GTDC Board of Directors MeetingTim Curran, CEO

September 9, 2015

9/25/2015 GTDC Confidential 1

11:15-1:45

Section I – Governance/Votes• Approval of Minutes – June 2015• Vice Chairmanship nomination and vote• Approval of updated 2015 budget

Section II - GTDC Mission and Initiatives• Mission Statement Review Should we update the statement?• Strategic Initiatives Review Should we keep doing what we do?• New Initiatives What new projects should we tackle?

• Funding How do we pay for this?

Luncheon Break1:45 -2:15

Section III – Presentation by Denise Sangster, Global Touch

Section I: Board Votes

1. Approval of Minutes

2. Vice Chairmanship

a. Mike Long has been nominated to the vice chairmanship.

b. Motion to approve

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Section II - 2015: Review of Budget & Current Flow of Funds

Net Income Overall Net Income in this update for 2015 has been reduced from $33.5k to $11.4k reflecting the

reduced income assumptions noted below, offset by favorable variances in overall net expenses

Income Negative variance versus plan in Membership Dues with the loss of Officer, and removal of

expected additions midyear of United Stationers and Elko

Summit Registration fees plan of $30k lowered to $20k to reflect comps for recruiting new vendor

attendees.

Compliance funding – proposal to be discussed in detail later in the meeting

Expenses• All administrative expenses are on track to plan for the year• Net total program, project and event expenses are on track to be below plan for the year,

partially offsetting negative income variance noted above• Foreign Currency Exchange expense has been added as a line item• Compliance expense forecast reduced to $25k from $50k as this phase of the project nears

completion

• Motion to approve updated 2015 budget

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Section III: Plans for 2016-2017

1. Mission Statement Review

2. Strategic Initiatives Review

3. New Initiatives Proposals

4. Funding Discussion

5. Approval of Strategic Initiatives 2016-2017

9/25/2015 GTDC Confidential 4

Current Mission Statement

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The Council shall be a worldwide industry association dedicated to advancing the role and

promoting the value of technology distribution to the vendor and investor community.

Should this be expanded or updated?

Existing Activities: Vendor Focused

1. Vendor Summits in USA, EMEA and LATAM• Highly evaluated by VP-SVP level participants• Growing attendance in all regions• Continued need to raise the level of vendor attendees• New format of “CEO-Connection” is helping but not sufficient

2. Researcha. To help vendors understand the value of distribution and defend it within their

organizationsb. High download rates – 2015 has continued the trend with over 3K downloads of our

research: • Economics and Value Study• Distribution Primer• Inside the Enterprise – U.S. and Europe• How the Fastest Growing Got Ahead • For release in September 2015: Beyond the Cloud – U.S. and Europe• Download breakdown: 37% Vendor, 9% Investor, 26% Distributor, 28% Other/Consultant

3. Database Management• Launched and maintain sales out database in the US and EMEA with NPD, Context and GFK for the last

10+ years• Support for organization expansion in LATAM and APAC by members in the regions• Provides benchmarking tool and critical funds to the distribution members and the GTDC

4. Training Programs• Based on the Distribution Primer, training sessions in EMEA are highly evaluated by distributors and

vendorsGTDC Confidential 6

Existing Activities: Investor Focused

1. Annual Investor NYC Conferencea. Growing attendance and key support for “having all distribution executives available

at one time”

b. Investor support for meeting format and company breakout sessions

c. Communicating to investors that distribution is on top of emerging growth opportunities

d. Active support from key “Sell side” analysts: Brian Alexander, Ananda Baruah, Jim Suva, Lou M. and other key analysts.

2. Research Leveraged by Investors

a. Regular requests for introductory view of the IT sales channel and “where” distribution fits

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Phase I: 2010 – Q3 2015 - Completed

• Objective: Help launch a cost effective process and tool for GTDC members

to certify themselves and to help vet compliance risks in the reseller

community

Phase II: 2015 Q4-2016 and beyond

• GTDC role diminishing as project moves into sales and technical areas that

are NOT GTDC core competencies nor part of the original mandate

• Recommend minimal GTDC involvement moving forward

• Proposal for the GTDC to transition out of day-to-day activities on the

project and help users identify and retain an outside resource as project

manager by end of year 2015 if so requested by current subscribers

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Compliance ABAC Platform

Looking forward

How can the GTDC expand its role as a key voice for the channel globally?

• New Vendor activities

• New Investor Activities

• New Recruitment Guidelines and Strategy

• New Best Practice activities

9/25/2015 GTDC Confidential 9

Proposed Initiatives: Investor Focused

1. Build on our current Investor Programa. 13 years of New York based program with great success and support

from attendees

b. Propose to launch a Midwest program in 2016

• Road trip in the Chicago/Milwaukee area in Fall

c. Focus on investors who cover the international markets

2. Include Investors to the EMEA meeting 2016a. Invite bankers and credit companies who help finance the channel

b. Help coordinate meetings with the distribution executives

c. Engage with a PR firm to help recruit and secure attendance

3. Dedicated research for investor communitya. Survey investors/analysts to obtain ideas

b. Leverage 3rd party analysts research: NPD, Context, GfK and others

9/25/2015 GTDC Confidential 10

Proposed Initiatives: Vendor Focused

1. Enhance/Expand U.S. Summit• Invest in higher profile speakers

• Recruiting Strategy – for discussion (Higher level? “born in the cloud”? Newer faces?Combination?)

• Enhance registration and meeting tool experience

2. Enhanced PR activities for Europe

• Replicate as much as possible (with EMEA media such as IT Europa) the extensive exposure CRN U.S. produced at 2014 Summit NA

3. Research • Role of distribution in IoT

• How distributors are enabling resellers transition into 3rd platform technologies

5. For Distributors: Parallel “best practices” sessions: Credit, Legal, HR, others

• Could be done following the U.S. Vendor Summit event

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9/25/2015 GTDC Confidential 12

Proposed Initiatives: Social Media

• Levereging Linkedin for blogs and articles about distribution:

Summit Recruitment Strategy

Strong push via electronic invitations, personal notes

Asked for help from key distribution executives

Targeted approach to cloud groups and born in cloud vendors

What we learned:• There is an exciting and new crop of vendors we can tap into

• Some of the born in cloud vendors are more interested in attending a reseller event than a distributor only one

• Unware of distribution services, but very interested in learning more

• We have some work to do in providing a more robust and functional registration and meeting tool via our site. Will require investment, but a central part of the participant experience

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Vendor Attendees

Acer America APC/Schneider Electric Aruba ASUS Attivo Autodesk Avaya Axiom Big Leaf Bluecoat Brocade Brother Burstorm Channel Mechanics Cisco Systems Citrix Commvault Dell Dropbox Eaton EMC Epson Ergotron Fortinet

Google HGST HP IBM Intel Jabra Juniper Networks Kaspersky Kensington Kingston Lenovo Lexmark LG Electronics McAfee Microsoft NEC Display Solutions Netapp Nexsan Nimble Nutanix OKI Data Americas Optoma Oracle OrionVM

Palo Alto Networks PKWARE Red Hat Riverbed Technologies RSA Ruckus Wireless Samsung Electronics America Sharp Sophos Startech.com Ltd Symantec Toshiba America Info. Systems Trend Micro TRENDnet Tripp Lite Unify Veeam Veritas Viewsonic VMware Vonage Watchguard Technologies Xerox

Rising Star Winners

500M and above 25M-100M

Vendor Rising Star Ranking Vendor Rising Star Ranking

Dell Gold Nutanix Gold

Acer Silver Beats Silver

EMC Bronze Ruckus Bronze

Honorable Mentions: Cisco, IBM

100M -500M SOFTWARE

Vendor Rising Star Ranking Vendor Rising Star Ranking

Nimble Gold Citrix Gold

Palo Alto Networks Silver RSA Silver

Microsoft Bronze Veeam Bronze

GTDC Channel Executive of the Year: Scott Dunsire,

GTDC Confidential 15

Honorable Mention: Fortinet, HGST Honorable Mention: Red Hat, Veritas

Honorable Mention: Google, Micron

Membership Criteria and Recruitment

Membership Criteria: standardized guidelines for emerging markets such as Russia and Eastern Europe being developed to include:• Compliance Check – via trusted database check such as Thomson Reuters or others

• 3 positive references from A-brand vendors

• Company Code of Conduct

• Company profile including financial details, type of business, fines or other sanctions

Potential recruiting targets:

• Eastern Europe (including Russia and Ukraine)• Elko USD 1,200M• Marvel USD 1,000M• OCS USD 2,700M• Merlion USD 4,000M

• RRC USD 500M• Treolan USD 900M

• South Africa• Pinacle USD 550M

• Mustek USD 370M

9/25/2015 GTDC Confidential 16

Global Expansion“Your presentation on distribution capabilities and the value delivered to the vendor & partner ecosystem was excellent. It displayed a complete & comprehensive bouquet of services from a distributor & brought the importance of the role we play in the chain.” –Sundar K. Redington India

Mexico Database – working with Ingram, Tech Data, Avnet and Intcomex to agree on contract terms and rebate allocation

• Goal to launch in late summer 2016

“Copycat organizations” – what if any engagement should we have with these organizations such as TDAI, Abradisti?

• TDAI has ten members including Avnet, Ingram, Redington.

• COO Veena Mishra attending Summit event

• Abradisti: 25 members including Avnet, Ingram and Westcon

• GTDC has had tried to re-engage with little success due to change in leadership.

• Loss of Officer as a member in 2015

Proposal: Alliance Partnership– no dues, no voting rights. Research exchange partnership

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Funding Discussion and ProposalRebates and Dues

1. Rebate flow is stronga. Database Program Rebates have doubled since 2009 (in USD and ROI)b. Achievement Bonuses anticipated to grow in 2016-2017

2. Member Dues have been flat a. Per Member dues rates are flatb. Overall Member dues net decline since 2012 due to consolidation and are approx. 1/3 the

size of rebate flow

3. Funding Recommendationa. 2015 small “windfall” approx. $100k put to 2016 reserve for Member Activities/Strategic

Initiativesb. 2016-2017

• Hold Member Dues steady and Direct Member Rebates steady/small growth rate• Allocate portion of anticipated incremental “Achievement Bonuses” to enhanced Member

Activities/Strategic Initiatives funding and (if unspent) to reserves• Sept 2015: EC/BOD - review and approval of funding proposal and priority Member Activities/Strategic

Initiatives for 2016-2017 for the Americas and Rest of World; provide guidance for EMEA;• Oct 2015: European Management Committee will be asked to recommend specific priority Member

Activities/Strategic Initiatives for EMEA as an outcome of their October 2015 meeting

4. Ongoing Funding Strategy• Aim for balance between Dues and Rebates ratios to distribute benefit and burden equitably amongst Members• Consider cap on Member Direct Rebate ROI of 250%

5. Request for approval of Funding Recommendation

9/25/2015 GTDC Confidential 18

Rebate Funds Flow: Current Process vs Proposal

9/25/2015 GTDC Confidential 19

NOTE: For analysis purposes all European rebates are converted to USD. Thus the exchange rate impact on the European rebates stated in USD was very significant between 2014 and 2015 (going from 1.32 to 1.10 average exchange rate).

The NPD Group, Inc. | Proprietary and Confidential

Expansion of NPD Database Through Order #

■ Product Adjacency

– Insights into common brands / categories purchased together

– Insights into solutions and how thosecompare against the channel

■ Product Collaboration

– Ability to see ecosystems forming aroundproduct categories

– Example Chromebooks and Carts

■ Productize the Solution

– Connecting unconnected products to create new vendor solutions

– Creates stronger vendor programs and partnerships

■ Market Demands Beyond Existing NPD Share and Revenue Reports

– Key vendors searching for deeper knowledge of solutions sales

– New revenue opportunities for NPD allows GTDC member rebates to grow

20

1.00

1.451.56

0.00

1.00

2.00

Un

its

HP PC

Other HP Product

Other MFG Product

For every HP PC sold 1 – 2 additional HP

products are attached to the same order

Yes, they are already

38%

Yes, but we haven't experienced much

there yet…

Maybe, but not sure what they're really offering to support

cloud business …

No, their services are not meaningful to my

company's cloud services…

Not sure2%

“Belief” that disti’s can add cloud value, but haven’t yet engaged

Perception and visibility issue; gap between legacy solution providers and those built-on-the-cloud

Q: Do you believe traditional IT distributors are capable of adding meaningful value to your business as cloud aggregators or master cloud service providers?

Distribution’s Opportunity in the Digital Era

Denise Sangster, President & CEOdenise@globaltouch.com

September 9, 2015