VARTECH 2021 Formula: ISVs + Recurring Revenue x Infinity

By: Jim Roddy, VP of Marketing & VAR/ISV Business Advisor at the RSPA

While listening to over three dozen main stage ISV presentations at VARTECH 2021, the annual partner conference for distributor BlueStar held Oct. 4-5 in Orlando, I picked up on a trend. See if you can spot it, too: “recurring revenue, recurring revenue, recurring revenue, recurring revenue, recurring revenue, recurring revenue, recurring revenue.”

Most every software developer on stage mentioned recurring revenue at least once – if not more – during their 90-second presentation. One ISV said they offered AI-Optimization-as-a-Service which I guess would be called AIOaaS. Another said, “Recurring revenue streams: that’s what we’re here for,” while another mentioned recurring revenue nine times across a minute-and-a-half (that’s once every 10 seconds if you’re keeping score at home). And what was BlueStar’s focus for their commercial break during the ISV presentations? Their Hybrid SaaS program which helps VARs earn more recurring revenue, of course.

Adding on software and services is the fastest path for VARs to increase the recurring revenue they receive from current customers and prospects, so you might as well shout it from the rooftops when you’re recruiting new reseller partners.

A total of 38 ISVs took the stage (one remoted in from Denmark) and many more walked the show floor, presented their app in a vendor partner booth, or exhibited at their own table in the expo hall’s ISV section which had the most worn carpet on the show floor. BlueStar even presented a new term they believe more accurately describes ISVs: Technology Software Companies (TSCs).

Software developer mania isn’t a VARTECH anomaly. The RSPA has seen its own ISV numbers skyrocket this year:

  • Over 230 ISV executives attended RetailNOW 2021 in Nashville, an all-time show record
  • ISVs now account for one-fifth of all RSPA members, and 40% of new members who have joined since May 1 are software developers
  • The RSPA Niche & Startup ISV Community has quickly grown to nearly 80 members, making it the association’s second largest subgroup (it’s hard for anyone to keep up with the Cannabis Community)

Visit the RSPA Solution Center – a web platform designed to connect VARs and ISVs to providers of innovative solutions

My top takeaway from VARTECH 2019 in the Bahamas was “it’s an ISV world, and we’re all just living in it.” That trend has only accelerated the past two years.

The traditional approach in the retail IT channel was a local dealer determining which vendor(s) to partner with, then taking that solution to their community. Today, and more frequently tomorrow, we are seeing both VARs and startups develop niche software, seek new vendor and distributor partners, and take that solution directly to the end user merchant. This is the new-look reseller – though they don’t call themselves that. When these entrepreneurs want to expand their sales into new areas, many of them will develop their own VAR channel.

Other thoughts, quotes, and observations from VARTECH 2021:

  • BlueStar President/CEO Steve Cuntz addressed the current product shortage head-on during his 10 minutes on the VARTECH main stage. He discussed production issues in Asia, the computer chip shortage, and tight labor markets in the freight and trucking industries which have resulted in ships backed up 40 miles off the California coast. “We have an incredible economy here in North America,” Cuntz said. “It’s hard for us to reset our expectations of when to receive product.” Cuntz offered hope for a better tomorrow, but “tomorrow” won’t come until sometime in 2022.
  • The cannabis vertical wasn’t the biggest market at VARTECH from a revenue standpoint, but it generated the most buzz for sure. I participated in a cannatech panel that attracted at least 50 attendees with varying experience in this emerging space. Fellow panelist Mark Romano of Watchguard recommended VARs break into this vertical offering security solutions. “Data, data, data,” Romano said referring to the private medical card information many dispensaries need to store. “If you’re not dealing with their security, someone else is.” Zebra’s Xavier Villarreal highlighted the complexity of cannatech seed-to-sale solutions, many which integrate RFID technology. “This stuff doesn’t work out of the box,” he said. “They need someone to walk them through the installation and training.” BlueStar’s Duane Roebuck added, “They’re tagging everything in the dispensary. Once a plant gets a stem, it gets an RFID tag. Because everything needs to be tracked, everything needs to be tagged. There’s a cost-justification for RFID in cannabis.” Brianna Moriarty from Star Micronics highlighted the opportunity for VARs with online ordering and e-commerce skills to share that expertise with cannabis dispensaries.
  • A retail IT VAR told me in a one-on-one conversation that once cannabis becomes federally legal and credit card payments are accepted, he expects processors to scoop up the top cannabis software providers. “Payments will take over the ISVs,” he predicted. We’ve seen that in the restaurant space, so why wouldn’t cannabis follow suit?
  • I moderated a panel on managing remote workforces featuring Chris Sullivan, Sr. VP of Global Sales for RSPA member Elo, Scott Wallingford, the VP/GM of Solutions and Services for Honeywell, and Chris Heim, the President/CEO of solutions provider AbeTech. Each of their companies relies on Microsoft Teams to keep their workforces connected, and each were happy with that product. Another commonality was the panel’s agreement on the increased importance of hiring a team of high-initiative self-starters you can trust to carry out the company’s mission. Tracking software will turn off trustworthy employees while the low performers will figure out a way to game the system. Embrace video calls (with everyone having cameras on) and messaging tools to stay close to your team. Provide them support; don’t be a Big Brother who’s to be feared.
  • RSPA Marketing Manager Chris Arnold and I are fanboys of BlueStar Partner Marketing Services Manager James Korte. When he speaks (or posts on social media) we listen, so you bet I was in the room to hear him talk with BlueStar colleagues Dean Reverman and John Martin for the breakout “Optimizing LinkedIn & Social Media for Business.” Below are some of Korte’s best comments, and you can listen to the conversation in full on an upcoming episode of BlueStar’s TEConnect Podcast:
    • “People don’t come to LinkedIn just to hear what your company has to say about itself. People come there to learn, so give them quality content.”
    • On written content vs. video on LinkedIn: “People like to see people, so video helps you stand out. But be sure to transcribe the key point of your video – they’re more likely to read that than watch your video.”
    • “Resharing a company post on LinkedIn isn’t a bad thing, but it’s stronger to create your own post related to it or commenting on that post. That’s better than the robotic reshare.”
    • “Getting the details right on social media is a big deal. Sometimes getting into the weeds is a good thing.”
    • “Wherever your people are is where you belong.”
  • Also overheard at VARTECH 2021:
    • “Update your damn LinkedIn photo. I know you like to live in the glory days, but make sure the photo looks like you do today.” BlueStar’s Martin (who has an updated damn LinkedIn photo)
    • “We are all innovators at heart. You don’t need specialized training. You just need to challenge assumptions and ask ‘what if’ questions.” Futurist Scott Steinberg
    • “The only thing stopping you from accomplishing greatness in your life is you. … Lead yourself, lead others, lead always.” VARTECH keynote Jason Redman, a Navy Seal and Wounded Warrior

Don’t forget to visit the RSPA Solution Center – a web platform designed to connect VARs and ISVs to providers of innovative solutions

Jim Roddy is the Vice President of Marketing and a Business Advisor for the Retail Solutions Providers Association (RSPA). He has been active in the POS channel since 1998, including 11 years as the President of Business Solutions Magazine, six years as an RSPA board member, one term as RSPA Chairman of the Board, and several years as a business coach for VARs, ISVs, and MSPs. Jim has been recognized as one of the world’s Top 100 Retail Influencers by RETHINK Retail, a Leading CannaTech Influencer by 420MSP, and is regularly requested to speak at industry conferences on SMB best practices. He is author of two books – The Walk-On Method To Career & Business Success and Hire Like You Just Beat Cancer – and is host of the award-winning RSPA Trusted Advisor podcast. For more information, contact