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What makes Nuxeo ECM different and worthy of interest? (No, it’s not “open source”)

March 18th, 2010

Note: this post follows the previous one about the ECM market and I advise you to read it to better understand the context of this one.


What differentiates you from the other enterprise content management offerings?


Standout-from-the-crowdI get this question regularly, and too often the expected answer is “open source”. While playing a role, I wouldn’t say that open source is what makes us different. Open source is in our DNA, but that’s not the key for our customers, nor the biggest change we’re aiming to bring to the market.

What makes us different? Our technology, the ECM platform.

This is by far our main market advantage and what we have to bring to the market: Nuxeo Enterprise Platform (EP), our ECM platform. We’ve built superior technology, leveraging an up-to-date Java stack, design pattern and modularity. This is hands down the main reason that we win deals today with enterprise architects and technology-savvy business sponsors.

The value proposition here is simple and compelling — We dramatically reduce the time and the cost of building on top of the ECM platform when compared to LiveLink or Documentum. This is why we won major deals with Jeppesen — a Boeing Company, Orange, BBC, EllisDon, Cengage Learning, Overstock.com, and many more.

We don’t try to hide from architects, we bring them back to the center of the game and give them the tools to answer challenges of the 21st century. To fully bring competitive advantage and deliver the value it promises, technology is important. We believe software is an engineering discipline, at the service of the business.

Of course, open source is deep in our DNA and brings a lot of value, ease and insurance to our customers. But from a decision-making standpoint, it plays a role but isn’t usually a key factor. The same is true for cost. Yes it is important but clearly only satisfying the functional and technical requirements are paramount. Ironically, price regularly plays against us: such as when our competitor friends have the financial resources to buy deals from us when money is key. Hence the best case for us to win is when what we offer is not achievable by the incumbents.

We offer a better ECM platform, enabling a new generation of content applications

On the platform side, our mission is to commoditize the market for “ECM platforms” with standards, widely known technology and great infrastructure. We made a strategic bet 3 years ago on a stack of technology and infrastructure that is now mainstream. So we have a great ECM platform, leveraging open standards and a well-known technology stack, highly modular and flexible. It runs on a wide range of hardware (from embedded devices in planes to large farms with terabytes of data) and serves very diverse needs (from mission-critical editorial systems for press agencies to a highly secure case management system for a nuclear agency or a mobile document repository for an offshore welding engineer.)

The net result of all this is that our platform is the most flexible and modular on the market and is widely recognized as such. This has become a great market advantage for us with the rise of content applications (CEVA/CCA: Content Enabled Vertical Applications / Composite Content Applications – as Gartner puts it and discussed at its recent Gartner Portals, Content & Collaboration Summit).

Content Apps represent a steady move in the ECM market where buyers want to buy vertical solutions, solving actual business problems. They don’t want to pour money into generic technology anymore. We are seeing a new category of ISVs, packaging business knowledge into software to create and sell those content applications (ex: construction project management, clinical facts management for biotech and life sciences, software for control and command centers, etc.). Content apps are a logical evolution of the ECM market toward more vertical, business-ready solutions. And we believe we offer a great development and composition model for the next generation of content apps.

As such, I believe Nuxeo is well-positioned to benefit from this evolution given that:

  • Open source software has shown superior ability to commoditize markets, recycling big vendors’ license revenue into a new stream of value. We participate actively in this commoditization, deriving revenue for us and offering better value for the customers.
  • Our platform’s flexibility and feature scope combined with the open source aspect of the software ease the life of content app architects and developers. The development model the platform offers is widely recognized and praised. We believe we can enable a new way of building content apps. Easier, cleaner, faster.
  • Our business model derives value from applications built on top of Nuxeo EP (thanks to the subscription-based business model we have created).

That’s why we’re here. To offer and evangelize an ECM platform and the associated content apps, responding to the new needs of businesses in this era of information explosion.

I hope this also bring some clarification and will entice people to look beyond the “open source” label. Because there’s a lot more to discover and that could really help your business!

Cheers,

EB.

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Posted in ECM, Marketing, Open Source, Software

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Is there room for Nuxeo in the mature and crowded ECM market?

March 15th, 2010

While exchanging with a well-recognized and successful industry expert about our differentiators and the market we are in. Since they popup frequently, I thought it might be interesting to publish the answer.


Bazaar-istanbul

ECM is a mature and crowded market. Is there really room for anything more than a niche player at this late stage in the game?

Hegemonic vendors

At a macro-level, the enterprise content market is composed by 5 hegemonic vendors (OpenText, EMC, IBM, Oracle, Microsoft) and a set of minor ones (~15 notable), after a strong and fast consolidation of this market. Gartner says: 3 top vendors have 52% of the ECM market. The Triad of ECM? ;-)

As many vendors have skipped investment in technology aggregating software from their acquisitions (with the notable exception of Microsoft) much of the current batch of software has been designed 15 years ago and hasn’t evolved much. They have forgotten they are in engineering, not retail. In this world of lean, on-demand, instant-on, the major ECM payers still talk literally in days or weeks to install their software. It’s faster to setup a whole virtual datacenter processing and storing terabytes of data on the Amazon Cloud than setting up a vanilla ECM system!

On top of this technology breakdown, many of these acquisitions have been poorly integrated, to say the least (with a special mention to OpenText on this side). And the pace of the recent consolidation has created a disturbance in the market.

Those two combined dynamics enable new vendors with good technology and the right go-to-market approach to enter the ECM arena, tickle the incumbents and rise, and bring some fresh air and fun to this market.

Perspective shift from customers

We see important shifts in how customers evaluate and choose ECM platforms:

  • More and more Architects are actively involved in the choice of next-generation ECM platforms (not only business users / archive managers) and are putting it at the core of their information system. This sets high expectations in terms of software architecture, integration capabilities or flexibility and technology stack.

  • They need to update systems deployed in the ’00s because incumbent vendors are not supporting those versions anymore => the cost of upgrading is high and they are looking for alternatives. Often we can offer efficient and better replacement for those systems for a fraction of the price of the ongoing maintenance. Let alone the license fees…

  • Given the lack of technical investment and the legacy of major ECM platforms, implementation is complex and expensive => we can do better with today’s technology. Monolithic is no where near the state-of-the-art of software-and Architects care because it directly impacts their ability to make these ECM platforms meet the new business challenges.

Move fast, commoditize legacy, create value with the rest

I really believe that the market maturity combined with the legacy technologies of monolithic players is a key advantage for us: we are disrupting the market by commoditizing the technology (platform) and deriving value from this commoditization.

We target what hurts: the fat and comfortable maintenance stream. We target it with more flexible, up-to-date technology and a company organized to provide superior service for support & maintenance as our customers actually deploy and use our products. That’ll tickle! ;-)

So yes, I’m firmly convinced that there is a room for new players, like us. And timing seems just right for a big one. The market needs to evolve and renew, in the best interest of customers. And they well deserve it, given the challenges of the knowledge era that just starts…

That’s going to be a tough ride. But… feels fun too!

Cheers,

EB.

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Posted in Business, ECM, Marketing, Open Source, Software

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Recruiting 2.0 @ Nuxeo – a real world story

December 17th, 2009

Dream-job-signal As you might have noticed, in September we (proudly) welcomed a new member of our executive team, Cheryl McKinnon has joined to lead our marketing, bringing many years of ECM experience from big name players.

Cheryl is a key member of our executive team and I am proud to have her on board: she brings deep knowledge of ECM alongside great sense or marketing. It’s a unusual hire for a company like Nuxeo. I believe the hiring process is a very interesting aspect of this story… It’s a total “2.0″ process.

Earlier this month, Cheryl organized and hosted a workshop for tech professionals who needed to get back into the job market – a move that ‘went viral’. She has lived the new Recruiting 2.0 experience and offered to share her learnings with others – because this is how we found her:

For several months I was thinking of finding a CMO to accelerate and strengthen our go-to-market strategy, as well add some serious brain power and experience in the field of ECM to our company. It wasn’t an active search at first – it took time to imagine the profile I was looking for. Once figured out, it became one of those sticky ideas I get sometimes… I had to fix this!

I considered several options to find the right person:

  1. Hunter Route -> great to find the typical “world-class marketing guy” but he/she might miss the twist that I was after. Plus I wasn’t sure I could properly explain the profile, let alone assuming the head hunter really gets it. :-)

  2. Wait for somebody to send a resume spontaneously -> can work, but I wasn’t confident in the exact timeline for obvious reasons! :-)

  3. Find her/him myself using my own (limited) resources.

As the first route seemed wrong (and/or too expensive) and the second one too uncertain I went for the third one and started to work on the topic.

I wanted an “ECM expert / Web 2.0 thinker / social media pundit / community-aware marketer”. That would have been the first brief for a head-hunter. Hence, I headed to LinkedIn: refined searches, careful manual review of profiles (including blog / twitter-feed reading).

Applying several rules: proper Linkedin profile, a professional blog, a twitter account, some activities in social media and communities of practice. But more than anything, I was looking for the “twist”, the small things, difficult to describe, that make a person right for a particular job at our company. The thing that makes your company special and that is so difficult to describe. I was looking for “Nuxeo’s CMO”, not “a CMO”.

I ended up with a very small hand-picked group of people that seemed to fit the profile. Next, I sent an intro email to explain the opportunity, got answers, (lot of) calls, in person meetings, explained and discussed about vision and strategy. Kind of a standard hiring process, actually, for a key position. With a difference, however, from the old times… I would never had been able to do it, just 5 years ago. LinkedIn, social media, blogs and twitter made that possible: find great people for key position in (close to) no time. Less time than describing such a complex profile and complex position to a head hunter actually.

I now use this approach for all key positions in the company: you don’t find us, we find you (well, if you find us that’s cool too…). The social web is just a wonderful opportunity for great companies to find great people and for great people to find great companies. It enables to hear the voice of the talents and connect with them, before the first interview. That’s a brand new way of seeing the hiring process. This would have been completely impossible just 5 years ago. And I don’t think we’re an isolated case, my wife has been hunted and hired the same way a few month ago (which is maybe what got me started with this approach, actually).

As a CEO, it’s the most valuable result I’m getting from social media: being able to connect and engage with great people that can join and strengthen the company, at no cost (except participating to the system, being very open and transparent). I have access to a virtually unlimited pool of talent: just need to pay attention and look for people. This is a huge opportunity, totally new compared to what our predecessors had to deal with. And a great threat for those who don’t get it.

We’re living amazing times…

EB.

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Posted in Business, Marketing, Recruitment, Web/Tech

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Commercial Open Source — Or Just a Free Demo?

August 12th, 2009

I’m reading a lot recently about “Commercial Open Source” being the next great thing in the software industry. I’ve just read the presentation “Talk Slides: The Commercial Open Source Business Model” by SAP Labs's Dirk Riehle. It’s a great presentation that really captures the vision and strategy of some high-profile companies in the so-called “Commercial Open Source” arena.

In summary, the “commercial open source” business model is based on the 3 pillars:

  1. a GPL (or GPL-like) software tagged “community”
  2. a proprietary version of the GPL software with some “proprietary extensions” sold using a traditional license
  3. a serious dose of communication efforts to explain how open source magically creates cheap great software for everyone (and that in fact you’re not really selling it) and generates a ton of leads allowing you to get to market faster and cheaper

Core myths of the “Commercial Open Source”

Here is how I analyse the core speech of the current "Commercial Open Source" model. I would be happy to hear about your opinion.

“Community Editions” you mean… “Free Demo”?

I don’t get the fundamental difference between offering a “low-end” open source version of your software and offering a free but proprietary one. Especially when I read that the “Community version” is for “developers, hobbyists and small deployments ‘cause it’s cool and fun tech” while the “Enterprise version” is for “enterprise deployment ‘cause it’s full of tests and stable code.”

Hmmm… how do you turn an untested, unstable software into an enterprise-grade, rock-solid software with “some extension”? Well, you don’t. :-) Either your software is well-tested and rock-solid, or it’s not.

If you just want to create a product line with different features depending on varying customer size, that’s fine but let’s call it this way.

Open source software generates leads, right?

Wrong. Freely downloadable apps generate leads. Free trials generate leads. Smart marketing efforts generate leads. Having access to source code does not generate leads, at least not when you are offering applications (it might be different for middleware or dev tools).

Want to generate leads? Create great software and offer free trial and downloadable software.

“It’s not proprietary software, it’s giving reason to buy when people use the software”

I love this one! Seriously. Of course customers need a reason to buy. That’s why they buy. :-)

The reason to buy is called “license fee for usage right”. It’s been around for 20 years and if you want to give people a “reason to buy” your software, just use a “license fee” for usage and maintenance. That is what it's designed for — it will save you a bunch of marketing dollars.

Open Source is good for Communities

It helps but it’s not enough. And it’s not limited to Open Source.

Openness, honesty, good software and good marketing create community. Ask Atlassian, Google, Twitter, Salesforce or even Microsoft. Not open source, but great communities and vibrant ecosystems.

“Commercial Open Source” or “Ashamed proprietary software”?

There is nothing wrong with selling “usage right to use binary software” (or more often called “license fees”…), which is what all “Commercial Open Source” vendors are doing. It doesn’t prevent you from creating great software, building a community and be nice. It just requires a bit more effort.

It's time to go public and add some clarity to all this. There is nothing wrong selling proprietary software, especially when you're contributing a lot of open source code (I’m a great fan of Atlassian and Day, in this respect). It is nothing to be ashamed of. Just be clear and focus on your software's competitive advantage rather than its open source "nature."

“Commercial Open Source” is not the business model of open source

There is no such thing as a business model of open source, by the way. There are many reason companies are producing open source software (from Microsoft to Google, from Oracle to RedHat). The only common fact: it’s a tsunami in the industry. Everybody’s using it, software vendors being the firsts. And many are producing some.

There are a lot of reasons to produce open source and a lot of ways to make money leveraging it, as some brilliant analysts and bloggers already said (two notable reading: “On open source business strategies (again)” by 451 Group’s Matthew Aslett or “Making Billions with Open Source, Revisited” by Redmonk’s Coté).

Here is how I would summarize it:

  1. Proprietary software (!): Build and distribute proprietary software leveraging open source ones (be it complete apps or just extensions). Take Day Software, quietly producing tons of good open source infrastructure components, they sell a great proprietary app. Or IBM with Geronimo / Websphere. Or Oracle. SpringSource and most “Commercial Open Source” companies fall into this category too. I think it’s the easiest way to make money out of open source.
  2. Support & Packaged Services: Sell support as subscription and high-value packaged services (monitoring, inventory, etc.) for open source software you’re producing. JBoss was the flagship in this business with quite a success making money with it. This is Nuxeo’s business too.
  3. Proprietary distribution: assemble open source software into a proprietary stack. It’s all open source software, but the recipe to assemble the different components together and deliver a coherent and supported stack is kept secret. This can also include some “proprietary services” such as automated updates or monitoring. This is RedHat’s business. Sun seems to look toward this way too (see Solaris and the recent WebStack).
  4. Proprietary tooling: sell proprietary tools that help running / operating / managing open source products. These tools are usually development tools, administration tools or deployment tools.
  5. SaaS: package open source software to deliver apps as a service. This is the business of managed apps hosting (to make apps run) and packaged services (to deliver great customer support and business domain knowledge). This is also Nuxeo’s business.

So in the end, what’s the key point? Is it doing open source no matter what for the sake of hype or is it solving problems by delivering great software and/or services to customers?

I wish people of the Commercial Open Source arena would focus more on the later…; cause it does not diminish their contribution to open source overall nor does it diminish their company’s greatness and value. For the best of the open source industry. These times are about transparency and openness after all…

What do you think? I have spent 10 years in the open source software industry, building a company, living through short-term hypes and various business models. And I'm still learning. :-) Would be really happy to discuss more about all this.

Cheers,

EB.

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Posted in Business, Marketing, Open Source, Software, Web/Tech

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Open Source Think Tank 09 – Tuesday & Thank you!

March 4th, 2009

Napa Wine TastingImage by Julie, Dave & Family via Flickr

Today's been the last yet most productive day. Very intense. We had two brainstorming sessions on Business Cases, one great talk about "Open Source and Fortune 500 CIOs" (by two of those top CIOs) and one open discussion about doing marketing as an Open Source Industry. And the results are actually so interesting that I'll report/discuss them in separate posts.

The lunch was pretty innovative. Much like speed dating. Open Source Speed-dating! (I should go to a VC with this idea! ;-) It fostered networking and worked pretty well. I think many people discovered great companies and great people, exploring this new horizon in the software business.

The afternoon lead us to the second Business Case of the day and to an open discussion on whether we should or not do some marketing as an industry as a whole, using some kind of trade association, focusing on open source business. This question comes back on the table for the 3rd year in a row. But now the answer is a loud and definitive: yes. Some work started on this, let's see where it goes now. But things are moving around this. And I think it might be a major step onto global awareness of CIOs. Something huge has been ignited today, hopefully… :)

After all this work, volunteers have been kindly invited to another wine tasting session at a nice Napa Valley's vineyard, for a casual closing party. Was relaxed and entertaining.

SO, now the event is closed, what the general impression? I would say: inspiring, hopeful and productive yet fun. I had the chance to meet quite a few very interesting people and to start some interesting discussions. Let's see where it goes, but the event is a clear success from my perspective.

Thanks to the Olliance Group, to the sponsors and to all participants. I'm excited to see you again in Paris for the next session of the think tank and see where we'll be. Growth is around us, for good! ;-)

I'll be posting more detailed post on the two business cases and the talk of the day in following posts. Don't hesitate to comment or drop an email if you'd like to get more information.

Thanks Napa… onto Paris now!

EB.

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Posted in Business, Marketing, Open Source