Zultys Reseller Update

This is just more hype. Sales last 12 months were only $6M worldwide. This is nothing. So stories about $250K pipelines from one reseller are just simply hot-air promoted by Sunnyvale and swallowed by naive journalists. Milnes himself has said last 2 months sales were 40% of previous months, hardly enough to keep the lights on

This is just more hype. Sales last 12 months were only $6M worldwide. This is nothing. So stories about $250K pipelines from one reseller are just simply hot-air promoted by Sunnyvale and swallowed by naive journalists. Milnes himself has said last 2 months sales were 40% of previous months. That is $250K a month WORLDWIDE hardly enough to keep the lights on. So dump the bullshit guys.

Obviously TMC is interested in advancing VoIP industry participants, but this promotion of an obviously over hyped company is disgraceful. Not naming the source essentially points to the source as being Zultys, and likely Iain Milnes in particular. It is the same kind of unsubstantiated bragging we have heard from him before. If the Zultys sales channel is "so strong" with sales "in the pipeline", why go through bankruptcy at all. There are many alternatives to Zultys and VARs who have real customers will have no trouble filling demand with another vendors product. Do you really think your readers are so dumb as to believe this company is viable?

Thanks for the candid comments. The source of this conversation is not Iain Milnes. It is a real reseller and I verified the person is real and living and breathing. I spoke with him and unless Iain is great at disguising his voice we are Ok here.

But I cannot understand how my posting of a conversation assumes anyone is dumb. Is this really what you meant to imply?

Whether the company is viable remains to be seen over time. I have no bias. My goal in writing this blog was to ensure the little-guy has a voice. Is this reseller BSing me? It is possible. So we will have to see what happens here. I am just an objective observer.

Yes he is. And he's probably from Oregon!

I can confirm we still have a pipeline of $150K (cost of goods) of Zultys. Although most of that is likely to go to Shoretel or Nortel or vanish into thin air unless we hear some good news soon.

Additionally, we purchased at least $50K in the last few weeks primarily because of discounted software offered by Zultys. I even just installed a new MX250 with 20 phones and PRI.

We are just a drop in the bucket, so I can only guess what the total pipeline for all resellers might be right now. Whatever it is, it is shrinking everyday for sure.

I do agree that I was surprised to hear Zultys was only a 6M company. We had been led to believe they were much bigger than that..

That said, I _really_ believe in the product. It can compete with *anyone* in the market and win hands down with both features and price at almost any size. I see no good reason Zultys couldn't become a 100 million dollar company in a few years except for the fact that they are filing chapter 11 and all their employees have found new jobs...

That never stopped Donald Trump though..

I think there are three possibilities of what could happen in the next few weeks. I'll list them in the order I think they might happen.

1. Iain, purchases the company back, hires back some key players and makes another go at it. Afterall, he has $65 million of his own in this.

2. Someone else purchases it and kills it or rebrands it as their own. Seeing as they are only a 6M company and currently in chapter 11, this might not even be necessary..

3. Someone else purchases it and tries to get back on track with new management. This might be nice if you want to see Iain out of the picture, but chances are it would take so much efort to get things back together that Zultys would lose its competive advantage by the time it was back and running at full steam.

I agree that the sales are shrinking fast so it would seem the longer Zultys waits to do something the worse off the company, its customers and resellers are. Let's hope for the sake of the remaining employees, resellers and customers this gets wrapped up rather quickly.

My crystal ball has been in the shop for a while now so I haven't got any more of a clue than anyone else what is really going to happen here.

I can tell you that, as a technical support person for CTD, a distributor that has been with Zultys for two and a half years, I have seen the good and the bad.

Through it all, two things have always been true:

1. The features of Zultys' core PBX product are far ahead of the other VoIP offerings out there.

2. Zultys' resellers know this and are true to the product despite the times when the company has failed them.

I know these things because we have, with all of the cards on the table, continued to do BOTH post-sales installation support and pre-sales engineering support throughout this entire ordeal.

During a pre-sales call yesterday, I was told by a reseller that his end user, "knows the situation with Zultys but has decided to go ahead with this purchase anyway because the Zultys system does so much more than anything else out there." Its a quote. I did not make that up.

This product line, scaled back to it core components and focused on expanding the solid enterprise features that it already has, is more than viable. In fact, it could devastating to the competition - that is why they are speaking out so loudly against it.

BTW: I know the reseller who did this interview. I helped his people with the pre-sales on many of their quotes and a number of large ones were in the signing stage when things fell apart in Sunnyvale. Attacking him, or me, will not change the truth of that.

For the record: just the other day we tallied that we have $265,000 (our cost from the distributor) of Zultys sales held up by the present chapter 11 situation.
The unfortunate thing is that we just started this summer to do the type of high value business we know the Zultys platform is capable of delivering & now we've lost momentum or possibly worse.
In the end we're in favor of any outcome that allows us to continue to sell this unique product in a VAR friendly environment...

Hi Rich:

As a fellow reseller, I can confirm the authenticity of the reseller interview and his comments. There is a bottleneck of pipeline. I think he is right on the money with his comments and sentiment.

Best regards,

Neil D

For the record: just the other day we tallied that we have $265,000 (our cost from the distributor) of Zultys sales held up by the present chapter 11 situation.
The unfortunate thing is that we just started this summer to do the type of high value business we know the Zultys platform is capable of delivering & now we've lost momentum or possibly worse.
In the end we're in favor of any outcome that allows us to continue to sell this unique product in a VAR friendly environment...

Hi Rich:

As a fellow reseller, I can confirm the authenticity of the reseller interview and his comments. There is a bottleneck of pipeline. I think he is right on the money with his comments and sentiment.

Best regards,

Neil D

I spent my whole career listening to talk of orders in the pipeline which never came. I usually figured maybe 25% would come to a sale ... at VERY best! Contrary to some of the enthusiasts above I think it is the LACK of unique features which has been the downfall of the Zultys offering. Instead of a concise elevator speech of why it is unique, Zultys gives you pages and pages of trivia. They never did marketing 101. Anyway it is now a busted flush so it is all academic.

O.K. then Rich give us the elevator speech. In a SHORT paragraph (not the many pages of trivia that Zultys promote), give us the UNIQUE features of the Zultys product. What a load of nonsense you talkk!

Unique:

1)Unlike some solutions it is not based on Bill Gates' super reliable/secure OS
& certainly not MULTIPLE boxes running his legendary OS....hmmm a couple of Units of rack space for a hardened appliance or a whole pile of Bill's magic boxes, tough decision.

2)Mac native end user client

3)Well suited to application integration & development...preserves value, resists commoditization just what a Value Added Reseller needs & exactly where we can help our clients (end users of the product) make more money in their businesses!

I can make a whole pile of money on the last item while delivering a ton of value to the end user & I can rest assured because of the 1st item!!!

PS the 2nd point is nice in certain competitive situations

As an FYI -- once again I am an objective observer on this matter. I never claimed Zultys has or does not have unique features. Regardless, companies with the most unique features can fail. In my experience companies with average features and great PR and marketing can do better than companies who focus on features.

I do believe Zultys did a good job with PR and marketing and they have a solid brand in the mind of enterprise customers. Most people think the company is much bigger than it really is which is generally a sign of a strong brand.

I said UNIQUE. You've described points that apply to most of its competitors. O.K. I realize that you have lots of stock of these products and have missed the opportunity to return it, so you need to make a big effort. Good luck with that, but sorry I'm not convinced by all the geeky stuff. I get terribly tired of the fashionable Gates bashing. I've been involved with many me-too products during my career and this one SCREAMS me-too!

When the news hit we had $5.6 million in potential Zultys sales projected over the next 18 months. Some of that we would not have won but much of it was with customers that saw how advanced the zultys product was.(And cost wise we were always less then Cisco, Avaya, or Shoretel)

If Zultys is picked up by a big name like Avaya, Inter-tel, 3COM, or somebody else with a good name and some marketing capital it will put them at least 18 months ahead of the other major vendors in regard to SIP, ITSP support, EASY MANAGEMENT, and Presence.

Looking at the Zultys paperwork there were some big names looking...Avaya, Dell, Foundry networks, Inter-tel, Acatel, and others.

Lets hope that somebody that see the value of a good reseller channel picks them up and get the product back on the street.

Actually other than our demo systems we have no Zultys product in stock, just a quarter million in pending Zultys sales......also we sell a ton of MS products to our clients, I just wouldn't want what was a previously reliable application (Voice) to be moved over to a less than reliable platform (Windows).
Zultys (& some other systems on the market) allow the Voice application to be moved over alongside the rest of the Applications within the Enterprise in a more reliable manner than any Windows box can provide, so not bashing just the reality of the matter.
With voice residing amongst the other Applications on the Network that's where real value can be derived extending the Voice application & integrating it w/ the other Applications (line of business, CRM, et al) & Databases.
Except for this the Zultys just becomes another "Our PBX feature vs. Your PBX feature" race to the lowest price
aka commoditization
And commoditization is best left to big boys not little guys like Zultys. So one key to continued success for Zultys is to build out the high value non-commodity aspects of the platform. This is important as SIP tears down the walls of proprietary systems & forces the PBX feature set to become even more commoditized.

I think "Former Employee" needs to change his name to "Bitter Former Employee".

He attakcs Rich, Who is very vendor neutral

Then he atttacks the resellers that like the product

Bitter ex-employee is either still sitting at home watching Oprah or has taken a job at a competitor (or MacDonalds). Either way he has everything to gain and nothing to lose from the slams and attacks

As a Canadian reseller, we too are disappointed in recent events. We didn't have a huge pipe, but saw lots of potential.

Under the right banner, Zultys would have great success.

As the reseller initially presented in this dialogue, I would like to thank my fellow resellers and distribution partners who know me and my business for verifying the accuracy of my statements.

I would like to thank Rich for his initially maintaining my anonymity until other channel VARs joined my ranks to verify the realities experienced by my business as being shared by their own.

It is interesting to have my truthfulness immediately challenged and my namelessness damned by somebody who maintains their name to be “Former Employee” (not even a VAR, now working for whom?).

As far as why we VARs like the product, particularly being located in South Florida? A totally SIP solution, including PSTN/data media gateway, fax server, instant messaging, chat, powerful call management client and soft-phone with exchange integration, hard drive RAID, dual redundant power infrastructures (120vAC and 48vDC), packaged in a single box with N+1 clustering and total fail-over/redundancy of all components… Please feel free to provide suggestions of alternate products offering ALL of the above at a reasonable price to NormanL@net-sdsi.com

Without selling to “new” customers until if/when this is over, we have delivered another $25K in the past week, and we have delivered the second of 14 intended systems to an end-user who knows what is going on and can’t believe the product will go away. We still have over $100K of new business waiting "on hold" in the pipeline.

As a VAR, I have no agenda or grudge. I just want my company to be able to keep selling a product that stands out to us and current and prospective customers as one that we don’t want to see go away. The marketplace, as well as the industry, should be interested in knowing this particular group of VARs and its shared experience and resultant product loyalty does indeed exist, for whatever it is worth. I keep in touch with more than a dozen active Zultys VARs. We don’t show up in a bankruptcy filing or on any balance sheet, but I can’t allow anybody to assert we don’t exist. And this would be the response to those labeling themselves as “Not Buying It”.

Norman Landerman

The passion expressed above for Zultys must have been its best kept secret until now.

"Former Employee" makes a good point about the absence of a persuasive value proposition for Zultys products in a highly competitive space, reinforced by the shockingly low sales of $6M over the past year. This number is confirmed in the bankruptcy filing.

Vendor passion and perceived product value to end users has not made Zultys profitable or retained shareholder value. With nearly four years in the market, it is reasonable to expect that Zultys would be able to at least sustain itself with the backing of a motivated sales channel. In the worst case, Zultys should have been an attractive acquisition candidate instead of bankrupt and on the auction block.

Any prudent investor or customer would have to ask, "with all the good marketing, innumerable business opportunities, and great products, how can it be possible that this company is insolvent?".

The reason a possible buyer wanted them to go Chap 11 was to dissolve the debt. This makes them MORE ATTRACTIVE to a potential buyer since futre lawsuits have now been avoided.

Sales were picking up BUT their 35,000,000 in technology investment and research caught up to them.

The question asked before is valid. Please show us another product with SIP, Presence, Fax to desktop, T1/Pri/FXS/FXO, voice mail, EASY management, ITSP support, Call detail reports, Easy dial plan set-up, Instant messaging... at a price point that is under the big boys. We have spent 60 days looking at 3com, avaya, sphere, vonexus, objectworld, and a few others... Nothing comes close to Zultys MX250

I hope whoever buys them, changes the managment screen to their name, paints the box, applies a new logo, and gets a quick turn around

This has been quite an emotional ride and I am blown away at how well-liked Zultys systems are. In the end it is all about profit so I seriously hope there is a positive outcome for the resellers, customers and Zultys employees.

In response to the question 'how can it be possible the company is insolvent', one only has to look at the top of the pile. Just like a box of corn flakes, the biggest ones are always on top.

Mr. Milnes, in my opinion, is a classic example of an entrepreneur who made it big with the bubble, and thought he could ride roughshod over everyone in his quest to have another home run.

Want an example? Ask anyone who's dealt with the guy. Couldn't give you the time of day. Sales policies were developed and issued with absolutely no input from the VAR channel or from the regional managers (at least the ones I spoke with). Zultys' outward marketing looked good, but it's sales policies & licensing schemes were complex and convoluted, and had little relationship to making it easy for the dealer. Prior to the last change in demo licensing, dealers had to actually PAY for feature licenses to be able to go sell the features with any intelligence.

Want another? Our company sent 3 people for training for a week in Sunnyvale, plus 2 days travel time, and he didn't even have the courtesy to drop into the training room to say 'hello' (although he walked by the window a few times).

The best thing that will happen out of this is Mr. Milnes will be gone - and if he's not, we won't be a dealer any longer.

Staying anonymous because if I didn't, we probably would lose any remaining support (and those in the know, know what I mean).

Hi Rich:

I am surprised that anyone would swing such an anonymous bat so wildly. Obviously the former employees are pissed - but should "Mr. or Ms. Anonymous" not hope for the best in this run-up to the auction?

There are dozens of resellers who have based a good part of their business to making a go with Zultys - despite the obvious problems with Zultys approach to sales, marketing, distribution and developing the channel - all of which have been problematic to say the least.

I can't speak for everyone, but I can say there appears to be a clear consensus among everyone I have spoken to (in the Zultys supply chain) that this may turn out to be a great opportunity in the end. That is for all of those who commit to doing whatever they can to keep the platform alive ( with the very real possibility of Iain making every decision in the future). There is no question that the engineering of this lil yellow box (for which you have to give Iain credit) is the top of the heap. I challenge anyone to dispute that fact - dollar for dollar and pound for pound this little Tivo sized monster is amazing.

So I see it not as a discussion of what will be done - or what will be sold. Rather, despite these chronic problems with brand, sales, marketing, distribution and channel strategy - we have used the the MX250 as a core of a solution that provides tangible value to our customers - in fact we won an Infoworld top 20 award about 10 months ago on behalf of one of our customers.

So, although the chips may fall as they may - start considering the opportunity that lies ahead. Consider yourself fortunate to have good knowledge about what this technology has done or could do in the right hands. Take a minute to consider what will happen if the chronic problems are resolved with some future owner of the technology that has a handle on branding, sales, marketing, distribution and channel strategy.

The future could be very bright indeed.

Best regards,

Neil D

Typo and correction: I said ( with the very real possibility of Iain making every decision in the future).

And I meant to say: ( with the very real possibility of Iain not making every decision in the future).

Thanks

We have sold Zultys for about a year now and its been a uphill battle the entire way.

$35M on product development and they can pass CallerID name? I gave up after loosing about $10k on a new MX30 unit we sold, which ZULTYS configured for me. and doesnt have a MAC MXIE interface which was promised. Oops engineering didnt tell the regional sales manager! Who got stuck with the equiptment? ME!

Right now I have an ASTERISK server sitting between Zultys MX250 and the CO. why? because ZULTYS resets the T1 and doesnt like DMS100(Dropping calls). Support? right.....

For my company Zultys was about a $20,000 mistake. Great Product. Core function Poor. Cooless factors Great. Phones UGLY.

Try to a $400 panasonic looking phone? Paging? buy a Zultys phone. Barge? Monitor? buy a Zultys phone.

Yes - the reseller is living and breathing and his name starts with N (and, no, its not Mr. Darling). Why doesn't someone ask him to produce his Zultys Certification? He never bothered to even get trained on the company's products (yet he now claims to live and die by their enormous market value). Now he is going to buy the company? But, heck, anyone would do a better job than Milnes. To take such incredible technology and flush it down the toilet due to business ineptitude is a real shame. And to then try to drag down a company's employees down the drain with him? Disgusting. My favorite quote of the last 4 weeks is Milnes telling anyone who listen to him bitch that "the employees drove the company to bankruptcy"

"Strong" channel of resellers? Strong compared to what? A company that sells direct?? The very fact that this reseller thinks he was part of a strong channel demonstrates his overall unawareness to the market in general and what real players are producing from their strong channels.

MOVE ON. This ship sank and the captain is a pirate.

Norman - Can you post your Zultys certification? Or wait - you didn't even bother to get trained on this company's products (yet you now claim to live and die by its enormous market value). Now you are going to buy the company? But, heck, anyone would do a better job than Milnes. To take such incredible technology and flush it down the toilet due to business ineptitude is a real shame. And to then try to drag down a company's employees down the drain with him? Disgusting. My favorite quote of the last 4 weeks is Milnes telling anyone who listen to him bitch that "the employees drove the company to bankruptcy"

I love how everyone on here pegs the employees as bitter. You work for free for 2 months (without being asked, you are forced becaue of Milnes lying), you get ripped off of your time and personal expense money - then let us know how happy you are! As employees, we were bullied and lied to for years and years...all for nothing. Milnes and his wife robbed people of their own money in the guise of stock investments, then turned around and took away these employees paychecks. She gets fed up and decides to leave him, so he then uses company funds to pay her off (he calls it a buyout of shares). Ironically, one month later he can't make his payroll? NOW he has the nerve to be collecting on loans he gave to employees to buy their stock options. He's steals from them (their time and often their personal money for expenses) and then he swings back around and demands their savings? Anyone reading this who wants to resell the products of a company run by such an unethical human being might consider what will eventually be done to then. Something will happen, its not a matter of what, but when. Old habits don't die. Shame on him the first time. Shame on you the second.

Iain does not deserve or get credit for the engineering of the little yellow box. Far far far from it. You just insulted a very talented team of engineers who put this product together under a ridiculously bad work environment. This product was designed by a Zultys executive, but not Iain Milnes. Iain just funded the operation. While he likes to take credit for all the good things that happened (and blamed other - namely the employees - for the bad, such as the bankruptcy) Iain is neither a brilliant engineer (as he'd like you to believe) nor a brilliant businessman (obviously, enough said).

Iain does not deserve or get credit for the engineering of the little yellow box. Far far far from it. You just insulted a very talented team of engineers who put this product together under a ridiculously bad work environment. This product was designed by a Zultys executive, but not Iain Milnes. Iain just funded the operation. While he likes to take credit for all the good things that happened (and blamed other - namely the employees - for the bad, such as the bankruptcy) Iain is neither a brilliant engineer (as he'd like you to believe) nor a brilliant businessman (obviously, enough said).

Its funny - someone called this blog a soap opera.

The ironic thing is that for a small company that was relatively unheard of in mainstream business, there was a a lot of drama. Such as - Iain Milnes and his wife ran the company like a small sweat shop - the employees were overworked, underpaid peasants. Bonuses came in the form of peanuts. Not kidding! Mrs. Milnes main job function was to snoop through emails, find incriminating comments and to march the offender into Mr. Milnes office for a verbal lashing. Well, Mrs. Milnes found a better pond to fish in earlier this year and exited the scene. Mr. Milnes decided to pay her off with Zultys funds. Ironically, the very next month - oila! there is no money to pay the overworked, underpaid, emotionally beaten, peanut eating employees. The very next month, Mr. Milnes, now running a company with no employees but acting as if nothing is wrong, sends out notices to the very employees he just laid off after making them work for 30 days for free. The notice demands full payment on the loans which Mr. and Mrs. Milnes gave to the employees to purchase their stock options. Thats right! He lays people off, pays his wife a divorce settlement with their paychecks, then comes back around and asks for their savings accounts.

But, gentle readers and posters: you are right. The employees are just bitter little people who should hope Zultys gets purchased for a lot of money. However. and this is a big HOWEVER: It doesn't matter how much Zultys sells for. Read how an "Assets Only" Auction works - the unsecured creditors (to which the employees belong) get ZERO. Put that in your Zultys pipe and light it up!

Finally, an ex-Zultys employee who is proud of what they have done and is willing to say it.

You all should be proud of what you did. We are all proud of you for it.

Sean

Well with all the above said the consensus seems to be:

Drama - far from being just another cold piece of technology there's certainly a lot passion in all respects surrounding Zultys....

People got screwed - customers, VARs, distributors, manufacturers & worst of all employees.....

Substance - there's something unique & of value here otherwise it would just go quietly into the night...

Substance - there's something unique & of value here otherwise it would just go quietly into the night...

---

That is my take as well -- I have never seen this sort of enthusiasm for a company having financial problems. This is a new one for me and it reminds me of -- excuse the geekiness here -- the viewer revolt when the networks took Star Trek off the air.

....pays his wife a divorce settlement with their paychecks,

Why is it that the investor pulled out in the 11th hour? Does anybody know?

Was it due to the CEO breaking his fiduciary responsabilities?

VCs don't just pull out without warning as he would have us believe. There was certainly something there they didn't like. But don't look for something odd. The following debts would do it for me!

Silicon Valley Bank $1.8M
Employees $2.751M
The manufacturer of the MX $648K
The manufacturer of the phones $438K
A credit analyst $278K
Marketeer $196K
Arrow Electronic $147K
Text100 $85K
Shareholders $40M

But this company is in great shape! Send him your checks.

I am sorry the employees were financial harmed. I am sorry they did not get paid for their last 30 days of work. Heck I am sorry that Iain got divorced. BUT we don't make partnership agreements based on the company soap opera we make these decisions based on the technology and the go to marketablility of a product. We have 18 years in the networking market place and we ahve not seen any other product that could line up with what the MX product from Zultys would do. You might point to a product and say that a certain product does something better then Zultys on 1 or two point/areas..but no product out there has the overall funcionality of an MX250. Not Cisco, not Avaya, Not 3Com, Not Mitel.

We will see what happens on the 11th oc Oct. We hope that the products get picked and turned around in a short period of time and we can partner with the new owners.

Since the Zultys platform with its presence, ease of management, great admin interface, SIP, and the list goes on,, is at lest 18 months ahead of some of the bigger players it would give a boost to anybody with a name and a few dollars to market it

Wow!!! What a lively discussion. One thing however that I don't understand is the nature of some of these comments. Assuming everyone is being honest, why would people attack each other on this post? It seems to me that everyone involved has been hurt by what has happened at Zultys. Resellers are stuck with orders that can not be fullfiled and former the employees of Zultys looks like they got absolutley screwed in the process.

Therefore, why all the attacking? Sounds like everyone agrees that what has happened with Zultys hurt a lot of people. If what the employees and resellers all say is true, it sounds like you should all be sympathetitc to each others plights and place the blame were it belongs; on the shoulders of Zultys ownership!!!

One last point, to the person that attacks Rich, all he did was comment on what a reseller told him. To attack him is unjustified. Obviously it sounds like you have a valid reason to be angry and bitter towards Milnes not Rich...

Put yourself in the position of a large company CEO or a Venture Capitialist. Do you rush out and buy a company and assume $45,000,000 in debt in order to get a technology or do you wait until those debts are discharged and pick the company up for between $6 - 12 Million,,,,,WITH NO DEBT.

Lets think about that a minute. Imagine somebody with a used Ford Mustang, they owe $15,950 to the bank for the car. The car is worth $13,287. So WHO IN THEIR RIGHT MIND would give the owner $13,287 and also assume the debt of $15,950.

If you answered that you would, Please give me a call..I have a used 2002 Dodge caravan I would like to talk to you about.

I think you mean $6 -$12. You slipped an M in by mistake.

This is almost not worth saying (but I have to say it) To: Midwest Reseller, You do understand that the whole point of the Chapter 11 reorginization is that all that unsecured debt (40+ million dollars) is erased, right? This makes this a very attractive looking investment if you believe in the basis of the company (the product).

Also, I am not understanding your car analogy?.. I have never owned a car that had the potential to earn millions of dollars a year.. Comparing the purchase of a used car to a technology company makes absolutely no sense at all..

I think that California Reseller and Midwest Reseller are making the same point.

None of the suitors were willing to buy Zultys prior to the Chapter 11 because they knew that Chapter 11 would wipe some or all of the debt and would allow them to buy the company more cheaply.

I think that California Reseller and Midwest Reseller are making the same point.

None of the suitors were willing to buy Zultys prior to the Chapter 11 because they knew that Chapter 11 would wipe some or all of the debt and would allow them to buy the company more cheaply.

I think that Midwest Reseller and California Reseller are making the same point.

That is that the pre-bankruptcy suitors were probably not too keen on paying for the company and assuming the debt of the company without the protection of a judge.

I don't think any of you have dealt with VCs. I have. They don't buy basket cases and don't think in the way you are implying. They buy thriving companies with a demonstrable future. Whoever buys this mess, I don't think it will be a VC. I'm afraid the only suitors will be the ones who created the mess. And for those who think they will have a Zultys without you know who, dream on!

If $65M went into these "awesome" products and $20M came out in the form of sales over the past 4 years, there is something very wrong. Hmmm, what could it be, ohhh maybe... customers don't want it! They buy from Cisco, Avaya, 3Com, Mitel, and yes, even ShoreTel. It follows that a reseller in his "right mind" would strive to carry products from these companies.

The source of the emotion here comes from the misdirection of one person. The infuriated victims who placed thier trust in this person are dedicated employees, resellers, and the end users that gave the products a chance.

Thanks to Mr. Tehrani for the forum to be heard, but don't mistake the reactions being expressed to be enthusiasm. This is just pent up frustration being vented.

My point was that NOBODY WOULD BUY A COMPANY AND ASSUME $45,000,000 in debt when they could wait a few months and pick it up WITHOUT DEBT.

Go back and read what I wrote. I was not saying that nobody would want it. I was saying that if you wanted and were a good business man (Person) you would not want to be saddled with teh debt and possible employee lawsuits.

I think that it will be picked up and hopefully by somebody witht a name that people will want to buy.

basic questions are this.

Is it a good technology?

Would it help a company to gain market share and grow business?

Would it help Avaya, 3COM, Foundry Networks, DELL?

If it had the name avaya on it would it sell?

Look at page 68-72 of the Chap 11 filing and you can see who looked at the company as a possible investment or purchase.

The MX250 is a greta product and if former employee thinks it is just another VoIP product and an also ran then they could very well be the reason Zultys is at where they are at.

Piss Poor Employees always hurt a company.

Dear California reseller.

Please go back and re-read my post to see if it makes sense the second time through. I was not trying to compare buying a car to buying a technology company. The point was about money and debt.

Company A has $45,000,000 in debt.
Company B is thinking about buying Company A

If B purchases A, B now owes $45,000,000

If B waits until A files Chap 11 then B can buy A and not owe $45,000,000.

NOW HERE IS THE IMPORTANT THING..

If A is on a train that leaves boston at 7 PM and is traveling at 80 MPH and B leaves Chicago at 8PM on a training traveling at 110 MPH, which Ford mustang will get a flat tire first the red one or the blue one.

And piss poor CEO's kill a company and create lawsuits based on thier actions.

If the technology was desirable, it would have sustained the company. Tha much is clear. So it must be considered either duplicated or uninspired technology by those who count.

Seems to me that this whole bankruptcy thing is a sham anyway. If the company is bought back by the same people, the only thing that really has changed is the shareholder list. Someone said the owner's ex-wife was paid off with company funds in his divorce. Maybe she got shares and he's doing all this to stick to to her! Talk about a soap opera.

I will not defend Iain here that is not my job nor am I trying to sell Iain to any of my customers.

Desireable technology...lol.
Zultys has around 3,000 to 5,000 installs
3com has 30,000
Avaya has 80,000
Cisco slightly less then Avaya

So 10% as much as 3COM and just less the %5 of what Avaya has. That is pretty good for an undesireable product.Most companies would love to have that type of success in the VoIP market place.

I think most resellers would hope that it is picked up by a large company with great marketing.

Look at Cisco, their products are at best second class but they are a great marketing company.

Think about how Zultys would do if they were the Avaya VX250, or the 3COM NMX250, or the Foundry Networks Voiceiron-250.

Put your facts where your mouth is, Show me another SIP System (the industry standard), that runs on Linux or unix (Security)
that has presence (productivity
ITSP Support (Cost Savings)
an easy management GUI (Management time saving=money)
Call recording
Fax to desk top
DID for voice and FAX
Auto Attendants
Voice to EMail
Call Detail reporting
That will connect with T1/FXo