Most MSPs have chosen not to become involved in the UCaaS market, something Pax8 is trying to change, in the belief that their ecosystem can provide MSPs with more visibility than they have had from working directly with these vendors.
Nick Heddy, Pax8’s Chief Revenue Officer
Cloud distributor Pax8 has established a new relationship with Unified Communications as a Service [UCaaS] provider RingCentral, and have joined RingCentral’s channel partner program. The relationship will see Pax8 offer RingCentral’s flagship RingCentral Office solution, which includes message, video and phone, along with RingCentral Cloud PBX for Microsoft Teams to its MSP partners.
Pax8 has been adding relationships with cloud service providers to make available new capabilities around networking communications for their MSPs, which are only lightly penetrated into the UCaaS space. As of late 2019, only about 10% of the Pax8 partner community was participating in networking communications. The vendors in this space were also sensitive to a lack of MSP interest, stemming from a dislike of the Master-Agent business model common in the industry.
“MSPs have been resistant because they like to hold support of billing and the customer as a whole,” said Nick Heddy, Pax8’s Chief Revenue Officer. “90% of our MSPs were not involved in this market at all. The 10% who were there were getting commission from the Masters, with very little visibility into the process.”
In June, however, RingCentral launched their new IGNITE! channel program – a subset of their broader channel program. IGNITE! is aimed at the SMB space, and adds an important new distinction, giving the partner full control over the sales process.
“We got our agreement done with RingCentral and the plan is to take their IGNITE! and its focus on automation, and give MSPs that visibility in this business that they have not had in the past,” Heddy said. “We are looking to shift that old mindset with our ecosystem.”
This process is one element of a collaborative engagement Pax8 commenced with RingCentral and other UCaaS vendors to find a model that would bring these vendors together with MSPs, through Pax8.
Andrew Pryfogle, Chief Market Development Officer at Pax8
“In the last 22 years, I’ve done a lot of UCaaS and have developed a lot of relationships with senior people in it,” said Andrew Pryfogle, Chief Market Development Officer at Pax8. “I’ve had relationships with senior RingCentral people for quite some time. Beginning last August, they were part of a supplier council, essentially an advisory board, we put together. We brought in a dozen leading vendors in to talk about how they could break into the MSP market, which is something that these vendors had not been successful at. We knew if we did this right, it would be found money. That’s why we have been rolling out relationships like RingCentral.”
RingCentral’s strong relationship with Microsoft is a major plus from Pax8’s perspective. Aside from RingCentral’s support for Microsoft Teams, RingCentral hired longtime Microsoft channel veteran Phil Sorgen as their Chief Revenue Officer in May.
“RingCentral went out and got Phil Sorgen, the old Microsoft channel chief, to be their CRO, which was a really good move,” Heddy said. “RingCentral effectively supports Teams, which has 75 million daily active users and is growing very fast. Their recent program around automation coincides with what we do around automation, and is a good inflection point. Their strong focus on both integrating into the Microsoft platform, and on automation, will enable partners to help build a product set that they had not sold in the past.”
Pryfogle emphasized the importance of the Microsoft relationship today, and how Pax8 is able to create synergies with UCaaS vendors around it.
“Microsoft is the most disruptive thing to happen to the UCaaS channel that I’ve seen in the last decade – outside of COVID,” he said. “Every single UCaaS provider is talking about their Microsoft strategy. They are not talking about how to beat Microsoft, but how to work with Microsoft. I don’t think anybody is better equipped to deal with that than Pax8.”
Pryfogle also stressed that RingCentral has a degree of brand equity in the market that can help MSPs who are new to the space.
“RingCentral has done a really good job adding collaboration and chat and video and different things into their platform, but what is really important to the channel is that they have built a fantastic brand,” he said. “They are the closest thing that there is to a household name in the UCaaS space. A partner can leverage that brand. Five years ago, the channel for RingCentral was 20% of their sales and today its nearly 70%. That involved a big investment of resources.”
