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What Zoom’s Acquisition Of Five9 Means For Enterprises

Zoom Acquisition of Five9


What Zoom’s Acquisition Of Five9 Means For Enterprises

Zoom's Acquisition of Five9

On July 18, 2021, Zoom announced that the company would be acquiring Five9, a cloud-based contact center. The deal is reportedly worth $14.7 billion and is Zoom’s largest M&A acquisition in its 10-year history.

Some industry analysts and commentators had seen this a mile off.

For those that didn’t here’s what you need to know about Zoom’s acquisition of Five9.

Details about Zoom’s acquisition of Five9

In 2019, Zoom was worth around $16 billion. The company has since seen its market cap explode to roughly $106.7 billion.

As a leading unified communications platform, Zoom has been exploring ways to serve the company’s enterprise customers even better.

Five9 is a pioneer and leading provider of cloud contact solutions and facilitates billions of engagements from over 2,000 customers worldwide.

The acquisition will complement Zoom’s UCaaS platform with Five9’s Contact Center as a Service (CCaaS) platform.

Eric Yuan, Zoom’s Founder and CEO, said “We are always looking for ways to enhance our platform. The addition of Five9 is a natural fit that will deliver even more value to our customers.”

“Enterprises communicate with their customers through a contact center. This acquisition will create a leading customer engagement platform that will help redefine how companies of all sizes connect with their customer base,” he added.

Zoom Five9 stock impact

Zoom will enter into the $24 billion contact center market with an all-stock deal that is set to close in the first half of 2022.

Five9 shareholders will receive 0.5533 shares of Zoom (ZM) Class A common stock for every Five9 (FIVN) shares that they own.

The value of Five9 stock is set at $200.28 per share, despite the fact that it closed on Friday at $177.60.

UCaaS analysts, like Dave Michels from TalkingPointz, feel that shareholders are getting the short end of the stick, however. 

Why? Because in April 2021, Wells Fargo predicted that Five9 stocks would jump to $220 per share, which is almost $20 higher than the per-share valuation set forth in the terms of the acquisition

What does the acquisition mean for enterprises?

Stephanie Watson, General Manager of MZA Consultants, feels that:

“The acquisition will enable Zoom to offer a compelling, integrated, and differentiated solution that encompasses conferencing, UCaaS, team collaboration, and customer experience capabilities that streamlines communication and collaboration. This will give management the ability to leverage expertise across the entirety of their business, as well as drive customer loyalty, retention, and revenue growth.”

Five9’s cloud-based contact center sits atop the CCaaS industry due to the company’s application of Artificial Intelligence (AI) and Workforce Optimization (WFO) tools.

What this means is that customers can access the smart Interactive Virtual Assistant before moving on to a live customer service representative (CSR).

On the other side of the call, AI provides CSR’s with the customer’s history and important analytics. Transcriptions of conversations occur in real-time so that supervisors can track things like call quality.

Imagine a use case with Zoom and Five9 when a CSR from your company is assisting a customer.

It will now be much easier to walk a customer through installing or troubleshooting an issue, all while tracking progress in real-time.

Rowan Trollope, the CEO of Five9, stated “This is already happening organically. Our ability to bring these things together natively will be a game-changer.”

And he’s not far from the mark. 

Robin Gareiss, CEO and Principal Analyst, Metrigy, published a research note confirming research shows that customer experience transformation projects with video integration produce better results than those without it.

Customer experience transformation projects

Enterprises using other collaboration platforms

The acquisition of Five9 only strengthens the case for interoperability amongst collaboration platforms. 

While a large number of Five9 customers will become Zoom customers, others will stick to using Microsoft Teams, Slack, and Webex. This presents several challenges for collaboration managers and architects. 

This is why interoperability between Zoom and other collaboration platforms remains high on the Mio roadmap.

Our goal is to provide the missing link so that you can still use your preferred collaboration platform to send messages to users via Zoom Chat.

Microsoft Teams Zoom integration

And the same is true vice versa. People who prefer Zoom Chat will be able to stay in Zoom and message users on other collaboration platforms.

Join the waitlist below to be one of the first to know when our interoperability tool goes live.

For early access, join the waitlist here.