Roughly two months after Autotask acquired VARStreet, the online product sourcing system is showing momentum with solutions providers. To wit: VARStreet's user base has doubled in the past six weeks or so, according to Autotask Chief Marketing Officer Bob Vogel. Here are some more insights, based on an email exchange with Vogel.

First, a little background: As you may recall, The VAR Guy was somewhat skeptical when Autotask acquired VARStreet back in March 2010. Sure, VARStreet is a well-known platform that helps VARs to plug into distributor systems, manage product purchases and automate time-intensive tasks. But as an independent company, VARStreet never quite lived up to its potential. One prime indicator: VARStreet's Website seemed to be stuck in Web 1.0 mode -- lacking any significant updates since 2006, a sure sign that the company was struggling.

Autotask stepped into the picture in late 2009, started to negotiate a VARStreet buyout, and announced the deal in March 2010. At the recent Autotask Community Live conference (April 18-20, 2010), more than half of attendees indicated that they planned to leverage VARStreet. To further accelerate that demand, Autotask this week pushed out a version of VARStreet that is embedded within the Autotask PSA (Professional Services Automation) platform.

"That’s now in limited release, and we’ll make it available to the general user base (and new users who want it) in about two weeks," said Vogel. "In terms of numbers sold, we’ve doubled the pre-existing VARStreet customer base in just six weeks. Ingram Seismic has added VARStreet to their product line and are starting to sell it as well."

There's also an e-commerce story here, since many solutions providers leverage VARStreet to build their own online stores. Once a VAR's online store is up and running, the average site is moving between US$10,000 and US$20,000 per month in product sales, Vogel adds.

Still, VARStreet faces market competition. A few cases in point: Quotewerks and Quosal both have proven momentum with VARs and MSPs. And CNet Channel Online continues to attract some attention from VARs that want e-procurement and sales quoting tools.

Meanwhile, Autotask continues to promote synergies between VARStreet (product sales automation) and its traditional Autotask SaaS platform (for services automation). In April, Autotask Go! and Autotask Pro (the company's two flagship PSA offerings) generated Autotask's biggest sales month in the company's history, Vogel says.

Changing Competitive Landscape

As The VAR Guy has pointed out, these are evolutionary times for PSA software providers. While Autotask celebrates apparent success with VARStreet, rival ConnectWise is gaining momentum with the ConnectWise Capital investment in LabTech Software, a remote monitoring and management (RMM) platform that positions itself against Kaseya. And to The VAR Guy's surprise, he's hearing from more and more MSPs that are signing up for LabTech.

You'll find that complete LabTech story over on MSPmentor.

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