Viirtue, MSP Partners Seek Larger Piece of IT Pie
Viirtue is expanding its quote-to-cash marketplace into cybersecurity and is inching closer to a partnership with Zoom.
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Viirtue emerged in 2017 from the merger of Rosenrauch's Syntel Solutions with Viirtue president Robert Finch's Element VoIP.
A marketplace did not exist in the company's initial plans. Viirtue was a UCaaS provider (it still is) whose platform different companies would white-label as their own offering. But Rosenrauch (pictured above, left) told Channel Futures that his team quickly faced the same pain points that have troubled white-label voice providers over the years. Partners found the administrative work around white-labeling to be complex and time-intensive. Tax information proved particularly cumbersome.
The provider originally launched Viibe (an acronym for Viirtue Billing Edge) as a means of handling billing and invoicing. But Rosenrauch said his team found an opportunity to remove sales friction for MSPs in other tech categories with a quote-to-cash platform.
Viirtue's partners have seen a significant evolution since the company's inception in 2017. The majority at the time were ITSPs, referred to as "telcos" by Viirtue, who helped businesses replace their premise-based PBX or put it in the cloud.
Many of these telcos stayed out of managed services because MSPs tended to be their referral partners.
On the other hand, MSPs wanted nothing to do with voice at the time, Rosenrauch said.
However, both partner types in recent years started pivoting. MSPs have adopted VoIP and UCaaS as ways to increase their recurring revenue. And with MSPs getting into voice, telcos see the writing on the wall that they need to expand their portfolio.
“They have to add more services. So they're adding SMS and MMS. They're adding other applications. They're doing integrations with CRMs," GreenStar Marketing CEO Dave George told Channel Futures. "The days of just putting the phone on the desk, plugging it in and programming the auto attendant to answer the phone an auto receptionist – those days are over. That's table stakes. That's just expected. 'What else are you going to do for me?'”
Rosenrauch said the two partner types have converged, with both adding their other's signature service. But that doesn't mean they're sitting on equal playing fields.
"I think the MSPs already have a leg up because they are very familiar with how to sell multiple services," he told Channel Futures. "We feel like our job here at Viirtue is to help these telcos and give them that playbook of how to turn their telecom into a full service provider.”
Partners in the Viirtue ecosystem often describe themselves as competing against the larger "channel providers." By that term, they're referring to large UC providers like RingCentral, 8x8, Nextiva and Dialpad. These vendors have evolved well beyond VoIP into SMS, videoconferencing and even contact center.
The smaller MSPs and telcos cite their local footprint and hands-on deployment and management services as competitive advantages over the large vendors, whose shareholders are increasingly deprioritizing the as-a-service element of their platform.
Moreover, Viirtue's partners are relying on integrations from other vendors in the Viirtue marketplace to deepen their voice platforms. A provider like TeamMate helps create integrations into the Microsoft Teams stack. Newly founded Upon.AI will provide services like automated call routing, fraud detection and translation.
Stephanie Benzik (pictured right), GreenStar senior director of marketing, said she has seen her partner clients go outside their regular portfolio to sell cybersecurity and Microsoft applications.
And Viirtue is easing the pain of finding and onboarding new vendors, Benzik said.
“Viirtue has said to them, 'Here's everything you need in a nice package to go to market. You don't have to figure it out all. You don't have to do a really big upfront investments of getting your own platform and figuring it out and maintaining it,’” Benzik said.
Bill McClain runs Virginia-based MSP Networking Solutions and hosted VoIP provider StratusDial. He said partners like him want to resell new products like cybersecurity, and it makes sense for them to use the same platform that they use for voice.
“It's really about reducing friction, and making it easier to one-stop-shop, similar to a Target that also has the grocery store in it. You can go to Viirtue and get your UCaaS products. But while you're here, take a look at this, this, this and this," McClain told Channel Futures.
McClain is one of the partners at Upon.AI, which sits on the vendor side of the Viirtue ecosystem. He said he hopes it will helps his peers go toe-to-toe with well-funded, feature-rich UC providers.
“If we can fill that void, then the partners can compete with the channel," McClain said.
Executives at CCaaS provider Xima Software urged MSPs to look beyond UCaaS if they haven't yet. That's in part due to how the price per seat has utterly plummeted.
"UC is a race to the bottom. Customers are saying, 'I want the lowest price possible,'" senior vice president of industry solutions John Florence told attendees.
On the other hand, CCaaS is seeing some of the "most margin-rich opportunities," chief strategy officer Cody Winget said.
MSPs may shy away from CCaaS for various reasons. One might be that they don't think their customers possess a contact center. But the term "contact center" can be misleading. Rather than asking clients if they run a contact center, Forence said partners should ask more specific questions, such as call routing, call volume visibility and non-phone communication with customers.
Secondly, some MSPs shy away from CCaaS because they don't want to sell a technology that feels unfamiliar to them. Florence said forming a relationship with a CCaaS provider they trust can get them over that hump.
“We’re not asking you to become contact center experts. It takes a long time to become a contact center expert," he said.
Viirtue's integration with Zoom experienced a delay due to a restructuring at the conferencing giant. Nevertheless, the APIs are coming, and Rosenrauch expressed excitement for what the partnership will do for Viirtue's MSP partners.
These partners may feel that they need to tap into the platforms of large players like Teams and Zoom. However, MSPs selling large, branded UC vendors like Zoom have found themselves faced with the potential of channel conflict. As their peers in the agent/advisor space have found, it's not uncommon for direct sales representatives to approach the customer at the time of renewal. That's an untenable dynamic for most MSPs, who insist that they must own the customer.
Rosenrauch said Zoom joining the Viirtue platform helps create a blueprint for future partnerships with branded UC providers.
"We feel like we can solve that problem together with Zoom by providing this platform as an intermediary. So Zoom reps aren't necessarily building direct relationships with their customers. It's all happening programmatically on the back end," he told Channel Futures. "That's where a bunch of suppliers can rebuild trust with these MSPs. Our hope is that they can still sell. Why would you want to white-label Zoom? What a great brand name. Our hope is that these partners will have more trust in saying it's Zoom they're selling if they know there's that buffer that keeps Zoom from using a backdoor into their customer.”
He said partners may prefer to white-label the Netsapiens platforms, due to its richer margins. But even so, there is room for Zoom offers.
"If their customer wants Zoom contact center or maybe Zoom video too, they can bundle that stuff together to give them best of both worlds and maintain ownership," Rosenrauch said.
Cross-selling and increased customer wallet share are top of mind for channel partners of all types.
Crexendo chief revenue officer Jon Brinton said he's seen the cost of customer acquisition gone up. That's due in part to the pandemic making people realize they didn't need to pick up the phone to listen to sales pitches.
And the conventional (and research-backed) wisdom remains that it costs less money to go deeper with an existing customer account than to find a new one.
That's Bill McClain's mindset.
"Once you get a client in-house, what do you try to do? You upsell them. You add more. When I meet with somebody, I talk about a pizza. And I say, 'Look, there's, there are eight slices in this pizza. And we're here to talk about this one slice, but you just need to know that I'm after all your slices. We're talking about UCaaS today. But I also want to talk to you about cybersecurity; I want to talk to you about helpdesk; I want to talk to you about all these different pieces,'" he told Channel Futures.
Those customers grow more sticky and entrenched with the partner as they consume more slices from the partner.
"We don't want churn; we don't want people leaving. If I now provide four solutions for this customer, that means when they leave me, they have to find four solutions," McClain said. "The ultimate goal is to is to reduce churn to zero, even if you have slow growth, because over time growth is growth. My mission has always been to keep them, because it's easier to keep a customer than to find a new one.”
Brinton said partner convergence is endangering MSPs that don't seek to expand wallet share.
“For an MSP that's not doing this, they're potentially missing a lot of opportunity to grow their share of wallet with their customers, present a valuable solution to them, and also keep a competitor out of their customer," Brinton told Channel futures. "Because they're going to buy this service from somebody else, and that somebody else could also come in with a managed security or something that's more in an MSPs traditional swim lane and displace them. It's worth investing the time and energy. And with our community, there are lots of different ways to start."
Viirtue is hosting employees, partners and vendors at its annual partner conference in Clearwater Beach, Florida. Attendees watched a fireside chat with Viirtue's recently expanded executive team, a keynote from customer experience expert Scott McKain (pictured), platform demos from Viirtue's product team and breakout sessions for education and training.
Viirtue is hosting employees, partners and vendors at its annual partner conference in Clearwater Beach, Florida. Attendees watched a fireside chat with Viirtue's recently expanded executive team, a keynote from customer experience expert Scott McKain (pictured), platform demos from Viirtue's product team and breakout sessions for education and training.
VIIRTUE CONNECT — MSPs are expanding their tech sales beyond VoIP and UCaaS into CCaaS and cybersecurity, and Viirtue plans to accelerate that expansion with its developing marketplace.
The UCaaS provider has been evolving into white-label platform for multiple technology vendors, boosted by a $10.8 million infusion it received from Ballast Point Ventures last year. That funding is accelerating Viirtue's Viibe quote-to-cash platform, which MSPs and internet telephony service providers (ITSPs) use to sell vendors such as Viirtue.
Viirtue execs at their annual annual Viirtue Connect Partner Summit this week in Clearwater, Florida, shared that Viibe is gradually expanding into a full-blown platform. And while many of the vendors on the platform have historically been Netsapiens-based VoIP and UCaaS providers, that portfolio is diversifying.
Viirtue in 2020 integrated contact-center-as-a-service (CCaaS) provider Xima onto the platform, and cybersecurity provider Coro will land in the upcoming weeks. Similarly, Viirtue is awaiting API integrations that will put Zoom's UCaaS and CCaaS offerings on Viibe. And the marketplace will continue to expand to include more vendors in AI, and even cybersecurity.
As the next phase of the expansion lies ahead, Viirtue execs and partners in their ecosystem took time to smell the roses on Wednesday.
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Viirtue's Daniel Rosenrauch
"We never expected this company to grow to this point and even beyond that," Viirtue CEO Daniel Rosenrauch said. "But now that we're here, we're grabbing the bull by the horns and I hope you all can trust us with that – that we really do want to take this company and continue to elevate it to the next level every day."
Channel Futures spoke to Rosenrauch, partners and vendors about the evolution of their space.
Scroll through the eight images above to hear their commentary and learn more about Viirtue Connect.
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