeks to get a new server in place.
Sometimes, we even got push back on why we needed to add capacity. They’d tell us we were on a defined infrastructure plan that only allocated so much memory per server. But with Connectria, we have a partner that immediately says, “Yes, we can do that. When do you want it by?” This gives us greater confidence in the commitments we make to our customers.
We also know that we have a partner with deep expertise in doing what they do best. They know all about VPNs, networking, security, databases hosting, Windows Server…everything we need. This lets us focus on what we do best.
To learn more about how partnering with Connectria can help you grow your business, reach out to us here. You can also visit our case studies for even more examples of ISVs and industry customers that have chosen to trust their cloud environments to Connectria.