IT infrastructure provider Selectel has launched an affiliate program that allows investors to earn a return on investment in IT infrastructure. The company has turned server rental into a distributor-dealer rental business. Analysts believe that only high-risk investment products can bring the same profitability.
According to a Selectel press service representative, the Selectel.Prime affiliate program will allow program participants to receive a monthly income of more than 20% of the server revenue, regardless of the load of specific equipment. The representative of the Selectel press service specified that in order to simplify interaction with partners, the provider introduced a special load factor. “With this scheme for calculating payments, the participant is also insured against inflation – with an increase in the cost of renting a server, his income increases by the corresponding amount. The monthly payment for a server worth 825,000 rubles currently amounts to about 17,000 rubles,” he said. .
Under the program, participants purchase fixed configurations of dedicated servers, the hardware used by Selectel customers to host applications, websites, databases, and other resource-intensive tasks. Thus, the income of the program participant is formed from the proceeds received from the lease of servers. The cost of configurations starts from 825 thousand rubles.
“The agreement is concluded for three years with the possibility of two-time automatic prolongation. Thus, the maximum duration of the agreement is nine years. When a participant leaves the program, the provider buys equipment from him at a pre-fixed cost, including depreciation,” the Selectel press service representative specified. According to him, only tax residents of Russia can participate in the program.
Konstantin Ansimov, Director of Infrastructure Products Development at Selectel, notes that Selectel.Prime may be of particular interest to an audience that is looking for new opportunities to generate predictable income in a fast-growing market. “Thanks to the launch of the program, we have the opportunity to diversify sources of funding and attract alternative funds that will help us remain a reliable partner for our clients and develop data center infrastructure,” he said.
Konstantin Ansimov said that now the company is focusing on assessing the potential interest in the program as a whole – as a new and non-standard offer for the market. “Depending on the demand from the audience, we will decide on the further development of the program. We also expect that the launch of the program will indirectly affect the growth of Selectel brand awareness as a whole,” he said.
According to him, at the stage of the pilot launch of the program, the company noted interest from representatives of the IT industry. “The interest is shown by both our current customers and those who follow the rapidly growing IaaS market and are looking for ways to generate predictable income. The list of potential participants is not limited to IT representatives. We expect Selectel.Prime to be of interest to a solvent audience that sees the prospects of the cloud services market and Selectel business,” explained Konstantin Ansimov.
Freedom Finance Global analyst Vladimir Chernov notes that the monthly income of a program participant can be 20% of the proceeds from the server, but this is not an income of 20% of the initial investment.
“The monthly payment for a server worth 825 thousand rubles, according to Selectel, is about 17 thousand rubles, which equates to a monthly return of 2.06% of the initial investment, or 24.72% per annum. Since this is a fixed and predicted income with little risk, then it can be called high, because bank deposits or fixed-income government bonds will not exceed 10-12% per annum – which is half as much, “explains the analyst.
According to him, at the end of the contract, the company buys the equipment, taking into account depreciation, which means that the annual profitability in terms of will be lower. “Due to depreciation, equipment can be bought back at half its original price, which means that two years of profit will be lost only on depreciation. In general, the conclusion of such contracts will be profitable on a long-term basis, entering such a business for a year or two there is no point,” says Vladimir Chernov. In his opinion, it is not entirely clear what Select had in mind when he spoke about payments of 17 thousand rubles. from the server. “If these are payments to the investor, then all the calculations above are correct for him, but if this is the entire monthly profit from the server, from which the investor will receive only 20%, then he will get only 3.4 thousand rubles per month, which will mean only 4 ,
Speaking about other investment instruments that generate a return of 24% per annum, Vladimir Chernov noted that the instrument offered by Selectel can be compared with high-risk investments in precious metals, in shares of companies on stock exchanges or in their purchases at initial public offerings (IPO) or into currencies. “They can also be compared with venture investments or investments in start-ups, which also have a high degree of risk. In general, only high-risk investment products can bring such returns,” he said.
Evgeny Makaryin, Head of the Linxdatacenter Product and Solutions Development Group, believes that Selectel has offered an interesting business model. “To appreciate its attractiveness, you need to delve into the numbers. But if Selectel – a provider specializing in HaaS – decided to test it in battle, then it is quite possible that it will be attractive to both the provider and partners. On the plus side – an interesting way invest free cash. And from the minuses – the partner is completely tied to the provider’s distribution channel and cannot manage this part of the business model in any way,” he notes.
According to him, plus and minus at the same time is that the partner is completely tied to one business line of the provider. “If it does not grow, it will not be possible to cover the risk in other directions. But the potential profit may be higher than the investment in the entire business of the provider,” Evgeny Makaryin believes.
Dmitry Isaev, Head of Cloud Solutions at Softline Group, notes that increasing sales channels is a reasonable step for any company that plans aggressive business growth. “The use of a partner channel for this is quite justified, especially since distributors are looking for new niches for development in modern conditions,” he explains.
According to him, a few years ago Softline already implemented a similar experience in selling services, offering them, in particular, through the distributor Axoft, which is part of the Softline group of companies. “Now my colleagues and I are discussing the parameters of the prospective development of the Axoft Cloud direction and we see very interesting opportunities for cooperation,” he said.
Speaking about ways to deal with the shortage of new servers, Dmitry Isaev said that in 2021 Softline launched a line of server hardware under the Inferit brand. “During the year, my colleagues and I implemented an extensive program of hardware improvements in both hardware and software to ensure high reliability and performance of hardware in cloud environments. In November 2022, the tests were completed, and from that moment on, Inferit server hardware is recommended by us for use in cloud platforms, including we ourselves began to use it when building cloud solutions. We are also considering equipment from other Russian cloud manufacturers in order to provide our customers with the highest quality and performance, “Dmitry Isaev said.
Sergey Krutilin, General Director of ActiveCloud Russia, said that the company uses similar distribution models, but not for equipment, but for cloud infrastructure. “A number of partners can purchase some of our services for themselves and sell our cloud to customers in parts,” he said. According to him, the company did not experience a shortage of new servers, since their equipment procurement model is long-term. “At the moment, we have restored the supply chains, and the company has adjusted to the new conditions,” he said.
Konstantin Ansimov believes that the market has overcome the main crisis associated with the shortage of equipment, and supply chains have been restored. “Yes, the range of solutions has changed and their cost has increased, but there are no significant problems with the availability of equipment now. Selectel has its own line for assembling servers from various components: from the very beginning, we developed in such a way as not to tie all deliveries to one or even several vendors. In addition In addition, large providers, as a rule, purchase equipment with a margin – some remains in warehouses and waits until the need arises to scale the infrastructure or replace components. Selectel is no exception in this regard,” he said.