On Purchasing VoIP Innovations

As expected, I’ve had a few questions about why we purchased VoIP Innovations.

One of the most obvious reasons is the addition of revenue (and recurring revenue at that) and healthy EBITDA. You can read the press release to see those kinds of details.

Strategically, adding VoIP Innovations supplements Sangoma’s long term growth and direction as a Communications as a Service company – we provide UC, Contact Center, SIP trunking, and Device all as a Service today. This deal enhances our SIP Trunking and CPaaS “as a service” offerings. While we will still obviously continue to sell and invest in hardware such as UC/PBX on-prem, gateways, SBCs and phones, etc., the industry is evolving towards Cloud, and, thus, Sangoma needs to continue to evolve in this direction. VoIP Innovations helps us in this continuous evolution.

One of the biggest questions I’ve received is related to why we are going down a service provider path, given most of VoIP Innovations revenue comes from their wholesale carrier services. Well, there are two reasons.

First of all, with Cloud, the demarcation line between enterprise and service provider is blurred. For instance, Sangoma itself is a service provider because we offer cloud services to business users. So are we in the enterprise business or service provider business? Where is the line? The customers of the VI wholesale carrier services tend to be MSPs and large enterprises who also need UC solutions. And, as I just wrote, we can deliver that to them. So we see channel synergies.

And, if you go back to the “traditional” definition of service provider, it is not like Sangoma is NOT in the service provider business. We sell to quite a few service providers, and when the Dialogic gateways came over in early 2018, Sangoma also picked up quite a few wholesale carrier customers and other service providers. So we know service providers, and there is also synergy with that part of our business and VoIP Innovations.

Finally, the CPaaS development platform APIdaze will enable additional applications to be written (by us and by third parties) and paired with Sangoma solutions. We are excited about that opportunity going forward.

In summary, we see revenue growth from the additional selling opportunities each side obtains by bringing the two companies being together.

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