Zenith RMM CEO: We're Looking At Alternatives To Infotech

Zenith RMM, the remote monitoring and management company recently launched as a separate spinoff from Zenith Infotech, is reaching out to partners and planning to provide alternative solutions to MSPs concerned about Zenith Infotech defaulting on bonds, says Michael George, CEO of Zenith RMM.

With many partners concerned and frustrated about the future of Zenith Infotech and Zenith RMM, George spoke with CRN's Scott Campbell to provide some insight. The following are excerpts from the conversation:

What message would you like to give to MSPs concerned and confused about the default issue swirling around Zenith?

I'll share all we know and all we can with the community. We are two separate companies so there are things we know and things we don't know. They are a partner of ours and they are embroiled in a default situation. It's one that there's a fair amount of sensitivity around. I'm happy to share whatever facts I can around how the partner base will and won't be impacted. As it relates to RMM, our business and customers and partners will be completely unaffected by anything that may transpire with InfoTech. That's completely separate.

Our concern and our focus is on the partners, MSP partners, that we share in common, those being Infotech's BDR [Business and Data Recovery] and MirrorCloud products that we also provide RMM for. That's really the constituent that we are maniacally focused on so that their businesses will go uninterrupted, regardless of what might transpire. We're in contact with a lot of them. For those that haven't been in touch with us because they haven't called in, please contact their account managers and we'll be happy to share with them more about what they should anticipate from us.

We have already stated on this matter that we will ensure a safe and smooth transition of BDR and cloud support and services, should some of them make the decision to seek alternative solutions. We are going to be announcing an alternative for them so they have the safety and security of business continuity.

So you will offer an alternative cloud solution to Zenith Infotech? When do you expect to make an announcement about that?

That which I just shared is in and of itself an announcement but I'm sure it's not completely clarifying. We've been working fast and furiously on a very meaningful, significant offering that is one that our partners will be familiar with and comfortable with once we announce it. We're trying to close gap between when we announce it and when we will make it available. We're talking about days and weeks, not weeks and months.

I've talked to several partners who are concerned about Zenith RMM too because Zenith Infotech is a shareholder in Zenith RMM, which could still impact RMM. Is Infotech a majority or minority shareholder?

Summit [Partners, the equity firm behind Zenith RMM] is the large majority shareholder. Infotech is the small minority shareholder. The answer to the question is no, there will be no impact whatsoever. They are a minority voice and minority shareholder.

Next: Supporting Partners Through Challenges

How many partners use both Zenith RMM and Zenith Infotech solutions and can you add any more details in terms of how they will deal with both companies going forward?

We support about 1,000 of their MSP partners. That's why this is an absolute top priority to get this resolved for those partners. They have our interests and we have their interests at heart here. That's why we are focused on making sure their products and services be uninterrupted with Infotech.

When the Zenith RMM operations were sold to Summit and spun off, did you have any indication that Zenith Infotech was having financial difficulties?

As you can appreciate as they are embroiled in legal battle, there's a level of detail I'm not at liberty to share. What I am able to share with you is we surveyed the entire customer base and we did an extensive amount of due diligence on the managed services business inside Infotech. We were well aware of many of the challenges that they were having with their SmartStyle and MirrorCloud products. That was not news to us in any way. As a result of that, we began a process that will result in the announcement in days or weeks that will resolve those issues to any of those partners.

The fact that they were having some challenges with those products in the marketplace was not news to us. We began even prior to the close of the acquisition, we began an effort to ensure our customers, our partners in common would have a suitable and viable alternative that minimizes if not eliminated any challenges associated with a transition of any sort.

Do you believe that Zenith sold off the RMM business because they were having financial issues?

I don't know the answer to that. It's a fair question, but one to ask of them. It's not entirely clear what the intent was. I can tell you we were very conscious and deliberate in what we acquired from the company. We felt very strongly that [RMM] was the core value proposition in the managed services offering. We felt very comfortable understanding the level of commitment needed to capitalize on the core assets the company has.

As was stated at the time of acquisition, Infotech was not properly configured to capitalize on both initiatives concurrently. They had the cloud and BDR and managed services. Both were doing well, but it was very difficult for them to try and see both of those lines of businesses out.

We saw this as a terrific opportunity and a rock solid core MSP community to work with. We surveyed our entire customer base to listen and learn from them what were their issues and where they would like to see major investments from us. We have prioritized our investments and roadmap initiatives in products and services around the results of that survey.

Next: Rebranding Initiatives?

In hindsight now, would you have done anything differently in terms of the acquisition, such as not using the Zenith name, to avoid confusion in the marketplace?

We always had our eyes on rebranding initiatives that will be coming soon. But it was too challenging to try to do as part of the transaction. The reason we kept Zenith in our name was that it is a pretty significant initiative to do it properly. We want it to be a rebranding effort aligned with our strategy going forward. We want to be closer to the partner community to better understand their priorities and strategies to align our mission with theirs. That takes time and we couldn't do it prior to the acquisition. You'll see some of that coming.

Has it been frustrating to have to be on the phone these days talking to the media and talking to partners to try to explain what Zenith RMM's relationship with Zenith Infotech is?

It is frustrating. In some ways you'd like the first point of engagement with the community to be positive. This unfortunately has been shadowed by negative news. However that news can be seen as a catalyst to engage with the media and with partners. We stated at the time of the acquisition, one of most critical initiatives with the company was to engage. We've moved our headquarters to the U.S. We wanted to be closer to the partners and community we serve.

I don't find it a begrudging exercise to be on the phone with partners. I’m spending lot of time doing it and and will continue to do that. Again, we wish it was under a more positive set of circumstances, but nonetheless we need to be smart together: we as an important provider, they as an important constituent for us.

Do you envision having to terminate the partnership or relationship with Zenith Infotech as a result of their debt issue?

Infotech has an opportunity. They're not the first company to be in default with bond holders. We don't act on their behalf or speak on their behalf, but our hope is that they go and rectify their default situation and be in good standing with us as a partner. At the moment, that's what they're declared to us and we're confident they are making every effort to do that.

As long as they get themselves in good standing in short order, they will be a good standing partner with us and we'll deal with them accordingly. That's the current path and where our energies are being spent.

Thank you. Any final comments that you'd like to share with Zenith partners?

We're hearing from lot of partners, I'm on the phone with a lot of them, given that the managed services piece is the core of their business and the BDR and cloud initiatives are newer and so they're not as deeply penetrated into their base.

So this is for the partners we have in common: While people are concerned about the future, we don't have partners panicking about the present, which is good. We don't want them to make short term, bad, reactionary decisions. We are stepping up and making sure they have very viable options for them should they make a decision to make an alternative move.