Grotech Capital Group is a private equity firm with a 22-year winning track record and approximately one billion dollars under management. Grotech is a recognized leader investing in information technology, health care and consumer companies located in the eastern United States.      * Venture Capital & Private Equity firm      * 22 years in the business – on 6th fund      * Current fund $410 million (appx $1b under management)      * 25 Employees in 2 offices (MD & VA) Life Before Going Hosted Before Hosted 3COM I PBX Tenure with Hosted 2 months Number of Employees 25 Number of Seats 38 Number of Locations 2

Prior System – 3com I-PBX Maintenance / Management Costs – 61% lower up front capex costs and 26% savings in TCO over IP PBX alternative What it did well that hosted would have to emulate? – maintained ability to carry forward legacy key system operating methods    that were ingrained in firm intercom /call announce personal screening Key Shortcomings: – Terrible voice quality (no QOS) – Frequent outages – No other productivity features (e.g. unified messaging)

The Buying Process

How long did it take to decide? – approximately 6 months; used consultant; no experience with hosted;    drove to wrong PBX solution – restarted process Sales person presentation & positioning: – night & day PBX sales – well honed model hosted – varied widely – mostly very weak. not even comparable without coaching Competition – IP-PBX:  Cisco, Avaya, Mitel – Hosted:  Non Broadsoft, Broadsoft (3 Carriers)

Key Driving Factors

For Change: – Terrible voice quality (PBX bypass!) For Hosted:  – Very limited internal IT/telecom expertise – Very difficult to get reliable external support for small business

The Trade Offs

		Hosted		IP PBX
Up front costs		$ 32 k		$ 83 k
Up front savings		61%
Monthly costs		$3 k		$3.6 k
5 Year TCO		$225  k		$302  k
Savings		26%
Features		*****		****
Ease of Administration		*****		***

Unexpected Results

Most people really hate change Unified messaging is a huge time saver and will be out standing when Blackberries can play wav files SIM ring is also a real productivity enhancer Ability to integrate cell phone and office voice mail to one is a major break through Negative – pushing send is unnatural on a desk phone

The Expected Results

Voice quality is just fine At desk productivity greatly enhanced w/ Outlook integration, tool bar, etc. Office Manager seems much happier! Whining has dropped significantly Clearly will lower costs over time Once we get used to all these features – every thing else will feel like a rotary phone.

Report Card

System Reliability   A
Sound Quality   B+
Features   A