Please, Your Brand First: TalkingHeadz with Michael Gold of Intermedia
It appears Intermedia is doing quite well. It’s not a particularly well known brand, but that’s by design. Michael Gold, its CEO, gives his partners several options when it comes to go-to-market branding. That’s just one of the features that attracted NEC to select Intermedia to power its UNIVERGE Blue cloud portfolio.
Yes, NEC. One of the largest, most global tech companies in Japan, and a worldwide leader in premises-based PBX systems. NEC selected Intermedia as its strategic supplier to power its cloud-delivered comms and collab services. Costco is another partner, though they use the Intermedia brand.
Soon we will know a lot more about Intermedia as the company just might go public this year.
Dave Michels 0:12
So welcome to the talkingHeadz. Today we’ll be talking with Michael gold the CEO of intermedia. Evan, before we get to the interview, let’s talk a little bit about the New Year. I mean, this is our second episode.
Evan Kirstel 0:24
Is it too late to say Happy New Year? Did we pass the cut off?
Dave Michels 0:28
Oh, we kind of pass it because that was our first episode. This is our second episode. But it’s still January. And we haven’t really talked about things like CES yet. You went to CES. Virtually, didn’t you? Yeah, I
Evan Kirstel 0:39
was there. I had my credit card in hand, I was looking for new gadgets to buy as always, and I came across a few things that I might buy. Let me let me run them by you and see if any of them hit the mark.
Dave Michels 0:52
I have to say I love going to CES as a consumer shopper. But it’s a terrible place to go to as some sort of industry analyst because that’s just the worst, then you have to work. But there is a lot of candy there. What did you find? Well, first and
Evan Kirstel 1:07
foremost, the BMW color changing car
Dave Michels 1:11
guy like a car openers thing I’ve ever seen. I’m a big fan of the E concept. And it has all kinds of you know, it’s not just gray, but all kinds of gray. But putting it on the outside of the car. It’s got to be the dumbest thing I’ve ever seen. This car can turn from white to gray to darker gray. That’s just ridiculous. I’m sorry. No, you got to have that. That’s off the list.
Evan Kirstel 1:34
It’s like your remarkable tablet on wheels. I thought you might like it. Okay, next concept of voice is hot as voice voice activated bathtub by Kohler. So you can control the tub temperature hot and cold stop start all by voice. What do you think
Dave Michels 1:51
that would actually sounds like it has potential The problem is that most of this voice recognition technology just doesn’t work very well. I don’t do very well with Alexa stuff. And the Google Assistant never seems to understand me. So I’m worried about giving my bathtub, some very clear and precise instructions. And having a burn me is scalding hot water. So I would say no, no, no.
Evan Kirstel 2:18
Well, most people don’t really understand your date. But that’s a different story. So
Dave Michels 2:22
our third topic is going to be something here What else you got?
Evan Kirstel 2:25
I have you know, for us a middle aged people. It’s a smart bed that changes temperature, shape, firmness, softness, all based on your preferences and learning your body positions and keeps you comfortable at night. What do you think a smart bed?
Dave Michels 2:43
Well, you know, you got my mind racing here about what makes a beds Mart. I was kind of with it. You had me intrigued. You know, it’s like this could be good because a bed is probably the dumbest thing in the house. And there’s opportunity to low bar opportunity for it to be smart without doing much. But as soon as you said it learns, I don’t know about that. I can see. Get myself getting in an argument with my bed. You know, I kind of want to sleep on my right side. No, at this time of evening, you sleep on your left side. And it’s gonna roll me over. So now No, no, you can’t have this. No, that’s off the table. All
Evan Kirstel 3:22
right, well over three. So very disappointing. But let’s get on with some enterprise technology and maybe shift gears here because this consumer stuff isn’t for you.
Dave Michels 3:31
Very good. Let’s get to Michael.
Talking. It’s a semi monthly podcast with interviews of the top movers and shakers and enterprise communications and collaboration. Your hosts are Dave Michaels and Evan Kersal, both of which offer extraordinary services including research, analysis, and social media marketing. You can find them on Twitter, LinkedIn, or at talking points.com. That’s points with the Z and Devin crystal calm. That’s K IR STL.
Dave Michels 4:01
Today we have with us Michael gold, the CEO of intermedia. And I’m guessing Michael, you don’t have a resume. I was looking over your background. You got into quest through an acquisition which acquired CMT, you got into intermediate when it acquired Lago and you’ve been an intermediate for like 11 years, so you probably don’t even have a resume. Is that accurate? Well, I
Michael Gold 4:22
mean, what is the resume nowadays, I think of a resume is LinkedIn when people send me the resumes I go right to LinkedIn anyway, so it’s pretty, it’s pretty current.
Evan Kirstel 4:34
And logos and interesting brand I hadn’t heard of the logo was at a sandwich shop or what, what is Lago all about?
Michael Gold 4:41
There was a predecessor to intermediate we were like a mini intermediate, and rolled that into intermedia in 2011, providing a suite of cloud products similar to the suite that intermediate has today, targeting mostly bar In MSPs, and providing them with a white label solution, like he does today.
Dave Michels 5:06
Excellent. Before we get to intermedia though this mobile blacklist, you know, you spend some time a quest, as you know, I have a phone booth at my house, I got it from Quest, back when they were getting rid of them. Now they’re kind of wishing they kept them, but just the people like me who want them, I didn’t know how it’s gonna be branded, they told me they had a phone booth, I didn’t know if it was gonna be branded quest or US West or mountain bill, or at&t. Turned out it says Bell System, which I’m really happy about. But I don’t think lumen, which is the current name of that company even has phone booths, but they should definitely have a booth does intermediate have phone, this
Michael Gold 5:41
intermediate does not have phone booths, no car service, which includes a phone services all in the cloud. So most of our customers would have IP phones, or they would literally use their computer or their are their mobile apps on their Android or iPhones to do all their phone calling.
Evan Kirstel 6:03
I’d love that idea of a phone booth from intermediate data that you could actually maybe use crypto to pay for your service, that would be
Dave Michels 6:11
a big virtual coin spot that you opened your virtual coin.
Michael Gold 6:14
Maybe that would be a fun marketing thing to do at trade shows are, you know, at a mall, our customer base are all businesses were focused on providing a suite of cloud communication services to businesses. So I don’t see how a phone booth is relevant. But that’s a fun idea.
Dave Michels 6:31
All right, well, photos are very relevant, that’s a different conversation. Let’s get to intermediate. Let’s get to that part of the podcast here. So it’s a UCAS brand, that isn’t as well known as some other brands. And that’s partly by design, because you either it, didn’t they teach you at Stanford that you’re supposed to market your brand. That’s a very good
Michael Gold 6:53
point. And your point about saying it’s by design. So we do have a brand and customers do buy under the intermediate brand, but the primary way that we go to market, and the lion’s share of our sales come through partners who resell our products, so we provide them with this platform that has a broad suite of cloud communications products, a business phone, video conferencing, Route, chat, file, collaboration, and more. And it allows our partners whether those might be managed service provider, whether it could be a company like NEC, and many others to put their own brand on the product and sell it as their own. So we are marketing to the partners for the most part, who are then marketing their own product suite based on ours to their end customers. We do however, also, as mentioned, sell into the intermediate brand. In fact, if you’re a Costco member, and it’s been a very great way for us to sell to the s of the SMB, Costco has nine or 10 million plus businesses who are members. And we sell an intermediate branded product, you know, our intermediate unite UCaaS solution and others to Costco members. And that, again, is intermediate branded.
Evan Kirstel 8:13
Yeah, I know Dave goes to Costco for the free hotdogs, but I didn’t realize he could
Dave Michels 8:18
not free and when they’re about 50.
Evan Kirstel 8:23
Are there any other brands that might be known to our listeners, besides Costco, or NEC,
Michael Gold 8:29
we have over 7000 partners who sell our products. And most of those partners sell under their own brands. And they include many managed service providers, bars, and other companies. Many of the Managed Print providers use intermediate they’ve expanded from selling copiers and printers and providing managed service around those two expanding into IT services and many of them base their IT service suite on the intermediate product suite, again, selling it under their brand. And the beauty of that is they maintain the customer relationship. They’re not simply being sales agents to another company and you know, living off of the Commission’s but they provide a suite of services, of which the products that are immediate provide are part of those services. And they are the top line revenue. They’re the face to the customer. They provide the support and the providing the full solution for their set of customers.
Dave Michels 9:27
So I want to dive in a little bit on this NEC partnership you have when that was announced that was a really big deal. I mean, NEC is a big company, big global company. And it was also kind of unusual. I mean, every other major PBX vendor that has signed up with the UK as partnership has elected RingCentral In fact, I’ve heard at RingCentral they refer to NEC as the one that got away. So how’s that partnership going and what can you tell us about it?
Michael Gold 9:57
It’s going really well and it’s one word very, very proud of. And you’re right RingCentral started down the path with Avaya, and forming a partnership with Avaya, where Avaya knowing you know struggling with UCaaS product knew that they needed to have something modern, reliable, scalable for their customers who weren’t satisfied with the cloud solution offerings that they were getting from Abidan. So they formed a partnership with RingCentral. I think it’s been a reasonable partnership for both parties. Shortly after that intermedia, formed a partnership with NEC and NEC was, you know, not the exact same company is Avaya. NEC is one of the largest companies in the world. It’s a major company headquartered out of Japan, and one of the original providers of traditional business phone systems. And so that said, they weren’t satisfied with what they had as an offering for UCaaS and CCAFs. And so they, they were looking for a partner. And so they selected intermedia one because we had a full product suite, proprietary product suite that you know, checked all the boxes in terms of having business phone, chat, video conferencing, mobile apps, desktop, App Security, cloud collaboration, all on one common platform. Furthermore, intermediate is the leader in providing such a platform in a manner that allows a partner to private labeling. And it’s more than just a business model. It’s how the platform is built. And the ability for our partners to do the management functionality as if this platform is their own. And NEC also has their primary go to market selling through partners. And so they also wanted to enable their partners to resell a product from NEC. So we have the perfect platform for that. As a Japanese company all companies want reliability and high quality as a Japanese company, they are their bars even higher than most intermediate one, the JD Power award six years in a row, I believe we’re the only SAS company who can claim that and so you know, that also checked in important box for NEC our NPS scores are, you know, at a world class level, our churn is revenue retention, is very high churn is very low. Those were also important considerations for NEC. So we formed the partnership. And now we initially launched in 2020, in the US, and then we expanded to Canada, to AMEA, in Asia Pacific. And so now we’ve deployed globally with NEC, it’s in the market under the NEC brand, they have signed up to partners that represent the lion’s share of their business, who are now unable to sell this product suite. It’s called NEC universal blue. And that, you know, been growing at a very strong rate as we expand on a global basis.
Dave Michels 13:03
And they’re not secretive about intermediate, a lot of companies or private label stuff, we just said univerge, blue, they don’t want people to know that there’s not their own tech, but they’re pretty open about it being intermediate.
Michael Gold 13:15
That’s right. I mean, the product is branded as NEC, but their partners know that intermediate is involved in we are actively helping them in the sales in the support to their partners in through their partners to their end customers. We work is almost one organization. In fact, the former head of any CS UC business, Akoto omy, he reached our retirement age within NEC they have a certain age where you’re required to retire. And so He then joined intermedia. And we recruited him to be the president of intermediate Japan.
Evan Kirstel 13:52
Dave is completely passed his mandatory retirement.
Dave Michels 13:55
That’s my useful buy data.
Michael Gold 13:58
And by the way, Makoto is a young, vibrant guy, he still runs marathons. So you meet him and you look at him and you see his energy and like this, like you say, really, he’s already retiring. He’s been a fantastic addition to our team, also very helpful as we expand in the Asia Pacific region. In fact, any C’s largest market is Japan, they’re the bike dominant provider. In Japan.
Evan Kirstel 14:23
They’re also in almost every country around the world. I assume that means you’re going global as well, as you guys provider, supporting every country and beyond just Japan, US Canada, Europe, you mentioned. Yeah, you’re right.
Michael Gold 14:37
There’s roughly 80 million NEC seats on a global basis. And I believe there’s like 430 million business telephony seats globally. So 80 million of the 430 or any C’s, they’re the market share leader globally to the SMB space, and they’re number two or three globally across all this segments.
Dave Michels 15:01
Now the partnership must be going pretty well, because NEC recently indicated that it wants to invest in intermediate. Now, you mentioned that the via RingCentral is going to the first of the RingCentral deals. But when they announced their partnership RingCentral invested in Avaya. So this is the opposite, right? This is the investing in intermediate, it’s completely the opposite direction, can you shed some light on what’s going on there? Again, this is
Michael Gold 15:29
a partnership, both parties benefit from it. Our initial deal that we signed in 2020, was a five year term. And there were some marketing support, limited level that intermediate provided to NEC. But for the most part, what we’re providing is our product suite, our operational expertise, and providing this offering that NEC is now reselling, and then NEC brings to the table, their 80 million seats, there are 1000s of partners, their international reach in their terrific brand. And so we kind of went into the market and started integrating our systems launching into different geographies. And we got to a point where, okay, they’re very happy. We’re very happy with how things are going. So we expanded the term of the relationship from five years to 10 years. And at the same time that we announced that, as you pointed out, the NEC agreed to put money into our planned IPO. They’ve made a commitment to invest $40 million into the IPO.
Evan Kirstel 16:32
Oh, fantastic. Well, speaking of the IPO and that investment, I read something about the IPO being on hold indefinitely. Is that the case? And if so when can we expect it?
Michael Gold 16:43
Well, I can’t comment on when it will happen. I mean, the markets Oh,
Dave Michels 16:47
come on, just tell us.
Michael Gold 16:49
Seriously, though, we are on file, and the markets need to be constructive for tech IPOs. As you may know, 2021 was a rough year, for IPOs. The over, you know, if you if you looked at all IPOs that were on 2021, they are trading down, you know, and I think that’s mostly as a result of just very high valuations at a certain point of the year. And so things are more normalized now. And so as the market is constructive for IPOs, that will be the time that we would expect to go out. But I don’t know when that will be. But we’re ready to go whenever the market is ready.
Dave Michels 17:28
So another Talking Heads exclusive. You heard it here live. Michael gold just confirmed that the IPO will happen at some point. When the market is ready. You got to be careful that premature IPO thing it could really ruin everything. So in other news last year, you announced a new sneakers. Really original Michael, use the and CZ company. No one ever thought of that before. But what seriously? Was this new CZ based on your Tilex acquisition?
Michael Gold 17:56
Yes. So we acquired a company a few years back called telex based out of Toronto, terrific enterprise grade Contact Center as a service solution. Once we bought the company we integrated into our platform, we’ve since integrated into our unified communications as a service product as well, we improve the UI improve the service quality, and we’re now in the market with this integrated solution. And you know, in many cases, it’s not even sold to traditional contact center, contact center customer base, because by combining these together, we’re finding new ways of enabling contact center within a business. So it’s been a good acquisition for us. And it’s a fast growing product for us.
Evan Kirstel 18:46
It’s still it’s still around as a brand, or is that unite?
Michael Gold 18:49
No, it depends on because it’s mostly sold through partners. They sell it on their various brands, for example, NEC has their own brand, various partners have their
Evan Kirstel 18:59
own end customers can buy CC or U C or both, or either is that right?
Michael Gold 19:06
That’s correct. You don’t have to buy it as a combined UC CC solutions. You can buy one or the other or both.
Dave Michels 19:11
Now the contest interspace, of course, is the very very competitive, what’s your angle of attack, there will table stakes or
Michael Gold 19:21
having a full featured Seacat spot which we have, but as to most of the other companies in the market, having quality reliability support. Also table stakes, we have it as do many of the competitors. One of the areas where we are a leader is in the whole private label aspect. And another is being one provider that can provide both UCaaS in CPS on a common platform integrated together. And so those are a few of the ways that we would differentiate.
Dave Michels 19:56
What do you mean integrated together? It was an acquisition that’s gonna be a completely separate application.
Michael Gold 20:03
You’re right, when we did buy the company, it was completely separate. And so when we first bought the company and, and then rebranded the product, we worked and we were quickly able to improve the UI, we were quickly able to improve other aspects of the product, but it wasn’t integrated out of the gate. So that took some time to get them integrated into one common platform. But now it is. And so it is, you know, one common product, one common platform.
Evan Kirstel 20:29
That’s great. Very cool. So you have you guys you have seek as other products, I think email share drive. I mean, you have quite a portfolio. And I’m working through my enterprise coms bingo card. So wondering what else is under the hood? Yeah, API’s maybe seapass? Video, what else you go
Michael Gold 20:47
on? You’re doing well. Just rally them off? And the answer is yes to all see, pass is one where we have elements of it, but we’re not I wouldn’t call us a C fats provider. But yes, business phone system, mobile apps, desktop apps, video conferencing, group chat, file collaboration, File Backup, email security, archiving. These are, you know, the lion’s share of the products that we offer? Well, again, one common platform, when you look across the UCaaS and Seacat space, I think you’d be challenged to find a provider that’s going to have as comprehensive of a platform is us. I mean, when you look at the Microsoft’s and Google’s Yes, they’ve done a good job of providing, certainly, I mean, to the biggest companies on the planet, done a great job of providing a broad suite of products, but not necessarily is complete on the uksc care
Dave Michels 21:46
side. I love that you so email and share drive. But it’s like what I mean, nobody does that in the UK airspace. So this is an historically because I’m the designated historian of the UK as industry. Historically, it’s always been, you know, we, we complement, Microsoft and Google, and we give you the comms component, and you don’t compete. And of course, meanwhile, Microsoft and Google now offers telephony. And I don’t think anyone else has figured out hey, maybe we should sell email and share drive. So let me ask you, Is it tough to sell email? And this does email company? Does it draw customers? Does it ever drag UCAS or is it always the other way around? Or what’s life? It’s an email provider?
Michael Gold 22:27
Great question. In fact, the history of our company, when I came into the business in the beginning of 2011, had you gone to the intermediate website, it would have said, intermediate, the most trusted name and hosted Exchange, and there’d be a price for getting a hosted email exchange box. And that was the business primarily, we had a small web hosting business. And so what we’ve done over the last 11 years, is we’ve expanded the product suite, to the products that Evan, you did a great job of rattling off, we also focused on changing the go to market from primarily direct to business to primarily through partners to get to the businesses. And so that’s how we built the expanded business over the last 11 years, we now have, you know, an excess of 125,000 business customers.
Dave Michels 23:18
And when you say I just want to clarify, when you say a little bit yours, you’re talking about your personal experience that intermediate 11 years, there’s not very many CEOs in this space that have been in that job for 11 years.
Michael Gold 23:29
That’s right, it’s been a transition, I’m bringing them out because you brought up the whole email that was really our legacy. And so now what we’ve done is approximately 70% of our partners that we sell UCAS with also use us for the what we call business card applications, which includes email, and archiving and security and the light. And so yes, it is complimentary.
Dave Michels 23:59
You feel all these resellers partners that are like in totally different industries, really hidden data backup recovery, you go to a typical UCAS partner event, they’re all pretty similar types of companies that are there, you’ve got a pretty diverse range of partners, right? Imagine.
Michael Gold 24:15
Right? So traditionally, this whole partner world you had the partners who were focused on selling, reselling long distance, or networking and phone systems, and then you had those who are doing more data services, which would include email backup, and other data oriented applications. But now, you cast kind of crosses over into both, but I think we’ve done a very good job at is taking those types of partners that traditionally weren’t going out selling business phone systems, and providing them through our UCaaS offering with the ability to be more of a one stop shop for their customers. So if they’re already providing I’ll just use the example of of email or file server to a customer, they move those to the cloud with us, while they’re that same business, of course, had a business phone system, and they probably had a different partner that they used for that, well, now they can have it all with the same partner in an integrated platform on one solution. And as a partner, they don’t have to just be a sales agent now and get a commission for that business phone system, they can actually get the full revenue for the business provide a one stop shop and better support and more value to the customer. The customer benefits from that as well, because they got one firm now to deal with one firm
Dave Michels 25:39
one brand, because they get to rename their brand to be their, whatever they want it to be, as you expand globally, his voice, the hard one, do all your different services like I mean, you do security services, to all your services export pretty easily, or his voice, just a hard one, you have to kind of regulate were subject to regulation. I mean,
Michael Gold 25:58
the email was already global, and other business card applications we’ve been providing on a global basis for many, many years. But you’re right, when you get into UCaaS, you are now dealing with regulatory issues, the way you know, calling plans are handled in different countries, it’s different sometimes in each and every country. And so the taxation is different. And the rules around that are different. And so there’s so many things that you have to plan for developed for as you go into each market. And so we’ve done that. And that’s what we’ve been doing in partnership with NEC as we’ve expanded into EMEA, and Asia Pacific regions.
Evan Kirstel 26:41
So in summary, you just talk about go to market, and what makes you unique, you go direct, you work through agents, distributors, you go private label, and anything else I missed any other ways to, to sell and market.
Michael Gold 26:55
That’s right, we go direct to the do reseller model. And then we also have an agent model, we call it an advisor model, but it’s an agent model.
Dave Michels 27:03
And all of those ways are available to them. And he’s the dealer.
Michael Gold 27:08
So NEC is a think of them as a private label partner of intermediate, but then NEC then has their own plan. So NEC sells direct. NEC offers a reseller plan to their partners, and then they also offer an agent model to
Evan Kirstel 27:24
their partners. So that’s a big difference from RingCentral. As far as I know, who just offer an agent model or something that’s co branded RingCentral. What’s more important, do you think for partners portfolio side or the branding side?
Michael Gold 27:39
Yes, branding is important, but what’s what I think is even more important is owning the customer relationship. And so what the reseller model provides, whether you’re selling it as a partner under your own brand, or whether it’s just, you are now getting the top line revenue, you are now the face to the customer, you are now handling, as opposed to an agent model where you bring a lead, and then the vendor, whether it’s you know, RingCentral, or a bi eight, or whomever is now billing the customer, supporting the customer and taking over that customer relationship. So in some cases, the partners prefer that because they don’t want to do more than that. But in many cases, we know for sure, and we see it in every day in the sales in the partnerships that we’re developing, the partner wants to own the customer relationship, they want to provide additional value in traditionally when they were selling phone systems, oftentimes, you know, that’s what they were doing their business model was reselling a phone system from Avaya, or our might tell or NEC as the case may be. And I am providing ongoing service, maintenance and support to my customers. And I’m billing them every month. They in that case, those partners like that business model. And so we’re offering them something that’s relatively similar to that as they move to the cloud, as opposed to model where, okay, now I’m going to move the customer to call it one of the intermediate competitors, and I’m just going to get up commission. And so some are fine with that. But we know for sure that many are not.
Dave Michels 29:23
Well, I want to push you on that a little more because you’re complaining, having your own brand with only the customer but there’s a line there may be a thin line, but you can own the customer and was somebody else’s brand. I mean, then it does happen. Let me ask you, when does it make sense for a bar to have their own brand versus another brand?
Michael Gold 29:45
Yeah, I want to clarify, I get your point and I agree with it, but not all of our resellers are selling under their own brand. So my point is more important than the brand is the reseller relationship and actually being the face of the customer. So, for example, NEC it’s important for NEC as a partner of intermediate to have their own brand. And you know, we prefer it. They’re a global brand that’s been around for over 100 years with a very large installed base. So for them, it’s very important for their partners who are selling as resellers of any Si, they don’t need to sell under their brand. They’re selling the NEC branded product, but they have a reseller relationship with NEC. That’s an example of where the reseller relationships important. The brand. For the NEC partners less important but the ran for NEC is quite important.
Dave Michels 30:41
When you’re a sales guy, would you rather sell Evan Kirstel’s UC service? Or would you rather sell Microsoft Teams like everybody else?
Evan Kirstel 30:49
Well, I have my own crypto, so why not have my own service back to the phone booth?
Dave Michels 30:54
Back to the coin booth? Yes, right.
Evan Kirstel 30:56
Yeah, exactly. But you know, one question I do have is how do you empower those partners to be successful in selling and marketing UCAS it’s a very competitive market, there’s a lot of meat to ism out there. It’s a complex sale, it’s not as easy as selling, you know, printer, a cat, how do you get them on boarded and successful so that you know, you can be successful?
Michael Gold 31:19
Great question. So we have a lot of infrastructure behind it. We have intermediate University,
Evan Kirstel 31:24
Dave, did you graduate from?
Michael Gold 31:29
From intermediate universities,
Evan Kirstel 31:30
what we do now we have a lot of educational
Michael Gold 31:32
content to train the support sales engineer and sales people on the product we have, you know, that’s also supported by weekly webinars, we have marketing materials that the partners can for those private label partners that they can very rapidly repurpose as their corporate identity. And you know, have a full set of content, whether it’s for email or social media campaigns, whether it’s for their website for their presentations, and more, we have a portal for allowing them to take orders to provision services, we’ve got tools to help them with onboarding, we handle the regulatory taxation and billing issues in a manner that makes it easy for them. We provide support to the partners, the partners provide support to their end customers, except in an agent model than we would be providing support to our partners customers. And so we put all that together, and a lot more to help them with selling. And there’s certainly a large team of people behind that, who work with the partners, as they ramp up and you know, expand their sales and marketing efforts.
Dave Michels 32:48
We got to wrap up, we’ve got just a few questions left for you. We talked a lot about the differences of intermediate, but we missed one, they probably missed federal but we missed one of them thinking of which is the bridge product, which I mean historically, in the UK airspace. It’s always been prem or cloud. It’s not it’s, it’s one or the other. And you mentioned that NEC has this huge installed base of the capital S and the SMB from base solutions. And apparently, you’ve come up with a prem and cloud solution. Can you talk a little bit about that with the bridge product. I mentioned a
Michael Gold 33:26
number of approximately 430 million business telephony seats globally. Of those only 20 million are getting their services from a UCaaS provider. So if you add up the ring Central’s the API aids advantages, the intermedius and others, its totals about 20 million seats. So we are still in the very early inning of deploying to move those 430 million seats to the cloud. Many businesses are not ready to just port their numbers to another provider. And so what we’ve developed in partnership with NEC is this bridge product, which allows a customer to keep their on prem system. And that’s their main platform for their PBX or business phone system, and then gain all of the UCaaS functionality through the bridge product. So what we’ve done is we’ve added the mobile apps and the desktop app, so call can come in. And you can either answer it on your traditional desk phone that’s part of your on prem PBX, or you can answer it on your mobile app or your desktop app. You can do extension calling from one or the other to the other. But you also gain on that mobile app and desktop app, you gain the chat functionality, you gain the video conferencing, you gain the integrated contact list. You gain the file sharing and file backup and more. And so it allows to repeat it allows the customer not worried about porting off of a system That’s working fine for them. But they still want these other UCAS features,
Dave Michels 35:04
that’s great. That global or is that just a pin
Michael Gold 35:08
that is being rolled out globally. But I want to highlight Japan in particular, because in Japan, the regulatory situation is such that porting numbers is not so easy. For example, in the US, if you are with a certain provider with your on prem system, and now you want to move to a cloud provider, porting your number from one provider to the other is quite easy, the current owner of that number has to help facilitate that move. And they’ve got to do it in a reasonably short period of time. In Japan, it doesn’t work that way. And so whoever has your number is going to have it. And it’s a few years out before the regulations change to require it. So even if you wanted to move to UCaaS solution in Japan, you may be stuck having to get a new number, which is a pain and people aren’t going to do that. And so for that market, in particular, you know, the bridge product is wonderful, because it allows them to gain you cash right away without having to deal with that.
Evan Kirstel 36:11
Fantastic. Plus, I like the idea of telling a customer I have a bridge to sell you. On Yeah. But I guess in closing, I’d love to chat about the industry a little bit. I mean, the two tier distribution model at Telecom has been kind of dying for some time, largely driven by the cloud and companies like yourself, customers, how do you calculate profitability of these models and margin, as we used to call it in one or two tier distribution and are the margins there for customers to really make money?
Michael Gold 36:45
Sure, so the partners are getting from intermedia or NEC as the case may be, when they’re on the reseller model, they’re getting it at a price point that allows them to through the value that they’re adding allows them to have reasonably good margins under the reseller model. In fact, they make five times more revenue than they would under an agent model. Because in the agent model, they’re getting about 20% Commission, right? Whereas in the reseller model, they’re getting the top line revenue. So that’s roughly five times more than under an agent model. And you know, over five year period, the profits are for the average partner because of course, they can set their own price, but for the average partner, they’re making about 2x the profit, it’s better from a revenue perspective, and it’s better from a margin perspective for the partner.
Evan Kirstel 37:33
Excellent. Well, that was quite a tour de force discussion. On intermediate you guys are really one of the best kept secrets of the industry. What do you think?
Michael Gold 37:42
Thanks for helping to share the secrets with your audience. really grateful that you gave me this platform to share the story and really liked the questions in the discussion.
Evan Kirstel 37:53
Great. Well, I look forward to what you get out there to the listeners. Thanks so much. Thank you. Thank you Wow, it was a great conversation with Michael from intermediate really a company that’s kind of the best kept secret in the UCAS space and beyond. And we get the best
Dave Michels 38:10
best kept secret by design that’s that’s the most interesting part. They actually want you to bury their name and use some other name on their product. I think that’s a brilliant strategy. Yeah, we
Evan Kirstel 38:20
get the best guest on talking heads I mean CEOs CMOS CX says I’m impressed with us if I if I do say so myself. Are Talking
Dave Michels 38:28
Heads podcast has the most interesting people in the industry. Plus we have some really good
Evan Kirstel 38:34
guests. On that note, I’ll talk to you next time.
Thank you the phone if your phone no man knows me
Transcribed by https://otter.ai