Cloud Distribution heeds VAR calls with leasing unleashing
New BNP Paribas-backed service will allow partners to unlock bigger deals more quickly, says distributor
Cloud Distribution has launched a leasing service tailored to VARs struggling to secure financing on subscription-type deals.
The distributor has teamed up with BNP Paribas to launch Cloud Capital, which differs from some other finance solutions by allowing resellers and their customers to roll the cost of maintenance, subscription and managed services – as well as traditional hardware – into the agreement.
Cloud Distribution director Adam Davison said several resellers had approached Cloud recently because asset finance firms don't tend to offer financing on the subscription or cloud-hosted technology the distributor sells.
"Partners were struggling to get financing on that type of offering," he said.
"Our agreement [with BNP Paribas] covers not only subscriptions, where there is no tangible hardware, but also managed services if the reseller wants to sell them, so the end user has one user to pay on a monthly basis for everything."
Cloud Finance also allows the partner to sign an agreement directly with BNP in instances where they want to own the equipment themselves and quote the customer, Davison (pictured) said.
Asset financing has a relatively low profile in the UK IT industry but Davison said drawing on leasing can allow resellers to snare bigger deals more quickly.
He gave the example of a recent deal at the end of last quarter where a customer was struggling to find the budget to upgrade two large appliances.
"When it came to do it, they didn't have the capital budget to buy both immediately and the project stalled," he explained.
"The customer also wanted to buy bigger boxes than they needed, to future-proof their network, and didn't have the budget to do that either. We suggested the partner talk to them about financing so they could get the budget out of Capex rather than Opex. The customer came back and said yes."
A new quoting tool, which will allow partners to secure finance quotes within hours, will also go live imminently, Davison said.
"As John Paul Getty said, 'If it appreciates, buy it. If it depreciates, lease it'," Davison said.