US-based RingCentral has a strong and growing influence in the UK and in March this year partnered with BT to launch BT Cloud Phone. Here, Curtis Peterson, SVP Operations, discusses the company's fast evolving expansion strategy.
Despite the march of technology and the attendant challenges of keeping pace, the biggest hurdle facing RingCentral is realising the market opportunities at hand and raising the company's profile. "With SaaS adoption maturing all the way through to enterprise accounts, building a case for SaaS-based business communications is no longer difficult," said Peterson. "And we are approaching the natural end-of-life for on-premise PBXs. This, combined with mobile workforces and the need for more than just voice, is wind at our back. The challenges are reaching all of the opportunities and telling our story."
RingCentral was founded in 1999 by Vlad Shmunis and Vlad Vendrow in Silicon Valley. Both have a pedigree in engineering and they shared a vision to build a software-based business comms solution. After delivering fax-over-Internet and basic forwarding services, their goal was to create a touch-enabled and touch configurable platform, a quest that came to fruition six years ago when they launched their flagship product, RC Office, which has since been adopted by more than 300,000 businesses in the US, Canada and UK.
The main driver for the company has been an up-market push. "We put a plan together for small businesses based on an e-commerce strategy with simple set-up and configuration," said Peterson. "This has traditionally been a difficult segment to serve as many customers are first time buyers of these types of systems. Our current focus is to continue to serve and grow the smaller business while moving up-market. This is a distribution and branding positioning exercise, and the early results are positive."
RingCentral employs and contracts approximately 1,500 employees in the US, UK, Russia, Ukraine, China and the Philippines. Its latest earnings report showed quarterly revenues of circa $65 million and year-over-year growth of 35 per cent, while improving operating margins. It's target customers trend towards 50-plus seats where the company witnessed Q1 growth of over 100 per cent. Just under 500 of RingCentral's employees are in engineering, QA and DevOPs roles. The company develops, certifies and deploys its own software-based systems that run on commodity hardware, and has over 100 patents issued or pending for its Intellectual Property.
Its target markets remain the UK, US, and CA with a focus on growing its up-market presence in all regions. "We are also targeting the international branch offices of companies that are headquartered in our key territories, serving over 29 additional countries with local telephone number presence," added Peterson. "Our partnerships with carriers have also been delivering growth."
VARs represent a significant portion of RingCentral's business. While they have traditionally profited from CPE, the new VAR model is solution-based. "By distributing RingCentral in their product portfolios they are able to meet the needs of a business that is mobile and works from multiple places," added Peterson. "We update our software every eight to ten weeks without service interruption. This allows VARs to profit from areas such as WAN, ISP, LAN, and specifically Wi-Fi. With IoT and multimedia communications coming to the Wi-Fi office, talented VARs who know how to engineer, build, configure and maintain these systems will be critical."
Peterson's interest in technology reaches back in time further than his memory. He does recall having a PC when they were rare, coding at the age of 12 and taking computers apart and reassembling them to see how they work on the inside. His relationship with communications was borne more out of necessity than curiosity. "I always liked the personal side of communications," he said. "We lived a long way from my grandparents and the ability to ring them seemed the kind of technology that could change lives."
Peterson was at that time ten years old and living in France, making regular trips to the post office where he could make satellite calls to his family. So it's not surprising that communications became an integral part of his life from an early age. Fast forward a few years and Peterson set about sharpening his technical skills in Computer Engineering at Auburn University and embarked on careers in research, development and code writing. "I moved to building out networks when the age of the Internet arrived," he explained. "But it was never about the bits and bytes to me, it was about technology and communications fundamentally improving lives and personal interaction."
Today, Peterson sees multi-modal communications and complete mobility driving the future of business communication platforms. "Our platform now includes business messaging and HD video meeting and collaboration capabilities," he said. "Our mobile-first approach means these technologies can be used on regular mobile devices. As the younger generation enters the workforce, they typically text three times more than talking, so a business comms platform must accommodate these new workforce behaviours."
Peterson has an uncanny knack for understanding what makes people tick, an attribute that underpins his biggest career achievement - successful people development. "Many of my former employees are either VPs at large companies, own and operate their own business, or at the forefront of their expertise and career," he commented. "Obviously, their hard work and ambitions are not my doing, but I do believe that my influence, vision, and attention to customers and people before technology had a small part to play in their growth."