Restructure, growth and market opportunities: Nextgen’s new wave

This year will see Nextgen position itself for strong growth as it aims to capitalise on opportunities particularly in key markets such as cyber security and data resilience.

The integration of Nextgen and Exclusive Networks involved significant changes to the business, including a restructuring which saw the departures of Danny Meadows in New Zealand and Gavin Lawless in Australia. 

On top of the management changes, Nextgen also shifted its global financial year to calendar FY and added new vendors to its portfolio from the Exclusive Networks’ stack.

Nextgen CEO John Walters highlighted the Australian and New Zealand business grew by 30 per cent year-on-year, with a 36 per cent compound annual growth rate (CAGR) over 13 years.

“We had to realign our structure to continue the growth and innovation,” he said. “We had to flatten the structure and we were tripping over each other.

“Gavin and I had a mature discussion around it and he’s decided to do other things and look for opportunities. Danny did a fantastic job in New Zealand and what I was wanting him to do was cover Australia and New Zealand with his new remit and it just wasn’t working from a personal perspective with his young family.

“Both of them have done themselves and Nextgen proud and we thank them for everything they’ve done and I’m sure we’ll be working together in the future very soon.”

Walters explained 2024 was a huge year for Nextgen — preparing the business for sale, appointing an advisor and attracting a number of interested parties before settling with Exclusive Networks. 

“Out of the due diligence came a really compelling offer from Exclusive, but it was not only just about the money. Equally as important was the vision and where they were going globally and how they were taking on the whole cyber opportunity into the future,” Walters said. 

“Their growth aspirations, culture and the whole box and dice. That was really important to me, because after 13 years of building a business, it’s not just about the price, it’s about finding the right home for the business.”

From the first week of July, the Exclusive team was moved into Nextgen’s offices in Sydney and Auckland and five vendors were brought across: Fortinet, SentinelOne, Infobox, Mimecast and Barracuda.

“I’m very proud of what the team was able to achieve over the course of that period from July to December. There’s some wonderful vendors that have joined the Nextgen family, and we’re working hard to make sure that they are given the love and attention, and the partners are given the services they need,” Walters said. 

Coming out of the Christmas period, Walters said the business undertook a restructure.

Key initiatives for 2025 include expanding the AWS Marketplace, developing the newly launched Nextgen Connect unit, enhancing its cyber lab and expanding oSpace globally. 

“When we started oSpace, I had the vision of being the next generation of distribution — a digital distribution business,” Walters said. “As we started building our platforms, AI and everything else, we suddenly realised that it was more than just a distribution business. It was actually a data, lead generation, demand generation and management platform we were building. It became an engine in its own right.”

This is where the idea for Nextgen Connect came about, to capitalise on the market as a digital distribution business.

“With Wendy O’Keeffe’s opportunity to come back to Australia, I thought, ‘Why don’t we set up Nextgen Connect, a digital distribution business, and it can leverage oSpace, our cyber lab and other values just as Nextgen Distribution does?’ 

“There were a number of vendors who, in particular, were like bees around that AWS Marketplace honeypot, that are the next generation of SaaS [software-as-a-service] vendors who really didn’t see a value in a tier two arrangement, but really needed a digital hand into the market or support.

“That just shows even though we’ve been bought, we can still innovate and get on with making big decisions like setting up a new business not long after our acquisition.”

The company aims to capitalise on market opportunities, particularly in cyber security and data resilience, and anticipates strong growth in 2025.

“I think this year, I’ll put it out there, we could be the fourth or fifth largest distributor in the A/NZ market,” Walters said. 

“Who would have thought when we started the business some 13 years ago? It’s not all about how big you are — certainly, scale helps — but you’ve really got to execute on the differentiation, value and innovation as well.”

Prior to the integration, Walters said 75 per cent of its line card was cyber and data resilience with its founding vendors such as Oracle, Arista Networks and MicroFocus (now OpenText), adding considerable weight. 

“All of the Exclusive vendors that came into the Nextgen portfolio has tipped us over the 80 per cent threshold of cyber and data resilience go-to-market. So it’s a big part of it,” Walters said. 

“We’re quite lucky in that we’ve got probably half a dozen vendors all in the same sort of revenue scale, which means we’re not beholden to one particular vendor. I think this is important and allows us to go to market with a ‘better together’ approach.”

In A/NZ, Walters said there was a lot of opportunity to behold, particularly within its AWS business, which Walters described as “going through the roof.”

Veronica Kruse was recently promoted as Nextgen’s director of marketplace to work closely with Emma Davidson and the AWS team.

“She’s driving our vendor portfolio that wants to be on the AWS Marketplace and we’ve got over a dozen of those now who are all fully accredited,” he said. 

“Our partner community has lots of opportunity to utilise the AWS Marketplace, but there’s still a lot of education required on how to maximise not only the opportunity, but the profitability that comes out of the AWS go-to-market.

Walters said the AWS Marketplace presented a big opportunity for the channel.

“There’s a lot that’s starting to go direct today, and the channel is missing out. We’ve got a big role to play in educating the channel, both at a vendor and partner level, how to maximise the opportunity with AWS Marketplace,” he said. 

“It’s a tsunami that’s here and anyone who puts their head in the sand and says ‘I wish it’d go away, I see there’s a threat’, they’re kidding themselves. They’ve got to get on board and understand it.”

Walters said Nextgen was continuing to invest in its platforms, particularly with AI, not just with oSpace, but also its Buyer Predictor. 

“We’re using an AI solution to predict what’s happening in our industry,” he said. 

The oSpace business unit is also continuing to grow at a rapid pace.

“We’ve got multi-million dollar contracts already in the US all using the oSpace platform for major vendors, some of which we don’t distribute, either here or in the US, and we’re helping them drive qualified leads and turning that into real deals,” Walters said. 

“It really goes to show, from my perspective, a value-add distribution that can harness the opportunities with data and add value around, not only just their vendor line card, but services as we continue to reinvent ourselves.”