RingCentral Channel Chief On Challenging Cisco, Avaya, And Why UCaaS Is 'The Product Of The Century'

Getting After It

Zane Long, senior vice president of global channel sales at RingCentral, has been at the helm for three years now, and the UCaaS specialist is growing recurring channel revenue by leaps and bounds.

That's because RingCentral has made it a priority to stay on the cutting edge of cloud-based communications. The Belmont, Calif.-based company this month announced a partnership with Ericsson to improve provision of its voice services over cellular networks. At the same time, it also just revealed RingCentral Persist, a new offering that lets users maintain communications services in case of an internet failure, and expanded its Open platform RingCentral Embeddable and an extended API library, which lets users easily embed communications into their applications.

Long described RingCentral's channel success, and talked about how it's taking on the competition, both the longtime UC market leaders, like Cisco and Avaya, and its fellow competitors in the cloud, such as 8x8 and Vonage. Here are excerpts from Long's conversation with CRN.

How is RingCentral's channel program unique compared to channel programs you've helped to build in the past?

Our go-to-market with our channel is very unique. In fact, I'd say it’s unique enough that no one else is doing it like this, which is a pretty bold statement. We call it channel harmony. It's simple, but it's difficult to mimic or copy unless you've been perfecting it like we have over three years. It's very simple. The obligation we have of our partners is to bring us one of their customers, make an intro, and then we take our direct sales reps and we basically ring the bell for the cavalry and surround that customer with an education on UCaaS. Partners can participate on all calls, some, or no calls -- whatever they want -- and we can execute on that customer on behalf of the partner. We let the partner go do what they do best while we do what we do best. It's very rare you see that level of depth of collaboration. What makes it channel harmony is that everyone is compensated at 100 percent, so no one loses any compensation, which creates a lot of harmony and no conflict with our direct sales reps who are all here to execute on customers that partners have introduced us to. I've never been able to build a program like this before.

Since you've joined RingCentral three years ago, how much has channel business grown?

In terms of revenue generation, the channel program has reached over $180 million in annual recurring revenue -- this is an 80 percent year-over-year growth.

What we are seeing is customers are making these transitions from on-premise solutions to the cloud. I like to call our channel partners the trusted advisers to their customers. Customers are saying, 'Introduce me to a UCaaS opportunity.' I've never before seen a product where customers are going to the partner to say; 'bring me to an opportunity,' -- it's always been reverse, with the partners saying to customers; 'You need this opportunity.' We can take any segment or size of customer and we have sales reps that can talk to any customers we have, like an enterprise or SMB, we have that segmentation. The channel contributed a record number of seven-digit total contract value deals for the quarter -- that's a little more than 70 percent of the seven-digit total contract value deals that came by way of partners, which doesn't surprise us because partners have those kinds of valued relationships with customers.

How is RingCentral going after UC market leaders, such as Cisco and Avaya?

We believe, obliviously, that UCaaS is the future and by what we are doing with a pure cloud play, we are proving to the market that we are more than just a contender. We certainly do compete with the Ciscos and the Avayas of the world and we are going to continue to demonstrate we have what customer want.

At the end of the day, it’s the customer that is driving the decision to move to cloud, just like customers drove the decision that a particular company had to file for bankruptcy. If we don’t stay on the cutting edge of technology and invest heavily into our priority software, we too could be left behind, but I can tell you that we aren't doing that. We understand we have to listen to our customers and continue to provide what they desire, and if we don't do that, then it's our fault if we lose.

How is RingCentral competing against fellow cloud UC players, like 8x8 and Vonage?

We win more than our fair share and I think that quite frankly, we are diminishing those particular cloud players because we are more interested in Cisco and Avaya. We believe that's where the true competition is now and into the future and we are going to continue to focus on making sure we have a product, a channel partner program, and the right kind of partners that will give us the greatest opportunity for success. Customers are telling us that we do, our partners are telling us this is the right program, and until we get negative feedback, we won't be making changes. We are going to continue to double down on what we are doing, and we expect growth from that equation.

Is RingCentral gaining more partners as customers transition from premise-based solutions to cloud?

With this kind of transformation, and let's be frank here, with the market at $75 billion for UCaaS with 8 percent penetration, if you're a really small partner, you're going to want to get in on that product. I have a saying that UCaaS isn't the product of the decade, it's the product of the century. When you think about other products out there today and the transformation speed in which customers are moving fast into the cloud, that combination makes sense.

Partners who were maybe prem-based UC partners are seeing their customers saying, 'I've heard about UCaaS and I want to see what it can do, so I want to introduce me to a UCaaS provider.' If that partner can't help them, they'll either go to another partner or a company like RingCentral directly and say; 'I'd like to learn more' and that partner just lost out on those commissions. It's a little pain-gain -- a partner can only withstand so much lose and that's what we've been seeing. They are making that transition from on-premise into the cloud. We are attracting and recruiting lots of those kinds of partners into our program because they don’t want to miss out.