On January 6, MobileIron announced a new president and CEO. Barry Mainz, formerly the president of Intel subsidiary Wind River, will replace outgoing president and CEO Bob Tinker, who co-founded MobileIron in 2008 with Ajay Mishra. Bob will remain a member of the board. This move is coming at a crucial time for MobileIron and the larger EMM market.
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MobileIron’s business background
After their IPO in 2014, MobileIron had a difficult start to 2015. They missed their Q1 numbers, and the stock price has been low ever since then. They also had a few other leadership changes, they’re not yet profitable, and there’s another new major EMM competitor in the form of Microsoft’s Enterprise Mobility Suite. With all this going on, some people have been pessimistic about MobileIron’s future and wonder how long they will remain independent.
However, it’s important to be aware that MobileIron has recovered somewhat. They had their best quarter ever in Q4 2015—revenue is expected to be $42 to $43 million on top of billings of $47.5 to 49 million, and they only spent $7 million in cash, which is much less than in previous quarters. These are just preliminary numbers, and the final earnings will come out on February 4, but this should put them at just under $150 million in revenue for 2015. This is near the high end of their revised guidance and shows about 13% growth for the year. MobileIron plans to be cash flow break-even by the end of 2016.
For right now, there’s no question that MobileIron is under the microscope, and it’s under these conditions that Barry Mainz is taking over. On the transition announcement call, Bob Tinker characterized this as a relay race, and said “Given the financial, the product, and the market position of the company are stronger than ever, I felt that now is the time to bring in an executive who could lead us into the next stage of growth and scale for our business.”
Barry has experience leading a similar technology company at this stage. Wind River provides software for the Internet of Things (IoT) and embedded devices. He has a background in sales, and led Wind River from small to mid size, where he says he learned what did and didn’t work.
His plans are to streamline their go to market and sales, tweak business processes, and make everything as efficient and cost effective as possible. He’s running sales temporarily, but they’re looking for a new sales leader.
I spoke to him in an interview last week, and he characterized MobileIron’s transition as going from the early startup stage where growth trumps profit to the next step of profitability and shareholder value. I asked him about the possibility of being acquired and he said, “That’s not why I joined... We’ll look at all offers, but that’s not why I joined. I want to build a business. I think there’s a huge opportunity to build the business.”
Product and EMM discussion
As it turns out, Barry already has experience with both EMM and MobileIron. While he was at Wind River they used MobileIron to roll out ServiceNow and other apps. (Intel and its subsidiaries tend to be fairly advanced in how they handle mobility.) He said he had an opportunity to get to know the whole EMM and mobile security space, and they chose MobileIron for its enterprise features, how well it supports a variety of OSes, and security (since they had to be ITAR compliant). And for those that were asking, Barry’s devices of choice are a Galaxy phone and an iPad.
Obviously, Barry characterizes the EMM market as a growing one, and he thinks that eventually, all medium and large enterprises will use EMM software. But at this point there’s only 15-25% penetration, and in our conversation the term he used to describe the market most often was that it’s early. This huge opportunity, combined with the market and product strength of MobileIron, is why he said he came.
One result of the early stage of EMM is that many people still think of EMM in terms of basic device management, and I asked him if this was a problem for MobileIron. He started his answer by pointing out that mobility is a competitive advantage for companies, and employee-facing mobility involves giving employees the ability to access and act on data and apps in a secure way. To do that, he said, you have to work with a company like MobileIron. Barry continued: “And when we talk to our customers that are at the forefront of mobility, they get our message.” He also said that right now there’s pent up demand, and after early adopters take advantage of mobility the rest of the market will know where to go.
One of the big product pushes for MobileIron right now is taking advantage of the MDM APIs in Windows 10. Barry said, “Look at Windows 10... those are really mobile endpoints, and the security model is different than it is for a desktop PC, and it was very clear to me that the current model didn’t satiate the needs going forward.” MobileIron also sees Android for Work and their OneTouch work with Apple as other big areas for 2016.
Since Barry came from an IoT company, some people have been wondering if we’d hear more about it from MobileIron. (Other EMM vendors have been all over IoT, but so far MobileIron has been pretty quiet about it.) Barry said “Absolutely, we have an opportunity here,” and he mentioned the automotive industry as an area with a lot of potential for ROI. Of course this is just a preliminary mention of IoT at MobileIron and not a product announcement, so let’s just say we won’t be surprised if we happen to hear more about it later this year.
Even though the EMM market has narrowed in the last few years, it’s still competitive, and now Microsoft is on the scene. On the transition call, Bob Tinker acknowledged Microsoft as one of MobileIron’s main competitors (along with AirWatch). Barry was quick to characterize this new competition as being good for everyone, but he also said that MobileIron has velocity and focus on their side.
One interesting effect to consider is that as the major independent EMM vendor, their business is more exposed than other vendors—there’s no way for them to fudge the numbers on how much they’re selling, bundle it in with other products, or throw it in cheap with other deals.
The last thing I’ll say is that I completely agree with Barry when he says that it’s still early for EMM and enterprise mobility in general. There are just so many new opportunities with Windows 10, Android for Work, the steady march of Apple’s enterprise features, and more companies taking advantage of it over time. This is great news for MobileIron, who will certainly continue to do interesting things.