Deal Radar 2009: MindTouch

This week, Deal Radar moves away from social media gaming and back to open source, this time with a focus on enterprise collaboration and service-oriented architecture, an area essential to the development of new ways of delivering software. MindTouch Deki, the flagship product of San Diego-based MindTouch, is an open source enterprise collaboration and community platform. This allows users to connect and remix enterprise systems, social tools and web services. 

MindTouch was founded by Aaron Fulkerson, CEO, a multifaceted entrepreneur and technology advocate who previously held senior management positions at three technology startups and has helped launch non-profits and businesses outside the technology industry.

Fulkerson worked for Microsoft Advanced Strategies and Policies on distributed systems and owned and operated a successful technology consulting firm. He also helped launch communities for Fortune 500 companies, non-profits, publishers and universities.

When founding MindTouch, Fulkerson was responsible for all aspects of the business, which began with community evangelism, viral marketing and product management. As the business matured, his role evolved to include traditional marketing, sales, operations and management.

Co-founder and CTO Steve Bjorg is a seasoned technologist and serial entrepreneur with over a decade of experience in software development and product design. He is the author of DREAM, a service-oriented distributed architecture that is the foundation of MindTouch’s technology. Prior to founding MindTouch, Bjorg worked with Fulkerson in advanced strategies at Microsoft and also founded a real-time 3D strategy game company.

In 2005, leveraging their experience at Microsoft, Fulkerson and Bjorg founded MindTouch as a solution to allow collaboration in a distributed environment. MindTouch is not VC-backed. To date, they have raised $3.2 million in funding from friends and family, and in less than three years have reached profitability and are presently not seeking additional funding.

MindTouch aims to differentiate itself from the crowded collaboration software market by its orchestration engine, underlined by its enterprise wiki interface. As social software is on the rise, more organizations are tapping into the collective intelligence and knowledge of their systems and employees to improve operational efficiencies and productivity. Externally, they’re looking to collaborate and share information with individuals such as their partners, members, alumni, resellers, distributors, developers or customers in order to create vibrant communities.

Currently MindTouch competes with vendors in different strategic groups: enterprise 2.0 collaboration and social software (wikis, social publishing, social software suites); web content management (WCM); enterprise collaboration systems (enterprise collaboration platforms, web CMS) and portals and mashup platforms. MindTouch aims to be easier to use, extend, integrate and develop than portal vendors. MindTouch Deki differs from enterprise 2.0 vendors by being an extensible platform that scales well and is easy to customize and integrate. According to Forrester Research, wiki-based collaboration is expected to be the most important technology for enterprise 2.0 in 2009, putting MindTouch in an attractive space in the industry. Competition includes Microsoft SharePoint and IBM Lotus Notes, among others.

In 2008, the enterprise collaboration market was over $3 billion, up from $2 billion the previous year, according to Gartner and Forrester Research. MindTouch Deki is deployed by Fortune 500 companies, major media, research and education institutions, government agencies, and online businesses worldwide. Customers include Microsoft, Fujitsu, Siemens, Gannett, The Washington Post, Intel, the US Army and the US Department of Defense.  

For larger enterprises, MindTouch commonly augments Microsoft SharePoint and other portal solutions to improve existing systems.  Smaller companies use MindTouch as an alternative to portal solutions.  Their customers in this area include companies in various industries including technology (Intel, Intuit, Mozilla and EMC), media/publishing (J. Wiley Publishing, Elsevier and Gazette Communications), and government agencies.

MindTouch has carved its space in a tight industry almost entirely by word-of-mouth. This has driven downloads of the open source build to the tune of many thousands in daily distribution. In addition, MindTouch’s enterprise penetration strategy is focused both on intranet initiatives and externally-facing community initiatives. The company has recently achieved profitability, and its revenue grew 37% in Q3, 80% in Q4 and over 500% in 2008. The company has millions of users and over hundreds of thousands of installations.

The company’s angel investor only corporate structure may give it a relatively patient base to build with, as angels invest their own money, whereas VCs are accountable to their Limited Partners, and push for exits at times that may not be in the companies’ best interest.

Related Reading:
Building A Smarter Corporation
IBM’s Entry into Social Networking
Deal Radar 2009: Central Desktop

This segment is a part in the series : Deal Radar 2009