(An End to) VAR Life
My reflections on nearly 20 years with OPENXTRA Limited a Value Added Reseller I co-founded all the way back in early 2003.
OPENXTRA Limited was purchased by AVTECH Software on 29th December 2022 and I decided to step back from my involvement. OPENXTRA is a Value Added Reseller in the server room environment monitoring market principally with a sideline as a supplier of network enabled power switches.
I co-founded OPENXTRA Limited with Denis Laverty all the way back in February 2003. The original idea was to curate a set of open source tools running on Microsoft Windows and provide paid support. The first product was called OPENXTRA BASICS. It consisted of a single installer for Ethereal (now called Wireshark), MRTG, NTop and quite a few other smaller tools like Nmap, tcpdump and net-snmp all with a single nice easy to use Window based installer. The goal was to make installing network management tools as easy as installing any regular Windows application. No messy configuration. We largely achieved that goal too.
Back in the late 1990s and early 2000s, open source tools were very painful to install and configure. Microsoft Windows was also not a huge priority for many open source projects. In fact, many projects had a lack of Windows support as a kind of badge of honour. That was the world into which the original product idea for OPENXTRA Limited was born in late 2002.
Building OPENXTRA BASICS was quite a large undertaking. By the time we were done, we’d written 3,000 lines of Python as a build system for it.
The tools were wildly popular far exceeding my expectations. The paid support was really unpopular. In fact, over a period of at least six months we managed to sell just a single support contract for the princely sum of around $49. Not the kind of money that is going to keep four people in rent.
The upside is that at least we knew pretty quickly that it wasn’t working and that we needed to find something else fast. The venture capitalists tell you to fail fast and we definitely did that.
Our one lucky break, in spite of all the effort we put into trying to get it, was that we didn’t have any external investors like angel investors or venture capital. That would not have been fun. We had a small friends and family round and they lost all of their investment. Those conversations were not the easiest and I have no plans to ever have them again.
This period in the company I look back with a huge amount of fondness. There was a real mission all four of us felt and we were all determined to get there.
I didn’t get paid for more than a year or so, I remember a strange combination of being completely enthused with our mission and being completely skint. In fact, I sold pretty well everything I owned at the time. If I still own anything from back then, it is because I couldn’t find anybody to sell it to. 😄
VAR Life Begins
Something had to give. You can’t run on zero money forever.
If we couldn’t sell support for the tools, maybe we could sell products of interest to people who were interested in the tools.
We started an e-commerce side of the website. Nothing very complicated by modern standards just a shopping cart tacked onto our regular website. We’d recently transitioned from a purely static website edited in Dreamweaver to a PHP based site. The site was incredibly primitive and yet people were quite happy to buy things. Selling online is absolutely magical and I never really lost the magic even after twenty years.
First product on the website was a wireless intrusion detection system produced by a startup in Silicon Valley. It initially sold okay for a while but soon stopped selling. I think the drop off was due to me changing the keywords we were advertising on. We weren’t tracking the ad spending very well at this point, so it is hard to pinpoint the exact cause. If you are paying for online advertising, you have to track the spend from day one.
The startup didn’t last long. This is something of a recurring pattern.
The second product we put up on the website was very different. It was an ethernet environment monitor manufactured by Sensatronics. Within the first few hours these just flew off the shelves. The manufacturer sent us a demo unit and before we’d managed to unbox it to give it a go, we’d sold it.
This was the first time I thought OPENXTRA might have a long term future and that I might finally get paid! 😄
Around 2006 or 2007 we did do some things I think were genuinely innovative. We paid a high four figure sum for a Java based e-commerce platform. We built what I think for a time in the late 2000s early 2010s was the leading e-commerce website in our tiny niche.
A big thing with buying products with many optional parts is that it can give buyers a lot of anxiety when purchasing especially online. When you clicked on the Config & Buy button, instead of just putting things into the shopping cart you entered the Config & Buy page. All of the available options for buying the product were displayed. You couldn’t buy the wrong thing because Config & Buy wouldn’t let you.
When we introduced the Config & Buy feature, calls from customers anxious about buying the wrong combination of products went down dramatically. The conversion rate of the website went up through the roof.
Once we were settled into selling environment monitors we looked around for other things we could sell to a similar audience.
Cable testers looked like a good bet and indeed we did sell a lot of them. There are two things you need to worry about as a reseller: the manufacturer and the product.
From the manufacturer, you need a big enough margin to make your marketing efforts pay. Selling products costs money. Quite a lot of money in fact. We found the cable tester market to be quite frustrating because the manufacturers were quite hard work. Things were locked down in a way no other niche we participated in was.
The products have got to work or you are going to have a ton of hassle. One particular cable tester we sold a bucket load of was a nightmare. Whole batches of these products simply did not work and we had the job of sorting it all out for the customer. And largely at our expense.
We got out of the cable tester market after around five or six years. It was quite a wrench but the right decision given the circumstances.
The Great Recession Hits
For a long time things went on as before. Much to my surprise. Slowly, due to a long period of government austerity, whole sectors of the economy just disappeared. We’d done pretty well with local government and higher education and it was as if somebody just switched off the tap one day.
The thing that hit us hardest were supplier issues. Suppliers get bought out by larger companies. It is a fact of VAR life. What surprised me was the number of suppliers being bought out and the fact that a number simply dumped the existing supplier network.
We put a lot of effort into building a customer base for some of these companies and it is heart breaking to see all of that effort going down the drain. Worse, the customers we had to inform about the broken relationship, often held us responsible. Consequently, the effect could well poison the entire relationship.
The Xsensior Years
Around about 2010, we noticed a gap in the products we were selling. There was room for a simple temperature measuring device that required the very minimum of configuration. The problem with network enabled devices is that you have to configure them to work on your network. Quite often the network is outsourced to some third party service provider making adding new devices to the network quite complex and possibly expensive.
Xsensior Lite was born to fit into minimum configuration brief. Xsensior Lite was a cheap USB thermometer combined with a Microsoft Windows based GUI to log and display the data as well as alert when things go wrong. We added a cloud version of the software called Xsensior Live not long afterwards.
Producing the software was one of the highlights of my time at OPENXTRA. It was an exciting time when everything seemed possible. As ever, reality has a habit of getting in the way. The big problem we had was that no one had any electronic engineering skills. We could do the software side but we just didn’t have the ability to design our own gadgets. This became quite a big limiting factor on Xsensior and effectively killed it when we were unable to source the hardware devices.
It was a missed opportunity because customers absolutely loved the product.
OPENXTRA has been purchased by AVTECH Software at the end of 2022. I decided after 20 years I wanted to step away and do something else. I am sure all of OPENXTRA’s many customers will find a good home with AVTECH. We’ve always found them very straightforward to deal with and I am sure our customers will too.
It has certainly been a roller coaster ride. I have made my fair share of mistakes over the last twenty years. But it’s been fun. 😄
A New Beginning
As for me personally, I am busy up-training in DevOps. Cisco, in co-operation with the Open University, offer remote digital skills training courses. The Department for Education in England have funded a number of places and luckily I managed to be selected. I am currently studying the Cisco DevNet Associate course. I already have a couple of decades Linux experience and a few years of using Ansible to deploy websites. Or, I might go back to programming full time.
I do seem to specialise in job hunting during a recession. When I first exited university it was during the early 1990s recession and here I am trying to do the same during the 2023 version.