Seth Ravin (Rimini Street)
Rimini Street is increasing efforts to expand capabilities across Southeast Asia in response to heightened customer demand across the region.
Less than two months after the specialist provider appointed a new regional director and opened a new office in Singapore, Seth Ravin - CEO and chairman of Rimini Street - sat down with Channel Asia to outline future plans in market.
“We open in every new market with the same idea, let’s get eight to 10 customers in the first year,” said Ravin, when speaking exclusively to Channel Asia. “We then try and double it every year. The idea is to get some local customers, which then become a reference point and we then look for the next 10, and so on.”
Despite only opening its first Southeast Asian office recently, Rimini Street has been doing business across ASEAN for sometime.
“Now we have people on the ground,” said Ravin. “We are actively employing engineers with the local knowledge to grow our business in Asia.”
First and foremost, Rimini Street was founded on the principle of putting client success first, according to Ravin.
“We were founded to disrupt and redefine the enterprise software support model by developing innovative new products and services that put client success first,” he explained.
“Our third-party support services enable clients to optimise existing enterprise software investments, extend current capabilities to leverage hybrid IT, and transform their businesses into digital enterprises with help from intelligent and agile technology roadmaps.”
While Singapore represents the first office in Southeast Asia, the specialist provider also has locations in Taiwan, Australia, South Korea and Japan.
Ravin sees regional markets such as Malaysia, Indonesia and the Philippines as key growth markets, with Singapore particularly important for the financial services sector.
So far, growth has been mostly organic and while acquisitions are always a possibility, “since no one does what we do, there is not really any companies to acquire in our space," said Ravin.
However, Ravin also admitted that if acquisition was an option, it would most likely fit the profile of a small consultancy. “They would have a very particular skill set,” said Ravin. “You know, 10 people who came together with great engineering talent.”
Market approach
From a value proposition perspective, and alongside software support, Ravin said Rimini Street does not use call centres. Instead, the provider assigns concierge engineers to every customer that has a minimum of 10 years experience with an average of 15 years.
“These are full-blown engineers who have worked on these systems,” said Ravin. “When a customer calls in because they have an assigned engineer, they already know the system. These engineers begin working on the problem within five minutes. That is a huge value add.”
Ravin said the business also provides a 15 minute service-level guarantee for urgent cases, with the average being a five minute response.
Furthermore, in the world of Oracle and SAP any change of the system is the responsibility of the client, according to Ravin, whereas, for Rimini Street, all changes are covered at the same level of support as the code delivered from the vendor.
“Even though we did not write it or we did not change it, it does not matter to us if something's broken, we are going to go in there to figure out what it is,” said Ravin. “For that level of support, normally the client would need to pay above the vendor’s maintenance to an Accenture or Capgemini, on top of the annual maintenance. Whereas, in our world, this is all free.
“Not only are we cutting the cost of what the client pays the vendor for maintenance but there is no charge for any of those additional services, which adds to the value proposition even more.”
Ravin also believes that the next big opportunity is centred around offering more of these additional services, increasing value proposition beyond what is offered elsewhere.
However, as Ravin acknowledged, work still needs to be done, particularly with regards to education, as many traditional enterprise customers are not aware such a service exists, instead opting to pay a premium for the maintenance fees offered at vendor-level.
“We reach out to potential customers through a series of education programs, including holding special seminars,” said Ravin. “You will also see us advertising in a bunch of different ways. I have found that Asian markets are really good for seminars.
“Whereas, seminars are not that popular in Europe. In Asia, we have been very successful with marketing events. The people really seem to want to come out.”
Ravin said vendors have traditionally charged more to customers in Asia, when compared to other markets.
“They are paying a lot more than their counterparts are paying in the US,” said Ravin. “I put that down to a difference of negotiating style. Markets such as Japan and Korea seem to be paying a lot more than what their US counterparts are paying.
“As we move through Asia, I think we are finding that again, customers have been taken advantage of more, by being charged higher fees.”
For Ravin, market success can also be linked to a provider’s ability to reach untapped areas of the market.
“If you really go out there to the global 2,000 companies, it’s hard to imagine that not even one of those companies does not have Oracle, SAP or both,” he observed. “Instead of calling Oracle or SAP, the client would pick up the phone and call Rimini Street instead.
“The licensing agreement is separate from the annual maintenance contract, so if a client switches to Rimini Street for maintenance, the license agreement does not change.”
Customer success
In Southeast Asia, Rimini Street works with packaging firm, Visy Holdings, as well as integrated healthcare provider, Kalbe Farma, in Indonesia, and Proton in Malaysia.
According to Ravin, the key to Rimini Street’s growth is "trust", comparing his business to that of an insurance policy, “you are only as good as the trust you put into your insurance policy”.
“When customers sign with us, they are trusting that on their worst day, we are going to be there," said Ravin. "That is what they are really buying, trust. Our success has always been based on client success. We have never changed or deviated from that. We take trust more seriously than anything, because if you lose trust in the marketplace, you are dead.”
Ravin highlighted the uniqueness of Rimini Street’s contract, comparing it to support contracts supplied by vendors.
“If you look at our service contracts, it's 14 pages of detail of not only exactly what you get, but also what you are not going to get,” he explained. “We want to be clear and manage expectations of what we have signed up to do. We have been in this market for 14 years. And in that time Oracle's profits have increased from 90 per cent to 95 per cent.”
And here is Ravin’s theory as to why this is the case.
“If you take Oracle’s $20 billion a year of profits from maintenance and Rimini Street takes one or two billion dollars of that, then why would the likes of Oracle or SAP engage in a price war that could cut the remaining $18 billion in a race to the bottom?” he asked.
“It is cheaper for the vendor to lose one or two billion to us and raise the price and hold it on the other $18 billion. If you start racing to the bottom on cost, the market will drop their stock like a stone.
“All their stock is based on the profits everyone expects from maintenance. And that is part of the reason why they have not changed. They cannot offer additional services because it would cost more than five per cent and it would break their financial model. They basically have to try to compete in a way without really changing their financial model.”
In looking ahead, Ravin said that for Rimini Street, geographic expansion is a top priority.
“We want to have a bigger footprint,” he said. “We want to be in all major markets before the competition gets there.”
