Reseller Altinet targets £5m revenue with MSP model

Leeds-based reseller looks to capitalise on growing MSP business after seeing 170 per cent revenue growth last year

Leeds-based MSP Altinet is aiming to hit revenue of £5m this year for the first time in its three-year history, according to co-founder Daniel Bailey.

Established in 2013, Altinet is a storage, networking and security vendor - and is partnered with the likes of Barracuda, Sophos and Censornet.

Speaking to CRN, Bailey said that the firm saw revenue growth of 170 per cent in 2016 and is now looking to hit between £4m - £5m this year.

While Altinet files abbreviated accounts on Companies House, Bailey said that achieving the target revenue this year would need a 70-80 per cent increase.

Bailey said that a key focus of 2016 for the VAR that will continue into 2017 is the shift towards a managed services model.

"We very much don't ever undertake a project that doesn't include using our services so there is never a time where we're transacting a £200,000 order and making a loss like some of the larger guys will do," he said.

"It's very much a case of working in a consultative way with very large companies down to academies or secondary schools where they're coming to us and saying 'we need to overcome this business challenge'."

This managed services drive has seen Altinet become an Amazon Web Services (AWS) partner - after considering the likes of Microsoft Azure and UKFast - and Bailey added that any reseller not looking to adopt a similar approach this year could find themselves in trouble.

"We've seen that the managed services area is going to be a huge part of what you have to do to be successful in the reseller world," he said.

"Its going to be tough if you want to keep trying to just sell licenses and hardware, maybe not in 2017, but definitely in 2018 and 2019 because when you can pay monthly for something rather than three years upfront it doesn't make sense anymore.

"Microsoft and Google were the leaders in this because it wasn't long ago where you could only buy a one-year or two-year license for a Microsoft product, but then they introduced Office 365."

2016 saw headcount increase to 23, with plans to add a further seven this year as part of a plan to reach the 60 mark by 2019. With this in mind, office space was doubled last year.

Altinet has also seen a shift in the importance of the education sector to overall revenue. In 2015 education made up around half of the resellers total revenue, but this fell to around 35 per cent in 2016 as corporate sales increased.

Key client wins included Best Western's UK hotels and property developer Henry Boot.