Temprano, which channel security veteran Luke Walling set up earlier this year to bring European companies into the North American market, has acquired Network Security Group as the first stage in its own distribution arm.
Newton N.C.-based Temprano Techvestors, which launched in September to bring European software firms into the North American market, has acquired the first step in a distribution arm to facilitate their strategy. They have announced the acquisition of Network Security Group [NSG], a network security solutions provider with nominal head offices in Charlestown MA, but whose staff are distributed up and down the eastern seaboard.
Temprano was launched earlier this year by Luke Walling, best known in the channel for his roles at AVG and then Avast Software, but who earlier in his career ran a similar company to Temprano, where he worked with European companies doing their North American marketing, building their channel, and handling all their go-to-market activities. AVG was one of his clients, who eventually bought his company. Temprano signed up its first client last month, Safetica, a Czech based data loss protection vendor. Their second client has been signed, but Walling is not yet ready to disclose their identity. They are an IT tools vendor with a significant presence in Asia and Europe and UK. In North America, they have a fledgling presence, but are in a couple significant OEM deals.
So how does NSG fit into Walling’s master plan? While they are a VAR, they are also a distributor, and that’s the key here. Early on, Walling indicated that Temprano would not be using distribution, unless it was a distribution company that they built themselves. They have jump-started the process by acquiring NSG to fill that void
“They are definitely complementary to our customer segment,” Walling said. “They have thousands of B2B buyers across north America. They also have about 500 partners who are focused on security.”
The European vendors Temprano is bringing to North America provide a natural cross-sell opportunity, Walling said.
“Both Safetica and our newest client are a natural cross-sell here,” he said. “The emerging market vendors we offer provide value and gives the distribution business a big financial opportunity. We see this as tremendous opportunity there, which will allow us to take that business a step further. It will make the NSG distribution channel more lucrative.”
Walling said he also expects these new vendors to make NSG more attractive as a distributor to new partners.
“We will be putting a big push in 2017 in recruiting new partners,” he indicated. “Safetica is complicated technology, and creating policies around it is high-value work. We could do it ourselves remotely, but I would much rather work with local partners to do it. I don’t want to create our own service delivery team.”
NSG is not a company Walling has worked with previously.
“I competed against them when I ran my own business before, so I know them from that, as well as from word of mouth,” he said. “They are attractive to us because they are very focused on sales, a highly effective sales organization, and not a traditional VAR, where the sales skills are sometimes lacking.”
NSG is a small company in terms of staff, with six people.
“Most of the team is virtual,” Walling said. “They are able to access customers in local markets from the Boston area down to Atlanta. They also do some interesting events, and run security-focused events across the north and southeast.”
Walling said that VARs typically sell either because the founder wants to retire, or where they want to expand their horizons – as he did himself when he sold his business to AVG. He indicated that NSG definitely falls into that latter category.
“It took a while to put the deal together because their founder, Peter Streips, wanted to see a future in the new business,” Walling said. Accordingly, NSG will act as a Temprano subsidiary under the NSG name rather than be directly integrated into the Temprano business.
While MSG has a large number of B2B buyers, the great majority is in the east, so Walling is thinking about complementing this with another distribution acquisition.
“In 2017, we will be looking at an additional acquisition, especially on the west coast of the U.S.,” he said. “That’s something we are thinking about.”