Anyone who doesn’t believe businesses are investing in cloud isn’t paying attention. That includes the contact center. A new focus on customer experience requires flexibility, agility, and integrations that simply aren’t possible with traditional solutions. Whether companies are replacing aging legacy technologies that have reached end of life, or they’re smart enough to realize they risk competitive advantage if they don’t businesses are moving their customer service teams into the cloud, and Five9 is at helping lead the charge.
The company announced a 27% increase in quarterly revenues from a year ago, reaching $77.4 million in Q2 2019, compared to $61.1 in Q2 2018. The quarter also represents its 14th consecutive quarter of positive operating cash flow, driven by 36% growth in LTM enterprise subscription revenue.
Five9 recently further strengthened its enterprise capabilities through a new partnership with Microsoft Teams, which will ensure contact center agents are able to easily connect with all other resources across their enterprises through Teams. Five9 already had a strong integration with Microsoft Dynamics 365. Five9 President Dan Burkland noted that the company continues to see more large deals come in and, in Q2 2019, more than 60% of its new contracts were through its ecosystem of partners.
CEO Rowan Trollope pointed to three key pillars he says will continue to drive Five9’s growth: market, product, and go-to-market strategy.
The total addressable market, he says, is greater than $24 billion, but currently it hasn’t even reached 15% penetration in terms of cloud contact centers. As businesses continue to embark on their digital transformation journeys and convert contact centers from cost centers to revenue generators, cloud will be a key component of the process.
As for the Five9 contact center platform, Trollope says it’s really hard for newer players to replicate Five9’s years of investment and iterative releases. Five9 is working on a new software delivery engine built on the latest PaaS technology, combining its own cloud infrastructure with public clouds from Amazon and Google.
Five9 is also preparing for the launch of its AI product, which will take advantage of the massive volume of data generated by five billion minutes of customer interactions running across its platform each year. The product will deliver real-time recommendations and predictions to assist live agents and deliver a better customer experience. Five9 has signed four of its largest customers to beta test the AI solution already and expects to go live with it next year, also following its growing public cloud strategy.
“We continue to leverage our own cloud infrastructure, but our future development and platform is really public cloud oriented,” Trollope said.
As part of its growth strategy, Five9 has prioritized its channel, including hiring a new VP and GM of International Sales, VP of Global Channel, and VP of professional services, all of whom report up to Andy Dignan, SVP of Global Channels and Services. Dignan was brought on a few weeks ago, most recently having the go-to-market strategy for Cisco (also Trollope’s most recent employer prior to being named Five9 CEO).
Partnerships will continue to play a significant role, particularly in the enterprise space, with firms like Deloitte, Accenture, Ernst & Young, and IBM helping companies formulate their digital transformation journeys – and of course a continued multi-pronged relationship with Microsoft.
But, Trollope believes the real differentiator is the firm’s customer success and services team, which helps enterprises succeed with their digital transformation journeys with onsite implementation assistance and high-touch experiences to support a hardened contact center platform. He believes this team is the secret sauce behind Five9’s growth.
“We believe no one else in the industry has anywhere near this level of customer facing expertise, and we believe it will take years to replicate,” he said. “The stars have clearly aligned for Five9 and all three pillars for success are in place.”
Indeed, the continued move to cloud, along with the development of AI strategies will pace the future of work across industries. What will the future workplace look like? How will customer interactions change thanks to AI? What about internal communications? These and much more will be answered at the Future of Work Expo 2020, taking place in Ft. Lauderdale, Florida, February 12-14, 2020. If you have an AI story to tell, we want to hear from you.
Edited by Erik Linask