N-able ratchets up freemium strategy

SCOTTSDALE, ARIZ. – N-able Technologies kicked off its 2011 Partner Summit here with a big clue into how it’s going to spend some of the money invested in it last week by private equity firm Accel-KKR.

It’s going to give away a whole lot more software.

Almost two years into its “” strategy of giving away pared-down Essentials versions of its flagship remote monitoring and management software with every paid copy sold, CEO Gavin Garbutt announced that it’s increasing the allotment of free management tools twenty-fold for its customers – any with 250 or more devices managed through the company’s paid offerings are eligible to offer Essentials on up to 5,000 devices.

On top of that, those companies will have access to 500 seats of each of its Group Policy Enforcer and managed anti- offerings – for what Garbutt called a total value of $108,000 of free software per MSP.

Garbutt’s strategy: Get to use the free Essentials platform to get access to more of customers’ devices, allowing them to get a better view of the customer’s overall environment and a better feel for the challenges they face.

“The whole idea is to reduce barriers of entry [to ] for non-managed customers,” Garbutt said.

Then, use that information to upsell and cross-sell based on customer needs. But whatever you do – don’t sell products. Garbutt advised partners to position everything as a service purchase rather than a solution purchase – don’t sell an anti-virus deployment, sell managed antivirus. Same for document management solutions versus .

“It doesn’t matter if it’s delivered on-premise or in the cloud, if you understand what SMBs are trying to achieve, you can help them align their business needs with their IT needs,” he said, adding that such a strategy can be implemented over time, with services building up over months or years. As Garbutt put it – don’t sell a whole cow; sell them a little fillet mignon that they can digest every day.

So is this strategy a good way to use the extra money? History points to yes. Consider this – over the two years since N-able introduced its “100 per cent IT management” freemium charge, the company’s MSP customers have increased the number of devices managed through N-able products by 200 per cent. Sure, some of that growth has been from the freebie Essentials editions. But over the same time period, number of devices managed under N-able’s for-pay Professional editions has increased by 175 per cent.

Will twenty times the freemium offerings mean twenty times the growth for N-able and its MSPs. That remains to be seen. But it should go a long way to achieving some of the macro goals Garbutt has for his company and its partners – getting 100 per cent of all their customers’ manageable devices managed, and growing managed services revenues by 100 per cent more per year.

The limited-time free offerings of GPO Enforcer and anti-spam follow a yearlong giveaway of the company’s managed endpoint security product that wrapped up last month. If the company’ partners can be as successful with the new try-before-you-buy products as they were with the managed antivirus service, it will prove to be quite profitable – Garbutt said that when the endpoint security promo ended, 98 per cent of the free devices covered were converted into paid customers.

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